Konica Minolta Jumps on Plan to Cut 2,400 Jobs, Boost Profit

(Bloomberg) -- Shares of Konica Minolta Inc. jumped to a 10-month high on its plan to slash 2,400 jobs worldwide, part of an effort to boost profitability.

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The maker of photocopiers and medical diagnostic imaging equipment said it is reducing headcount around the world over the next twelve months by increasing productivity through the use of generative artificial intelligence. The cuts are set to increase profit by ¥20 billion ($130 million) in the fiscal year starting April 2025, it said.

The company, which had close to 40,000 employees worldwide as of early last year, will concentrate its resources on profitability, it said in a statement Thursday. Its stock closed up 5.9% to its highest since May.

Japan is crowded with the world’s biggest makers of office equipment, including Canon Inc., Fujifilm Holdings Corp. and Ricoh Co. Demand for printers and copiers has declined steadily as more offices go paperless, prompting many of these companies to shift their optics expertise into areas such as health care, semiconductor production and space technologies.

Last year, Ricoh and Toshiba Tec Corp. announced a merger of such operations, and investors have been looking for signs of further consolidation in the sector, according to Okasan Securities analyst Takashi Shimamoto.

“We will also pursue the possibility of alliances in areas where there are no competitive clashes,” Konica Minolta Chief Executive Officer Toshimitsu Taiko said at a news conference regarding the company’s multifunction printer operations. “We are doing what we can on our own.”

Konica Minolta will use AI “even for tasks that require some judgment,” he said.

Konica Minolta, which dates back to 1873, was an early innovator in cameras and photo materials. It later diversified into copiers and health care equipment.

Its stock price remains far below the level of the 2000s. The stock is down more than 50% over the past five years.

The shares had recovered some of those losses in recent months, gaining 21% this year before today’s rally.

(Updates with executive comment from sixth paragraph.)