OEM loses ¥34.5 million ($441,000/€358,000) in Q1 2012, blames decline in demand.
Epson has reported a decline of 14.4 percent in sales for Q1 2012 compared to that of the same quarter in 2011, falling from ¥217.7 million ($2.8 million/€2.2 million) to ¥186.4 million ($2.3 million/€1.9 million), reports Channelweb.
The reasons for the decline have been listed as a slowing demand in most product categories, including printers and PCs; along with litigation costs, which led to a ¥13.3 million ($170,000/€138,000) loss for the company. A dispute was settled earlier this year regarding accusations against Epson and six other vendors of an LCD price-fixing cartel, costing the company $553 million (€449 million).
In an announcement Epson made to its investors, the company stated: “In Europe, the economy maintained a holding pattern due to factors such as high unemployment and uncertainty. In Asia, China posted growth on increased internal demand but saw the pace of expansion slow.”
“The printer business as a whole reported a decline in net sales [although] Inkjet printer unit shipments increased compared to the same period last year.
“Sales of consumables, on the other hand, declined. Unit shipments of large-format printers increased owing to growth of low-end models in Europe, the Americas and Asia. However, sales of higher-price models were sluggish, cancelling out the effect of greater volume.”
Despite the poor results, Epson stated that it is planning to continue its current three-year plan, aiming to build the company into “a community of robust businesses”, by “channel[ing] its collective energy into coping with a difficult business environment, including uncertainty about the financial future in Europe and a strong yen [and] to accelerate the speed with which it executes business strategies”.
Epson are not the only OEM to report poor quarterly results, with Lexmark reporting “weaker than expected” results and HP recording a shares fall of 1.9 percent as a result.