(Corrects dateline to Oct 27)
* Q3 operating profit falls 21 pct to 71.8 bln yen
* Steep fall had been flagged by Nikkei business daily
* Investments in new businesses also weighed on profit
* Full-year earnings forecast lifted on weaker yen
By Sophie Knight
TOKYO, Oct 27 Japan's Canon Inc said
quarterly operating profit fell by a fifth as demand for digital
cameras slumped and it spent more on developing new businesses,
but it nudged up its full-year earnings estimates on a sharply
The consumer shift to smartphones for casual photo taking
has pummelled demand for compact cameras, while the growing
popularity of lighter mirrorless cameras has taken away market
share from higher margin single-lens reflex cameras.
Operating profit for the July-September quarter came in at
71.8 billion yen ($665 million), not far off figures flagged by
the Nikkei business daily earlier this month.
Investments to boost businesses such as video surveillance
and semiconductor steppers also helped to outweigh a 11.4
billion yen contribution from a weaker yen, a company spokesman
Revenue fell 4.5 percent to 872.2 billion yen.
The export-reliant company lifted its operating profit
forecast but it acknowledged that but for the weaker yen, it
would have revised down.
It now expects 370 billion yen for the year to end December,
up from a prior prediction of 365 billion yen and a 9.7 percent
increase on the previous year.
While a softer yen boosts earnings for export-oriented
companies, the Japanese currency's rapid descent against the
greenback - around 8 percent over the July-September period -
has driven up import costs and prompted complaints from Japan
Inc that yen weakness has gone far enough.
"It's difficult to give an ideal level but if it stopped at
its current level it wouldn't be a bad thing," said Chief
Financial Officer Toshizo Tanaka.
Japan's currency is trading at around 108 yen to the dollar
after having weakened to as low as 110 yen at the beginning of
this month. A Reuters Corporate Survey showed in September that
only one quarter of Japanese firms preferred an exchange rate of
105 yen or weaker.
Canon's shares closed up 0.8 percent on Monday ahead of
(1 US dollar = 107.9600 Japanese yen)
(Reporting by Sophie Knight; Editing by Edwina Gibbs)