Shares of Eastman Kodak Company (KODK Quick QuoteKODK - Free Report) have slipped 4.4% since reporting results for the fourth quarter of 2024. This compares with the S&P 500 index’s 0.1% decline over the same time frame. Over the past month, the stock has lost 5.5% compared to the S&P 500’s 5.7% fall.

Financial Performance Overview

Kodak reported consolidated revenues of $266 million, down 3% from $275 million in the prior-year quarter. Despite the revenue decline, gross profit increased 9% to $51 million, with the gross margin improving to 19% from 17% in the fourth quarter of 2023. Net income upsurged 420% to $26 million from $5 million in the prior-year quarter. Operational EBITDA skyrocketed 350% to $9 million from $2 million a year ago.

For 2024, revenues were $1.04 billion, down 7% from $1.12 billion in 2023. Gross profit declined 3% to $203 million, with the gross margin remaining steady at 19%. Net income grew 36% to $102 million from $75 million in 2023. However, Operational EBITDA dropped 42% to $26 million from $45 million in the prior year due to lower volumes, higher manufacturing costs and increased expenses related to litigation, IT investments and trade shows.

Eastman Kodak Company Price, Consensus and EPS Surprise

 

Eastman Kodak Company price-consensus-eps-surprise-chart | Eastman Kodak Company Quote

Business Segments

Print Division: Kodak’s print business continued to face headwinds, with revenues declining from $208 million in the fourth quarter of 2023 to $187 million in the fourth quarter of 2024. Operational EBITDA for the segment dropped from $2 million to $1 million. The company completed its tariff petition process with the U.S. International Trade Commission, an outcome that management believes will create a level playing field in the U.S. plates market.

KODK showcased its PROSPER 7000 Turbo Press at the Hunkeler Innovationdays tradeshow, emphasizing its role as the world’s fastest inkjet press.

Advanced Materials & Chemicals (AM&C): The AM&C segment demonstrated strong growth, with fourth-quarter 2024 revenues increasing to $68 million from $58 million in the prior-year quarter. Operational EBITDA was $2 million against a loss of $5 million. Kodak has continued investing in its pharmaceutical manufacturing facility, which is expected to commence production in 2025. The company is also expanding its film production capacity to meet growing demand.

Brand Licensing: Revenues from brand licensing increased to $7 million in the fourth quarter of 2024 from $5 million in the prior-year period. Operational EBITDA for the segment rose from $5 million to $6 million.

Other Key Business Metrics

Kodak’s Print segment generated $187 million in revenues in the fourth quarter, down from $208 million a year ago. Operational EBITDA for the segment declined slightly to $1 million from $2 million. AM&C revenues increased year over year to $68 million from $58 million. Operational EBITDA was $2 million against a $5 million loss in the prior-year quarter. The Brand segment’s revenues rose to $7 million from $5 million, with operational EBITDA improving to $6 million from $5 million.

For the year, Print revenues declined year over year to $737 million from $828 million, while the AM&C segment grew to $271 million from $255 million. The Brand segment’s revenues increased slightly to $20 million from $17 million. Print posted a negative operational EBITDA of $8 million, a steep drop from $20 million in 2023. AM&C improved its profitability from $10 million in the prior year to $17 million in operational EBITDA.

Management Commentary

KODK’s leadership emphasized its continued focus on shedding unprofitable businesses, investing in innovation and driving operational efficiencies. CEO Jim Continenza highlighted the company’s efforts to stabilize revenue declines, maintain gross margin levels, and strengthen its AM&C segment. He also pointed to the expansion of film manufacturing capacity to meet growing demand and the upcoming launch of the company’s Current Good Manufacturing Practice pharmaceutical facility.

In the Print division, Kodak completed the tariff petition process with the U.S. International Trade Commission, a move intended to ensure fair competition in the domestic printing plates market.

Factors Influencing Performance

The improvement in the gross margin was driven by pricing actions and operational efficiencies, but higher aluminum costs, litigation expenses and inventory reserve adjustments in the Electrophotographic Printing Solutions business weighed on profitability. While net income increased substantially, operational EBITDA declined due to higher expenses related to IT infrastructure, restructuring efforts and investments in growth initiatives.

The company’s year-end cash balance was $201 million, down from $255 million at the end of 2023. The decline was due to capital expenditure for growth projects, investments in IT systems and lower cash flow from operations, which decreased $45 million year over year.

Guidance & Outlook

Management did not provide explicit financial guidance but reiterated its commitment to increasing efficiency, expanding growth segments and optimizing its portfolio. The company aims to continue its investment in the AM&C segment while leveraging improvements in its digital print and commercial printing operations.

Other Developments

KODK’s board of directors approved the termination of the Kodak Retirement Income Plan, effective March 31, 2025. The company expects a significant portion of any reverted assets from the plan to be used to reduce long-term debt, thereby lowering annual debt servicing costs. Kodak received $40 million in brand licensing cash proceeds in early 2024, which contributed to working capital improvements.

While the company continues to face challenges in its legacy Print business, management remains focused on its strategic transformation, with investments in AM&C and digital printing technology expected to shape its growth trajectory.