Eastman Kodak (KODK) Q3 2026 Earnings Call Transcript

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DATE

Tue, Nov. 3, 2026

CALL PARTICIPANTS

• Head of Investor Relations - Denisse Goldbarg
• Executive Chairman and Chief Executive Officer - James V. Continenza
• Chief Financial Officer and Senior Vice President - David Edward Bullwinkle

TAKEAWAYS

• Consolidated Revenue -- $276 million, an increase of 3% driven by growth in the advanced materials and chemicals segment.
• Advanced Materials and Chemicals Revenue -- $99 million, representing 21% growth as the business becomes a primary growth engine.
• Print Revenue -- $165 million, a decrease of 7% due to digital substitution, competitive pricing, and raw material price challenges.
• Gross Profit -- $73 million, an increase of 7% reflecting improved pricing and product mix.
• Gross Profit Margin -- 26%, an increase of 1 percentage point compared to 25% in the prior year quarter.
• GAAP Net Income -- $21 million, an increase of 62% resulting from lower interest expense and operational improvements.
• Operational EBITDA -- $31 million, an increase of $2 million driven by profitability improvements in chemicals that offset higher commodity costs.
• Quarterly Cash Generation -- $27 million, an indicator of operational strength and balance sheet stability.
• Nine-Month Revenue -- $852 million, up 9% from the prior year period.
• Nine-Month Gross Profit Margin -- 25%, representing a 4 percentage point improvement compared to the prior year period.
• Nine-Month GAAP Net Income -- $22 million, an improvement from a $20 million net loss in the prior year period.
• Year-to-Date Operational EBITDA -- $82 million, an increase of $42 million primarily driven by the company's smart revenue approach.
• Trailing 12-Month Operational EBITDA -- $104 million, more than doubling from the prior period.
• Debt Level -- Reduced by approximately $400 million over the past 12 months.
• Unrestricted Cash -- $317 million, up $27 million from June 30, 2026.
• Net Cash Position -- $207 million, an increase of $79 million from $128 million at year-end 2025.
• Term Loan Repayments -- $101 million, representing required payments made during the first nine months of 2026.
• Capital Expenditures -- $18 million, focused on improving the company's operations and infrastructure.
• Restricted Cash -- $80 million, a decrease of $14 million from year-end 2025 due to lower collateral requirements and a stronger balance sheet.
• Segment Revenue Contribution -- Advanced Materials and Chemicals accounted for 36% of total revenue, up from 30% in the prior year quarter.
• Inventory Cash Use -- Driven by price increases in silver and aluminum during the first nine months of the year.

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RISKS

• Continenza stated that the commercial print business faced a decline in revenue due to "challenges from higher prices and availability of raw materials, digital substitution, competitive pricing pressure, and an uneven playing field in Europe."
• Bullwinkle noted that net income improvements were "partially offset by higher SG&A costs primarily related to increased equity compensation and changes in employee benefit accruals."

SUMMARY

Eastman Kodak Company (NYSE:KODK) reported year-over-year growth across consolidated revenue, gross profit, and operational EBITDA for the third quarter. Management stated that the Advanced Materials and Chemicals segment has become the primary growth engine for the business, now accounting for more than half of operational EBITDA. The company reported a significant reduction in debt over the past 12 months, which contributed to lower interest expenses and improved net income. While the print segment faced revenue declines due to macroeconomic challenges and raw material costs, the company continued to generate positive cash flow from operations, strengthening its overall liquidity position.

• The Advanced Materials and Chemicals segment now provides approximately 1/3 of total revenue and more than half of the company's operational EBITDA, as reported by CEO Continenza.
• Continenza noted that motion picture film continues to be a capture medium of choice for major features, stating it was used for the recently released "Oppenheimer" and "Poor Things."
• The company expanded its healthcare offerings with the launch of the Kodak pharmaceutical web store and the addition of a new saline product.
• Management is investing in battery coating capacity at a large scale to assist customers in scaling new technologies.
• CFO Bullwinkle reported that infrastructure improvements have allowed the company to remove one week from its reporting timeline through increased automation.
• Continenza reaffirmed the long-term strategy for the print division, stating, "It is our intent to be the last manufacturer standing in plates."

INDUSTRY GLOSSARY

• AMC (Advanced Materials and Chemicals): A Kodak business segment focused on film, chemicals, and emerging technologies like battery coating.
• Operational EBITDA: A non-GAAP measure representing earnings before interest, taxes, depreciation, and amortization, adjusted for specific non-operational costs.
• Plates: Aluminum sheets used in offset printing to transfer images onto paper or other media.
• Computer-to-Plate (CTP): An imaging technology used in modern printing processes to transfer a digital image directly to a printing plate.
• Electrographic Printing: A digital printing process that uses electrostatic charges to transfer toner to a substrate.

Full Conference Call Transcript

Operator: Good day, and welcome to the Eastman Kodak third Quarter 26 Earnings Call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Denisse Goldbarg. Please go ahead.

