Olympus refocused on medical devices and swung from a ¥8.7B loss to ¥62.6B net income.

Olympus spent the early 2010s recovering from the 2011 scandal in which an internal investigation found the company had concealed investment losses that ultimately rose to ¥132.2 billion ($1.7 billion). Shareholders approved a new board in 2012 and promoted Hiroyuki Sasa, a 30-year veteran of the medical business, to president.

The recovery plan centered on the medical business — endoscopes and surgical devices, where Olympus was the world leader — while cutting losses in imaging. In March 2016 the company agreed to pay $646 million to resolve US investigations into kickbacks paid to doctors and hospitals, the largest amount ever paid for violations of the US Anti-Kickback Statute.

The focus delivered in FY2016 (year ended March 2016): consolidated net sales rose 5.2% to ¥804.6 billion, operating income rose 14.8% to ¥104.5 billion, and net income came to ¥62.6 billion versus a ¥8.7 billion net loss the year before — despite ¥22.5 billion of extraordinary losses booked for the US settlement.

The medical business added ¥50.6 billion of the sales growth, and the company's own annual report credited the medium-term plan launched in fiscal 2013 for the turnaround.

FY2016 net income was ¥62.6B versus a ¥8.7B net loss in FY2015; operating income rose 14.8% to ¥104.5B and sales grew 5.2% to ¥804.6B, led by medical.

Endoscopy leadership gave Olympus a defensible, high-margin core.

The $646M settlement removed a legal overhang that scared customers.

Cutting imaging losses freed resources for medical growth.

A formal medium-term plan made the priority visible to investors and staff.

A scandal-hit company can turn around if leadership bets on the strongest, most defensible business — then reorganizes everything else around it and settles the legal overhang early.

Olympus continued to grow the medical business and returned to paying dividends, and the endoscopy franchise remained its profit engine through the decade. The 2016 results marked the point where the scandal era — legal, financial and reputational — was firmly behind the company.