New Olympus Financials @ Hogan's

Discussion in 'Olympus Cameras' started by D7k1, Feb 7, 2015.

  1. D7k1

    D7k1 Mu-43 All-Pro Subscribing Member

    Nov 18, 2013
    I love my EP5, but the new EM5 II falls just short of a buy for me (I want 4K video). I'm pretty much an Oly Fan Boy now, and hope the assumption that Olympus is in the camera business to developed optical tools is a correct assumption. The biggest thing I see wrong in Tom's report is the reported 4.7 month inventory levels. I bought my first Olympus -EPL1- when they were closing them out everywhere at very low prices. This new reported inventory level just seems so large (after all the manufacturers knew last year that the market's were either stagnant or still declining). I would think that these inventory numbers indicate another round of deeply discounted older models in the coming year. I see the price of the new EM5 II is $1,100 which really is not a bad price for such a camera (If I was buying a m43 camera this year it would be between the EM1, EM5 II, and the Pany Gh4. That the two Olympus cameras are in the same price range seems like a confused marketing plan unless a new EM1 II gets released soon, hopefully with 4K video. I was talking to a Panasonic regional sales guy the other day, and he said something that really seems to define the market, the video component is very small and we have that, in still cameras just about any camera is Good Enough, consumers I see are confused. If I needed a new m43 camera today that is exactly where I'd be and that is with 40 years of photography experience (including 15 in the retail end).

    I'm sure there will always be "advanced" cameras, but who is going to be in the last manufacturers standing is anyone's guess, I'm rooting for Olympus! This financial report shows some hope and some despair, I'm pretty much set for 5 years or so, but I think its going to be a wild ride during that time and consumer choices will be harder than ever.
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  2. TRCPhoto

    TRCPhoto Mu-43 Regular

    Dec 13, 2014
    Princeton, NJ
    Agreed. I love my EM1 and EM5 but do worry from time to time that in the not so distant future they'll announce that they've had enough and are tossing in the towel.
  3. OzRay

    OzRay Mu-43 Hall of Famer

    Jan 29, 2010
    South Gippsland, Australia
    Ray, not Oz
    Unfortunately, Hogan looks at nothing but numbers and so doesn't appear to see anything but a one sided result (always negative). Look at any industry and you'll see similar numbers for just about any manufacturer/product, but it doesn't mean that the brand/product is going under.
  4. KBeezie

    KBeezie Mu-43 All-Pro

    Sep 15, 2012
    Grand Rapids, Mi
    Karl Blessing
    Does he also factor in other markets the companies may be in? For example Sony makes a huge chunk of their money from insurance, at least in Japan.
  5. OzRay

    OzRay Mu-43 Hall of Famer

    Jan 29, 2010
    South Gippsland, Australia
    Ray, not Oz
    From time to time he does comment on how other divisions of a company are performing, but that's about it. Frequently he's only guessing about numbers and often I don't even understand what he's trying to convey, other than it's bad, bad, bad, from his point of view. He often comes across as a doomsday merchant.
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  6. KBeezie

    KBeezie Mu-43 All-Pro

    Sep 15, 2012
    Grand Rapids, Mi
    Karl Blessing
    It would certainly cause a lot of pageviews if you keep hinting at the fall of such and such. More pageviews than 'all is well' type of news.
  7. D7k1

    D7k1 Mu-43 All-Pro Subscribing Member

    Nov 18, 2013
    Yes, I agree the whole industry is under pressure and Tom does focus on the downward trend. I don't think the key to turn around is just have cameras that communicate though as he does. However having almost 5 months of inventory on had is not a good thing. Every industry has its ups and downs but its how mangers react to changing conditions that determines who will win and who will loss market share and/or profitability.
  8. wushumr2

    wushumr2 Mu-43 Regular

    May 20, 2013
    Thom has also given some decent insight into the players, for instance that Panasonic's CEO stated that any division making less than 5% ROI is getting cut. Yes, he leaves out context, but adding it might make things even scarier.
  9. getoutandshoot

