Epson reported revenue for the first quarter was ¥314.8 billion ($A3.35 billion), an increase of 5.7% year-on-year, while overall business profits were down 31% year-on-year. "Revenue in the commercial and industrial printing business sharply increased."
Epson Monna Lisa ML-8000 textile printer
“The global economy in the first quarter of the year under review showed stronger signs of a global economic slowdown, with ongoing high inflation and the tightening of monetary policy by countries around the world,” Epson said.
“The slow pace of economic recovery in China has had a particularly significant impact on the global economy. Meanwhile, although US consumption has thus far remained firm, there are growing concerns about an economic downturn in Europe and North America. Moreover, the economic growth rate in emerging countries is also decelerating. Looking at the situation by product market, the device market, and the semiconductor market in particular, has entered an inventory adjustment phase due to a decline in demand since the peak, and the market situation is deteriorating. As for the future, risks such as high global inflation and a protracted economic slowdown are ongoing, and the future is clouded by uncertainty. Epson will continue to closely monitor trends moving forward.
“The positive effects of a weaker yen helped to boost revenue to ¥314.8 billion, an increase of 5.7% from the prior-year period, with the printing solutions and visual communications segments the primary beneficiaries. Business profit was ¥15.5 billion, down 31.1% from the prior-year period, because the positive foreign exchange effects of a weak yen were more than offset by a sharp drop in revenue in the microdevices business. Profit from operating activities was ¥19.7 billion, down 36.8% from the prior-year period. Profit before tax was ¥28.2 billion, down 23.7% from the prior-year period. Profit for the period attributable to owners of the parent company was ¥20.1 billion, down 24.3% from the prior-year period.
Printing Solutions Segment
"Revenue in the office and home printing business increased. While unit sales of ink cartridge printers sharply decreased, inkjet printer revenue increased. Revenue benefitted from an increase in unit sales of high-capacity ink tank printers in emerging markets, growth in sales of office shared inkjet printers with the launch of high- speed linehead inkjet multifunction printers, and positive foreign exchange effects. Sales of inkjet printer consumables increased owing to growth in sales of ink cartridges, ink bottles for high-capacity ink tank printers, and ink for office shared printers.
"Revenue in the commercial and industrial printing business sharply increased. Commercial and industrial inkjet printer revenue increased despite a decline in unit sales in Europe and North America, where investment demand fell along with rising interest rates. The increase in revenue was the result of a rebound in demand in China from the prior-year period, when China was still under the country’s zero-COVID policy, and positive foreign exchange effects. Sales of consumables for commercial and industrial inkjet printers increased due to a combination of positive foreign exchange effects and sales growth from the prior-year period when ink demand from major customers in North America decreased. Small printer sales increased sharply compared to the prior-year period, when sales were impacted by supply constraints.
"The printhead sales business recorded a sharp increase in revenue primarily owing to increased demand in China.
Segment profit in the printing solutions segment increased due to a combination of dynamic pricing, fixed cost control, and positive foreign exchange effects
.
"As a result of the foregoing factors, revenue in the printing solutions segment was ¥215.1 billion, up 8.8% from the prior-year period. Segment profit was ¥22.3 billion, up 6.0% from the prior-year period.
"Epson revised the 2023 fiscal full-year financial outlook based on changes in its assumptions about the business environment. The company expects demand will be lower than initially expected due to inflation and other factors that are causing hesitancy to buy and invest. Inventory adjustments are taking longer than expected in the microdevices market, and the outlook also reflects this."
