Print is dead? Japan’s Ricoh Co., best known as a maker of copiers, printers, faxes and other office mainstays, has joined those saying so.
With the pandemic upending workplace practices around the world, the office-equipment giant on Wednesday unveiled an ambitious shift away from paper and into the digital realm, aiming to transform into a digital-services provider.
Investors cheered the move, with the stock surging 16% in Tokyo on Thursday. That’s the most since 1992, and came even as the Nikkei 225 Stock Average fell 2.1%.
The coronavirus outbreak has forced companies worldwide to upend long-held practices — downsizing offices, eschewing business travel and turning to video conferencing as more staff work from home. In Japan, the pandemic has helped propel a long-overdue shift to the digital space, with the administration of Prime Minister Yoshihide Suga promoting a move away from faxes, company seals and other vestiges of physical offices.
In its five-year plan, Ricoh said it would seek to become a “digital services company,” acknowledging the damage the pandemic has done to its mainstay printing business. It pledged a 300 billion yen ($2.8 billion) war chest for acquisitions, promising “aggressive investment and M&A” in Europe. The firm aims to get the majority of operating profit from digital services by fiscal 2025, seizing on opportunities to help other workplaces shift online.
The company will also spend as much as 100 billion yen on a share buyback program over the next year, and plans to retire all its treasury stock once the repurchase is complete.
Founded in 1936, Ricoh was one of the Japanese giants of traditional office equipment, alongside the likes of Konica Minolta Inc. and Canon Inc. At one time, it was also a major maker of digital cameras, and acquired the Pentax brand in 2011.
But changing times have been unkind to Ricoh, even before the pandemic. Despite a booming stock market, its shares are largely flat for the last decade, even as the Nikkei 225, of which Ricoh is a member, has surged more than 170% in that period.