Sliding Mirrorless Camera Sales Could Be the Final Straw for Nikon

The technology was supposed to lure in 'prosumers

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Sliding Mirrorless Camera Sales Could Be the Final Straw for Nikon

Nokia, for one, is trying to build an identity around itself as the builder of Windows 8 smartphones made for photographers, emphasizing the camera capabilities of its Lumia line. The company’s latest offering, the Lumia 1020, packs a 41MP camera with 6-element lens, optical image stabilization and a Xenon flash.

Plus, Samsung (SSNLF) just released the Galaxy S4 Zoom, a smartphone with a 10X optical zoom lens that eliminates one of the digital camera’s remaining advantages over smartphones.

One of the smarter players in the camera industry these days just may be Sony (SNE) — yes, that Sony.

The company has its own digital cameras, including the Alpha professional line (a DSLR equivalent), NEX mirrorless cameras and Cyber-shot compact cameras. It’s made inroads against Canon and Nikon in selling premium cameras in recent years, but has also been actively developing camera technology for smartphones — and not just its own Xperia.

Apple’s iPhone 5 — which was arguably the most anticipated smartphone of 2012 — uses a Sony camera sensor. And now Sony is prepping a pair of all-in-one camera lenses that combine a big image sensor, optical zoom lens and processing inside a self-contained unit that snaps onto smartphones, using the smartphone display for framing and review.

In other words, it’s “prosumer” quality but also tiny, integrated with your existing smartphone, can be migrated to future devices and is removable if you don’t want a lens permanently sticking out your phone a la the Galaxy S4 Zoom.

Smart.

That brings us back to Nikon. The bottom line: The company is having problems and they’re only going to get worse. This year started out okay, but shrinking sales in all segments (including DSLRs) paint a much uglier picture.

After a forecast of decreased demand and falling prices in February, Nikon’s stock took a 19% plunge (the largest single day hit it’s taken since 1985). In early August, the company released revised profit expectations based on lower sales, causing Nikon’s stock dropped 14%. Nikon is now down 40% on the year.

Plus, while cameras are just one division for Sony and part of a product mix that includes printers, scanners, projectors and medical equipment for Canon, Nikon is highly dependent on camera sales. Its Precision Equipment business is small potatoes, shrinking and according to its August earnings report, currently running at a loss.

With continually eroding compact camera sales, DSLRs under price pressure and now mirrorless cameras beginning to lose ground in a big way to smartphones, camera manufacturers like Nikon can’t sit still or they could become the next Kodak.

As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.


Article printed from InvestorPlace Media, http://investorplace.com/2013/08/nikon-and-cameras/.

©2014 InvestorPlace Media, LLC

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