Segment Information

12 Months Ended

Dec. 31, 2011

Segment Information

22. Segment Information

Canon operates its business in three segments: the Office Business Unit, the Consumer Business Unit, and the Industry and Others Business Unit, which are based on the organizational structure and information reviewed by Canon’s management to evaluate results and allocate resources.

The primary products included in each segment are as follows:

Office Business Unit: Office network digital MFDs / Color network digital MFDs / Personal-use network digital MFDs / Office copying machines / Full-color copying machines / Personal-use copying machines / Laser printers / Large format inkjet printers / Digital production printers

Consumer Business Unit: Digital SLR cameras / Compact digital cameras / Interchangeable lenses / Digital video camcorders / Inkjet multifunction printers / Single function inkjet printers / Image scanners / Broadcast equipment / Calculators

Industry and Others Business Unit: Semiconductor lithography equipment / LCD lithography equipment / Medical image recording equipment / Ophthalmic products / Magnetic heads / Micromotors / Computers / Handy terminals / Document scanners

The accounting policies of the segments are substantially the same as those described in the significant accounting policies in Note 1. Canon evaluates performance of, and allocates resources to, each segment based on operating profit.

Information about operating results and assets for each segment as of and for the years ended December 31, 2011, 2010 and 2009 is as follows:

	Office		Consumer		Industry and Others			Corporate and eliminations			Consolidated
	(Millions of yen)
2011:
Net sales:
External customers	¥	1,912,112	¥	1,311,023	¥	334,298		¥	—		¥	3,557,433
Intersegment		5,831		1,021		86,565			(93,417	)		—
Total		1,917,943		1,312,044		420,863			(93,417	)		3,557,433
Operating cost and expenses		1,658,678		1,100,750		396,563			23,371			3,179,362
Operating profit	¥	259,265	¥	211,294	¥	24,300		¥	(116,788	)	¥	378,071
Total assets	¥	821,782	¥	452,809	¥	362,638		¥	2,293,498		¥	3,930,727
Depreciation and amortization		93,196		45,609		29,685			92,853			261,343
Capital expenditures		53,888		48,192		37,648			122,753			262,481
2010:
Net sales:
External customers	¥	1,978,945	¥	1,389,622	¥	338,334		¥	—		¥	3,706,901
Intersegment		8,324		1,705		94,624			(104,653	)		—
Total		1,987,269		1,391,327		432,958			(104,653	)		3,706,901
Operating cost and expenses		1,693,947		1,153,262		442,789			29,351			3,319,349
Operating profit (loss)	¥	293,322	¥	238,065	¥	(9,831	)	¥	(134,004	)	¥	387,552
Total assets	¥	855,893	¥	414,022	¥	307,029		¥	2,406,876		¥	3,983,820
Depreciation and amortization		103,548		41,665		37,387			93,593			276,193
Capital expenditures		53,115		36,266		27,105			77,061			193,547
2009:
Net sales:
External customers	¥	1,635,056	¥	1,299,194	¥	274,951		¥	—		¥	3,209,201
Intersegment		10,020		1,966		83,047			(95,033	)		—
Total		1,645,076		1,301,160		357,998			(95,033	)		3,209,201
Operating cost and expenses		1,415,680		1,117,668		433,954			24,844			2,992,146
Operating profit (loss)	¥	229,396	¥	183,492	¥	(75,956	)	¥	(119,877	)	¥	217,055
Total assets	¥	745,646	¥	437,160	¥	359,635		¥	2,305,116		¥	3,847,557
Depreciation and amortization		90,878		48,701		60,770			115,044			315,393
Capital expenditures		96,718		27,503		25,644			108,387			258,252

Intersegment sales are recorded at the same prices used in transactions with third parties. Expenses not directly associated with specific segments are allocated based on the most reasonable measures applicable. Corporate expenses include certain corporate research and development expenses. Segment assets are based on those directly associated with each segment. Corporate assets primarily consist of cash and cash equivalents, finance receivables, investments, deferred tax assets, goodwill and corporate properties. Capital expenditures represent the additions to property, plant and equipment and intangible assets measured on an accrual basis.

