Nikon Posts Big Losses and Cuts Projections

Nikon posted its third quarter FY2025 financial results, and there is a lot of red ink. Nikon’s revenue is down 28.7 billion yen, nearly $183 million, year-over-year for the first three quarters, and the company has recorded 103.6 billion yen in losses, nearly $660 million, so far this fiscal year.

While a majority of those losses can be attributed to foreign exchange effects and impairment losses on non-financial assets, Nikon also cites reduced sales as a contributing factor. While the losses outlined above are bad, looking only at the third quarter paints an even worse picture. Operating profit for Q3 alone was negative 98.8 billion yen, or just over $629 million.

On the plus side, Nikon’s Imaging Products Business at least was in the black, but both revenue and profit declined year over year. Nikon blames some of this on a decline in average selling prices for its imaging products and higher-than-expected marketing costs, both the result of increased competition in the imaging space.

“In the Imaging Products Business, sales were led by Nikon’s first digital cinema camera the ZR. However, the business segment recorded year-on-year decreases in both revenue and profit, reflecting a decline in average selling prices due to changes in the product mix and higher promotion expenses amid intensifying competitive environment, as well as the effects of foreign exchange movements, tariffs, and other factors,” Nikon explains.

Nikon maintains that the digital camera market has “mid-to-long-term strength,” but notes signs of slowing growth in emerging markets. Even though Nikon’s imaging products business isn’t actively losing money, unlike some of its other segments, it reported operating profit 11 billion yen below expectations, which is $70 million at current exchange rates. That’s a significant dip, nearly a 35% decrease compared to the company’s forecast last fall.

Nikon believes that the Z5 II, Z50 II, and ZR will deliver strong overall sales. Nonetheless, Nikon has decreased its projected camera sales for this fiscal year from 950,000 to 900,000 units and decreased expected lens sales from 1.4 million to 1.3 million.

From FY2022 until now, Nikon’s camera sales have not increased overall. Lens sales have trended upward, but not by a significant margin. The company’s sales have plateaued despite Nikon releasing numerous fantastic cameras and lenses.

Nikon’s Imaging Products business unit is fundamental to the company’s overall financial health and well-being, accounting for nearly half of Nikon’s total revenue.

Although Nikon’s stock price has rebounded a bit since it released its financial results, the stock has dipped overall this week. Nikon also announced that, due to worse-than-expected financial results, the company’s chairman/CEO and president/COO will not receive bonuses or performance-based stock compensation at this time.