Canon (CAJPY) 6-K Current report (foreign)

FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

For the month of .... October ……………………………………………… ,  2022

CANON INC.

(Translation of registrant’s name into English)

30-2, Shimomaruko 3-Chome, Ohta-ku, Tokyo 146-8501, Japan

(Address of principal executive offices)

[Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F X Form 40-F

[Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes No X

[If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):82-....................

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

CANON INC.

    (Registrant)

Date…	October 26, 2022	By....../s/.......... Sachiho Tanino.............
		(Signature)*
		Sachiho Tanino                  General Manager                  Consolidated Accounting Div.                  Canon Inc.

*Print the name and title of the signing officer under his signature.

The following materials are included.

1.  RESULTS FOR THE THIRD QUARTER AND THE NINE MONTHS ENDED SEPTEMBER 30, 2022

CONSOLIDATED RESULTS FOR THE THIRD QUARTER AND

THE NINE MONTHS ENDED SEPTEMBER 30, 2022

October 26, 2022

CONSOLIDATED RESULTS FOR THE THIRD QUARTER

			(Millions of yen, thousands of U.S. dollars, except per share amounts)
	Actual
	Three months ended September 30, 2022		Three months ended September 30, 2021		Change(%)		Three months ended September 30, 2022
Net sales	¥	996,090	¥	833,324	+	19.5	$	6,869,586
Operating profit		81,440		58,728	+	38.7		561,655
Income before income taxes		79,076		79,326	-	0.3		545,352
Net income attributable to Canon Inc.	¥	54,118	¥	49,317	+	9.7	$	373,228
Net income attributable to Canon Inc. shareholders per share:
- Basic	¥	52.90	¥	47.16	+	12.2	$	0.36
- Diluted		52.88		47.15	+	12.2		0.36
CONSOLIDATED RESULTS FOR THE NINE MONTHS
			(Millions of yen, thousands of U.S. dollars, except per share amounts)
	Actual								Projection
	Nine months ended September 30, 2022		Nine months ended September 30, 2021		Change(%)		Nine months ended September 30, 2022		Year ending December 31, 2022		Change(%)
Net sales	¥	2,874,239	¥	2,557,908	+	12.4	$	19,822,338	¥	4,090,000	+	16.4
Operating profit		256,055		206,561	+	24.0		1,765,897		385,000	+	36.6
Income before income taxes		231,969		231,147	+	0.4		1,599,786		367,000	+	21.2
Net income attributable to Canon Inc.	¥	159,118	¥	154,920	+	2.7	$	1,097,366	¥	250,000	+	16.4
Net income attributable to Canon Inc. shareholders per share:
- Basic	¥	153.70	¥	148.16	+	3.7	$	1.06	¥	242.57	+	18.1
- Diluted		153.65		148.12	+	3.7		1.06		242.48	+	18.1
	Actual
	As of September 30, 2022		As of December 31, 2021		Change(%)		As of September 30, 2022
Total assets	¥	5,301,056	¥	4,750,888	+	11.6	$	36,559,007
Canon Inc. shareholders’ equity	¥	3,122,629	¥	2,873,773	+	8.7	$	21,535,372

Notes:	1. Canon’s consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles.
	2. U.S. dollar amounts are translated from yen at the rate of JPY145=U.S.$1, the approximate exchange rate on the Tokyo Foreign Exchange Market as of September 30, 2022, solely for the convenience of the reader.

Canon Inc.	30-2, Shimomaruko 3-chome, Ohta-ku,
Headquarter office	Tokyo 146-8501, Japan
	Phone: +81-3-3758-2111

- 1 -

I. Operating Results and Financial Conditions

2022 Third Quarter in Review

Looking back at the third quarter of 2022, the pace of economic recovery slowed amid rising global inflation and interest rates, despite personal consumption underpinned by easing of restrictions on economic activities. In the United States, the economy showed signs of a slowdown due to inflation and tightened financial measures. However, economic recovery continued due to a robust increase in personal consumption. In Europe, the economy slowed down due to increased energy prices and continuous hikes of interest rates in response to the prolonged Ukraine crisis. In China, the speed of recovery of personal consumption declined due to restrictions implemented under its Zero-COVID strategy again. In other emerging countries, the economy recovered moderately, mainly in India and Southeast Asia. In Japan, in spite of a resurgence of coronavirus disease (“COVID-19”) infections happening amid inflationary pressure caused by depreciation of the yen, the economy continued to recover moderately, mainly in terms of personal consumption resulting from eased restrictions.

