Japan’s Canon said Wednesday that it missed its full-year profit target due to slumping demand for its digital cameras as consumers increasingly turn to smartphones for taking pictures.
The company reported that net profit rose 2.6 percent last year to 230.5 billion yen ($2.2 billion) thanks to a weak yen and cost-cutting efforts, but that figure missed an earlier prediction for a 240 billion yen profit.
Revenue rose 7.2 percent to 3.7 trillion, while Canon said it logged a 4.1 percent rise in operating profit to 337.3 billion yen.
Unlike many Japanese firms which report on a fiscal year ending in March, Canon reports on a calendar-year basis.
Rising profits were mainly due to “the effects of ongoing cost-cutting efforts along with the depreciation of the yen,” it said in a statement, adding that it saw “steady sales growth for office multifunction devices and laser printers”.
Japanese exporters have benefited from the yen’s sharp decline over the past year as it inflates their repatriated income and makes them more competitive overseas.
Canon and Japanese rivals including Sony and Olympus have seen a big drop in demand for their digital imaging products as camera-equipped smartphone sales boom.
For 2014, Canon said it expected to earn a net profit of 240 billion yen and an operating profit of 360 billion yen on sales of 3.85 trillion yen.
Earlier in January, Canon said it was looking to ramp up capacity at home as it anticipates a further slide in the yen to make domestic manufacturing cheaper.
Canon had shifted camera and photocopier production abroad as the yen soared in the wake of the 2008 financial crisis making Japan-made goods expensive overseas. It is now set to reverse that move as it banks on the prime minister’s economic stimulus plan, known as Abenomics, to push the yen below pre-crisis levels.