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Shares of Eastman Kodak Company (KODK - Free Report) have declined 7.1% since reporting results for the first quarter of 2025. This compares with the S&P 500 index’s 3.1% growth over the same time frame. Over the past month, the stock has lost 1.5% compared with the S&P 500’s 8.1% rally.
Earnings & Revenue Performances
Kodak’s financial performance for the first quarter reflected stability in top-line revenues but pronounced weakness in profitability. The company reported consolidated revenues of $247 million, down 1% from $249 million in the year-ago quarter. However, gross profit declined 6% to $46 million from $49 million, led by higher aluminum and manufacturing costs.
On the bottom line, the company swung to a net loss of $7 million from a net income of $32 million in the first quarter of 2024. This reversal was partly attributable to the absence of a $17-million gain on asset sales recorded in the prior-year period. Operational EBITDA dropped 50% to $2 million from $4 million, though excluding foreign exchange and non-cash adjustments, it showed a $1-million improvement.
Eastman Kodak Company Price, Consensus and EPS Surprise
Segment-wise, performance was mixed. The Print division reported revenues of $165 million, a decline of $17 million from the prior-year period. Operational EBITDA for this segment fell to negative $9 million from breakeven due to input cost pressures.
In contrast, the Advanced Materials and Chemicals (AM&C) segment delivered robust growth, with revenues rising 25% year over year to $74 million from $59 million. Operational EBITDA for AM&C rose to $7 million from $1 million, reflecting stronger volume demand and improved pricing. The Brand segment’s revenues were flat at $4 million but saw a modest rise in operational EBITDA to $4 million from $3 million.
The company ended the quarter with $158 million in cash, a $43-million decrease from the end of 2024. The cash flow from operations was a negative $38 million against a $17-million inflow in the year-ago quarter. The deterioration was primarily led by lower net earnings, higher inventory, and increased receivables and other liabilities. Investing cash outflows were $7 million, down from $14 million the prior year due to the absence of asset sale proceeds.
Management Commentary
CEO Jim Continenza emphasized Kodak’s ongoing commitment to its United States-based manufacturing footprint, noting expansions in both pharmaceutical and film capabilities. Management reiterated its focus on shedding unprofitable businesses, investing in innovation, and enhancing operational efficiencies. Management also acknowledged that cost pressures, especially from aluminum and labor, had impacted profitability but were partially offset by strategic price increases.
CFO David Bullwinkle provided further insight into the financials, emphasizing that the company’s operational execution continued amid economic uncertainty. He highlighted the AM&C segment as a growth driver, and noted that cash usage was primarily related to investments in AM&C initiatives and higher input costs. Management expects the cGMP pharma facility to become operational later in 2025, supporting revenue expansion.
Factors Influencing Headline Numbers
Kodak’s top-line resilience can be attributed to stable demand in its core businesses and increased contributions from AM&C. However, the significant decline in net income and operational EBITDA was influenced by multiple headwinds — increased aluminum and manufacturing costs, the absence of prior-year asset sale gains, and unfavorable foreign exchange effects. The Print segment faced particular margin compression due to these factors, while the AM&C segment benefited from higher volumes and prices in film and chemical sales.
Guidance Provided by Management
Management indicated continued investment in innovation and operational efficiency, particularly within AM&C and digital printing technologies like the PROSPER ULTRA 520 press, which is transitioning from controlled introduction to controlled production. Management also pointed to the progress in winding down the Kodak Retirement Income Plan (KRIP), with asset reversions expected to help reduce long-term debt.
Other Developments
In the quarter, Kodak made notable progress on terminating its U.S. pension plan, KRIP, which ceased accruing benefits as of March 31, 2025. Election mailings for participants are scheduled for the summer, and annuity purchases are expected in the fourth quarter. The company anticipates that any reversion of excess plan assets will be directed toward debt reduction, lowering interest expenses. Kodak also amended its term-loan credit agreement to permit interest payments in-kind for the next six quarters and revised prepayment terms for certain transactions.
Overall, while Eastman Kodak managed to stabilize revenues; margin pressures, and a sharp decline in net income and cash flows underscore the financial headwinds the company continues to face.
Management's emphasis on long-term restructuring and focused investments in AM&C may be fruitful in the future, but near-term profitability challenges are concerning.
