Recently we shared the second quarter financial results of Fujifilm (in Japan the fiscal year starts in April and ends in March)
The numbers were actually good:
Imaging achievements. The sales of instant photo systems and digital cameras were strong, with revenue up 19.5% YoY to JPY219.2 billion and operating income up 85.5% to JPY49.4 billion.
But despite that, the growth was not as strong as Fujifilm hoped for.
Hence, in a Q&A session discussing the financial results, the Fujifilm CEO (Mr. Goto) and the Vice President (Mr. Higuchi) were asked about the reasons for that.
Shibano [Q]: I would like to ask President Goto about Imaging. Since President Goto took office, I believe you have often expressed your strong belief in the potentials of Imaging. In fact, the strong performance of H1 of the fiscal year indicates this, but the operating income for H1 was JPY49.4 billion, and even though Q4 is usually weak, there is Q3, so H2 of the fiscal year, which includes the sales season, is expected to see a 387% decrease, or even a 17% decrease YoY, which is a little questionable. I would like to ask again if there is any specific reason for such a decline, worse than the previous year, in H2. This is the point what I would like to reconfirm.
Higuchi [A]: Regarding H2 of last year, we closed our U.S. plant in H2 of last year, and there was a one-time profit. One reason is that we don’t have it in this term. Another is that we have increased development costs for new products in H2 in order to continue to introduce new products without interruption, and we have also increased marketing expenses and marketing investment.
Goto [A]: I will continue with my answer. Now, we are looking at Black Friday toward December, the biggest sales season in the U.S. at the end of November, and the purchasing situation, or rather the movement, is on par with the previous year, but the voice from the person in charge is that inflation in the U.S. is high. We have heard that it is not clear whether it will be as good as the previous year. However, in fact, given the tight demand for INSTAX film and the fact that cameras are selling well if they are made, I believe that there is room for a bounce upward, although we are taking a firm stance now. Is that all right?
Good thing first: one reason why the profit was not as strong as hoped, was that Fujifilm has allocated lots of resources to increase development and marketing expenses in order to assure “to continue to introduce new products without interruption“.
Of course the managers talk about R&D money for Instax as well as digital cameras. But it’s great to hear that overall they keep investing more money to push development.
Also worth to note is the comment of Fujifilm CEO Mr. Goto, who says that “cameras are selling well if they are made“. And this is probably Fujifilm’s biggest issue so far, with lots of cameras out of stock and in many cases even a complete suspension of camera sales in certain countries until who knows when.
The CEO says the hope is to “bounce back” thanks to Black Friday sales, although inflation is still high and it is not sure if the holiday season will run as good as last year.
And in this regard, here are the current deals you find on X/GFX gear that should help Fujifilm to show up with better figures by the end of the fiscal year.
GFX Gear
X Cameras
X Lenses
Fujifilm Q&A here
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