Nikon Q3/2018 financial results are out: profits, earnings per share are up, revenue is down

Nikon released their third quarter financial results for the year ending March 2018:

  • Nine-month profit up 56.7% to¥22.31 billion from¥14.24 billion last year
  • Earnings per share up ¥56.13 from¥35.84 for last year
  • Operating profit up more than 100% to¥41.5 billion from last year's¥18.6 billion
  • Revenue down by 7.2% to¥525.26 billion from last year's¥566.12 billion (source: NASDAQ)

Additional information:

Q3 financial results

Forecast the 2018 financial year

Revision of dividend forecast

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  • T.I.M

    Nikon’s revenue is down ?
    Let me fix it, one D850 (I gave up on the D30x30) + one AF-S 400mm f/2.8 FL + one PC-E 19mm f/4E, I think that should do it.

    • Photobug

      Excellent start.

      • Lou Rivera

        They are in the black

    • Andrew

      Nikon’s earnings is a conundrum, every time they announce it the revenue is down, but in contrast, the earnings are up. The only adage that is fit for this scenario other than clever management is that “a sufficiently advanced technology (vis-a-vis D850) is indistinguishable from magic!” The margin on the magical D850 must be huge. One or more “Mirrored” product introductions should continue this trend.

  • doge

    Yeah that’s what happens when you slash operating expenses. Nothing to see here.

    • Looks like the largest contributor by some margin were the restructuring expenses in the prior year which weren’t repeated. Cost of sales is down as well, but that’s pretty much in line with revenue. Not sure I’d call that “slash operating expenses”.

  • br0xibear
    • Allan

      Digital camera sales down 12.5% (310/2470) for the 1st 3 quarters.
      Lens sales down 10% for the 1st 3 quarters.
      Compact DSC down 12.3% for the 1st 3 quarters.

      Don’t bet the mortgage that Nikon will be here for another 100 years.

      • Allan

        Comparing 3rd quarter results for 2016 and 2017 show sharper declines (19%, 20%, and 27%, respectively.)

        • ITN

          3rd quarter is October to December? Revenue was down, but profit is up, compared to FY2017.

      • Roger S

        On the other hand, with profits, operating profits, and earnings per share going up significantly (while revenues fall but to a lesser degree), one can speculate that Nikon is basically in a period of becoming leaner and meaner — not a bad position from which to assert a broader resurgence in its fortunes in the future. Or possibly not? I don’t know, but I would say that the die is not yet cast.

        Not completely on topic: It certainly would have helped Nikon’s future image if they had persuaded Elon Musk to put a Nikon D850 around the neck of the spaceman now (supposedly) driving the red Tesla toward the Asteroid Belt. 🙂

        • BVS

          Unfortunately, even Elon Musk couldn’t find it in stock anywhere…

          • Fly Moon

            I would’ve given Elon Musk my D850!

        • Yes, Tesla’s advertising budgets is 0$ and they just got the best car ad ever made…

          • Wade Marks

            Tesla did get the best car ad ever made…but it certainly was not free. Granted, it may not have cost Tesla itself any money, but it did cost Elon Musk’s other company, SpaceX, a whole lot of money.

            In essence, it was probably the most expensive car ad ever made, but the cost was shuffled from one of the owner’s companies to another. Nothing wrong with that, but it only could happen because the person who started the car company also happened to start a rocket company as well. It was not Tesla being such a marketing genius of a company that it found a way to get free publicity.

            • My point is that the Falcon Heavy’s test flight would have gone up with or without a Tesla, so it was basically free for Tesla. SpaceX were going to spend the same amount of money even without a Tesla car as a cargo.

            • Fly Moon


            • CERO

              Actually, it did cost them nothing.

              The Falcon Heavy was required to be test with a payload of any kind anyway.
              They usually sent concrete slabs on rocket tests. So instead of wasting with nothing flashy, they sent a car. So it was synergy of advertisement.

        • Thom Hogan

          They’re writing off billions next quarter. That will make everyone leaner and unhappier.

          You have to match this up against the news earlier this week: they cut costs—mostly where it impacts customers—in order to pay a bigger dividend to shareholders. It feels a bit like an enforced cashout to me.

          • Roger S

            Good points. I was going to add somewhere that if they are using their growing profits to increase shareholders’ dividends or buy back outstanding stock, they are making a big mistake. And one problem with the “leaner and meaner” approach — the company usually ends up being “meaner” to its customers.

            • Allan

              Now much meaner can they get? 🙂

            • Roger S

              Start charging $500 for an annual subscription to a new Nikon Cloud software package including ViewNX-i, Capture NX-D, and the only workable version of the Snapbridge app. 🙂

            • Allan


              You’re right.

            • Allen_Wentz

              I will pay $500 for that _workable_ version…

            • Roger S

              lol — I knew I wasn’t being mean enough.

            • SteveWithAnS

              Don’t hold your breath.

            • Davidvictormeldrew Idontbeliev

              That could happen – may happen copying Microsoft / Adobe model charging people for using Capture, View, Snap app bridge.

              Another for Canon, Nikon in a declining market is the possibility like what the car companies do like Bmw, Ford is to charge for a hire as you try scheme in a credit scheme; a D6 for £150 per month along with say a 200-400 F4 MK 3 for £200 per month, etc, etc, etc, etc and every 2 – 4 years or so pay a bit more for the latest model, e.g., D8, etc.

            • Davidvictormeldrew Idontbeliev

              The above scenario of hiring / lease agreements could come into play ? – and could be a good side line for the camera manufacturers. If a large company like BMW can make it work then camera companies can do.

            • Davidvictormeldrew Idontbeliev

              Nikon’s software NX-i, NX-D are quite good and also free. Snapbridge app just needs some work doing to it – some more features and a bit more stability.

            • PhilK

              See above.

            • PhilK

              Either that or they start to turnaround their business and actually stay in business.

              A company cannot get any “meaner” to their customers than ceasing to exist and then all their existing products and ecosystem instantly become orphaned/unsupported.

          • sickheadache

            I got your Private G650 ER waiting on the Tarmac and You are flying over to Japan and will straighten out Nikon. Report back please.

            • Thom Hogan

              If I had my own jet, it wouldn’t be flying to Tokyo ;~).

            • sickheadache

     are our only Hope! You must fly to Tokyo and meet with Akihiro Krennick and straighten out Nikon. May the Farce be with You!

          • Davidvictormeldrew Idontbeliev

            Yep true on that companies have a choice to fund / keep Customer service or to keep the shareholder happy and fat with a dividend that sometimes the company can ill afford where it could be logical to pay less of a dividend or to delay it – to build emergency funds up and to plug any shortfalls, e.g., pension, rainy day fund, paying suppliers in longer cycles, e.g., 120 days instead of 60 days., etc.

            Although the sales are there, there is a decline of Revenue in units but the costs to customer is going up, meaning less of a revenue market, delays in stock, customer getting more dissatisfied with sales and customer sales and either a) not upgrading or biting as much b) going for alternative / competitors, e.g., MB-D18, Mh025a, etc, etc, etc, etc.

            Deja vu with what happened with UK private sector company Carillion who had a good order book – private – private sector but still got into difficulties as described here:-


          • PhilK

            I guess if you already made your mind up to be unhappy with the fact that Nikon is actually increasing their profits then perhaps that makes sense.

            But increased profit doesn’t simply mean some kind of windfall to investors (I sincerely doubt anyone in the world got amazingly rich from Nikon’s 3rd-quarter performance), it also, much more importantly means the company is in a better position to continue to be a viable ongoing business.

            That to me FAR overshadows any miniscule “investor benefit” that may go along with that, considering how shaky Nikon’s financial condition has been in recent years.

            I should also mention that they actually increased the profit in their semiconductor division this quarter, a favorite whipping-boy of yours.

            I don’t really care how they did it, I just like the fact that they are losing less money these days, because I want them to stick around.

            • thundrrd

              I want Nikon to stick around too, but how can you like them losing money just because it was a little less than they lost before?

            • PhilK

              They are not losing money, they are making money these days.

              It would be nicer if they made more money so they could afford things like better marketing and service, but that can’t usually be changed overnight. Acquisitions cost money in the near term before they pay for themselves too.

              Some recent reading through some prior official statements, I see that they are planning to do precisely what I suspected they would do, which is:

              A) move their emphasis to higher-end, more profitable products for a while (which they have been pretty successful at over the last couple of years),

              B) jettison unprofitable businesses (which is ongoing), and then

              C) plan for growth after that.

              They certainly have made some mistakes along the way (KeyMission, waiting too long to produce a high-performance MILC line) but they seem to be moving forward, if a bit slower than ideal.

            • thundrrd

              I was only responding to your last sentence – ”

              I don’t really care how they did it, I just like the fact that they are losing less money these days, because I want them to stick around.

            • PhilK

              Yeah that was not very well worded by me.

          • Karl

            Perhaps they’re learning from Sears.

          • CERO

            Thats like every Wall Street shoved business.

            Think Disney, they were renounced to have the best service, the best “doesn’t matter the cost” kind of service. Now? Since Iger its been slash and cuts.

            Workers are less and are overworked most of the time.

        • PhilK

          I must say that was a brilliant marketing move by Musk but I sincerely doubt he would have been interested in sharing that limelight with some other company.

          • Roger S

            I think you are right, based on what I can tell about Musk’s approach to things — unless, of course, the Nikon camera was powered by special versions of his Powerwall batteries made to hold a charge in the cold of space — although this would require Nikon to accommodate non-Nikon batteries in its camera, which would — oh, geez, never mind. 🙂

      • Allen_Wentz

        Certainly non-phone camera sales have been shrinking for years now. Not a temporary scenario, a permanent market disruption. All the payers need to dramatically restructure their plans.

        • Roger S

          Yes, restructuring but not surrendering (I hope)

        • Thom Hogan

          This is Nikon’s excuse you’re repeating. Canon, on the other hand, still retains their nearly 50% market share and isn’t experiencing the unit volume drop Nikon is. Care to explain that?

          • Davidvictormeldrew Idontbeliev

            True on that score Thom,,, possibly with Nikon’s past mistakes and Qc issues, narrowing presence in imaginery sector (Strong in Pro DX, FF but weak in rest of the market), delays in going to markets (DL / Coolpix A update ?), ranges and wrong ventures, e.g., Keymissions, etc and cutting back on customer support and QC issues creep up.

            Still puzzled in this – As Nikon introduced Video in DSLR why didn’t they venture into a Video orientated DSLR like taking the D800 and putting some video guts in (and then up spin it / cancel it if it dived) or tried doing a video range like the EOS Cxxx range ?

            another puzzler but can understand why this happened to me….. I had a Nikon DSLR (D8xx) which was in warranty which went for a service inspection with Nikon UK and they wanted to charge me for a repair of £250 for a slight damage to mirror unit / assembly. I went for a second opinion and went for a UK firm called Fixation who did the repair for free when I provided the warranty information.

            • PhilK

              The reason they didn’t introduce a “Video D800” is because A) the D800 architecture is not suited for that, B) it is not Nikon’s historical expertise, and C) it is not Nikon’s historical interest.

              Companies like Canon, Sony and Panasonic have vastly more experience, expertise and resources to build “video-oriented” products. Naturally one would expect them to do more of this than Nikon does.

              Neither is video going to be the determining factor in the success of every camera model. I don’t think anyone could successfully argue that either the D500 or D850 were market failures, yet they don’t really have very competitive video functionality compared to Sony, Panasonic or (to some extent) Canon models.

              I suspect Nikon will continue to improve video capabilities (particularly on a new MILC product line) but I would never expect them to be superior in that area to companies with vastly greater known capabilities and experience in those fields.

              But all Nikon needs to be is “good enough” in that particular area. Just like Canon does not need to have the highest dynamic-range sensors to be the top seller of digital cameras year after year.

            • Davidvictormeldrew Idontbeliev

              True on that and Nikon-2 should be a good mirror-less system when it comes out.

            • nuitamericaine

              Actually, the D850 video quality is excellent, it’s only the video AF and noisy lenses which let the side down. To be fair to Nikon, they’re not the only ones with this issue – Panasonic video AF is pretty unreliable too, and Fuji have good enough AF but their fast primes are noisy as hell in video AF.