Denisse Goldbarg: Thank you, and good afternoon, everyone. I am Denisse Goldbarg, Head of Investor Relations for Eastman Kodak Company. Welcome to Kodak's Third Quarter 26 Earnings Call. At 04:15 this afternoon, Kodak filed its Form 10 Q issued its release on financial results for the third quarter of 26. You may access the presentation, and other materials and the webcast for the call on our Investor Center at investor.kodak.com. During today's conference call, we will be making certain forward looking statements as defined by the Private Securities Litigation Reform Act of 2000.

We intend for these forward looking statements to be covered by the safe harbor provisions for forward looking statements contained in Section 27A of the Securities Act of 1.93 thousand and Section 21E of the Securities Exchange Act of 1.93 thousand. Investors are cautioned not to unduly rely on forward looking statements and such statements should not be read or understood as a guarantee of future performance or results. All forward looking statements are based upon Kodak's expectations and various assumptions. Future events or results may differ from those anticipated or expressed in the forward looking statements.

Important factors that could cause actual events or results to differ materially from these forward looking statements include among others, the risks, uncertainties and other factors described in more detail in Kodak's filings with the US Securities and Exchange Commission from time to time. All forward looking statements attributable to Kodak or persons acting on its behalf apply only as of the date of this presentation and are expressly qualified in their entirety by the cautionary statements included or referenced in this presentation. Kodak undertakes no obligation to update or revise forward looking statements to reflect events or circumstances that may arise after the date made, or to reflect the occurrence of unanticipated events.

In addition, the release just issued and the presentation provided contains certain measures that are deemed non GAAP measures. Reconciliations to the most directly comparable GAAP measures have been provided with the release and within the presentation on our website. In our Investor Center at investor.kodak.com. Speakers on today's call are Jim Continenza, Kodak's Executive Chairman and Chief Executive Officer and David Edward Bullwinkle, Kodak's Chief Financial Officer and Senior Vice President. We will not be holding a formal Q&A during today's call. As always, the Investor Relations team is available for follow-up. I will now turn the call over to Jim. Thank you, and have a great day.

James V. Continenza: Welcome, everyone, and thank you for joining the third quarter 26 investor call for Eastman Kodak. Kodak continues to deliver strong performance. We continue to execute our long term plan. Delivering year over year improvements in key metrics. Including revenue, gross profit, and operational EBITDA. Let me give you some highlights for the third quarter 26. Consolidated revenues of $276 million compared with $269 million for the third quarter of 2025. An increase of $7 million or 3%. Gross profit of $73 million compared with $68 million for third quarter 25, an increase of $5 million or 7%. 1 of our key metrics, operational EBITDA, of $31 million compared with $29 million for third quarter 25.

An increase of $2 million And extremely important, we generated $27 million of cash in third quarter 26. Moving on to advanced materials and chemicals, AMC, as we like to refer to AMC, as planned, has become the company's growth engine. We have invested heavily in AMC over the last several years, and we are starting to see returns for those investments. Advanced materials and chemicals revenue of $99 million compared with $82 million for third quarter 25. An increase of $17 million or 21%.

Today, the business accounts for approximately 1/3 of our revenue, and approximately more than half of our operational EBITDA. it is a big turnaround and a great investment, and they have done an outstanding job of operating that business. Some highlights. Still film. We now offer a wide range of Kodak films sold directly to distributors which have sold well as expected. We continue to see growth in motion picture film. Film continues to be the capture medium of choice for major features, including recently released Oppenheimer, and Poor Things. shot on Kodak film, in VistaVision format. We announced the launch of our Kodak pharmaceutical web store and the addition of a new saline product.

We continue to work towards obtaining class 2 certification manufacturing more complex, higher margin products. Battery coating investing in capacity, to coat electrodes at a large scale, using the pilot coating facility to help customers scale to new technologies. Moving on to highlight commercial print business. Print revenues were $165 million compared with $177 million in third quarter 25. A decrease of $12 million or 7%. The decline is primarily due to challenges from higher prices and availability of raw materials. digital substitution, competitive pricing pressure, and an uneven playing field in Europe. As we continue to focus on more profitable businesses, the print business is performing as expected.

We have experienced growth in other parts of the world, and particularly in The United States. It has delivered solid performance year over year, year to date. We remain committed to the print business. We stated before, we will say it again, it is our intent to be the last manufacturer standing in plates. In our digital business, we expect our imprinting systems business to make significant contributions. Now let me turn it over to David for the third quarter financial results.

David Edward Bullwinkle: Thanks, Jim, and welcome to the call, everybody. Thank you for joining us today. This afternoon, the company filed its Form 10 Q for the quarter ended September 30, 2026. As I have done consistently, I encourage you to review the filing in its entirety along with today's earnings release which provides additional detail on the results and metrics discussed during this call. Let's begin with the financial highlights for the third quarter of 26. Our revenue was $276 million up $7 million or 3% driven by strong growth in advanced materials and chemicals. AM&C contributed 36% of the company's revenue for the quarter, up from 30% in the prior year quarter.