In the markets in which Canon operates, demand for office multifunction devices (MFDs) remained firm, while demand for laser printers and inkjet printers declined due to the decreased demand from customers working from home. For cameras, demand remained solid, mainly for mirrorless cameras and lenses. For medical equipment, demand mainly for diagnostic imaging unit products recovered outside Japan, although demand in Japan declined this year due to a drop-off after government spending concluded last year. Demand remained high for semiconductor lithography equipment amid favorable market conditions, while demand for such devices as memory declined. For FPD (Flat Panel Display) lithography equipment, demand tend to decline due to decreased demand from customers working from home amid the COVID-19 pandemic and the current economic slowdown.

The average values of the yen during the third quarter and the first nine months of the year were ¥138.40 and ¥128.26 against the U.S. dollar, respectively, a year-on-year depreciation of approximately ¥28 and year-on-year depreciation of approximately ¥20, and ¥139.40 and ¥136.07 against the euro, respectively, a year-on-year depreciation of approximately ¥10 and year-on-year depreciation of approximately ¥6.

As for the third quarter, despite concerns about the impact of inflation and rising interest rates, sales for mirrorless cameras and network cameras remained solid and sales for office MFDs recovered steadily. Net sales for the third quarter increased by 19.5% year-on-year to ¥996.1 billion due to the price adjustment of products and depreciation of the yen. Net sales for the first nine months of the year increased by 12.4% year-on-year to ¥2,874.2 billion. Gross profit as a percentage of net sales decreased by 1.3 points to 45.3% due to the increase in the ratio of hardware caused by stabilization of production supply including printers, in addition to the increased costs of parts and logistics. However, third-quarter gross profit increased by 16.3% year-on-year to ¥451.0 billion, mainly due to the depreciation of the yen. Although operating expenses increased by 12.3% year-on-year to ¥369.6 billion as a result of increased operating expenses denominated in foreign currencies due to the depreciation of the yen, the expense to sales ratio decreased by 2.5 points to 37.1% due to the promotion of efficiency for operations although sales activities increased. As a result, operating profit as a measure of the performance of business activities increased by 38.7% year-on-year to ¥81.4 billion. Other income (deductions) decreased by ¥22.9 billion year-on-year to a loss of ¥2.3 billion, mainly due to deterioration of valuation gains and losses on securities and currency exchange losses from liabilities, incurred by group finance, denominated in foreign currencies, caused by the depreciation of the yen. As a result, although income before income taxes decreased by 0.3% year-on-year to ¥79.1 billion, net income attributable to Canon Inc. increased by 9.7% year-on-year to ¥54.1 billion. Operating profit for the first nine months of the year increased by 24.0% to ¥256.1 billion, while income before income taxes increased by 0.4% to ¥232.0 billion and first nine months net income attributable to Canon Inc. increased by 2.7% to ¥159.1 billion.

Basic net income attributable to Canon Inc. shareholders per share was ¥52.90 for the third quarter, a year-on-year increase of ¥5.74, and ¥153.70 for the first nine months, a year-on-year increase of ¥5.54.

- 2 -

Results by Segment

Looking at Canon’s third quarter performance by business unit, in the Printing Business Unit, unit sales increased compared with the previous year due to the recovery of demand for office MFDs following improvements in the supply of semiconductor chips. Revenue from services and consumables increased moderately compared with the previous year due to the recovery in work in office. As for laser printers and inkjet printers, unit sales increased significantly compared with the previous year due to recovery from stagnant production activities. However, consumables decreased compared with the previous year as demand from customers working from home slowed down. For equipment in the production printing market, sales increased compared with the previous year due to strong sales of the varioPRINT iX series of high-speed cut-sheet color inkjet presses, while revenue from services also increased. These factors resulted in total sales for the business unit of ¥551.5 billion, a year-on-year increase of 20.1%, while income before income taxes decreased by 29.9% year-on-year to ¥43.5 billion, due to the increased costs of parts and logistics and the increase in the ratio of hardware caused by stabilization of production supply. Sales for the combined first nine months of the year totaled ¥1,623.8 billion, a year-on-year increase of 14.5%, while income before income taxes totaled ¥169.1 billion, a year-on-year decrease of 7.4%.