            • PhilK

              I’m talking about mostly things like:

              – Poor AF (everyone recognizes this)

              – Lack of codec/transfer options

              – Lack of video-practical lenses

              – Lack of features like focus peaking, zebra stripes (D850 finally started to offer)

              – Rolling shutter

              – Simplistic audio functionality

              Re: 4K quality, my understanding is that the D850 uses either pixel binning or line-skipping, which even though it is finally using the whole sensor, it is inferior to a more sophisticated tactic like oversampling which Sony uses.

            • Davidvictormeldrew Idontbeliev

              True Nikon has brought 4K to more of its DSLR’s than Canon and the excellent D850 (the best DSLR I owned) as compared to the Canon 5D uses the whole part of the sensor.

              With Nikon’s excellent tech and improving video functionality + quality should be superb in the forthcoming Nikon 2 system.

            • PhilK

              Well, guess what: Canon also has a dedicated video camera line that they are trying to protect.

              Same kind of thing people regularly rag on Nikon about here.

            • CERO

              The poor AF is on the video side only right? and only compared to the high end of Canon right?

              codec transfer options? what for?

              As for rolling shutter, this happens on almost every single camera. The only ones that had decent rolling shutter was the 1DX (flagship of Canon) and the Sony Alpha 9.

            • PhilK

              Yes, we were discussing video. Nikon has absolutely nothing to apologize for on still photo AF, with the minor exception of a couple of aspects which are pretty much impossible to implement on a FF DSLR. (In-viewfinder focus-peaking, corner-to-corner AF points, etc)

              Re codecs and transfer options, Nikon has never been top-of-class when it comes to implementing the latest and largest variety of video codecs and transfer options. Higher performance competitors have features like log gamma, 10-bit sampling, 4:2:2 color, ProRes, focus peaking that doesn’t go away at 4K, etc etc.

              I suppose rolling shutter on the D850 is “OK” as far as general purpose still/video cams go, but I still don’t know why people don’t just buy semi-pro dedicated videocams if they want to shoot a lot of high-quality video.

            • CERO

              I actually wonder about the AF too, Nikon’s AF in video in all their DSLRs are outright awful.

              Is it a processor issue? I know that most Canon ones have the dual processor system…
              Would it draw too much power to add an additional processor to help drive the AF both in video and in optical?

            • KnightPhoto

              Nothing to do with processors. Sensors such as the Nikon 1, Canon (“dual-pixel”) have “on sensor phase detect autofocus” built in. Aside from the tech Nikon displayed in the Nikon 1 series, Nikon has chosen to not build OSPDAF into their DSLR sensors. So DSLRs in live-view are forced to use “contrast detect autofocus” which is typically much slower than OSPDAF.

              It’s a design choice Nikon has made to date, since they have obviously had the technology for many years now (since the Nikon 1). Now with mirrorless immanent, Nikon WILL be including OSPDAF in their mirrorless sensors and this will be very interesting to see how Nikon’s OSPDAF technology has matured and what form it will take.

            • CERO

              aaah Gotcha!.. would adding that thing be a cost problem? size problem? or what could have made them refuse to add the full phase detect autofocus?

            • KnightPhoto

              That is one of the mysteries about Nikon over the last few years. In the Nikon 1 they had world leading OSPDAF technology but did not utilize it in their DSLRs. E.g. did it not scale up well to APS-C or FX sensors (geometry issue mentioned by Thom), sacrifices some light (shouldn’t really be a major factor), waiting to introduce a variant (Nikon has other patents for other methods).

              In my role of armchair Nikon-CEO I would have introduced it right away, as it is only used in Live-view on a DSLR, and furthermore would have been offering add-on EVF capability to all Nikon DSLRs while encouraging Nikon engineers to continue to develop this tech as a top-priority. It will be interesting to see what form this vital OSPDAF tech is going to be on Nikon’s immanent mirrorless cameras!

            • PhilK

              Nikon DSLRs are optimized for still photography, the sensors don’t have any on-sensor phase-detect AFcapability which is why the live-view AF is so poor. (It also doesn’t help that most Nikkor lenses use focusing mechanisms that are not really optimal for video either – that’s what the new AF-P lenses are better at.)

              In addition to the basic architectural handicap of using a camera with a flopping mirror for video, Nikon also credibly argues that doing on-sensor PDAF trades off still image performance for live-view AF performance. (You are basically taking away sensor-photosite real-estate from the imaging function and giving it to AF functions, or else multiplexing the signals meaning that your sensor readout is slower, causing issues with speed and/or rolling-shutter)

              I’m personally 100% fine with that optimization choice because I couldn’t care less about shooting video with a DSLR.

              However if the rumored new large-sensor MILC product-line materializes, Nikon really should make sure they address most of their historical DSLR video performance weaknesses as that is the product category that many people expect good video performance from.

              (Tho personally I think the whole idea of using a still camera as a video camcorder is kind of dumb and inherently non-optimal in a variety of ways)

            • PhilK

              Speaking of high-performance video competitors, this newly-announced product may drive a stake through the heart of the “DSLR videography” segment that I always thought was a doomed product category anyway;


            • CERO

              chist.. gotta love technology. Tech like this would have cost 20,000 USD or more a few years ago.

            • Davidvictormeldrew Idontbeliev

              Yes agree the Nikon video quality is good and with the Mirrorless Nikon 2 and its mirrorless video and still optimized lens will be a very good system.

            • thundrrd

              Do you work for Nikon?

            • ITN

              Canon make QC and design problems too, they just don’t lose sales because of them. Mirrors falling out of 5Ds, 1D III AF, blocked flare in 1Dx, sensor oil in 1DX II, etc. Their customers just don’t care or believe that there is a problem. Nikon customers seem to care, worry, and complain.

            • PhilK

              Interesting. Now I want to see a survey about how many of these problems are reported with each platform.

              Too hard to gauge from anecdotal online reports.

            • Davidvictormeldrew Idontbeliev

              True on that – no company is perfect and Nikon is doing well at the moment in its pitching off products from (aps) D7500 and (ff) D750 upwards – the lower – mid end will probably get addressed by the Nikon 2 mirrorless models.

            • thundrrd

              You do work for Nikon, don’t you?

          • PhilK

            They are on the tail-end of their “honeymoon period” when they can sell mediocrity and still see sales/marketshare rises.

            That period will not continue forever. I have witnessed many companies fade into irrelevance following such periods.

            Mind you, I don’t really expect Canon to do that, either as a whole or in their imaging business, but the point is, the current scenario for them is not going to last forever either.

        • Davidvictormeldrew Idontbeliev

          Phone sales and the innovations that each new model brings has possibly reached a plateau too as well. There are some excellent models like Iphone 7,Samsung galaxy note S8 which does it’s job very well and now it is hard to justify too in upgrading on the phone front too.

      • ITN

        Consumer camera buying has been on the decline and so what Nikon is doing is refocusing on high end gear and this gives them profitability. The low end gear is no longer making a profit but they were ones which were sold in great numbers several years ago. It is understandable that unit sales are down for Nikon because of their change of emphasis. No more D3x00 frequent updates or new 18-xxx DX zooms, enter the D850, D500 and D5; 180-400, 70-200 FL, 105/1.4, 28/1.4, 19 PC, etc.

        • Thom Hogan

          Sorry folks. This is tantamount to saying “we couldn’t figure out how to make competitive <US$1000 cameras, so we decided to stop."

          Good companies figure out how to continue to grow, even under severe outside pressures. They tend to do this by solving customer problems, not making new customer problems.

          • ITN

            Nikon aren’t fundamentally into consumer products, they want to make stuff like 180-400, D850, 800/5.6, 105/1.4, 14-24/2.8, 1200-1700/5.6-8, 6mm fisheye etc.

            • Thom Hogan

              Hate to tell you this, but those are consumer products, as they’re sold to a consumer, not a business. They just happen to be high-end or luxury consumer products. In the end, that audience is even more demanding than the low end consumer.

            • ITN

              Well I sincerely doubt that even a single 6mm f/2.8 or 1200-1700mm was ever sold to an individual.

              I’m well aware of the classification you are referring to (Canon lists all EOS stuff in consumer products) but what I mean is a consumer whose life is not driven by their need to do photography and is not a professional photographer but a general consumer to whom a camera is just a gadget like their TV, smartphone or bike.

              Those products on my list that are sold to individuals most are sold to either professional photographers or private individuals who think, breathe etc. nothing much but photography. Still, many of them are sold to businesses. And the target buyer according to whose needs these products are designed, is not a consumer but a professional photographer.

              Nikon is driven to supply products and excite those whose life revolves around photography, instead of those who occasionally dabble in it.

            • Davidvictormeldrew Idontbeliev

              Good argument but Nikon is / should be open to both audiences and how can they survive / grow / maintain their market share if they restrict themselves as they are doing. Agreed with Thom if Canon can grow their business and be able to sell cameras under $1000 as an example there must be something fundamentally wrong with the gadgers and bean counters running Nikon.

            • Allan

              Gadger. Another new one for me. I like it. 🙂

            • ITN

              I think Nikon expect the consumer photography business to crash and burn and they don’t want to burn with it, so they refocus their resources on less volatile markets.

              Sony is getting a lot of customers straight to their A7 series full-frame mirrorless cameras. Most of those customers were not users of their APS-C line but came from Canon and Nikon full frame products. Nikon can do the same thing, instead of luring in the consumer focus on the high end users directly.

              Notice however that Nikon are still offering many sub $1000 products it is not that they’ve cancelled all those products but are not emphasizing their development as much as before.

          • Claude Mayonnaise

            Agree, I’m not sure what world most people here are living in but buying a D850 type of camera and a $2000 lens to go with it is not the real world the majority of people outside of these camera sites live in. Canon is selling $1000 cameras, looking fine and yelling at Nikon,”if you can’t stand the heat, get out of the kitchen”

            • PhilK

              Would you rather that Nikon disappear?

              Because simply wishing that they magically gained the resources of a company 4 times their size (by revenue, 8x their size by staff) is fantasy.

              That is one of the reasons Canon’s production efficiency is better than Nikon’s. Not to mention advertising budget and many other things.

            • Claude Mayonnaise

              In a way, they probably are already disappearing if they continue to shrink and don’t offer products for certain markets at a price other companies offer. I don’t know about you but Leica doesn’t exist to me, it exists to a small fraction of the market. Not to say that market should not exist but I have a hard time believing that a market for solid affordable gear has totally vanished. If that is what they are going to become then so be it but I think this will only result in more people buying into Canon. This is only my opinion.

            • PhilK

              Nikon has a lonnnnnnnng way to go before they become “Leica-like” and I sincerely doubt they want to emulate Leica.

              Leica probably doesn’t even make money on camera equipment, if they do it cannot be much. Most of their profit is probably generated by their commercial/industrial products and licensing, eg to companies like Panasonic. I seriously doubt Nikon wants to be in that position.

              Neither do I share the “sky is falling” predictions here.

              Yes, Nikon is struggling. No, there doesn’t appear to be any evidence that they are doomed. In fact, there appears to be significant evidence that their response to their struggling is actually starting to bear fruit in a very difficult competitive environment against much larger competitors.

            • PhilK

              I never asserted “Leica is failing” or going out of business.

              But Nikon has around 16x the number of employees Leica does, for example. Leica also has a microscopic camera market share. Does Nikon really want to shrink to that size?

              I sincerely doubt it.

            • I did not say that Nikon will become exactly like Leica with the same number of employees – I was just talking about the idea of a smaller camera manufacture that makes less, but expensive high-end equipment. Obviously this will also not happen tomorrow. Btw, Nikon makes microscopes as well:
              Anyway, this is just my opinion based on the declining camera sales. If you think that Nikon and the other companies will be able to maintain the same numbers for the next decade, I think you are wrong.

            • PhilK

              I’m well aware of all the various product categories Nikon produces. Most of their non-consumer-imaging products are fairly small businesses.

              Re: maintaining the same numbers, I don’t doubt that if they are trying to maintain the same product mix they had 5-10 years ago. But there are a variety of optical and related businesses that could keep the revenue flowing.

              For example their silicon lithography business was a big, smart, forward-thinking bet – but eventually they fell victim to a giant European consortium that progressively took away the most profitable high end of that business. (And basically has a global monopoly now on the highest performance systems like EUV)

              Industrial metrology seemed like another good bet, but I’m not sure why they didn’t seem to do much to improve/expand that product line after they bought the company and made it a Nikon division.

