Did Canon Just Acknowledge That Sony’s Aggressive Pricing Is Eating Into Its Profits?

Did Canon Just Acknowledge That Sony’s Aggressive Pricing Is Eating Into Its Profits?

Canon has just announced its financial results for the third quarter of 2019, and in line with recent performance, the news is not good. For the first time, the report seems to acknowledge that aggressive pricing by its competitors is having an impact.

Canon continues to cite a global economic slowdown, partly as a result of the ongoing friction trade between the U.S. and China, with Europe and China being worst affected. The report states that as a result, “net sales declined 6.2% to 869.5 billion yen, operating profit dropped 43.7% to 38.4 billion yen, and net income fell 42.7% to 26.5 billion yen.”

Notably, and perhaps for the first time, there is a hint that Sony’s aggressive pricing and release cycle might be having an impact. The report mentions “price competition surrounding higher-end full-frame models” as being one of the major factors in falling sales. It explains that the “energy that each manufacturer is putting into this segment” has intensified, and it’s always interesting to try and read the hidden meanings buried in these reports.

Sony certainly positioned itself very aggressively when it released the a7 III last year, with many customers realizing that the a7 line had matured to a point that it was genuinely a viable alternative to their pro and prosumer DSLRs. With adapters ready to help Canon users make the transition, the relatively low price made it an attractive option.

On top of this, Sony has adopted a system of incremental updates across its top-end cameras, offering new models that offer relatively minor upgrades, as seen in the Sony a7R IV. This has had a knock-on effect of pushing down the price of preceding models, such as the a7R III, which is currently available for less than $2,500. Given that this went to market in October 2017 at $3,198 and arguably still offers more than Canon’s EOS R, it’s understandable why Canon might be now feeling the squeeze.

While pro cameras are taking a hit, the report does note that consumer cameras are performing well and that total camera sales for 2019 are still in line with projections.

What are your thoughts? Will we continue to see Canon fighting at the top end of the market? Leave a comment below.

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Previous comments

I think Canon is lagging in FF resolution war, but not in the lens war. Their lenses are the best, but most expensive, for mirrorless. Once they release a very expensive FF EOS R whatever, then they'll be top of the game again. 4500? Probably...Add that to a lens and that's 7500?

Kevin Harding's picture

Personally I think it's naive for anyone to talk of one brand as being 'the best', whether we are talking cameras or lenses. They generally ignore the top of the line brands such Hasselblad, Phase One, Zeiss, Red and Leica. Obviously not talking about Mirrorless specifically.

However even if only talking about common 35mm brands (and yes mirrorless) then the fact is often ignored that depending on focal length Sony, Nikon and Canon all have market leading focal lengths and that not one dominates or has 'the best lenses'?

And that none of those three brands have lenses that can match Fuji, Panasonic or Olympus in their respective mirrorless formats (MF, APSC, 4/3s)?

As you may have gathered I hate generalisations ;)

Misinformed article author. All camera sales are down, Canon, Nikon and Sony. It's not that one is affecting the other. The only thing affecting could be the constant pumping of new cameras making purchasing decisions more dificult. Another greatly misinformed author comment is about Canons sales hacimg anything to do with the trade issues between the USA and China. All Canon cameras and lenses are made in Japan not China. All models including Powershots, Rebels and Pro DSLR's and Mirrorless cameras and all lenses including regular EF lenses, EF-S lenses, EF L Series lenses and RF lenses. So how is the China-USA trade issue affecting Canon? Anyone with a Canon camera or lens, any models, can look at them and see that they clearly state Made in Japan. Assumtions pave the way for bad journalism, get the facts before making an article, if not then it is just an opinion of the author and not a newsworthy article.

Andy Day's picture

The report directly cites aggressive pricing from competitors. The report directly cites USA China trade friction as having an impact on its profits.