Nikkei reported that Canon's operating profit is likely to fall short of the current forecast by about $447 million as consumers opt for smartphone cameras over digital cameras.
The report found that Canon's operating profit is anticipated to fall 20% to slightly above $2.4 billion, compared with the projected $2.9 billion. The Japanese company's sales for 2019 are also not expected to reach the standing projection of $34.8 billion.
Canon did not immediately respond to a request for comment from CNBC.
Canon's digital camera sales are shrinking in China in particular, Nikkei said, adding that a slowdown in chipmaking equipment orders is also expected to hurt earnings as demand for smartphone semiconductors declines.
The Japanese company will announce its first-quarter results on April 24.