              There are lots of opportunities in optical-related fields but I’m not sure Nikon is capable of capitalizing on them.

          • PhilK

            I don’t think anyone with a clue would seriously suggest that Nikon has “stopped making <$1000 USD cameras".

            But they do seem to have put a bit more corporate emphasis on high-end products the last few years, which is a safer market for them, and has resulted in significantly increasing their profits recently.

            I don't know why that is a bad thing. It is separate from the issue of producing competitive lower-end models.

            Of course, I have also long argued that Nikon's lower production efficiency compared to competitors like Canon and Sony unsurprisingly results in higher prices for many of their products.

            Nikon can either accept that current reality and not waste ridiculous amounts of corporate resources trying to compete head-to-head in brutally competitive areas where this is a particular market handicap for them (and instead emphasize high-end products for now), or they can wring their hands about their lack of production efficiences, do nothing about it, and shrink even faster.

            Simply expecting them to be as efficient as Canon tomorrow is a fantasy. There are many reasons why companies like Canon, Sony and Panasonic have advantages in these areas, starting with the fact that all those companies are gigantic electronics manufacturers and Nikon is not.

            Nikon will certainly improve these things on an ongoing basis, but so will their big competitors.

            • ITN

              I thought Nikon were very efficient in making cameras and lenses. Which products do you think Nikon are not making efficiently?

            • PhilK

              Based on the teardowns I’ve seen, I think the electronics in the lenses are oftentimes too bulky and not using latest production/miniaturization techniques, causing the lenses in turn to be too expensive and bulky.

              Which doesn’t really come as much of a surprise to me because companies like Canon and Sony and Panasonic produce millions and millions of electronic products of every sort and have vastly more experience in this area than Nikon does.

              On the other hand, there seems to be less design for production efficiences even in the mechanical/optical side, requiring more hand-tweaking to do things like align the lens than a lot of the Canon designs. Eg using a bunch of manually-placed-and-glued shims instead of something that can be trimmed after assembly by some sort of automated equipment.

        • Davidvictormeldrew Idontbeliev

          Although Canon’s making sales / market presence in entry category ( may be not much ) and in their Mirrorless range from entry level to their current top end Mirrorless.

        • Davidvictormeldrew Idontbeliev

          With the Nikon 2 the lower – mid end should be addressed so that new blood / punters can buy into the Nikon system and then upgrade later as they wish.

    • T.I.M

      sound like my mother-in-law…

    • Roger S

      I didn’t realize until now that Homer is Nikon yellow. 🙂

  • sandy

    They are in the black. More so than anyone but Canon.

  • Proto

    Excessively overpriced E lens = fewer sales and gouging of loyal customers. i.e. low revenue, high profit.

    • ckuklbac

      That’s the way I read it as well . . .

  • Aldo

    This is what nikon wanted… to be smaller but more profitable

    • I think this is the future – less products, more high-end products, more expensive products, more profits, something like Leica

      • Proto

        End-up like Hasselblad — bought by a Chinese startup?

        • Davidvictormeldrew Idontbeliev

          or Kodak

        • PhilK

          Double Plus Ungood.

      • Robert Falconer

        I think you’re right. But only very few of the camera manufacturers will be able to pull that off, I think. There just aren’t enough “prestige” brands.

        • ITN

          Well Sony is doing the same thing essentially, they offer relatively high priced lenses for the focal length and aperture, and Canon have those expensive products as well; look at Canon cinema camera and lens prices and they’re the ones that almost doubled the price of 200-400/4 lenses. All three big camera manufacturers are emphasizing the high end. This is because consumer buying habits are fragile and they come and go, whereas the enthusiast and professional are going to keep buying equipment despite trends.

          • Thom Hogan

            And within your narrow view of the market, how’s Nikon’s unit volume going? Other than the D500 and D850, it’s going down. How’s Sony’s going? ;~)

            • Davidvictormeldrew Idontbeliev

              Sony and Canon again could be going down at the high end if they keeping on jacking up the prices of their Cameras and lenses decreasing the amount of punters they have who are willing to spend – regardless of their democratics.

              As the professional market is becoming more competitive, economic conditions in world bit over the shop and more competitve, nagging Girlfriend syndrome, increasing bills in the shop, less disposable incomes cheaper alternatives of imaginery captures are being used these are pressures on people’s spending money

              Have to hand it to Sony & Canon they have more of a breath of presence in the imaginary market where Nikon should not have rested on their laurels too long.

              Taking examples: Mirrorless Aps (both S & C established), Powershot / RXnn / RXnnn – sorted and established, Camcorder market S & C sorted & established, Cina / videographers lines – S, C + Sigma sorted and established = more market presence, more users having in their hand their products, maintain market % share as a percentage, etc.

            • ITN

              Nikon had previously experienced success in the low end DSLR market that was possible because their competitors were not offering excellent live view AF or wireless functionality at that time. Nikon today offer poor LV AF and poor Snapbridge experience compared to their competitors’ products (who have sorted out these problems) so their consumer DSLR sales have dried up. Thus Nikon unit sales volume are going down in the entry level segment. Sigma is offering high quality f/1.4 primes at 1/3 of the cost of corresponding Nikkors, so Sigma is taking a large chunk of Nikon’s high end lens sales. Overall, sales are going down partly for these considerations.

              But Nikon’s focus on high end products is not wrong. It is a more stable market and one which is not as price or trends sensitive.

            • I may actually answer that one – Sony started basically from 0, so their only way was up or they would not be around today. I have a question: is Nikon the only company that is losing market share? I am just curious, I know you keep track of that.

            • Thom Hogan

              Sony did not start from zero. They actually started from where Nikon is today (e.g. APS-C and full frame DSLRs). To Sony’s surprise, the full on switch to mirrorless didn’t actually win them new ILC market share, it just switched people over. That’s a danger Nikon now faces.

              Canon is holding market share.
              Fujifilm is gaining market share.
              Olympus is holding market share.
              Panasonic is unknown.
              Sony is holding market share.
              The overall ILC market is flat, but tilting more towards mirrorless over time.

              Nikon is the only major player losing market share. In APS-C they’re losing share specifically to Fujifilm.

            • Wow, it is surprising to me that only Nikon is losing market share.

            • PhilK

              Not really surprising to me, Nikon 1 was a flop and most of the interest in the market the last few years has been in mirrorless… because it’s “the new gadget on the block” and Nikon isn’t really a player.

              Whereas Fuji has been making new categories of cameras that photographers like to use, with good lenses. Seems to me a substantial number of NR readers also have Fuji mirrorless’s as well as Nikon DSLRs these days.

            • Davidvictormeldrew Idontbeliev

              Good call, not sure what the answer was back then. My take would have been to start introducing mirrorless to both end of APs market D3xxx and then expanded the system when it got traction and more uptake. On Nikon 1 – perhaps the lenses and cameras could have been cheaper and other things as discussed before, possibly would have introduced the DL at same time using the same CX sensors (1″).

              If Nikon 1 / DL range took off then improved the specs as time go by and if it looked like it is diving then kill the range as soon as appropriate but at the same time be open to customers on why you did this.

            • AlexG

              I agree with the idea of PhilK.
              It would be interesting to do a survey to see what percentage of people who own Nikon cameras have a second camera system, what percentage of them from another brand and which brand.
              Would also be interesting to read their comments why do they own specific brand systems and maybe this could help Nikon to get a clue what are the reasons they potentially will lose those customers and what in general are customers looking for that Nikon cannot satisfy.

            • Adam Brown

              I don’t think Sony hasn’t gained marketshare… or at least it’s an over-simplification. Their market share today looks very different than it was 5-10 years ago. Maybe you’re right, and their *total market* share has stayed the same. But I suspect their high end/professional/full frame market share is much higher than it was 5-10 years ago, while they have neglected the lower end of the market. Thus, if they have maintained the same total market share while simultaneously shifting up market.. that’s a a pretty profitable pathway.

      • Davidvictormeldrew Idontbeliev

        true but doesn’t always translates into more profits or revenues – doesn’t help with economic uncertainty and jittery stock markets at moment, Even though stock markets do go up and down – plus some punter/s will make a killing regardless to what the market does.

      • ITN

        Well, Nikon still make a lot of relatively inexpensive but good products even though they are putting more emphasis on high end. The 50/2 Apo Summicron is $7795 and Nikon AF-S 50/1.8 is $217. I think comparing Nikon and Leica is exaggerating things a bit. Nikon isn’t going to turn into a jewellery maker.

        • I think it is not fair to even mention the Leica and Nikon 50mm lenses in the same sentences.

          • ITN

            My point is that Nikon still make some lenses in the hundreds of thousands, not hundreds of copies. And offer good lenses at affordable prices. They are not approaching Leica exclusivity nor should they. Moving towards a higher end focus doesn’t mean they will become something wholly irrational.

            • My comparison with Leica was not so much for the exclusivity as for the prices and number of unit produced. Juts a reminder: the latest 180-400mm Lens is $12,400. The previous version 200-400 was $7,000. The is how I see Nikon in the future. You can argue the details, but the price of the 200-400 lens almost doubled… But forget what I think, Nikon said it themselves – fewer models with concentration on high-end products:

            • ITN

              The 180-400 is a lens that is price increased by the sample optimized TC. Canon’s price is the same. It doesn’t mean Nikon is going to dramatically increase the prices of the rest of their lenses. They already doubled the price expected for f/1.4 lenses and as a result Sigma took that business largely away from Nikon. Nikon is dead in the water if they try further price increases along these lines. What they can do is offer unique products which no one else can make and charge a premium for them.

            • Canon’s version is cheaper at $11k and Canon seems to be doing just fine and they can basically do whatever they want

            • In Canada the Canon is $16,079.99 and the Nikon is $15,549.95. I think that they are in the same ballpark. Both of my numbers are from the respective manufacturers’ Canadian Websites.

          • PhilK

            Why not?

            • Image quality, sharpness (edge to edge), micro contrast, build quality, bokeh, price…

            • PhilK

              What’s the cheapest 50mm lens they make?

              And is it better than the most expensive one Nikon makes in every respect?

            • This is not what we are comparing here – ITM mentioned the Nikon 50mm f/1.8 and the Leica 50mm f/2 APO lenses – see the comment above.

            • PhilK

              Right but you made the blanket statement that “it is not fair to even mention Leica and Nikon 50mm lenses in the same sentences”.

              Seems like a pretty hardcore thing to assert, to me.

              Nikon is not even close to becoming anything like Leica is. People here complain about Nikon marketshare all the time, Leica’s marketshare is almost an invisible dot in comparison to Nikon, even at their reduced level these days.

              Neither do I think Nikon has any desire to emulate Leica’s market position.

      • Thom Hogan

        Again, you buy a company’s stock for its future story. Nikon’s current future story is “we’re going to continue to contract, but at least we’ll still make a profit.”

        • PhilK

          I don’t know where you get this “story” from.

          You can’t just take the numbers and extrapolate what Nikon’s strategic plans are.

          Yes, at the current moment they are seeing successes with some new, higher-end cameras which have been sales successes, partly because they have been making more of an effort to release higher-end models lately.

          That has nothing to do with whether or not Nikon is secretly planning to keep contracting as a company for the next 10 years.

          • thundrrd

            Where did Thom say Nikon is secretly planning to keep contracting as a company for any amount of time. He said it is the future story of the stock. He is right.

      • PhilK

        As much as I do think, for the moment, that emphasizing higher-end products is a good idea for Nikon, I don’t think Nikon should be following Leica.

        I’d like to know what is actually keeping Leica afloat. I doubt it’s their consumer imaging business. I’d wager it is more likely their industrial/medical products and licensing deals. (Eg with Panasonic)

    • rhlpetrus

      Agreed, this is the way to go, concentrate on quality products, including superzooms and entry-level dslrs and soon, mirrorless. In the upper level dslrs they have been doing well for some time now.

    • Proto

      And end-up being bough by a Chinese startup. Like Hasselblad – smaller with mortgage level prices on products

    • Thom Hogan

      Not exactly. Nikon wants to be bigger, it wants growth. But they have no way to do that so they’re cutting costs to the bone to show more profit, and the shareholders have demanded that in dividends.

      Simply put, it can’t keep running this way. Something will give.

