It is almost a case of smartphone killed the camera star, as camera manufacturer Nikon announced that they would be pumping almost $2 billion dollars into mergers and acquisitions in order to expand the company’s medical devices unit.“Merger and acquisition will account for a large part of the initial sharp growth in the medical business. There is a huge potential in this business,” said Kazuo Ushida, Nikon’s soon-to-be CEO.
The move comes as Nikon revealed that their imaging and camera businesses has been taking a sharp decline in sales, as consumers prefer to take photos with their smartphones over a SLR or digital camera.“Of the markets related to the business, the situation for the Digital camera – Interchangeable Lens Type market worsened, mainly in Europe and China, and the compact digital camera market shrank drastically as well, leaving both markets in a challenging business climate,” the company said in their financial results presentation in May.
The only foresee a 2.1% growth in their imaging products business over the next three years, while aiming to reach $1.28 billion in revenue from the medical units – that would account for almost 11% of their total revenue target. In the previous year, net sales in their camera business decline 8.8%.According to Wall Street Journal, Nikon is making similar moves as some of its largest competitors.“Nikon’s health-focused blueprint for growth mirrors a series of other technology companies, including Toshiba Corp. and Hitachi that are betting big on rising medical needs as revenue from traditional electronics products tapers off. Rival Canon Inc. also has beefed up its R&D spending on medical devices,” they wrote.This comes after Nikon revealed in May that they will be undergoing a reorganisation of their corporate structure and change of director assignments on the back of Nikon’s stocks slumping to their lowest levels since 2011. Adding to their woes, they had to set aside $17.7 million for warranty reserve to cover the cost of repairs and replacements of the D600′s sensor debris build-up.