As for the Imaging Business Unit, unit sales of interchangeable-lens digital cameras were above those of the same period of the previous year due to continued strong demand for full-frame mirrorless cameras including the EOS R5 and EOS R6 as well as favorable reviews of the new EOS R7 and EOS R10 APS-C-size mirror-less cameras. Unit sales of lenses increased owing to strong sales of RF-series interchangeable-lenses that expanded the product lineup. As for network cameras, sales increased significantly mainly as a result of strengthening sales activities in response to diversifying market needs in addition to the recovery of products supply. As for professional video production equipment, sales of Cinema EOS-series including the new EOS R5 C, professional video cameras and broadcast lenses, were strong. These factors resulted in total sales for the business unit of ¥202.9 billion, a year-on-year increase of 32.0%, while income before income taxes increased by 108.1% year-on-year to ¥36.8 billion mainly as a result of improved profitability due to an enhanced product mix. Sales for the combined first nine months of the year totaled ¥561.0 billion, a year-on-year increase of 18.8%, while income before income taxes totaled ¥83.4 billion, a year-on-year increase of 47.3%.

As for the Medical Business Unit, sales of diagnostic ultrasound systems and clinical chemistry analyzers were strong mainly in Europe and Asia although demand in Japan declined this year due to a drop-off after government spending concluded last year. These factors resulted in total sales for the business unit of ¥126.1 billion, a year-on-year increase of 9.0%, while income before income taxes decreased by 35.2% year-on-year to ¥6.6 billion as a result of the increased costs of parts and logistics. Sales for the combined first nine months of the year totaled ¥362.5 billion, a year-on-year increase of 3.0%, while income before income taxes totaled ¥21.6 billion, a year-on-year decrease of 15.9%.

As for the Industrial and Others Business Unit, regarding semiconductor lithography equipment, unit sales increased compared with the previous year as a result of maximizing production capacity amid strong sales for a wide range of products such as power device and logic. For FPD lithography equipment, unit sales were flat compared with the previous year thanks to minimizing the impact of both caused by decreased demand from customers working from home amid the COVID-19 pandemic, as well as economic slowdown. For OLED display manufacturing equipment, sales decreased compared with the previous year as panel manufacturers were in the midst of considering investment plans in response to diversifying OLED panel applications. These factors resulted in total sales for the business unit of ¥154.5 billion, a year-on-year increase of 18.5%, while income before income taxes totaled ¥16.3 billion, a year-on-year increase of 992.6% due to the increased unit sales of semiconductor lithography equipment. Sales for combined first nine months of the year totaled ¥424.1 billion, a year-on-year increase of 7.9%, while income before income taxes totaled ¥44.9 billion, a year-on-year increase of 70.9%.

- 3 -

Cash Flow

During the first nine months of 2022, cash flow from operating activities decreased by ¥161.5 billion year-on-year to ¥188.5 billion as a result of higher inventory levels of main products for shopping season in the fourth quarter, and increased payment of income taxes due to increased taxable income. Cash flow used for investing activities decreased by ¥16.0 billion year-on-year to ¥132.4 billion due to the absence of major M&A transactions and the increased sales of fixed assets resulting from optimization of a branch office capacity at overseas sales subsidiaries, while capital investment to improve efficiency and productivity remained consistent and purchases of securities increased. Accordingly, free cash flow decreased by ¥145.5 billion compared with the previous year to ¥56.1 billion.

Cash flow from financing activities, despite an increase in short-term loans, recorded an outlay of ¥29.6 billion mainly due to repurchases of treasury stock and dividend payout, which increased ¥30.4 billion year-on-year.