      • Robert Falconer

        What will give is your aforementioned desire “to be bigger”. I think that ship has sailed.

        • rls976

          As phone cameras eat away at the pure-camera sales, perhaps some of Nikon’s competitors will go out of business. Then their customers will go elsewhere including, to some extent, Nikon.

          • Davidvictormeldrew Idontbeliev

            True but titans have fallen in the past – Kodak for one, never forget customer is always right and be open to change, stop living in the past, be adaptable stop making wrong business decisions and be open with your customers in what you’re planning to do. Get feedback and adjust your plans / developments to what customer wants but not what you want / think the customer wants – classic example DL series.

            • ITN

              It was not possible for a chemical photography business to convert into digital photography in any sensible way as a business because success in the new would have eaten profits from the old, and the business executives could not make such decisions. They made good money on chemical photography while it lasted and then they closed shop.

            • Thom Hogan

              Funny. You should tell that to Fujifilm.

            • ITN

              Fujifilm received government subsidies which carried it out through tougher times. Kodak did not so they were more at the mercy of the market forces. Also for a very long time Fujifilm was not successful in the digital photography market; only recently have they had some success.

            • ITN

              Also, Kodak was not a significant manufacturer of interchangeable lenses; Fuji was making lenses for Hasselblad and now are making lenses also for their own ILCs. That put Fuji at an advantage in starting their own mirrorless camera lineup. I think it was not foreseeable that Kodak would have started to make their own ILC lenses there was no sign that they ever intended to do that. Notice that Fuji is in Japan and Kodak in the USA; for Fuji the infrastructure to make lenses efficiently was already in place and no doubt they benefit from availability of materials, engineers, manufacturing workers and subcontractors for lenses in Japan. Without ILC lens manufacturing capability Kodak could not have started their own mirrorless ILC system as easily (of course they could have made a deal with a Japanese company similar to Hasselblad’s).

            • Davidvictormeldrew Idontbeliev

              Thanks for an excellent response….

            • PhilK

              Actually, Kodak was one of the key, early pioneers of digital photography technology. (Among various other things, they produced the digital parts for some of Nikon and Canon’s earliest efforts at digital SLRs, before either Nikon or Canon could do that themselves)

              But they failed to capitalize adequately on this going forward.

            • BG

              “in any sensible way as a business because success in the new would have eaten profits from the old” – still better to eat your profit yourself (i.e. it stays within the company) than have some other company eat your profit (i.e. goodbye).

          • Thom Hogan

            I’m on record for nine years saying that this isn’t the answer. The first camera company that truly lives to play in the mobile communications world will destroy the others.

            • br0xibear

              “The first camera company that truly lives to play in the mobile communications world will destroy the others.”
              What does that mean Thom ?

            • Thom Hogan

              It means that if SnapBridge actually worked, if it used current, expensive parts instead of cheaper old ones, if it actually understood how to put images where we want them (cloud, server, computer, Facebook, Twitter, etc.), Nikon would have a real winner in their hands.

              A lot of us are using kludge systems to get immediacy for our PJ results. Ask yourself how the NYT is getting near instant coverage of the opening ceremonies. That’s the thing that would make me drop my current camera for a new one. And I believe that to be true all the way down to the casual consumer. Indeed, it may be more important at the casual consumer level (though that’s more Facebook, Instagram, Snap, email,

            • br0xibear

              “Nikon would have a real winner in their hands” if SnapBridge worked the way you want it to ?.I don’t see it that way at all.
              I agree sports photographers/photojournalists would benefit from an easy and fast way of transferring images, but I don’t see that making a big difference to Nikon selling more camera gear…those photographers are tiny in number.
              I also don’t see it mattering to what you call “casual consumers”, those people don’t want a DSLR or mirrorless or any other camera…they just want the camera inside their phone to be better.
              Maybe it’s geographical or cultural, but from my experience in the UK, unless you’re an enthusiast or professional, most people do not care about a camera beyond their phone.

            • ITN

              Sports pros already have their fast transfer of images, I don’t understand what the complaint is there.

            • br0xibear

              Oh I wasn’t complaining, I just wanted clarification from Thom was about what he meant.

            • PhilK

              Yeah, you could build your own mobile FTP/HTTP image server to talk to a WT-6 and post/send files to your desired destination but there is no turnkey Nikon solution for this.

              How does it get done on a 1D-X II?

            • ITN

              Each photographer seat at the Olympics has an ethernet socket so that’s how the images get transferred quickly. I am not sure what you find missing? Casual shooters are not going to have an ftp server with staff to do picture selection and the pros already have it and working. Snapbridge needs to be faster and more reliable but it already transfers the images where they are needed: the mobile communications hub called the smartphone. From there the images can be sent by email, text message, whatsapp, skype, facebook, whatever. There is no benefit in reproducing the functionality of the mobile phone in a camera when the camera can send the files to the phone in the background.

            • PhilK

              Interesting about the ethernet jack.

              While I agree that it is unrealistic to expect Nikon to replicate mobile phone functionality in a Nikon-branded product, they do really need to build a good mobile app for tasks such as image transfer. One that works easily and reliably and has the necessary features to make things like social media posting easy.

              For a pro product for the D5, they appear to assume that the photographer has the expertise or resources to build their own intermediate media server working off of FTP or HTTP, and I think that’s not a particularly unreasonable assumption.

              But I’d like to know how, eg a Canon shooter does the same with a 1Dx.

            • ITN

              As far as I know, all you need to do is turn on your mobile phone’s access point, plug in the WT-6 or WT-7, and type your employer’s or client’s ftp server IP address in the camera and then the images can be either automatically transferred in the background or selected manually for transfer. The photo agency or newspaper have the ftp server already for this and staff to edit the images back home. This should work if there are only a few people around. In a stadium there is too much wireless traffic and the physical ethernet cord is used.

              However this assumes there is an ftp server somewhere. If this is not the case, you can plug the ethernet cord from the camera to your laptop and then edit the images on the laptop and send out by e-mail or other means. But then you need the laptop.

              I think what Thom may be suggesting is that this should work without an ftp server or laptop and with some kind of application on the camera which would allow direct posting on common social media and e-mail. This would likely require android as the camera operating system and be slow as hell to start up. I believe it is better that mobile phone functionality is NOT reproduced in the camera because of the delays and additional programming work. IMO Snapbridge is on the right track in the sense that it transfers small jpgs onto the phone in the background but it should be much faster in transfer and also in setting up. I find it very convenient to send the images out when they are on the phone. And there are editing apps that allow the images to be cropped, exposure adjusted etc; there is no need for Nikon to reproduce this functionality that already exists on the phone, in the camera.

            • PhilK

              I agree that it would be stupid to try to replicate a phone platform inside the camera.

              But I don’t think a reasonably intelligent person with knowledge of the tech would suggest that.

              Neither do I personally think it’s a great idea to try to upload to some FTP server thousands of miles away directly from the camera. I’m telling you as a networking guy that this is not a great idea. Both from a security and performance standpoint.

              The logical thing would be to have some sort of mobile device act as an intermediary – either a phone or a tablet. Then the camera is not bogged-down with networking tasks trying to constantly babysit the transfer of large files over an unreliable wireless/internet link, and the mobile device can be provisioned as per local and other requirements to connect to the best network to do the transfers with. (And retry during the inevitable periods the network will be unavailable/unreliable)

              So in my view what Nikon really should offer is some kind of mobile app for the major mobile platforms, to perform this “intermediary” task. And charge money for it if necessary. Someone spending over $6k on their camera bodies is an idiot if they are complaining about a $99 app. (If the app is decent, anyway)

            • ITN

              I remembered that part wrong; at the Olympics the major media outlets have people working at the press center where they set up their ftp server. And then they send the edited images out from there. So the transfer from camera to the server may span cities but is not in a different country, and mostly they use wired transfers.This kind of workflow requires someone to set up shop and do the editing etc.

              I suppose currently the major limitation for consumers to have easy editing and transfer of the images online is due to the slow speed of snapbridge. The pro equipment transfers even raw files pretty quickly but they are set up for (s)ftp servers and laptops and not mobile devices as recipients of the images. I suppose eventually Nikon will implement something that will transfer large jpgs to mobile devices quickly. On the other hand, for moderately serious photographers, it shouldn’t be too much trouble to travel with a small laptop and once you have a laptop then you can use proper editing software, use a calibrated screen, and use either hotel wifi or mobile phone access point to get them online.

              The question then is how much do photographers want to use mobile devices to edit and send their images instead of a laptop. And how much they really need to publish their images quickly.

              I don’t think it is a bad idea to let time go by instead of publishing images immediately. Often one’s opinion of which image is best and how it should be edited takes time to mature. ”Too easy” and ”too fast” publication without giving it some thought is in my opinion one of the problems of modern social media use.

            • PhilK

              I rather doubt the photographer who is in the field at an event is going to be sitting there writing twitter taglines after every shot, someone has to be doing that for them unless they want to miss lots of photo opportunities.

              Snapbridge isn’t really the question here because I thought we were talking about sports photographers at sporting events. (You referred to ethernet jacks at major sporting events and Thom referred to “PJ results”. [photojournalism])

              If the photographer has the time to sit there and edit/categorize/tagline/keyword images for posting, then yes, a GOOD mobile app of some sort is essential. It’s pointless to expect to have the camera itself manage all your social media accounts and so on, that is what a smartphone is for.

              For breaking-news photojournalism you need something that will send files somewhere as you shoot them, both so an editor somewhere can post them ASAP, and so they can be archived somewhere in case some unfriendly person (govt/military or otherwise) decides they don’t like the fact you are taking pictures of things and either confiscates or destroys your camera/memory cards.

              That would probably not use Snapbridge in the usual “consumer” way, it could be a separate app in combination with eg a WT-6, a smartphone and/or satellite transponder. (Or for even more survivability, a customized mesh network of some kind built to talk to ethernet to keep the data off the public airwave bands.)

            • ITN

              If the photographer wants to tag the photos while shooting the voice memo may be the easiest to use and least disruptive. If they shoot to a laptop it should be easy to do the tagging with a browser. Or the person who is editing the images in the press centre (ftp) can do the tagging. I am not absolutely sure but I recall that images in the D5 can also be tagged using a web browser in a mobile device or laptop if the camera has the WT-6. So if the photographer has an assistant nearby they can see the images in the camera using a web browser and can tag them before they are transmitted.

            • If I was in a politically tough location, I would want Snapbridge (not the current incarnation that should be called BrokenBridge) hooked to a mobile phone. If my phone was in my pocket it would likely upload a lot of images before the local pork figured out what it was doing.

            • Yes, but if you want to sell D5500s or equivalents to people that are used to taking a picture with their IPhone and pressing send, you need to replicate that. About 0% of that market is going to deal with and FTP server. Snapbridge is a joke. I spent half an hour trying to connect my D850 to my IPhone and gave up to see if Thom has a legit complaint, and he does. More to the point, if you do manage to make that connection, it is as likely to not work consistently as it is to work consistently.

              My wife has an IPhone and D5500. She takes pictures of our children (12 years to 3 months) with her IPhone and hasn’t picked up the D5500 in six months. If she snapped a picture with the D5500 and could get it to WeChat (she is Chinese) in 10 seconds like she can with her IPhone, would she use an IPhone? Of course not.

            • ITN

              Snapbridge seems to work with my camera and phone though, but is slow. It doesn’t work in a crowd with a lot of other traffic (and I imagine a host of rf busy environments). I think the ideas of automatic connection making to established pairs and background transfer even with the camera off are good but the speed of making the connection and transfer of images should be much faster.

              I think the implementation of Snapbridge could very well be responsible for a large part of Nikon’s loss of sales in the consumer market and also for some pro applications where other manufacturers’ wifi works properly and Nikon’s does not.

              But personally it is not a big deal to me. It would be fun if it was fast and less quirky but I wouldn’t choose a camera system based on wifi implementation.

            • Thom Hogan

              I’m aware of that. But the Olympics (and World Cup Soccer) are not played every day. Moreover, this is asking the customer to solve the problem, not solving it for the customer.

              As for casual photographers, they have simply given up on the dedicated camera they own because it can’t do what they want it to do.

