In the first quarter, sales of interchangeable-lens cameras were down 19% to 850 thousand units. This reflects the combined impact of accelerated market contraction for DSLRs, in particular entry-level models, and economic slowdown in China, which is a sizeable market for interchangeable-lens cameras.

The habit of capturing images with smartphones with improved cameras has become a part of daily lives of consumers. As a result, the market for entry-level DSLRs is contracting at a pace that exceeds the outlook we had at the beginning of the year. That said, we expect the user base of professionals and advanced-amateur, people who value the image quality and expressive possibilities afforded by cameras with large sensors and an abundance of interchangeable-lenses to remain. For the market overall, however, we expect the trend of market contraction to continue for some time.

In light of these circumstances, we decided to reexamine our full-year projections for the market and our own unit sales. We now expect the market and our own unit sales to decline 17% to 8.6 million units and 4.2 million units, respectively.

Mirrorless cameras, known for being small and lightweight, are increasing their presence in the market. Amid this situation, we will steadily shift our focus from DSLR to mirrorless cameras with the aim of maintaining our overwhelming competitiveness, which we have built upon DSLRs.

From a profit perspective, in the full-frame sensor category where particularly high growth continues, even among mirrorless models, we will work to improve our product mix, actively expanding sales of both R System products. Additionally, for lenses with high profitability, we will not only promote sales of RF lenses, but also continue to promote the appeal of our broad range of EF lenses. Furthermore, we will work to expand automation initiatives not only to other products, but also other processes, raising our cost competitiveness and linking this to a recovery in profitability.