Owing to these factors, as well as the impact from foreign currency exchange adjustments, cash and cash equivalents increased by ¥63.9 billion to ¥465.3 billion from the end of the previous year.

Outlook

The outlook for the global economy from the fourth quarter onwards is expected to maintain a recovery trend. However, although the shortage of semiconductor chips is gradually improving, the outlook remains uncertain due to risks such as the prolonged Ukraine crisis, curbing of consumption as inflation progresses and curbing investment due to rising interest rates.

In the markets in which Canon operates, demand for office MFDs is expected to remain solid. However, there are concerns that the demand for laser printers and inkjet printers would be affected by the decrease of demand from customers working from home and the current economic slowdown. As for mirrorless cameras, demand is expected to remain solid due to the need for high-quality visual expression. For network cameras, the market is expected to maintain stable growth due to the growing demand for video analysis and high value-added products. In addition, the market for professional video production equipment is expected to grow, supported by increasing demand for video content due to the spread of online video streaming. As for the medical equipment market, demand is expected to remain solid due to a recovery in large investments previously held back due to the COVID-19 pandemic mainly for diagnostic imaging unit products. For semiconductor lithography equipment, demand from a wide range of fields such as logic is expected to continue. For FPD lithography equipment, there are concerns about a delay of investments of panel manufacturers due to the decrease of demand for work from home amid the COVID-19 pandemic.

With regard to currency exchange rates on which Canon bases its performance outlook, Canon anticipates exchange rates of ¥148 to the U.S. dollar and ¥144 to the euro, representing depreciation of approximately ¥23 against the U.S. dollar and depreciation of approximately ¥8 against the euro as the previous year. For the U.S. dollar and the euro, Canon expects the yen to depreciate by ¥5 and depreciate by ¥2 from its previous forecast, respectively.

Upon taking into consideration of the current economic forecast, although the Printing Business unit is expected to be sluggish amid the inflation and hikes of interest rates, demand for other business units are expected to remain firm. Considering the situation of recent exchange rates and continued efforts to maximize production and supply competitive products in the market, Canon revised the forecast upward to full-year consolidated net sales of ¥4,090.0 billion, a year-on-year increase of 16.4%; operating profit of ¥385.0 billion, a year-on-year increase of 36.6%. Meanwhile, taking into account valuation losses on securities and currency exchange losses, Canon projects income before income taxes of ¥367.0 billion, a year-on-year increase of 21.2%; and net income attributable to Canon Inc. of ¥250.0 billion, a year-on-year increase of 16.4%.

Consolidated Outlook

Fiscal year	Millions of yen
	Year ending December 31, 2022				Change			Year ended December 31, 2021		Change (%)
	Previous Outlook (A)		Revised Outlook (B)		(B - A)			Results (C)		(B - C) / C
Net sales		4,080,000		4,090,000		10,000			3,513,357		+16.4%
Operating profit		376,000		385,000		9,000			281,918		+36.6%
Income before income taxes		378,000		367,000		(11,000	)		302,706		+21.2%
Net income attributable to Canon Inc.		262,000		250,000		(12,000	)		214,718		+16.4%

- 4 -

This document contains forward-looking statements with respect to future results, performance and achievements that are subject to risk and uncertainties and reflect management’s views and assumptions formed by available information. All statements other than statements of historical fact are statements that could be considered forward-looking statements. When used in this document, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “project” or “should” and similar expressions, as they relate to Canon, are intended to identify forward-looking statements. Many factors could cause the actual results, performance or achievements of Canon to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, introduction of competing products by other companies, lack of acceptance of new products or services by Canon’s targeted customers, inability to meet efficiency and cost reduction objectives, changes in business strategy and various other factors, both referenced and not referenced in this document. A detailed description of these and other risk factors is included in Canon’s annual report on Form 20-F, which is on file with the United States Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. Canon does not intend or assume any obligation to update these forward-looking statements.