              And don’t try to tell me about “hubs.” I wrote about hubs and nests long, long ago. But not a single camera maker seems to have figured out the same problem in a way that’s useful to consumers. Sony and Samsung (while they were still in the camera market) were the best positioned to fully integrate and use pass-through technologies. But sadly, nothing yet.

            • For a dedicated photographer like us, it is difficult to fathom this issue. While aware, I did not truly appreciate it until I saw the behaviour of my wife.

              “My wife has an IPhone and D5500. She takes pictures of our children (12 years to 3 months) with her IPhone and hasn’t picked up the D5500 in six months. If she snapped a picture with the D5500 and could get it to WeChat (she is Chinese) in 10 seconds like she can with her IPhone, would she use an IPhone? Of course not.”

            • L8rNik

              Are you implying the NYT doing anything different from every wire service using the FTP capabilities of a Nikon or Canon flagship camera?

            • Dennis Beaton

              I too think ac wireless protocol should be built in the DSLR and ML cameras. We are in the 21st century. The world has two kinds of people, pixelpeepers and non pixelpeepers or DSLR versus smartphones.

            • rls976

              I don’t comprehend how a camera company like Nikon could become a successful mobile-phone designer/manufacturer. Perhaps their path would be to persuade some mobile communications giants to embed Nikon’s lens and other technology into their phones. In other words, the photographic component of the mobile phone would be Nikon. I do not consider the obverse likely – that you could take a Nikon DSLR or mirrorless, and add a mobile phone into it.

            • Thom Hogan

              At this point, they probably can’t. Not without having some notion that Apple/Google/Samsung haven’t thought of that they could introduce without leaks.

              My suggestion to Nikon almost a decade ago was that they pursue a “Nikon Inside” strategy. The strategy that Leica actually pursued.

            • pest

              AI is that thing, not social media 😉

          • Davidvictormeldrew Idontbeliev

            Possibly ? or they stick with what they got or they could buy / use more mobile tech like Smartphones and adapt or buy a bridge camera like the Sony RX10 Mk 1-3, Pany ZF1000, etc ?

      • ITN

        It was clear when Nikon started to be successful in selling consumer digital cameras that this massive buying frenzy by people who had shown no interest in photography in the past would not last. Nikon spent some years making a lot of products for the consumer but eventually the market was saturated and consumers moved on to the next new gadget: the smartphone. A lot of people who weren’t interested in photography got excited with it – briefly – and they stopped doing it when they realized that getting to the next level in their photography would have required the expenditure of a lot of time and learning. Only a few people are willing to do that. There is no long term business to selling cameras to consumers at least not something with expectation of growth. This is a good thing as there is too much bad photography published in social media all the time now, and somehow that problem should be solved. It is not by consumers buying better cameras but by some standards of publication worthy images to be established also in social media IMO. Growth for Nikon can be achieved if they manage to make better and more diverse products for the dedicated photographer, instead of wasting time on consumer toys.

        • Thom Hogan

          You’re changing your story. Do we have to go back and look up your comments pre-2011? ;~)

          Even if it was clear that the buying frenzy would not last, you would have to explain why Nikon continued building capacity even after the sales peak. That says that Nikon didn’t agree with your now “it was clear” statement.

          • ITN

            I recall reading Nikon exec comments around 2009 where they noted that they recognize that the market is in the transition to digital photography and implied in that discussion it seemed that they didn’t think that the transition (and the associated buying frenzy) would last forever.

            I’ve been worried about Nikon’s focus since they decided to terminate many of their more exotic and unusual products in 2005, in order to make space for greater production of consumer products in their factories. I felt they were leaving their traditional market to supply something that didn’t work well for me and they seemed to be giving the professional market over to Canon. I am glad that they are now going back to their roots where they used to make a host of small-volume, high end lenses for specialist needs. They’re approaching a point where they are getting close to what they had in the manual focus era in terms of diversity of primes etc.

  • sandy

    They have a lot of work to do, but better than it was. The rate of revenue loss is decreasing, Y-O-Y. And profits are way up. They need to NOT fumble the mirror less line. We will see what the stock does tomorrow.

    • Davidvictormeldrew Idontbeliev

      Already have with Nikon 1 – hope they do Nikon 2 right and bit of concern that it is coming quite late too the party where Canon, Fuji and Sony have a stronghold and also the jittery economics that is going wrong – stock markets around world are jittery at the moment due to no of reasons – but people panic and should be ok / adjusted to correct level over time.

      My reservation with Nikon-2 is the specs, pricing, lens availability, specs and capability + pricing of the Adaptor, Nikon being open to showing as an example a road map on what is planned for Nikon-2. Does not matter whether they leak anything to C, S – they already have a guess / idea what Nikon is trying to do – just be open and transparent with their existing customers.

      I still have a nagging doubt on what happened with Nikon-1 could be repeated on Nikon-2 – therefore will only transfer across once my old equipment fails and Nikon-2 to be well established and have a big of an user base for me to invest in it.

    • Thom Hogan

      People have to take a view broader than one quarter’s results, especially a quarter that is highly manipulated, as is the Christmas quarter.

      Next quarter Nikon will write down the Chinese factory, possibly more. Tell me how much their profits are way up then. ;~)

      • sandy

        Fact. It’s better. Fact. Profits are way up. It maybe putting lipstick on a pig, but it is still better. Words you seldom use. And as I pointed out in my entirely factual statement, they have a lot of work to do. I know they haven’t hired you Thom, and maybe they should, but their responses are not ineffective. Lets see. I think this super tanker turns very slowly.

        • I have to agree. It is not too late and they can do it. Tell me about a company that doesn’t put lipstick on a pig. Remember Olympus accounting scandal? They almost went down because of it, but they didn’t and they seems to be doing well today.

  • BVS

    Great, financials are out. Now can they reveal their mirrorless please!

  • Eric Calabros

    %14 profit margin in Q3? D850 is doing this miracle. Why not keep it at this level with a mirrorless D750?

    • Muhammed

      While the D850 is amazing, let’s keep in mind it’s essentially a D800++. The hard development was done years ago. Profits are up likely because Nikon’s been charging and arm and a leg for their new lenses and have been recycling old designs (D3x00, D5x00). Not much r&d or retooling needed, and a feature or two and markup the price. The problem is that model won’t last.

      • Davidvictormeldrew Idontbeliev

        agree 100%

      • ITN

        The D850 is successful because of the D5 AF module making it much more likely that shots are in focus than before. This is not a “years ago” development project but something they did very recently.

        Also the sensor is new, Nikon’s first full frame 4K video capable sensor, and permitted 9fps at 45MP which is a ridiculous improvement over 36MP at 5fps in the D810. This development must have cost a fortune.

        • Muhammed

          They’re still incremental improvements. Take the AF module from the D5. Sony’s had a 42MP sensor for a few years, so 45MP isn’t a massive stretch (yes, I realize it’s probably not a Sony sensor in the D850).

          Higher FPS/4K video output are likely just due to improvements in being able to move data faster off the sensor and to some type of storage (sensor to cache buffer to card).

          The D850 is spectacular, but it’s not going to sell in extreme high volume to generate game-changing profits. A $500-1000ish small mirrorless kit sold at Costco/Walmart/Bestbuy with instant connectivity to smart devices, ability to post directly to social media (Regular Facebook, Instagram, Snapchat, not some proprietary nonsese) might be a step in the right direction. The big question is how to sell to the masses now that everyone has a smartphone.

          • ITN

            So, if a car manufacturer such as Ferrari or BMW came out with a new model which goes 900 km/h with the same fuel consumption as a 300km/h capable model today, and it would include dozens of other improvements you’d call it an “incremental improvement”. I get it, you’re very demanding. But someone has to design those circuits and it costs an enormous amount of money and collaborative effort by engineers to make this kind of advancements.

            A design that is several years old?! You serious? All products can be traced down to previous products and research that it builds upon. Nothing comes from scratch, what engineers do is they talk to other people who worked on a problem before and learn from their mistakes to make some improvements and a new product. The same is true of science as a whole, not just technology. No one really makes a huge individual advancement in a short time. The inventors might not tell you their sources but they practically never invented it all themselves. All of technology is a gradual progress that depends on the support of the entire industry basically.
            The D5 AF module had to be developed by some people and it still is better than other manufacturers have come up with, two years later. It’s not an incremental advance but something of a breakthrough. And the D850 is the first camera that includes this AF system and has widespread appeal in the market.

            The low-priced camera segment is so intensively competed that there is no profit to be made from those products, and the manufacturers are in it mainly for PR and getting customers in the first place. There is nothing Nikon or anyone else can make to turn these into profitable ventures, except perhaps make the lenses and cameras by robots as Canon are now doing with a few items. But even so I suspect they’re dumping them on the market without making money.

            Consumers are simply not interested in cameras any more and there is nothing to see there.

            • PhilK

              I doubt Canon is selling those cameras at a loss. In fact there are international trade laws that prohibit such things.

              But no doubt their production efficiencies and cost model is better than Nikon, at least on DSLRs and lenses. (Nikon’s compact cameras produced at their more modern Chinese factories may be more competitive on that front. The Chinese factory they are closing was one of the oldest/least-efficient)

            • Anybody who thinks a politician (and that is who is making those determinations) can determine if something is being sold at a loss or even understands the principles behind even having that discussion is naïve.

            • PhilK

              The individual politicians are not making those determinations, certainly not in a country of any significant trading volume.

              Significant trading countries have trade agencies staffed with people who know how to research and calculate these things, and raise complaints with relevant international trade organisations if necessary.

              Even in a country without such agencies, politicians have staff that do research for them. Sorry (not sorry) to deflate your rant.

            • Perhaps it is a rant, but it is a pretty tame one.
              And what does “rant status” have to do with the credibility of an argument?
              Neither economists nor accountants can agree on a specific definition of cost – mostly because they recognize that trying is futile. You can write a book (and many have been written) where even full cost and marginal cost are a single chapter. You can pick one that is convenient to support almost any cost that you want. So when some expert, such as a trade agency analyst, stands up and makes a pronouncement about cost in support of a cause (usually restricting trade) I just roll my eyes.
              This is hugely relevant to a company like Nikon where the best definition of cost depends on what kind of decision you are trying to make. A good litmus test on whether you are using the right cost is to reconcile it with a cash flow analysis.

            • PhilK

              I realize accountants and accountancies have a habit of moving the numbers around until they can give a public company’s management the figures that make the company look as good as possible to investors, but a manufacturing company that has no idea what it costs to produce a product has no business manufacturing anything.

              General consensus can be reached on many things after effective research, including whether a manufacturer is likely to be dumping products below cost, regardless whether someone who doesn’t like regulations and regulators proclaims that it’s an impossible figure to estimate or not.

            • I am not saying that a company may not know how to calculate costs. I am saying that there is a different methodology depending on the purpose: Produce a financial statement, allocate overheard, start a product line or open a factory, continue or discontinue a product line, determine what price to charge etc. etc. etc.

              But I suspect that we have an irreconcilable difference in opinion.

              Does this mean that we can’t be friends?

            • PhilK

              I’m simply saying that whether or not one approves of the whole geopolitical trade regulatory process, it’s not that difficult for people who specialize in this stuff to get a sense about whether a company is dumping product below cost or not, particularly in egregious cases.

              As for being friends, sure… can I borrow your 400/2.8E FL VR this weekend? 😀

            • Ha ha! Maybe friendly acquaintances.

      • PhilK

        Ideally they probably should have replaced the D3xxx and/or D5xxx a couple of years ago with mirrorless.

        Which I suspect is probably what is going to ultimately happen over the next year or two, but they are just responding a bit slowly to this market change.

        But given their limited resources, I actually think the recent focus on the higher-end SLRs was probably a good choice, because it was the most direct way to improve their situation in the short-term with the lowest risk.

        Because as we can see with Nikon 1, if they don’t do mirrorless right it will just become a weight around their neck.

  • ZoetMB

    Even with the D850, they’re still projecting sales of 500,000 fewer DSLRs and 600,000 fewer lenses than last fiscal. So yes, they were more profitable, but their customer base is getting smaller and smaller, which hurts lens sales. Nikon claims a 22.2% lens share, but comparing their sales to CIPA shipments in the same period, they really only have a 14.1% share, about 10% below their share of DSLR sales. IMO, that means their lenses are priced too high and consumers are buying third-party lenses.

    Profits are up because they slashed marketing expenses, which made sense because they didn’t have enough D850’s to ship, so why spend money marketing it, but did it make sense as regards everything else that they sell?