Information by major geographic area as of and for the years ended December 31, 2011, 2010 and 2009 is as follows:

	2011		2010		2009
	(Millions of yen)
Net sales:
Japan	¥	694,450	¥	695,749	¥	702,344
Americas		961,955		1,023,299		894,154
Europe		1,113,065		1,172,474		995,150
Asia and Oceania		787,963		815,379		617,553
Total	¥	3,557,433	¥	3,706,901	¥	3,209,201
Long-lived assets:
Japan	¥	1,070,412	¥	1,104,949	¥	1,205,887
Americas		85,824		69,034		59,273
Europe		83,296		108,160		44,875
Asia and Oceania		89,334		72,846		77,146
Total	¥	1,328,866	¥	1,354,989	¥	1,387,181

Net sales are attributed to areas based on the location where the product is shipped to the customers. Other than in Japan and the United States, Canon does not conduct business in any individual country in which its sales in that country exceed 10% of consolidated net sales. Net sales in the United States are ¥779,652 million, ¥836,645 million and ¥793,428 million for the years ended December 31, 2011, 2010 and 2009, respectively.

Long-lived assets represent property, plant and equipment and intangible assets for each geographic area.

The following information is based on the location of the Company and its subsidiaries as of and for the years ended December 31, 2011, 2010 and 2009. In addition to the disclosure requirements under U.S. GAAP, Canon discloses this information in order to provide financial statements users with useful information.

	Japan		Americas		Europe		Asia and Oceania		Corporate and eliminations			Consolidated
	(Millions of yen)
2011:
Net sales:
External customers	¥	807,883	¥	952,833	¥	1,109,256	¥	687,461	¥	—		¥	3,557,433
Intersegment		1,873,157		16,217		4,681		744,179		(2,638,234	)		—
Total		2,681,040		969,050		1,113,937		1,431,640		(2,638,234	)		3,557,433
Operating cost and expenses		2,273,336		948,593		1,069,489		1,388,580		(2,500,636	)		3,179,362
Operating profit	¥	407,704	¥	20,457	¥	44,448	¥	43,060	¥	(137,598	)	¥	378,071
Total assets	¥	1,236,468	¥	250,131	¥	427,030	¥	442,263	¥	1,574,835		¥	3,930,727
2010:
Net sales:
External customers	¥	854,208	¥	1,008,200	¥	1,163,452	¥	681,041	¥	—		¥	3,706,901
Intersegment		1,974,591		7,975		3,489		723,423		(2,709,478	)		—
Total		2,828,799		1,016,175		1,166,941		1,404,464		(2,709,478	)		3,706,901
Operating cost and expenses		2,398,439		993,310		1,126,521		1,357,663		(2,556,584	)		3,319,349
Operating profit	¥	430,360	¥	22,865	¥	40,420	¥	46,801	¥	(152,894	)	¥	387,552
Total assets	¥	1,321,572	¥	251,587	¥	472,785	¥	421,250	¥	1,516,626		¥	3,983,820
2009:
Net sales:
External customers	¥	827,762	¥	871,633	¥	991,336	¥	518,470	¥	—		¥	3,209,201
Intersegment		1,714,375		1,263		919		534,147		(2,250,704	)		—
Total		2,542,137		872,896		992,255		1,052,617		(2,250,704	)		3,209,201
Operating cost and expenses		2,288,471		860,863		964,606		1,019,208		(2,141,002	)		2,992,146
Operating profit	¥	253,666	¥	12,033	¥	27,649	¥	33,409	¥	(109,702	)	¥	217,055
Total assets	¥	1,386,511	¥	198,094	¥	378,477	¥	384,795	¥	1,499,680		¥	3,847,557