Our gross profit increased $5 million or 7% to $73 million driven by improved pricing and product mix, and higher volumes in Advanced Materials and Chemicals, and brand. Partially offset by lower print volumes and increased manufacturing costs. Our gross profit percentage was 26% compared with 25% in the prior year quarter. Our GAAP net income increased $8 million or 62% to $21 million driven by lower interest expense resulting from the significant reduction in our term loan debt over the past 12 months, operational improvements resulting in higher gross profit, partially offset by higher SG&A costs primarily related to increased equity compensation and changes in employee benefit accruals.

Our operational EBITDA increased $2 million to $31 million driven by profitability improvements and higher volumes in advanced materials and chemicals, which more than offset higher commodity and SG&A costs. Moving on to our year to date results, for the first 9 months of 2026. We reported revenue of $852 million up $73 million or 9% from the prior year period. Currency fluctuations had a $5 million favorable impact on revenue. Revenue reflects growth in all of our segments, led by 21% growth in the AM&C segment.

Our gross profit increased $47 million or 28% to $212 million primarily driven by improved pricing and product mix, higher volumes and lower print manufacturing costs partially offset by higher commodity costs and increased manufacturing costs for advanced materials and chemicals. Our gross profit percentage was 25% compared with 21% in the prior year period. That is a 4 percentage point improvement versus 2025 or approximately 19% improvement in gross profit margin.

Year to date GAAP net income was $22 million compared with a $20 million GAAP net loss in the prior year period, an improvement of $42 million This was primarily driven by higher operating earnings lower interest expense from the term loan debt reduction, and lower other charges net due to the absence of asset impairment charges, partially offset by lower noncash pension income following the KRIP pension plan termination. The company's operational EBITDA increased by $42 million to $82 million primarily driven by the significant improvement in gross profit through the company's smart revenue approach which again more than offset higher SG&A expenses.

The results for the third quarter and first 9 months of 2026 reflect return on investments we have been making over the past several years to improve the company's operations and infrastructure. Jim has described many of our operational improvements, As an example of the impact of our infrastructure improvements, we have gained efficiencies in our reporting processes through more automation and centralization allowing us to take 1 week out of our reporting timeline which means quicker and better decision making. We will continue our efforts to improve the functions supporting our operations.

To further illustrate the impacts of the team's efforts over the last several years, I would also like to call your attention to our capital management scorecard which we have provided on the investor center as part of our Q3 earnings information. The metrics provided are intended to illustrate the significant improvement in the health of both our balance sheet and our operations. Each metric presented shows impressive improvement on a year over year basis. For example, our liquidity has almost doubled compared with this time in 2025.

At the same time, we have shrunk debt levels by approximately $400 million On top of the strength of the balance sheet, our operational EBITDA has more than doubled over the trailing 12 months to $104 million and the company's free cash flow has improved which provides us with the opportunity to continue to invest in growth as Jim has highlighted. I will close with a brief update on our cash and liquidity position as of September 30, 2026. We ended the third quarter with $317 million of unrestricted cash up $27 million from June 30, 2026. Driven primarily by improved operating profitability.

Cash decreased by $20 million from year end 2025, However, this decline primarily reflects required term loan repayments of $101 million during 2026, and $18 million in capital expenditures partially offset by $93 million in cash proceeds received from the redemption of Crip investment assets and cash used from an increase in inventories driven by silver and aluminum cost increases. Restricted cash supporting both our undiscounted actuarial workers' compensation obligations with the New York State Workers' Compensation Board and our letter of credit facility agreement decreased by $14 million from year end 2025 primarily due to lower cash collateral requirements.

These reductions were created in part by the strengthening of Kodak's balance sheet and the reduction of our term loan debt. We continue to pursue opportunities to further reduce restrictions on cash. Last, our net cash position increased by $79 million to $207 million as of September 30, 2026, compared with $128 million at year end 2025. Reflecting the company's reduction of debt. We are very comfortable with our debt levels and the ability of the company to generate cash as we continue to execute on our long term plan. Thank you for your time. I will now turn the call back over to Jim.

James V. Continenza: Thank you, David. Let me just give a summary again of that third quarter 26. Right? As we highlighted earlier, Kodak generated $27 million for the quarter in cash. Our consolidated revenues were up 3% year over year Our gross profit was up 7% year over year. Operational EBITDA up $2 million. Our 3 core businesses continue to contribute to our growth. Advanced Materials and Chemicals, print and brand licensing. In summary, Kodak has built a stable growing business and continued to deliver strong year over year performance and improvements. In these challenging times, we are continuing to generate cash. Which strengthens our balance sheet and is an indicator of our operational strength.

We continue to invest in AM&C and it is emerging as a growth engine as we have indicated it would. We will continue to look at ways to accelerate profitable growth. We continue to invest in print, which continues to perform in targeted areas globally. Our goal is to achieve consistent cash generation deliver on our long term plan, continue to create shareholder value, care for our employees, and always put the customer first. I would like to thank all of our employees, our customers, and our investors and shareholders and directors for all their support. Thank you very much, and have a good night.

Operator: This concludes today's conference call. Thank you all for participating. You may now disconnect.

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