Kodak returns to profit in 1st-Qtr, revenue rises
Eastman Kodak Co. said Thursday it posted a $119 million profit in the first quarter in contrast to a steep loss a year ago, lifted by inkjet printer sales and a settlement deal with Samsung Electronics Co. over disputed digital-imaging technology.
Revenue rose 31 percent, matching Wall Street expectations. But its adjusted earnings fell short of analysts' estimates.
Kodak shares fell 48 cents, or 5.7 percent, to $7.87 in pre-opening trading.
The photography pioneer said it earned 40 cents a share, in the January-March period. That compares with a loss of $353 million, or $1.32 a share, a year earlier.
Excluding one-time items of $137 million, or 42 cents a share, Kodak said it earned 82 cents a share. Analysts expected Kodak to earn 90 cents per share.
Revenue rose to $1.93 billion from $1.48 billion, boosted by a one-time licensing payment of $550 million from Samsung. It also benefited from a 27 percent jump in sales of consumer inkjet printers and ink.
Digital sales rose 55 percent to $1.5 billion from $972 million in last year's first quarter. The segment notched an operating profit of $393 million compared with a an operating loss of $217 million a year earlier.
Traditional film-based revenue fell 14 percent to $431 million from $503 million. Helped by cost reductions, however, operating profits doubled to $16 million.
After a yearlong legal tussle, Kodak negotiated royalty payment deals with South Korea's Samsung and LG Electronics Inc. in December. It followed up in January by suing Apple Inc. and Research in Motion Ltd. over digital-camera technology in their iPhone and BlackBerry smart phones.
Kodak has amassed more than 1,000 digital-imaging patents, and almost all of today's digital cameras rely on that technology. On average, it expects to generate $250 million to $350 million annually through 2011 in licensing fees and royalties from its intellectual property.
Kodak is relying on leaner costs, licensing fees from digital-imaging inventions, and film revenue as it battles to complete a long-drawn-out digital transformation. It eliminated 4,100 jobs in 2009, shrinking its work force to 20,300, the smallest since the 1930s.
On the Net: www.kodak.com