The Japanese company - Canon has reduced the annual profit forecast due to weaker than expected demand for cameras in China and Southeast Asia.
The world's largest manufacturer of cameras and printers is expecting an operating profit for 2015 that will amount to 365 billion yen ($ 3.02 billion) against 380 billion projected three months earlier. The forecast on revenue decreased to 3.8 trillion yen from 3.9 trillion.
The company has also worsened the annual forecast on sales of compact cameras, to 6.5 million from 7 million. The forecast for cameras with interchangeable lenses is reduced to 5.5 million from 5.8 million.
The operating profit for the quarter rose 7.6 %, to 77.3 billion yen, while the consensus forecast of seven analysts polled by Reuters, anticipated 86.5 billion.
The lowering of the annual forecast for the market of cameras confirms the validity of the selected strategy by Canon for business diversification in favor of surveillance equipment.
Canon invests in more new businesses to be less dependent on the segment of compact cameras, forced out by smartphones, and digital cameras with removable lenses, the market of which is nearing a glut. In May, the company completed a deal to acquire 85 % of the Swedish Axis AB, a manufacturer of cameras for security systems, which, as Canon expects, is to bring it about 2 % of revenue this year.
Despite the decline, cameras still bring the Japanese company about a quarter of total sales, but sales in this segment are falling faster than expected, amid slowing economic growth in China and other markets, said Canon in a statement.
The Canon shares closed Tuesday's trading with decline of about 2.1 %, even before the announcement of quarterly results and forecasts, while the broader market index fell by 0.9 %.