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Eastman Kodak Q1 Earnings Dip Y/Y Amid Cost Pressures & Flat Sales
Shares of Eastman Kodak Company (KODK - Free Report) have declined 7.1% since reporting results for the first quarter of 2025. This compares with the S&P 500 index’s 3.1% growth over the same time frame. Over the past month, the stock has lost 1.5% compared with the S&P 500’s 8.1% rally.
Earnings & Revenue Performances
Kodak’s financial performance for the first quarter reflected stability in top-line revenues but pronounced weakness in profitability. The company reported consolidated revenues of $247 million, down 1% from $249 million in the year-ago quarter. However, gross profit declined 6% to $46 million from $49 million, led by higher aluminum and manufacturing costs.
On the bottom line, the company swung to a net loss of $7 million from a net income of $32 million in the first quarter of 2024. This reversal was partly attributable to the absence of a $17-million gain on asset sales recorded in the prior-year period. Operational EBITDA dropped 50% to $2 million from $4 million, though excluding foreign exchange and non-cash adjustments, it showed a $1-million improvement.
Eastman Kodak Company Price, Consensus and EPS Surprise
Eastman Kodak Company price-consensus-eps-surprise-chart | Eastman Kodak Company Quote
Other Key Business Metrics
Segment-wise, performance was mixed. The Print division reported revenues of $165 million, a decline of $17 million from the prior-year period. Operational EBITDA for this segment fell to negative $9 million from breakeven due to input cost pressures.
In contrast, the Advanced Materials and Chemicals (AM&C) segment delivered robust growth, with revenues rising 25% year over year to $74 million from $59 million. Operational EBITDA for AM&C rose to $7 million from $1 million, reflecting stronger volume demand and improved pricing. The Brand segment’s revenues were flat at $4 million but saw a modest rise in operational EBITDA to $4 million from $3 million.
The company ended the quarter with $158 million in cash, a $43-million decrease from the end of 2024. The cash flow from operations was a negative $38 million against a $17-million inflow in the year-ago quarter. The deterioration was primarily led by lower net earnings, higher inventory, and increased receivables and other liabilities. Investing cash outflows were $7 million, down from $14 million the prior year due to the absence of asset sale proceeds.
Management Commentary
CEO Jim Continenza emphasized Kodak’s ongoing commitment to its United States-based manufacturing footprint, noting expansions in both pharmaceutical and film capabilities. Management reiterated its focus on shedding unprofitable businesses, investing in innovation, and enhancing operational efficiencies. Management also acknowledged that cost pressures, especially from aluminum and labor, had impacted profitability but were partially offset by strategic price increases.
CFO David Bullwinkle provided further insight into the financials, emphasizing that the company’s operational execution continued amid economic uncertainty. He highlighted the AM&C segment as a growth driver, and noted that cash usage was primarily related to investments in AM&C initiatives and higher input costs. Management expects the cGMP pharma facility to become operational later in 2025, supporting revenue expansion.
Factors Influencing Headline Numbers
Kodak’s top-line resilience can be attributed to stable demand in its core businesses and increased contributions from AM&C. However, the significant decline in net income and operational EBITDA was influenced by multiple headwinds — increased aluminum and manufacturing costs, the absence of prior-year asset sale gains, and unfavorable foreign exchange effects. The Print segment faced particular margin compression due to these factors, while the AM&C segment benefited from higher volumes and prices in film and chemical sales.
Guidance Provided by Management
Management indicated continued investment in innovation and operational efficiency, particularly within AM&C and digital printing technologies like the PROSPER ULTRA 520 press, which is transitioning from controlled introduction to controlled production. Management also pointed to the progress in winding down the Kodak Retirement Income Plan (KRIP), with asset reversions expected to help reduce long-term debt.
Other Developments
In the quarter, Kodak made notable progress on terminating its U.S. pension plan, KRIP, which ceased accruing benefits as of March 31, 2025. Election mailings for participants are scheduled for the summer, and annuity purchases are expected in the fourth quarter. The company anticipates that any reversion of excess plan assets will be directed toward debt reduction, lowering interest expenses. Kodak also amended its term-loan credit agreement to permit interest payments in-kind for the next six quarters and revised prepayment terms for certain transactions.
Overall, while Eastman Kodak managed to stabilize revenues; margin pressures, and a sharp decline in net income and cash flows underscore the financial headwinds the company continues to face.
Management's emphasis on long-term restructuring and focused investments in AM&C may be fruitful in the future, but near-term profitability challenges are concerning.