    getoutandshoot Mu-43 Regular

    Apr 28, 2012
    SF Bay area, CA
    I like Thom. He calls it like he sees it, dishes out both positive and negative, and he has more insight than I on a lot of it. I can take what he says for what it's worth to me. For example he ripped on the E-M5II, but the stuff that bothers him doesn't bother me too much. The fact is that only Nikon and Canon have been profitable for quite a while, which is pretty sad. I think Thom would be the first one rooting for Olympus to do better. I believe he owns and uses an E-M1 currently. I own and use both Nikon and Olympus systems, and I am far more enthused with the products Olympus has given me! So I certainly hope they do better.
  10. sriracha

    sriracha ballistic photons Subscribing Member

    Jan 22, 2011
    Sony's imaging business at least is turning operating profit whereas Olympus is reporting losses (albeit decreasing yoy). Tom's report is not wrong or overly negative, he pretty much summarized what was on the earnings presentation written by management. the 3 year loss in Oly's imaging business has been subsidized by their Medical and Scientific Solutions business lines.

    investors are usually ok with a 2-3 year business line operating loss if companies are investing in a new(er) area. problem is that Oly has been in this restructuring / turnaround mode for a long time AND is forecasting a 4th consecutive operating loss. usually two general conclusions can be drawn: they over invested / lack efficiency or management has no clue what to do with the business.

    given all their prior accounting and financial issues i tend to think it might be the former. their recent Air product with open SDKs is actually intriguing. however releasing for Japan only worries me as the US has far more vibrant developing business than Asia... which kinda makes me think their is probably an internal struggle between old guards (who decided to release in Asia) and new product guys (who came up with the camera-as-a-platform idea).
  11. bikerhiker

    bikerhiker Mu-43 All-Pro

    Dec 24, 2013
    Sadly though, the camera sales is shrinking and many dealers are still sitting on old inventory. I mean old means 1 and sometimes 2 generation behind sitting on the shelves. Unfortunately though, the camera industry is like the old personal computer industry and it is ripe for some consolidation or attrition. We all know what happened to Atari, Commodore, Texas Industry, Tandy etc... They were the ones that looked innovative, but unfortunately succumbed to industry consolidation. Today, we are left with PC and Mac.

    Tom always like to sell bad news. That's how newspaper make money; in selling bad news. No one is going to pay and read good news, so he's just following the prescribed winning formula that papers had been using for ages. Except that now it's online blogging. I like what Tom is saying and I tend to understand his point of view; except that it's hard to see why people say Olympus isn't innovating. The new 5 axis IBIS is something Olympus has a good handle on and all lenses benefit from it; unlike Sony, Panasonic, Canon and even Nikon where you have to get into the $5000 to $20,000 lenses to get the latest Sport VR feature that is available for $1100 on the E-M5 II, something Tom neglects to conveniently mention. Isn't that innovation to bring benefits like this to the masses?!? The pixel shift 40MP while limited brings high resolution imaging to a $1100 body with the ability to eliminate moire and false colors. A body similar like this would be the Sigma SD-1, but that was a flop. The Nikon D810 is a $3000 + body and a Sony A7R is a $2500 + body and both of them don't have IBIS and you need expensive lenses to have the same IS capability as the IBIS in Olympus; meaning you need to invest more money.

    While the E-M5 II is all good, it doesn't address the fact that it is selling in an environment of ever shrinking camera sales. I predict that 2015 will continue to experience the same camera sales contraction as 2014. You can see it with Canon pushing out the 50MP EOS 5DS as this almost a cry of we're running out of ideas why people don't buy real cameras anymore!?! What good is 50MP when most of our displays are on smartphones and only a 2MP standard 1080p? Most of us don't have 4K nor 5K iMac and even then it's only good up to 14MP. We are almost repeating the same scanner industry where scanner makers kept pushing out scanners that claim to scan and output 10,000 dpi and claim we can see a big difference. But of course we can -- in our imagination as somehow our eyes can resolve more than 300 dpi. And somehow our ears can resolve more than 20,000 Hertz or way way below 20 Hertz. If 50MP isn't enough, then the next full frame would be 80MP from Nikon or Sony.