- 5 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

II. Financial Statements

1. CONSOLIDATED BALANCE SHEETS

	Millions of yen
	As of      September 30, 2022			As of December 31, 2021			Change
ASSETS
Current assets		2,294,590			1,878,345			416,245
Cash and cash equivalents		465,298			401,395			63,903
Short-term investments		12,216			3,377			8,839
Trade receivables		572,810			522,432			50,378
Inventories		883,897			650,568			233,329
Prepaid expenses and other current assets		376,297			314,489			61,808
Allowance for credit losses		(15,928	)		(13,916	)		(2,012	)
Non-current assets		3,006,466			2,872,543			133,923
Noncurrent receivables		13,528			16,388			(2,860	)
Investments		60,378			60,967			(589	)
Property, plant and equipment, net		1,056,175			1,041,403			14,772
Operating lease right-of-use assets		110,367			95,791			14,576
Intangible assets, net		293,625			301,793			(8,168	)
Goodwill		987,032			953,850			33,182
Other assets		488,636			404,720			83,916
Allowance for credit losses		(3,275	)		(2,369	)		(906	)
Total assets		5,301,056			4,750,888			550,168
LIABILITIES AND EQUITY
Current liabilities		1,339,451			1,060,833			278,618
Short-term loans and current portion of long-term debt		242,789			44,891			197,898
Short-term loans related to financial services		41,500			42,300			(800	)
Other short-term loans and current portion of long-term debt		201,289			2,591			198,698
Trade payables		392,999			338,604			54,395
Accrued income taxes		32,849			43,081			(10,232	)
Accrued expenses		375,429			323,929			51,500
Current operating lease liabilities		33,036			30,945			2,091
Other current liabilities		262,349			279,383			(17,034	)
Non-Current liabilities		607,381			591,626			15,755
Long-term debt, excluding current installments		180,315			179,750			565
Accrued pension and severance cost		239,227			248,467			(9,240	)
Noncurrent operating lease liabilities		77,219			65,385			11,834
Other noncurrent liabilities		110,620			98,024			12,596
Total liabilities		1,946,832			1,652,459			294,373
Canon Inc. shareholders’ equity		3,122,629			2,873,773			248,856
Common stock		174,762			174,762			-
Additional paid-in capital		404,838			403,119			1,719
Retained earnings		3,644,401			3,606,052			38,349
Legal reserve		64,491			68,015			(3,524	)
Other retained earnings		3,579,910			3,538,037			41,873
Accumulated other comprehensive income (loss)		156,987			(151,794	)		308,781
Treasury stock, at cost		(1,258,359	)		(1,158,366	)		(99,993	)
Noncontrolling interests		231,595			224,656			6,939
Total equity		3,354,224			3,098,429			255,795
Total liabilities and equity		5,301,056			4,750,888			550,168
	Millions of yen
	As of September 30, 2022			As of December 31, 2021
Notes:
1. Accumulated depreciation		3,011,134			2,862,801
2. Accumulated other comprehensive income (loss):
Foreign currency translation adjustments		312,728			5,519
Net unrealized gains and losses on securities		(21	)		-
Net gains and losses on derivative instruments		(2,796	)		(894	)
Pension liability adjustments		(152,924	)		(156,419	)

- 6 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

2. CONSOLIDATED STATEMENTS OF INCOME AND

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Consolidated statements of income

Results for the third quarter

	Millions of yen
	Three months      ended September 30, 2022			Three months      ended September 30, 2021			Change(%)
Net sales		996,090			833,324			+	19.5
Cost of sales		545,057			445,365
Gross profit		451,033			387,959			+	16.3
Operating expenses:
Selling, general and administrative expenses		294,576			256,531
Research and development expenses		75,017			72,700
		369,593			329,231
Operating profit		81,440			58,728			+	38.7
Other income (deductions):
Interest and dividend income		1,542			482
Interest expense		(207	)		(94	)
Other, net		(3,699	)		20,210
		(2,364	)		20,598
Income before income taxes		79,076			79,326			–	0.3
Income taxes		21,827			25,001
Consolidated net income		57,249			54,325
Less: Net income attributable to noncontrolling interests		3,131			5,008
Net income attributable to Canon Inc.		54,118			49,317			+	9.7
Results for the nine months
	Millions of yen
	Nine months ended September 30, 2022			Nine months ended September 30, 2021			Change(%)
Net sales		2,874,239			2,557,908			+	12.4
Cost of sales		1,564,776			1,367,967
Gross profit		1,309,463			1,189,941			+	10.0
Operating expenses:
Selling, general and administrative expenses		832,335			772,370
Research and development expenses		221,073			211,010
		1,053,408			983,380
Operating profit		256,055			206,561			+	24.0
Other income (deductions):
Interest and dividend income		3,167			1,519
Interest expense		(737	)		(442	)
Other, net		(26,516	)		23,509
		(24,086	)		24,586
Income before income taxes		231,969			231,147			+	0.4
Income taxes		61,962			63,734
Consolidated net income		170,007			167,413
Less: Net income attributable to noncontrolling interests		10,889			12,493
Net income attributable to Canon Inc.		159,118			154,920			+	2.7

