Nikon 1998 Annual Report Download - page 6

for film scanners and focused efforts on promoting newly
developed products, with particular emphasis on digital
cameras. In new business areas, Nikon began offering
optics engines for use in high-resolution, high-brightness
LCD projectors.
Overseas Expansion
In Europe, the Company established Nikon Optical U.K.
Ltd., a small-scale optical lens factory located on the out-
skirts of London that is responsible for marketing activi-
ties as well as the processing, coloring, and coating of
lenses for sale in the European market. Elsewhere, Nikon
Precision Europe GmbH’s training center, DUV Education
& Application Centre, opened in Livingston, Scotland. The
center will enhance technical training and support capabili-
ties for excimer steppers. In a related move, a new office at
Nikon Precision Korea Ltd. was completed, which will further
improve service and customer support activities in the
Korean stepper market.
Research and Development
While half of Nikon’s R&D budget is targeted at the con-
tinued development of cutting-edge excimer steppers, the
development of sophisticated digital cameras and products
for new business fields continues to command a major
share of R&D funding. Areas of particular success include
the development and recent launch of a high-resolution,
high-performance compact infrared charged-coupled
device camera that ensures outstanding image quality.
Nikon has also developed a motion detector that works
as a high-performance sensor with a built-in image pro-
cessing function that can be used in security cameras,
electronic eyes for robots, and digital cameras. In these
and other ways, Nikon is steadily expanding its range of
quality products by creating and commercializing superior
technologies.
Outlook
Although the release of Microsoft Windows®98 and the
accelerating sales of PCs equipped with new micropro-
cessors should serve as a catalyst for bolstering invest-
ment by semiconductor manufacturers, the outlook for
stronger earnings in the near term remains dim. However,
Nikon is confident that the Company will again achieve
robust growth and performance with the expansion of the
semiconductor industry in the medium-to-long term. Nikon
will focus its attention on employing three fundamental
business strategies. First, Nikon will concentrate on the
fastest possible development of next-generation Argon
Fluoride (ArF) excimer steppers and other high-technology
products to meet the needs of the rapidly progressing
market for semiconductor manufacturing related equip-
ment. Second, the Company will devote all its energies to
accelerating the product development cycle and creating
innovative products that meet sophisticated consumer
needs. Finally, we will strategically apply our core tech-
nologies to create innovative products and develop new
business areas to follow in the path of our successful
stepper operations.
We are confident that the successful application of these
three strategies will place Nikon firmly on the road to
higher sales and improved profitability. We look forward
to your continued guidance and encouragement in the
years ahead.
July 1998
Shigeo Ono, Chairman
Shoichiro Yoshida, President
4Nikon Corporation
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