Iconic US film company Kodak warns it may go out of business
The American company credited with revolutionizing amateur photography is warning it could go out of business after more than 130 years.
The Rochester, New York-based Eastman Kodak Co. offered a bleak picture of its financials in earnings reports and filings, tracking a second quarter loss and sending shares tumbling in early trading Tuesday, Aug. 12.
The iconic brand said in Monday, Aug. 11 government filings that there is "substantial doubt" about the company’s ability to continue, as it faces more than $470 million in debt and slashes its pension plan in an attempt to remain afloat.
"Kodak has debt coming due within twelve months and does not have committed financing or available liquidity to meet such debt obligations if they were to become due in accordance with their current terms," the company said in its filings to the Securities and Exchange Commission.
Kodak became one of the most iconic American companies in the late 19th century with the introducton of the Kodak #1 camera in 1888, credited with making photography accessible to the everyday person. Though it rose to prominence for its film photography products, it struggled to adapt to the changing industry as digital imaging took over, with the company filing for bankruptcy in 2012. In recent years, it has pursued specialty chemicals and pharmaceuticals.
Tariffs had no 'material impact'
In its most recent earnings report, Kodak said its consolidated revenues were $263 million at the end of the quarter on June 30, a decrease of $4 million since the same period last year. Gross profit decreased 12% compared to last year's second quarter end, Kodak disclosed, and its cash balance sits at $155 million, marking a loss of just under 23% since the end of December.
Jim Continenza, Kodak’s Executive Chairman and CEO, said tariffs have not had a "material impact" on its businesses, noting the domestic production of many of its products such as printing plates, film, inkjet presses and inks and pharmaceutical ingredients.
What's next for Kodak?
Kodak's chief financial officer David Bullwinkle said in the company's Aug. 11 statement it plans to focus on its advanced chemicals and materials sector moving forward, and said the cut to its retirement program is going toward paying down its debt.
He said the company expects to "have a clear understanding" by Friday, Aug. 15 of how it will meet its debt obligations.
"For the second half of the year, we will continue to focus on reducing costs today and converting our investments into long-term growth," Bullwinkle said.
The company was founded by George Eastman in 1889 and renamed a few years later to the Eastman Kodak Company. Eastman's Kodak Brownie camera introduced in 1900 made photography accessible to everyday Americans, later introducing color versions in the 1920s and 1930s, and offering the world's first digital camera in 1975.
Kathryn Palmer is a national trending news reporter for Paste BN. You can reach her at kapalmer@usatoday.com and on X @KathrynPlmr.