- 7 -

CANON INC. AND SUBSIDIARIES

CONSOLIDATED

Consolidated statements of comprehensive income

Results for the third quarter

	Millions of yen
	Three months ended September 30, 2022			Three months ended September 30, 2021			Change(%)
Consolidated net income		57,249			54,325			+	5.4
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments		42,987			(7,584	)
Net unrealized gains and losses on securities		(21	)		-
Net gains and losses on derivative instruments		617			321
Pension liability adjustments		4,254			(118	)
		47,837			(7,381	)
Comprehensive income (loss)		105,086			46,944			+	123.9
Less: Comprehensive income (loss) attributable to noncontrolling interests		3,965			5,235
Comprehensive income (loss) attributable to Canon Inc.		101,121			41,709			+	142.4
Results for the nine months
	Millions of yen
	Nine months ended September 30, 2022			Nine months ended September 30, 2021			Change(%)
Consolidated net income		170,007			167,413			+	1.5
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments		309,018			80,433
Net unrealized gains and losses on securities		(21	)		-
Net gains and losses on derivative instruments		(1,867	)		(324	)
Pension liability adjustments		3,519			20,135
		310,649			100,244
Comprehensive income (loss)		480,656			267,657			+	79.6
Less: Comprehensive income (loss) attributable to noncontrolling interests		12,757			13,653
Comprehensive income (loss) attributable to Canon Inc.		467,899			254,004			+	84.2

- 8 -

CANON INC. AND SUBSIDIARIES    

CONSOLIDATED

3. DETAILS OF SALES

Results for the third quarter

	Millions of yen
Sales by business unit	Three months ended September 30, 2022			Three months ended September 30, 2021			Change(%)
Printing		551,495			459,201			+	20.1
Imaging		202,933			153,784			+	32.0
Medical		126,074			115,714			+	9.0
Industrial and Others		154,546			130,381			+	18.5
Eliminations		(38,958	)		(25,756	)			-
Total		996,090			833,324			+	19.5
	Millions of yen
Sales by region	Three months ended September 30, 2022			Three months ended September 30, 2021			Change(%)
Japan		201,091			186,435			+	7.9
Overseas:
Americas		311,553			244,611			+	27.4
Europe		251,981			206,069			+	22.3
Asia and Oceania		231,465			196,209			+	18.0
		794,999			646,889			+	22.9
Total		996,090			833,324			+	19.5
Results for the nine months
	Millions of yen
Sales by business unit	Nine months ended September 30, 2022			Nine months ended September 30, 2021			Change(%)
Printing		1,623,809			1,418,197			+	14.5
Imaging		561,031			472,235			+	18.8
Medical		362,503			351,905			+	3.0
Industrial and Others		424,061			392,998			+	7.9
Eliminations		(97,165	)		(77,427	)			-
Total		2,874,239			2,557,908			+	12.4
	Millions of yen
Sales by region	Nine months ended September 30, 2022			Nine months ended September 30, 2021			Change(%)
Japan		627,576			602,013			+	4.2
Overseas:
Americas		893,993			710,299			+	25.9
Europe		720,649			652,584			+	10.4
Asia and Oceania		632,021			593,012			+	6.6
		2,246,663			1,955,895			+	14.9
Total		2,874,239			2,557,908			+	12.4

