Canon Inc. Reports Record Results for Fiscal Year 2003.

Business Editors/High-Tech Writers

LAKE SUCCESS, N.Y.--(BUSINESS WIRE)--Jan. 29, 2004

Canon U.S.A., Inc., a subsidiary of Canon Inc. (NYSE: CAJ - news) and a leader in imaging technologies, today announced Canon Inc. fiscal-year 2003 consolidated net sales of 3,198.1 billion yen (US$ 29,889 million), which represents a year-over-year increase of 8.8% over fiscal year 2002.

Canon reported 2003 net income of 275.7 billion yen (US$ 2,577 million), which represents a year-over-year increase of 44.6% and basic earnings per share of 313.81 yen (US$ 2.93).

Operating profit also advanced, improving 31.2% over fiscal year 2002.

Canon reported fourth-quarter revenue of 894.9 billion yen (US$ 8,363 million), 3.9 percent higher than fourth quarter 2002 with net income of 75.0 billion yen (US$ 701 million), 24.8 percent higher than fourth quarter 2002.

"For the full year, net sales grew by 8.8% year-on-year. This growth was the result of strong sales of digital cameras and color network multifunction devices compared to the previous year, as well as higher sales of laser beam printers and semiconductor production equipment. Laser beam printers, which have a comparatively high profit margin, enjoyed a turnaround to higher sales for the year. In addition, we expanded sales of consumables, prompted by a growing base of installed color multifunction devices and color laser beam printers," said Toshizo Tanaka, Senior Managing Director and Group Executive for Finance and Accounting Headquarters, Canon Inc.

For more detailed information and tables, please refer to our Announcement of Fiscal-Year 2003 financial results at http://www.canon.com/finance/index.html.

Canon U.S.A., Inc. delivers consumer, business-to-business, and industrial imaging solutions. The Company is listed as one of Fortune's Most Admired Companies in America, and is ranked #39 on the Business Week list of "Top 100 Brands." Its parent company Canon Inc. (NYSE:CAJ) is a top patent-holder of technology, ranking second overall in the U.S. in 2003. Canon Inc. achieved global revenues of $29.9 billion in 2003; $9.8 billion of which came from Canon Americas. For more information, visit www.usa.canon.com.

This release may contain 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 release, 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 release. 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.

Note: In this release, U.S. dollar amounts are translated from yen at the rate of US$ = JPY 107, the approximate exchange rate on the Tokyo Foreign Exchange Market as of December 30, 2003, solely for the convenience of the reader.