Nikon cans DL cameras, announces big loss

Nikon Corporation has cancelled its DL series of premium compact cameras, the DL18-50 f1.8-2.8, DL24-85 f1.8-2.8, and DL24-500 f2.8-5.6, and announced an extraordinary loss of $342 million (30 billion yen) for the nine months to December 2016.

The DL series was to be launched in June last year. ‘However, with the identification of issues with the integrated circuit for image processing, release of the three cameras was delayed indeterminately,’ the press announcement stated.

‘Since then, everyone involved has worked very hard to develop products with which our customers will be satisfied. However, it has been decided that sales of the DL series will be cancelled due to concerns regarding their profitability considering the increase in development costs, and the drop in the number of expected sales due to the slow-down of the market.’

(The reference to the ‘slow-down on the market’ is challengable. Premium, 4K-capable fixed lens cameras such as the Sony RX series are if anything a bright spot in an otherwise depressed compact market. In its annual report, Canon mentioned its G-series as good sellers in 2016.)

‘We sincerely apologise to all those affected by this decision, especially those customers who waited so long for the cameras to be released, retailers and others whose business will be affected, for the inconvenience this decision may cause.’

The three cameras used a 1-inch  (12.8×9.6mm) image sensor also used in the Nikon 1 series.

While the DL cameras have been cancelled, the news is also bad for the KeyMission line of action cameras which Nikon launched in 2016, with the company referring to substantially slower sales than predicted in its financial report.

For the first three quarters, sales of Nikon cameras and lenses are down 23 percent while operating income is down 9.4 percent compared to April-Dec 2015.

Nikon has been running a voluntary redundancy program to ultimately reduce costs. However, expenses related to this program will create another extraordinary loss of around $190 million for the final quarter of Nikon’s financial year.