Notes:	1.  The primary products included in each of the segments are as follows:
	Printing Business Unit:
	Office multifunction devices (MFDs) / Document solutions / Laser multifunction printers (MFPs) / Laser printers / Inkjet printers / Image scanners / Calculators / Digital continuous feed presses / Digital sheet-fed presses / Large format printers
	Imaging Business Unit:
	Interchangeable-lens digital cameras / Interchangeable lenses / Digital compact cameras / Compact photo printers / Network cameras / Video management software / Video content analytics software / Digital camcorders / Digital cinema cameras / Broadcast equipment /Multimedia projectors
	Medical Business Unit:
	Computed tomography (CT) systems / Diagnostic ultrasound systems / Diagnostic X-ray systems / Magnetic resonance imaging (MRI) systems / Clinical chemistry analyzers / Digital radiography systems / Ophthalmic equipment
	Industrial and Others Business Unit:
	Semiconductor lithography equipment / FPD (Flat panel display) lithography equipment / OLED Display Manufacturing Equipment / Vacuum thin-film deposition equipment / Die bonders / Handy terminals / Document scanners
	2.  The principal countries and regions included in each regional category are as follows:
	Americas: United States of America, Canada, Latin America Europe: United Kingdom, Germany, France, Netherlands, European countries, Middle East and Africa Asia and Oceania: China, Asian countries, Australia

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

4. CONSOLIDATED STATEMENTS OF CASH FLOWS

	Millions of yen
	Nine months ended September 30, 2022			Nine months ended September 30, 2021
Cash flows from operating activities:
Consolidated net income		170,007			167,413
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
Depreciation and amortization		166,225			161,372
(Gain) loss on disposal of fixed assets		(9,549	)		6,185
Deferred income taxes		(6,081	)		2,170
Decrease in trade receivables		8,399			95,423
Increase in inventories		(153,886	)		(54,239	)
Increase in trade payables		75,275			33,550
(Decrease) increase in accrued income taxes		(12,740	)		24,503
Increase in accrued expenses		20,144			5,359
Decrease in accrued pension and severance cost		(29,442	)		(31,928	)
Other, net		(39,871	)		(59,837	)
Net cash provided by operating activities		188,481			349,971
Cash flows from investing activities:
Purchases of fixed assets		(132,251	)		(123,095	)
Proceeds from sale of fixed assets		14,316			2,102
Proceeds from maturity of held to maturity securities		2,151			-
Purchases of securities		(20,053	)		(1,633	)
Proceeds from sale and maturity of securities		6,518			1,707
Acquisitions of businesses, net of cash acquired		(5,890	)		(29,072	)
Other, net		2,859			1,640
Net cash used in investing activities		(132,350	)		(148,351	)
Cash flows from financing activities:
Repayments of long-term debt		(1,546	)		(47,518	)
Decrease in short-term loans related to financial services, net		(800	)		(800	)
Increase (decrease) in other short-term loans, net		197,840			(82	)
Dividends paid		(119,326	)		(88,891	)
Repurchases and reissuance of treasury stock, net		(100,012	)		(14	)
Other, net		(5,738	)		(2,681	)
Net cash used in financing activities		(29,582	)		(139,986	)
Effect of exchange rate changes on cash and cash equivalents		37,354			12,922
Net change in cash and cash equivalents		63,903			74,556
Cash and cash equivalents at beginning of period		401,395			407,684
Cash and cash equivalents at end of period		465,298			482,240

* Canon has changed the presentation of “Decrease in short-term loans related to financial services, net” and “Increase (decrease) in other short-term loans, net” separated from “Increase (decrease) in short-term loans, net” from the fourth quarter of 2021. To conform with the change in the presentation, consolidated statement of cash flows for the nine months ended September 30, 2021 also has been reclassified.

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CANON INC. AND SUBSIDIARIES

CONSOLIDATED

5. NOTE FOR GOING CONCERN ASSUMPTION

Not applicable.

6. SIGNIFICANT CHANGES IN CANON INC. SHAREHOLDERS’ EQUITY

None.

7. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Canon’s consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles.

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