    • ZoetMB

      And their full fiscal year projection clearly shows that there will be no mirrorless this fiscal year. So nothing before April 1.

      • Kob12

        Announcement can still be before April 1st. Nobody expect them to ship a product for revenue in one month after announcement.

        • Thom Hogan

          Could be. But you also don’t want to announce “new great thing” followed a couple weeks later by “giant massive writedown.” I’m starting to think that they’ll wait until after the fiscal year report to announce/ship nearly simultaneously.

          • Yes, mirrorless announcement in March looks really hard at that point unless they can really keep a secret (I doubt that) or they will just announce the development only without any details. That explains the lack of any rumors and leaks.

            • Davidvictormeldrew Idontbeliev

              Possibly hopefully it doesn’t repeat the saga of the DL series – high expectations, good no of pre orders, technical difficulties experienced and then cancellation of the series which showed promise + overall perception of decline in the markets that Nikon operated in, e.g., serious Digital compacts, etc.

              Must say when Nikon’s on it they’re on it 100%+ – the D850 is testament to this.

      • TurtleCat

        I expect a development announcement. They will have to time it well to not affect sales during the quarter.

        • Allan

          “They will have to time it well to not affect sales during the quarter.”

          I don’t understand.

          • TurtleCat

            Whether misnamed or not, the Osborne Effect.

            • Allan

              Got it. 🙂

            • Roger S

              You learn something new every day.

            • Thom Hogan

              Having been in charge of products at Osborne at the time, yes, misnamed. Osborne failed for a different reason than usually cited.

            • Davidvictormeldrew Idontbeliev

              Thought someone was having a yawn at UK ex chancellor George Osbourne and his effects good / neutral / bad he undertook whilst he was in charge of the UK Economy

      • Thom Hogan

        As I’ve written elsewhere, I don’t expect them to ship a mirrorless camera until May, and that’s only if they can get all the ducks lined up in a row.

    • Eric Calabros

      No, its means way fewer people buy their sub $1000 DSLRs so less 18-55, 55-200 are selling.

      • ZoetMB

        There’s no way to tell that because Nikon doesn’t break out revenue or model units. Overall, they’re projecting sales of 600,000 fewer lenses. If they’re losing many low-end lens sales and making it up with high priced lens sales, lens revenue should be up, but we don’t know. They’re still projecting 4.18% less overall Imaging Group revenue than last fiscal.

        • Thom Hogan

          Look at the CIPA numbers for average cost per unit. Then, with some brilliant math algorithms you can start to figure out high end/low end unit volume. At least to a good approximation.

          • ZoetMB

            Well, looking just at Nikon’s average per unit (including lenses and compacts), the average for the first 9 months was $342.56. That is up from $325.05 in fiscal 2017. but only by 5.4%.

        • Muhammed

          Except you’re going to be less likely to drop big money on lenses if you’re unsure about the system as a whole. I’m also guessing that $1000+ lenses isn’t as big a market as we’d like to believe.

      • drororomon

        True and that’s where they desperately need to reinvigorate their products. People are buying sub $1000 cameras from other companies and they need to fix that fast.

      • Thom Hogan

        And yet Canon doesn’t have that problem ;~).

        Seriously. The Nikon guys in Tokyo have created a mess and its their own dang fault. They have products better than a competitor’s that sell worse.

        • ZoetMB

          Yeah, so why is that? It’s not like I’m seeing a lot of Canon marketing either. I assume that most sales today are via e-commerce, so it’s not retail salespeople preferring Canon.

          • Muhammed

            Canon has a mirrorless offering. While we all ooh and aah over the D850s and 5D IVs it’s the consumer oriented cameras that sell in high volume. Canon’s M lineup has done reasonably well and gives consumers *something* in the mirrorless front vs nothing.

            Revenue being down with profits up means they’re cutting costs internally to make their numbers and that can only go on for so long. IBM did that for years and they’re a speck of the company they were 20-30 years ago.

          • PhilK

            I have to wonder if it is really true in developing countries like India whether the majority of people are buying things online like they do in wealthy countries like the USA.

            Though we already know that Nikon sales/marketing are weak. Have been for some time now. Partly a money problem. It takes a ridiculous amount of money to advertise and market mass-market products.

        • ITN

          Canon always sell well it doesn’t mean Nikon would, if they did the same thing as Canon.

          • Thom Hogan

            That’s the lamest comment I’ve seen in a while.

            It means that Nikon doesn’t know how to market is what it means. They don’t know how to retain customers is what it means.

            For a company that has for most of my life claimed that the company they’d most like to dislodge from its position is Canon, Nikon has done a very poor job of coming close to that. Which means they have no idea why Canon is successful. Hard to believe.

            • ITN

              My point is that Canon have to some degree different customers than Nikon’s, and copying Canon products doesn’t necessarily result in increased sales for Nikon – what they need is uniqueness that stands out, not just a basic good product. There is a cost of transition and familiarity which keep Canon users with Canon. Even for the professional level I believe the D5 sales were hurt by its having a worse base ISO DR than the D4(s) even though the AF is much improved and Canon was able to move the 1DX even though it had poor low ISO DR and excellent AF. The customers expect different things. Nikon users are used to high DR at base ISO and taking this away immediately removes the camera from some people’s consideration as an un-Nikon-like product even though the AF is superb and image quality above base ISO is excellent. That’s the problem when you copy the competitor’s recipe – you ignore those users who chose your previous product in the first place. And 1DX users aren’t moving to D5 because the Nikon FL teles are so expensive, there is just too high a cost of transition for those long lens sports photographers. What Nikon need is the right combination of features in the camera and the right lenses. They’re getting there but curiously enough it is the D850 which is getting good reviews even though it doesn’t quite have the D5’s AF performance. I think it’s the DR thing – Nikon users think they need the best low ISO DR and are accustomed to it even if they don’t actually use it much. This is a perceived problem thing – IMO the D5 is a major breakthrough product but the majority customers didn’t see it as such. It is the same with consumer products – there is a perception thing which favous Canon. Nikon totally blew it with Snapbridge which they’re now getting to work but it should never have been launched when they did that. Canon and Sony don’t offer background transfer AFAIK which is perhaps why they didn’t have Nikon’s trouble in getting it to work.

              I believe Canon’s consumer ILC sales is boosted by better LV and video AF compared to Nikon’s. Entry level customers are used to using the back LCD for everything and Nikon doesn’t give a good impression of their expertise when the customer tries it out on their DSLRs. Thus customers who expect a DSLR with a user experience similar to using a smartphone or compact digital camera without viewfinder are likely to choose Canon or Sony.

              So Nikon’s consumer DSLR sales were disadvantaged by (1) LV AF, (2) Snapbridge problems, and their pro sales were disadvantaged by (a) not releasing the D850 when it was expected (in summer 2016) as well as (b) a perceived DR problem in the D5, and (c) more expensive FL lenses than the competitor’s, and finally (d) still no usable video AF. There are product reasons why Canon are doing better in the market but even so, Nikon cannot succeed by simply copying Canon products because Nikon potential customers expect a different thing than Canon is offering.

              And I believe Nikon are getting the hang of it now; they are giving up pushing the consumer market as it is a lost cause, and they’re offering a plethora of excellent cameras and lenses for the professional market, and finally the message about the D5 AF is getting through to customers. Art Morris’ switching to Nikon is an example that people are now seeing that there is a difference in AF and it is worth switching for even if the cost is high.

              Canon’s success is partly because they are very steady in how they improve their products and rarely make unexpected things, it’s something that their customers appreciate (and internet commentators love to hate). Nikon have great breakthroughs but then also great disasters, so they’re not perceived as as reliable in the present time as Canon.

        • DaveyJ

          My favorite Nikon Camera is by far the D7500, followed by;the D7200,is now in a UW Ikelite housing good to,200Ft. Deep. Because the D500 has no flash. And our Apple iPhone can send pics blazingly fast and of good enough quality. Still fail to see any advantage of mirrorless. If a camera company cannot produce entry level cameras to attract new entrants….according to,the Economics Principles I have seen, it will die in two generations.

    • Roger S

      Yes, their lens share is concerning — probably also true for other camera makers competing with the third-party lens companies.

      More importantly, their strategy of going leaner in a period of falling revenues but rising profits is clearly not sustainable. How they invest their higher profits strategically in cameras and lenses, but also in things like marketing, will determine if they can use their current situation to their future advantage.

      • Thom Hogan

        Let me a bit of a contrarian for a moment. Nikon’s lens market share is going down because they ILC body sales are going down. Moreover, they consist solely of DSLRs for the most part, and the Nikon crowd already has a closet full of lenses.

        When Fujifilm and Sony and even Canon get people to move to a mirrorless system, it’s a lens restart. Those companies and the third parties that make lenses for those mounts should be having a field day, and they are.

        Which is just another way of seeing how Nikon’s “last to mirrorless” strategy is a complete backfire. They’ve allowed other companies to steal lens sales. Wasn’t Nikon ever proud of being a lens company? Didn’t it want to defend their top position there? Apparently not.

        Now they have the problem of trying to play catch up, but if they do that with the DX model as I expect, those new mirrorless lenses of theirs won’t be many and won’t see all that interesting. Total fail on lenses from a lens company. They should be ashamed.

        • Roger S

          (I don’t mind contrarians, being one myself in real life. I don’t appreciate confirmation bias — I want to hear things that I haven’t already thought myself. And NR is a good place for that).

          Anyway, your argument that Nikon has dug a deep hole (for a lens company) through some of its past decisions is convincing. Current profits, I hope, will give them some breathing space to think strategically to get back on top of things again. Time will tell, but I’m not totally pessimistic.

        • This is why I think it is pretty much guaranteed that their next mirrorless will have a new mount. Still no word on potential March announcement.

        • Davidvictormeldrew Idontbeliev

          Yep agree on that a wrong no of errors made and they keep on making these – especially dangerous in a declining market and with the jitters on the stock market and anxiety on how vibrant as an example the UK, European, USA economies will be down the line.

          I expect that with inflation creeping up, bills going up all the time for essentials, food, gas / petrol, transport that Interest rates are expected to go up quite considerable from 0.5 to 2% – 4% by end of cop 2019 meaning less disposal income to spend on luxuries like cars, cameras, etc, etc, etc, etc = less sales to Nikon coffers and more squeezing on their economic long term viability – remembering the scene from the unemployed man from Michael Douglas film Falling Down

          Still have big reservations in investing in Nikon-2 at beginning or in the medium future especially with things to consider like price, specs, how good adapter/s are and whether do I really need a Nikon-2 over what I got now, also the nagging saga and possible abandonment of Nikon-1 is playing on my mind.

          Nikon’s main realm is the camera and photography market where most of their sales are derived from – so they should have done more / be braver as part of their mirrorless and digital strategy from 2011.

          Harping again Nikon-1 with small set of essential primes and zooms – more realistically priced would be fine coupled with introduction of DL, Keymission and update to Coolpix A should have been taken. The DL’s could have used the same sensors (series 1) as in the Nikon-1 as well.

          Simply run with the market and update the series; keeping the viable models on the shelf and dumping models / series once there is less of a market. In 2018 we could have been on the 4th/ 5th series of the DL range and have a market presence / fierce competitor to Sony (RX ) and Canon G Powershot.

          Also could have started Nikon-2 at the same time as DX mirrorless range that will primarily replace the D3xxx range and as it got traction in the market replace further DSLR models, e.g., D5xxx in 2017, D6xxx in 2018, etc, etc, etc, etc.

          Also found some have their decisions they made baffling and wrong;-

          – Leaving Video from the DF ( where again it probably wouldn’t cost much more to the camera and once again the punter if not interested simply don’t use it),

          – Not building up of enough available stock and possibly in view of the customer overpricing of items like MB-D18, MH-25a, etc. – still can’t get the Nikon MH-25a charger in the UK still after awaiting since the D850 announcement.

          – Strange with D7500 taking things away like 2nd memory slot, grip. Would have been ace if the same grip on the D7100 / d7200 (mb-d15) could have been reused.

          With no egg heads giving me an good answer ( without fanboy/girl ism hysteria ) to this query why couldn’t the MB-D17 / MB-D18 be made so that it was compatible with both the D500 / D850 so I could use the same / 1 grip on both bodies without splashing out another £350 on another grip.

