Epson Shines in Q3 With Huge Jump in Profit and Strong Inkjet Revenue

Large-capacity ink tank models and remote working demand two driving forces



Christine Dunne


It’s been a rough year for most of us, and document imaging manufacturers are no exception. While financial performance has improved since the pandemic first hit, revenues and profits are still generally below the norm.


So when we saw that Epson’s printing solutions business had a 20.4% operating margin in Q3 (October 1, 2020-December 31, 2020) and the company has added 6,630 jobs since March, we were quite impressed and eager to know more. We did have our suspicions it was related to the company’s inkjet business and home working needs, but sought out more information in Epson’s financial disclosures.


Epson’s Q3 Printing Solutions Business Performance 2019 vs. 2020
Source: Third Quarter Financial Results Fiscal Year 2020 (Ending March 2021) presentation


Epson’s Number of Employees Over Time
Source: Third Quarter Financial Results Fiscal Year 2020 (Ending March 2021) presentation


Printing Solutions Revenue Fairly Flat Overall, But Printer Revenue Up 10+%

Year-over-year revenue in the printing solutions business, which includes inkjet, laser, dot matrix, commercial, and industrial printers; inkjet printheads; point-of-sale systems; and PCs, was fairly flat—an impressive achievement given the state of the world.

Digging deeper into the results, we see that:

  • Printer (home and office inkjet, laser, SIDM printers) revenue was up 10.4% year over year (to ¥144.5 billion)
  • Professional printing (commercial and industrial inkjet printers, POS printers, printheads) was down 1.4% (to ¥50.4)
  • Other (PCs) products were down 2.8%


Printing Solutions Revenue Up 62% Year Over Year

At the same time, Epson’s printing solutions business operating profit increased 62% year over year, resulting in the over 20% margin mentioned above. Keypoint Intelligence tracks document imaging manufacturers’ revenue and profit year after year, and this margin is quite impressive.


The below image comes from our review of manufactures’ financial performance in the 2019 fiscal year, showing that most imaging/print business profit margins (for the year) were well below 20% (not to mention it was a non-pandemic year).


Various Imaging/Print Operating Profit Margins in 2019
Source: Keypoint Intelligence


High-Capacity Ink Tank Printer Demand and Higher Prices Driving Epson Financial Success

Looking closer at Epson’s Q3 results, we see that the volume of office and home inkjet printer hardware grew 2% year over year, but revenue from this segment increased 17% in Japanese yen and 22% in local currency. This is being driven by increased sales of high-capacity ink tank printers and higher selling prices/improved model mix for ink cartridge printers for SOHO/home use. Also, office and home ink revenue grew 5% (in Japanese yen) on sustained at-home print in “North America, Europe, etc.”


For the full fiscal year, Epson expects office and home inkjet printer hardware revenue to be up 10% (in Japanese yen) year over year (with high-capacity ink tank printer units up 3%), office and home ink revenue to be up 6% (in Japanese yen), and printing solutions operating profit to be 14.3%—which is still higher than Epson’s typical operating margin.


While vendors like Brother, Canon, and HP are also seeing great success in their respective SOHO and inkjet businesses (driven by the work-from-home trend), Epson’s relative emphasis on inkjet versus laser, high-capacity and refillable ink tank models, as well as high-capacity ink cartridge printers puts it in a unique position.


Subscribers to our office-based Advisory Services can log in to the InfoCenter to view our past vendor financial reviews. This summer, we’ll publish vendor financial reviews for the 2020 fiscal year for both our office- and production-based services. Not a subscriber? No problem. Just send us an email at for more info.