Japanese manufacturers shipped 28% fewer compact cameras in July than the same month the year before.
The total value of cameras with built-in lenses dropped 32.3%, according to global shipment figures released by the Camera & Imaging Products Association (CIPA).
Shipments to the Americas and Asia took the biggest hit, with volumes falling 37.3% in both markets.
The number of compact cameras shipped to European countries dropped 14.7% in volume, and 28.6% in value terms.
However, worldwide shipments of interchangeable-lens models saw an increase of 20.3% in value and 4.3% in volume.
Overall, Japanese digital camera production fell 21.2% in unit terms and 9.4% in value, compared to July 2011.