          Sorry for my rantism – again like to converse with my fellow experts and also aim to make Nikon to be strong as possible going forward.

    • Thom Hogan

      Right. You have to be careful with numbers, especially from a company that micromanages them. They don’t always tell the story that the company wants to tell.

      Simply put, Nikon cannot afford to keep losing market share like they have been. If that keeps happening, they will have to write down more assets as non-performing. If you look at their history, this is the same thing that happened in the Precision division. Contraction, where they kept trying to spin positive news in between giant fits of write downs.

    • Davidvictormeldrew Idontbeliev

      and overheads like factories, cut down on stuff like pensions, salaries and booting poor loyal and hardworking staff at the door.

      Must admit it is not only Nikon that does this but most companies are cutting to the bone more and more where in some circumstances the customer experience and support, etc deteriorates as a result and people will look elsewhere or not invest much of their spare ££/$$ with the company in question.

    • ITN

      The majority of the D3x00 and D5x00 customers that they lost only ever bought 1-2 kit lenses so there is no great loss in terms of money made, only in quantity.

      • Thom Hogan

        So your argument is that Nikon should never have tackled them?

      • August Personage

        But if you don’t chase the D3x00 and D5x00 customers (who may not buy many lenses) how can you expect to grow the D750/850/500 customers (who do buy lenses).

        • PhilK

          There are tons of successful “boutique” product manufacturers who do not attempt to make low-end/mass consumer products.

          That said, in some cases volume sales can benefit high-end product development/sales but Nikon’s problem now is that most of their major competitors these days are much larger companies with vastly more electronics-building experience and resources than Nikon has.

          Since mirrorless cameras are becoming primarily an electronic (not mechanical) product, that’s a problem, especially when it comes to producing lower-end/high-volume products which require very high production efficiencies and rapid product development cycles.

          Thus it’s not very surprising at all to me that Nikon is trying to “go upmarket” a bit to distance themselves from some of the most rabid low-end product competition. (At least until they stabilize their business a bit)

          • August Personage

            Yes but are those boutique manufacturers of consumer electronics anywhere near the size of Nikon? McIntosh, Legacy Audio, Rotel (just to use audio as an example) etc are all absolutely tiny. Are we expecting Nikon to shrink in size the same way? And what goes is they do? Research and development? For that matter without the cash flow from the mass market 3×00 and 5×00 how much does that impact the R&D budget? Or their ability to purchase chips in large volumes and for a discount ?
            Abandoning the mass market in favor of becoming a boutique manufacturer is….. well I couldn’t view that as anything other than the beginning of the end.
            Also most boutique manufacturers started as boutique manufacturers, not as dominant players who downsized.

            • PhilK

              This was my point as well.

              For example, Peter asserted here that Nikon could emulate Leica. My reply was that I sincerely doubt that Nikon wants to do that, as Leica A) is a very small company in consumer imaging with a microscopic marketshare compared to Nikon even today, and B) Leica probably doesn’t make much money at all on own-branded consumer camera equipment production, most of their profits are likely coming from industrial products and licensing. (Eg to Panasonic)

              And yes, being a mass-market producer has undeniable benefits in terms of helping to increase production efficiencies and gain capital to devote to R&D, marketing etc. This is why Canon is in a much better position than Nikon these days, combined with their vastly greater electronics capabilities/experience.

              My point is: Nikon cannot realistically compete head-to-head with that and expect to produce a better mass-market DSLR/lens at a lower price than Canon without selling it at an unprofitable price point. Should they keep beating their head against the wall trying anyway? Or should they try to retrench a bit to product categories they can make a much better margin on, at least for now?

            • August Personage

              Ah, fair enough. Apologies for the misreading.
              A retrenchment brings other problems than the ones discussed above. Nikon is a publicly held company, even if the majority is in the hands of a few large institutional investors. How well would a significant down sizing sit with them?
              If this were an American company we would expect a PE firm to strip mine Nikon for all of its assets. Being that the majority holders are Japanese banks that may not happen.
              Still they can’t be happy with the prospect of a massive reduction in the value of their holdings should a boutique approach be decided on. After all, many bought in with the understanding Nikon was part of the duopoly in cameras (with the revenue that that meant) and not a small, bit cool, bit player.
              This is not going to be an easy position to get themselves out of

      • Davidvictormeldrew Idontbeliev

        and perceived market share and presence in the market across the spectrum.

    • PhilK

      Ehh, it doesn’t take a rocket-scientist to figure out that if they are losing sales and market-share in DSLRs, then they will sell less lenses, too.

      Doesn’t necessarily mean the entire reason is “lenses too expensive”.

      Also, Canon for example has a lens mount that makes it easy to use the same lenses on their mirrorless and video-dedicated cameras as on their FF DSLRs. That makes Canon EF mount lenses more appealing to purchase. Nikon does not have that same advantage because of the issues with mount conversion and lack of a popular MILC to mount them on. (Nikon 1 is not it)

      Micro 4/3 has their own advantage that he mount is standardized and publicly documented and the lenses work on multiple manufacturer’s products.


  • ekgurbuz

    sorry but this is not even exciting, a game loser in financial terms. ever heard about short term superfulous gain vs long term loss? i.e. buying from the future? where is the innovation that this company needs? It is the industry roll ok, but one needs to be proactive rather than being reactive. HBS XXX 101

    • Allen_Wentz

      The D5, D500 D850 were IMO “the innovation that this company needs” for the last few years at least. No other manufacturer has bested Nikon in any of those categories.

      We will of course also have to see how well Nikon does with mirrorless. But I am a pro-body DSLR guy, so mirrorless is just academically interesting to me.

      • ekgurbuz

        Well, digital will never catch film was a topic too, back in say 2005 or so. Guess what, no more film in the professional world. Since what, maybe 2009 or so. Have you ever heard of mirrorless DSLR? I am too a DSLR guy historically, but we all have to say goodbye to DSLR tech soon. Over guys, let’s confess, er… embrace it.

        • Allen_Wentz

          Oh, I agree mirrorless is the future; if we are capturing digitally we may as well preview digitally. All that mirror viewfinding is (ultimately) inefficient. It just is not here for me yet.

        • sandy

          Nikon sells more cameras than all the mirrorless combined. So yes, they have to go that way, but no, it won’t drastically fix things long term, at least not back to sales figures from five years ago.

      • Thom Hogan

        Sure. But how many customers do those cameras account for? Worse still, how many NEW customers do those cameras account for?

        • Allen_Wentz

          Good point. About zero new customers.

    • Thom Hogan

      When you purchase stock in a company, what you’re buying is the future. You’re buying income growth, cashflow, or asset appreciation.

      Nikon is trying to say they have income growth on sales contraction. Can’t keep that up for more than a quarter or two more, I think. Their cashflow isn’t improving that I can see, particularly since they’re paying out a higher dividend now and it all gets used up for that. And their assets are depreciating.

      So what they’ve done is built a faux financial story. One that looks good as long as they can keep finding more cuts than they contract. The minute that stops happening, all bets are off.

      • Serious investors see right through that, right? So yeah, good for a quarter or so. New coat of wax to help sell it.

        • Thom Hogan

          In Japan things are a little different. Nikon is a bit of a puppet, in that the strings from the core of banks that are their primary shareholders are driving a lot of their decisions at the moment. It’s why that dividend has been increased despite the company really needing cash to grow a business, any business.

          • PhilK

            That may in fact be the major point here: does Nikon really deserve the blame for that?

            Maybe people should be annoyed at Mitsubishi instead.

            Then again, the stock market is an ephemeral extension of people’s fantasies anyway. Nikon’s banking overlords desire to up the dividend to make the company look better to some eyes may in fact be a useful strategy, if it helps Nikon’s corporate image in the investor world, and perhaps increases the capital available to them in the long run.

      • ekgurbuz

        Thank you for the technical explanation for my poor wording of the very concept, if I have not misunderstood what you have elegantly outlined sir.

  • Kob12

    I wonder by how much they decimated their R&D in order to show such an increase in profits during a period of reduced revenues.

  • Allan

    ” … while the projecting marketing expenses were suppressed.”

    ” Continuous and strict implementation of cost/expenditure management with discipline.”

    ” … as well as efficient sales expenses control.”

    Bean counters.


    • Allen_Wentz

      D5, D500, D850.

      Nay sayers.


      • Allan

        Excellent products (Nikon engineering).

        But, is this enough to sustain Nikon as a camera company?

        • Allen_Wentz

          That is indeed the question when we even have full movies like Unsane, directed by Steven Soderbergh, shot fully in 4K on an iPhone.

        • Thom Hogan

          Not really. Let’s put that into context.

          They failed at the action camera market.
          They are failing at the consumer compact market.
          They failed at their first mirrorless effort.
          They are failing at their consumer DSLR market.
          They failed at the video market.
          They failed at the smartphone market.
          They succeeded with US$2000+ DSLRs only a market we know is contracting.
          They overbuilt facilities for what they are currently doing, and by 3x or so.

          Something has to reverse in all that picture. Otherwise the contraction keeps happening, and probably at a faster pace.

          • jmb2560

            and perhaps failing to learn from their own mistakes which in my view may be the worst.

          • Markus

            Yeah lets sell all Nikon stuff now. They are more and less a dead ship.

            Basicly you can find a lot failure on every camera manufactor out there, damn on every company.

            Nikon is still a big and profitable company.

            • Thom Hogan

              Didn’t say sell your camera gear. It still takes as good a photo as it did yesterday. I’m pretty sure I could stop buying stuff and be happy with a D850 and lenses for the rest of my life.

              But you have to understand how everything that’s happening effects the future. You just come out of college and you can get a D5 or an A9. One’s cheaper. One seems to be coming from a company that’s rolling fast with the technology future. One seems to have buzz and momentum. One makes video gear with the same mount. You’re going to buy that one, aren’t you?

              This is Nikon’s existential problem: the D500,D750,D850,D5 crowd that the new, smaller, high profit Nikon is centered around is an aging crowd that is still upgrading. I can document an average age increase and a slowing upgrade cycle for that crowd.

              Nikon needs more new blood in the system.

            • John Albino

              At age 73 it’s hard for me to cost-justify a D850 with a useful-life probability far exceeding mine…. I wonder how many others on this forum (and others) join me in being part of the “Last camera syndrome” you’ve written about?

              One of Nikon’s biggest problems is that, at 100 years old, many of its most long-time owner-users (me since 1962 for example) are fast approaching that age themselves.

            • I am only 49 and trying to decide whether I buy into Phase One or wait and see how medium format unfolds. Definitely not last camera syndrome and if Nikon screws up the transition to mirrorless, not even the last “system” syndrome.

            • PhilK

              Funny thing about products like Phase One is that if people think Nikon is “gouging” them for their products…. what is PhaseOne doing? LOL.

            • That is an excellent point. With a D850 and about 20 mostly professional lenses I still spend a lot less than someone with a Porsche, and I would much rather have a camera.

            • Allan

              The actuaries tell us that the average 73 year old can expect to live another 12.1 years. Lots of time to buy and enjoy Nikon’s wonderful products. 🙂

            • A D850 for the rest of your life? Let me know when your last Botswana trip is. I will want to go on it.

              Also, even if you have enough batteries, will they last and will you still be able to get them? Do you buy a bunch and put them in the freezer?

            • sandy

              So how does that shake out. No one has long term sustainable sales except for perhaps Canon, and even they have drastically reduced sales.
              There is no magic camera with connectivity that will fix the market. It’s a pro and advanced amateur market again, and likely to stay that way as long as ten times the R&D is poured into smartphone cameras than stand alone cameras.
              The boom is over, short of major disruptive technology that is not even over the horizon.

            • Luca Motz

              One doesn’t ever break on you though..Someone coming out of college looking to buy one of those cameras will most likely go with Canon (70% of the time?) or Nikon. The odd one will go with Sony. But I believe if one of them is looking into the “not so rugged but high tech” section they’re going to decide between the D850 or the A7R3. And at that point I could see them going with the Sony over the Nikon any day, unless they want more robustness that is.

            • This is how I see thing too, but what do I know 🙂

          • AlexG

            I will add to those things you named, the lenses, as Nikon failed to develop a complete dx lens line, additionally they now selling lenses priced way up than Canon counterparts, atleast here in Europe and the fact that their D850 still has a ridiculously high price compared to competition and to what the D8xx line used to have, again here in Europe.

