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Canon looks to OLED material in quest for new growth

As cameras and printers face headwinds, company shifts sights to display industry

OLED panels are becoming more common in smartphones and TVs.

TOKYO -- Canon is looking to start producing materials used in next-generation, flexible light displays in a bid to cultivate new business arenas as the OLED panels become more common in smartphones and TVs, its chairman said in an interview with Nikkei.

Canon currently uses organic light-emitting diode displays in mirrorless cameras. The panels are also expected to become more widely used in video production and medical equipment, given the shift toward high-definition imagery in these fields, fueling demand for materials used in the panels.

"We are considering producing OLED materials internally," Canon Chairman and CEO Fujio Mitarai said.

Further details, including the timing, still need to be ironed out. Canon's research and development team, along with subsidiary Fukui Canon Materials, are expected to take the lead on production. The materials will likely be used in OLEDs for Canon's own products.

The group also produces machines used in OLED-related production, and could tap sales networks there to sell the panels to outside clients. Canon Tokki, for example, has a high market share in vacuum deposition equipment.

Regarding Canon Marketing Japan and Canon Electronics, two subsidiaries currently listed on the Tokyo Stock Exchange, "there will be no need for a merger," Mitarai said.

Other Japanese companies like Toshiba are unloading or integrating listed subsidiaries in an effort to boost corporate governance. But Canon is "not considering changing things in terms of capital," Mitarai said, adding that he wanted the two units to become big players in their fields. Canon Marketing promotes products from both within and outside the group, while Canon Electronics is focusing on cutting-edge fields like space.

With mainstay products like digital cameras and printers facing headwinds, Canon's group net profit plunged 51% to a 10-year low of 125.1 billion yen ($1.16 billion) in 2019. 

Mitarai said he aimed to increase revenue from newer business fields to over 50% of the group total from about 25% by the mid-2020s.

To that end, Canon is investing heavily into sales networks for medical equipment and image analysis software for surveillance cameras. "If there is a good acquisition target, we'll jump on it immediate," he said.

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