    So you see, the time for consolidation and attrition isn't far. Typically, history had shown that the big sensors loose out against the smaller platform. This is why we don't see a lot of view cameras. And this is why 35mm had displaced medium format as the most mobile landscape platform and caused many European medium format makers to close shop. Today, it's probably the iPhone and Android that may kill the traditional industries. The Japanese is a little stubborn sometimes. They focus on hardware, when in fact today, it's software UI and apps like instagram, facebook and flickr that counts!!

    More gloom and doom I suppose and expect insane megapixel as we move forward to no end. Sighh!
  12. broody

    broody Mu-43 Veteran

    Sep 8, 2013
    Mirrorless has pretty much no penetration in the U.S. Sadly I can understand Oly's stance here, they've been gaining ground on Sony at home, and are growing in Europe and Asia, there is nothing for them to gain in America.

    At least the camera industry crash is putting serious pressure on manufacters who release substandard products. Oly's PEN line went down in flames after they refused to fit it with EVFs (Fuji gladly took their customers away), and they were forced to give video a serious look. Panasonic was seriously pressured after years of lagging behind in tech, and they stopped playing around with outdated sensors and cheaply made bodies, giving us the GH4/GX7/GM1/LX100.
  13. Jonathan F/2

    Jonathan F/2 Mu-43 Hall of Famer

    Aug 10, 2011
    Los Angeles, USA
    I was at photo meet here in LA with several hundred photographers, and DSLRs are still king. This meet also had a demographic of young 18 to 30 year olds and I barely saw any mirrorless cameras. Basically they either use their phone for quick snaps or use a DSLR for more serious photos. Mirrorless occupies that gray area which seems to be a hard sell in N. America.
  14. gryphon1911

    gryphon1911 Mu-43 Hall of Famer

    Mar 13, 2014
    Central Ohio, USA
    Mirrorless cameras have a hard sell in N. America because of perception from marketing. Nikon and Canon have so indoctrinated the masses on what a camera should look like. Not to mention we Americans as a culture tend to believe that bigger is better.

    The first sets of mirrorless cameras came out and they looked like the point and shoots. No one is going to take that seriously. Panasonic G/GM, Oly PENS, Fuji X cameras all came out and no one really cared.

    Then, Panasonic and Olympus started making the GH and the OM-D lines and they do better because photographers serious about their craft understand the importance of an actual viewfinder and how it is more than just about seeing better in bright light. Client perceptions also have some influence. Don't want to show up to a photo shoot with a Canon Powershot.

    They finally get it, but we may be in the precarious situation where the big 2 might just be able to hold out long enough to win a war of attrition. The other side of that is that the mirrorless offerings could stick around long enough that we will eventually start getting a hybridization of mirrorless and DSLR. It's hard to predict these things, the market can be fickle.

    I know of a lot of pro's who dropped their DSLRs and went mirrorless....but they also went up to medium format as well.

    The market right now is just down right weird, honestly. lol
  15. Canonista

    Canonista Mu-43 Top Veteran

    Sep 3, 2011
    This is no different than in the film camera days. It required the next big technological advance to revive camera sales, whether that was automatic exposure, auto focus, image stabilization, and finally digital imaging. Along the way, some camera mfrs succumbed, either closing shop, or being acquired by others.

    Whether Olympus is absorbed into Sony, or Panasonic sells off its camera division to Ricoh/Pentax, does not bother me. My only concern is that the micro four thirds format survives and continues in good health so that I can upgrade my gear or replace them as they wear out.

    So folks, keep that GAS coming, and churn your gear!
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