      • ZoetMB

        No question that they’re fantastic products. But they’re not selling. So either in spite of their greatness, the market doesn’t care -or- Nikon does really lousy marketing.

        • Aurelie

          DPReview had a new D850 article pretty much every day for weeks on end. There wasn’t a tech site that didn’t report on this camera.

          Yet they managed to sell very few. Most people simply do not have the money, or are not willing to spend the money, on these type of cameras. Especially not when most have a smartphone that is good enough.

          This focus on the high-end market instead of going for mass market is going to come back and bite these companies in the behind.

          You can not rely on baby boomers with disposable income, you need new customers to keep a company afloat.

          • Neutron

            Production of d850 doesn’t seem to satisfy needs until very recently. I am not surprised that they are unable to sell in large quantities.

          • Davidvictormeldrew Idontbeliev

            Yep most of the baby boomers have and want more- they may have more income coming in but may have more going out, e.g., increasing costs in the shop, energy bills, etc – trying to make ends meet and trying to get on housing ladder.

            The luxuries that they want – a) either go out of the window b) go for second hand produce c) go for alternatives to DSLR like smartphones d) bang as much on credit like deluxe cars and high end mortgages with the hope that life doesn’t bite back.

            Not sure the answer is for these camera manufacturers like Nikon and in the end I don’t really care as it is not my problem and I can do for time being with what I’ve got.

          • sandy

            Yet they sell very few. Proof or ignorance.

        • The D850 is selling well. What is not selling is consumer DSLRs.

          • Yes, I think even the D7500 is not selling. The D3xxx and D5xxx are basically dead. This is why I said that the future of Nikon will be in expensive, high end gear.

            • Davidvictormeldrew Idontbeliev

              Although Canon, Fuji, Sony do still have a presence in the lower end like RX10 / RX100, entry level mirrorless (M100) so they must be doing something right.

              Hopefully the Nikon 2 will improve Nikon’s fortunes and they be able to grow – increasing young blood and new users to their system.

            • jmb2560

              Peter: I am glad to see that you have drastically changed your mind on the topic. Less than a year ago, I wrote here (I have yet to find my post) that Nikon should move to high-end, possibly larger format and focus on margin instead of volume. You replied that for Nikon to remain relevant, the focus should be on a successful high volume mid-range DSLR.
              Nikon is not Canon: high-volume mid-range is not in the company DNA. But Nikon is not Leica either. Leica is the Prada/Vuitton/Hermes of photography. Leica sells very well in China, Russia, and generally well in places where you find Bentley and Rolex dealers. You don’t buy the SL or the M10 when you shoot thousands of images per year. You buy a “red round logo” that fits well with your Birkin or Kelly handbag. Nikon’s major issue here will be to position the brand at a different level. It does not happen overnight.

              If any Marketing exec from Nikon read this post: Have a look at the bible of brand positioning “Positioning, the battle for your mind”. it’s all there!

            • Could be, but you have to agree that also a lot changed since – the D3400 and D5600 were a joke, the DL were canceled, the Nikon 1 is probably dead while the D850 and D500 were one of the best cameras ever made. Add the new $12k+ 180-400mm lens and you can see why I changed my mind. Nikon cannot even upgrade the very popular P900 Coolpix camera!

            • jmb2560

              Your recent post about lens compatibility (or lack of) even with recent bodies is also worrisome. Add to that an upcoming mirrorless which according to some made be focusing on the mid-range market and you have a disaster in the making. Hopefully if am too pessimistic.

            • The reality is that we are all just guessing. Nobody here knows what Nikon’s plan is and what are the reasons behind this plan.

            • PhilK

              When people say the D3xxx and D5xxx are “dead”, I think we should probably have some perspective here.

              Even at “dead” status I’ll bet the D3xxx and D5xxx outsell the D850 by a factor of 4 or more.

              Pity we will likely never see the actual numbers on that unless an Amazon or Walmart insider violates an NDA.

            • I don’t think the latest D3400 and D5600 models sold at all – they only offer Snapbridge as an update from previous versions. If you are talking about all D5xxx and D3xxx models I agree with you.

  • Aurelie

    Wait, I thought Nikon had it all figured out.

    You mean to tell me that raising prices on cameras and lenses to $6000+ doesn’t magically translate to more revenue? You mean to tell me not everyone is rich?!

    • Lou Rivera

      A D1 cost $5,130 in 1999
      A D5 costs $6,496 in 2018
      A D800 cost $2,999 in 2012
      A D850 costs $3,296 in 2018

      Not sure where you’re getting the rising prices perception from.

      • Aurelie

        >shows increasing cost
        >says there is no increasing cost


        • Aurelie
          • Roger S

            Thanks for this reminder of contemporary economic reality, which clearly creates challenges for companies offering expensive products (as well as challenges for most people just trying to get by from month to month).

          • TurtleCat

            That’s a non-sequitur. What people have in savings, which is an estimation game anyway, is not really relevant to the price of a camera.

        • Roger S

          Yes, but over a period of almost two decades.

        • Lou Rivera

          Apparently you’re not familiar with the concept of inflation. The 2018 D5 is actually cheaper than the 1999 D1 adjusted for inflation.

          • For sure. Even the D850 close enough to the D800 adjusted for inflation as not to matter.

        • PhilK

          According to the US Government’s Consumer Price Index calculation of dollar inflation over time, that $5130 for the D1 in March 1999 would be equivalent of $7664 in December 2017.

          Looks like your argument failed.

  • Aurelie

    Nikon’s lithography business is also dead in the water. They tried to sue ASML and Zeiss and ASML countersued.

    ASML’s EUV is being brought online in 2018-2019 by Intel, GlobalFoundries and TSMC, it is going to crush the remaining lithography tech Nikon has left. Nikon’s tech is incapable of doing 7nm nodes, while EUV will bring nodes deep into 3nm territory.

    • marymig

      Yes, that is a serious issue.

    • PhilK

      Amazing what you can do sometimes by building a consortium of dozens of companies and outsourcing production, to compete with one single company that does it all in-house.

      • goldilocks

        ASML isn’t a consortium. They also don’t outsource, unlike Nikon.

        • PhilK

          That is absolutely not what I have researched about that company in the past.

          As just one example, it is my understanding that Zeiss is the provider of the optics (and optical patent portfolio) in ASML equipment. Unless ASML owns Zeiss, ASML is absolutely not a vertically-integrated company the way Nikon is in photolithography equipment.

  • Connor
  • Wow, the world has changed. Over a twelve year production cycle, Leica produced 220,000 M3 cameras. Arguably one of the great cameras of all time. Many are still in service. Nikon sold 850,000 DSLRs in a single QUARTER, and that was off from the 1,000,000 sold in the same quarter the year before.

    • Lou Rivera

      Lots of clowns on this page…

      • John Hardy

        NikonRumors needs a new site called NikonBusinessAnalystRoleplay.

        • Lol 🙂

        • PhilK

          One of the mobile platform sites I used to spend time at had a special forum section called “Armchair CEO”.

          I think this needs to become standard. 😀

          • Davidvictormeldrew Idontbeliev

            On one hand it is good to discuss with people with different / same view points and In the end it doesn’t matter, CEO of manufacturer X will do what’s in the best interest of the company, shareholders, etc. At least being an Armchair CEO it doesn’t matter if Company x gets into trouble or has a bad form of luck, e.g., Samsung Galaxy Note 7 overheating and battery issues, poorer than anticipated sales – it’s not my problem or my health and ££/$$ on the line

      • Michiel953

        Jerks too.

  • Kob12

    With all the doom and gloom on this Comments page, the market sees Nikon in much more positive terms:

    Today quotes:

    7731:JP (NIKON): +2.97%
    Sector Technology: -4.02%
    Industry Hardware: -4.48%

    • Thom Hogan

      Dividend increase.

      • PhilK

        And if that increases the capital available to the company, then bully for them.

        The stock market is an ephemeral nonsense-generator anyway.

        • Thom Hogan

          Overall, the asset/liability ledger has shifted slightly towards liability, at least after the dividend is paid out. I’m particularly interested in the increase of pre-payments Nikon is receiving.

  • Davidvictormeldrew Idontbeliev

    Have to say some excellent posts and very intelligent responses – like being around this forum learning more and sharing views with fellow specialists

  • James Fennessy

    The D850 must be great for profits and revenue. That body, and the big FL primes, are great and kept me with Nikon when I considered switching. However, the new 180-400 is not going to help. I was eagerly waiting for that lens to fill the gap between my great 70-200 FL and my 600 FL, and yet I’m not going to buy this extremely heavy and overpriced monster. One of the great things about the new FL lenses was their 25% weight reduction (with improved optics) over the old glass. Yet the new 180-400 is significantly HEAVIER than the old 200-400, at about double the price. I will be sitting out this new lens, waiting for Sigma to fill that gap (my 200-500 just isn’t quite as sharp as my other Nikon glass).

    • ITN

      Canon’s 200-400 (which uses fluorite of course) was similarly priced (launch price) and is heavier than the 180-400 Nikkor yet apparently successful. Probably the reason for the success has to be experienced by using the lens. The FL design makes the new Nikon 180-400 less front heavy than the Nikon 200-400 so it may be easier to handle despite the increased weight.

      • James Fennessy

        The new 180-400 is going to be far heavier, and thousands more costly, than both its predecessor 200-400 and the 500mm f4 FL. Its more expensive than my 600 f4 FL, and just about as heavy. Yes, it’s 3% lighter (and 12.7% more expensive) than Canon’s equally inefficient 200-400, but I wouldn’t buy either of them. I generally buy all Nikon, was waiting to buy a lighter $10K version of the old 200-400, and Nikon didn’t deliver. Canon does offer a lightweight and sharp 400 f4 that I wish Nikon offered, or someone would build for a Nikon mount.

  • Tom Taubert

    Kudos to Nikon for living another day.
    Apple , Samsung, and Google are not about to sit on their hands and let customers drift away from their embedded cameras to mirrorless dedicated cameras at the expense of their sales.

  • br0xibear
  • RC Jenkins

    Just because it’s interesting to compare, take a look at Fuji’s recently announced Q3 numbers as well (also for overall imaging business):

    ::Revenue – 116.0 Billion (-5.3% YoY)
    ::Operating Profit – 16.2 Billion (+95.2% YoY)

    ::Revenue – 297.7 Billion (+15.6% YoY)
    ::Operating Income (Profit?) – 50 Billion (+76.1% YoY)

    • Allan

      I don’t see the number of cameras and lenses sold this period compared to previous periods.

      • RC Jenkins

        Yes, I don’t know if they posted it in their report–I’m just going on the screenshots in the article.

        A majority of their revenue (72%) was from the Instax system.

        It looks like about 20% (24.6 Billion) was their digital cameras, like the Fuji X, Fuji G, and compact systems.

        And it looks like Nikon’s equivalent “imaging products” was around 116 Billion, or around 5x larger than Fuji’s.

        It will be interesting to track how these shift over the next few years.

  • MonkeySpanner

    No one knows anything yet about the mirrorless that is supposed to be coming?

    • AYWY


      Countdown 18-days to CP+ in Yokohama.

    • Yes, this usually means it’s not coming soon, but I could be wrong.

      • AYWY

        I hope for a repeat of the D500. Surprise announcement in Jan and shipped in March.

        A surprise announce in CP+ and ship in May is possible.

        At least for me, i may be picking up an M5 or Fuji, or whatever APS MILC Canon/Sony may unveil in CP+ if there still isn’t any news.

  • PhilK

    The intermediary in either case should be something local – eg close to the camera using a reliable communications link of some kind, wired or wireless.

    Or else the camera will be continuously bogged-down managing file uploads to some either far-away or unreliable end-point that requires continuous network “babysitting” to make sure each file transfers properly over that slow/unreliable link.

  • Gabriel Schwartz

    Maybe if D850 was in stores Nikon would have make more revenue.
    The short supply of this camera 6 months after it was released if pathetic.

    • I agree, this is getting ridiculous. It’s only in the US as well.

  • Azmodan

    Great news to see both Canon and Nikon doing so much better this year. We need them both healthy to keep smashing each other. Now to make mirrorless that puts Sony on the back foot.

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