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Note 26 - Segment Information
 12 Months Ended
Dec. 31, 2024
Segment Reporting [Abstract]  
Segment Information

NOTE 26: SEGMENT INFORMATION

Kodak has three reportable segments: Print, Advanced Materials and Chemicals and Brand. Kodak’s reportable segments are based on a combination of factors that the chief operating decision maker (“CODM”) uses to evaluate and manage the business operations, including but not limited to, Kodak’s organizational structure, customer base, markets, products and services and related technologies. Kodak does not aggregate operating segments. A description of Kodak’s reportable segments follows.

Print: The Print segment is comprised of four lines of business, the Prepress Solutions business: the Prosper business, the Software business and the Electrophotographic Printing Solutions business.

Advanced Materials and Chemicals: The Advanced Materials and Chemicals segment is comprised of four lines of business: the Industrial Film and Chemicals business, the Motion Picture business, the Advanced Materials and Functional Printing business and the IP Licensing and Analytical Services business.

 

Brand: The Brand segment contains the brand licensing business.

 

The balance of Kodak’s continuing operations, which do not meet the criteria of a reportable segment, are reported in All Other revenues and All Other Operational EBITDA, and primarily represent the operations of the Eastman Business Park, a more than 1,200 acre technology center and industrial complex.

The accounting policies of the segments are the same as those described in the summary of significant accounting policies in Note 1. There are no intersegment sales between the segments.

Kodak’s CODM is the Executive Chairman and Chief Executive Officer. Kodak’s segment measure of profit and loss is an adjusted earnings before interest, taxes, depreciation and amortization (“Operational EBITDA”). Operational EBITDA represents the earnings from operations excluding the provision for income taxes; non-service cost components of pension and other postemployment benefits (“OPEB”) income; depreciation and amortization expense; restructuring costs and other; stock-based compensation expense; consulting and other costs; interest expense; other operating income (expense), net and other income (charges), net.

The CODM uses Operational EBITDA in assessing segment performance and deciding how to allocate resources for each segment predominantly through the annual budget and forecasting process. The CODM evaluates Operational EBITDA budget-to-actual variances, changes in Operational EBITDA from prior periods and when comparing the results of each segment with one another.

 

Segment financial information is shown below. Asset information by reportable segment is not disclosed below as this information is not regularly provided to or used by the CODM in assessing performance and allocating resources.

 

 

 

 

Segment Revenues, Operational EBITDA and Consolidated Earnings from Continuing Operations Before Income Taxes

 

 

Year Ended December 31,

 

2024

 

 

2023

 

 

2022

 

(in millions)

 

 

 

 

 

 

 

 

Print:

 

 

 

 

 

 

 

 

    Revenues from external customers

$

737

 

 

$

828

 

 

$

938

 

    Cost of revenues

597

 

 

 

667

 

 

 

797

 

    Selling, general and administrative expenses

130

 

 

 

124

 

 

 

117

 

    Research and development expenses

18

 

 

 

17

 

 

 

19

 

        Operational EBITDA

 

(8

)

 

 

20

 

 

 

5

 

 

 

 

 

 

 

 

 

 

Advanced Materials and Chemicals:

 

 

 

 

 

 

 

 

    Revenues from external customers

 

271

 

 

 

255

 

 

 

234

 

    Cost of revenues

210

 

 

 

203

 

 

 

201

 

    Selling, general and administrative expenses

33

 

 

 

30

 

 

23

 

    Research and development expenses

11

 

 

 

12

 

 

 

11

 

        Operational EBITDA

 

17

 

 

 

10

 

 

 

(1

)

 

 

 

 

 

 

 

 

 

Brand:

 

 

 

 

 

 

 

 

    Revenues from external customers

 

20

 

 

 

17

 

 

 

17

 

    Selling, general and administrative expenses

3

 

 

 

2

 

 

3

 

        Operational EBITDA

 

17

 

 

 

15

 

 

 

14

 

 

 

 

 

 

 

 

 

 

Total Operational EBITDA for Reportable Segments

 

26

 

 

 

45

 

 

 

18

 

    All Other Operational EBITDA

 

2

 

 

 

2

 

 

 

3

 

    Depreciation and amortization

 

(28

)

 

 

(30

)

 

 

(29

)

    Restructuring costs and other

 

(8

)

 

 

(10

)

 

 

(13

)

    Stock-based compensation

 

(6

)

 

 

(7

)

 

 

(5

)

    Consulting and other costs (1)

 

(1

)

 

 

13

 

 

 

2

 

    Idle costs (2)

 

(2

)

 

 

(3

)

 

 

(3

)

    Other operating income (expense), net (3)

 

10

 

 

 

(6

)

 

 

1

 

    Interest expense (3)

 

(59

)

 

 

(52

)

 

 

(40

)

    Pension income excluding service cost component (3)

 

173

 

 

 

161

 

 

 

98

 

    Loss on early extinguishment of debt (3)

 

—

 

 

 

(27

)

 

 

—

 

    Other income (charges), net (3)

 

3

 

 

 

1

 

 

 

(1

)

Consolidated earnings from continuing operations before income taxes

$

110

 

 

$

87

 

 

$

31

 

 

 

 

 

 

 

 

 

 

 

Consulting and other costs are professional services and internal costs associated with corporate strategic initiatives and litigation. Consulting and other costs included $15 million of income in the year ended December 31, 2023, representing insurance reimbursement of legal costs previously paid by the Company associated with investigations and litigation matters. Kodak received $20 million of insurance reimbursement in 2023 of which $5 million was recorded in Other current assets in the Consolidated Statement of Financial Position as of December 31, 2022.
(2)
Consists of third-party costs such as security, maintenance, and utilities required to maintain land and buildings in certain locations not used in any Kodak operations and the costs, net of any rental income received, of underutilized portions of certain properties.
(3)
As reported in the Consolidated Statement of Operations.

 

 

 

 

 

A reconciliation of reportable segment revenues to consolidated revenues follows:

 

 

Year Ended December 31,

 

(in millions)

2024

 

 

2023

 

 

2022

 

Total Reportable Segment Revenues

$

1,028

 

 

$

1,100

 

 

$

1,189

 

All Other Revenues

 

15

 

 

 

17

 

 

16

 

    Total Consolidated Revenues

$

1,043

 

 

$

1,117

 

 

$

1,205

 

In 2024, Kodak decreased employee benefit reserves by $2 million primarily reflecting a decrease in workers’ compensation reserves of approximately $2 million driven by changes in discount rates. The decrease in reserves in 2024 impacted gross profit and SG&A each by approximately $1 million.

In 2023, Kodak decreased employee benefit reserves by $1 million primarily reflecting a reduction in workers’ compensation reserves of approximately $1 million driven by changes in discount rates. The decrease in reserves in 2023 impacted SG&A by approximately $1 million.

In 2022, Kodak decreased employee benefit reserves by approximately $15 million composed of a reduction in workers’ compensation reserves of approximately $13 million driven by changes in discount rates and a decrease in other employee benefit reserves of approximately $2 million, driven by both changes in discount rates and favorable experience. The decrease in reserves in 2022 impacted gross profit by approximately $9 million, R&D by approximately $1 million and SG&A by approximately $5 million.

 

Amortization and depreciation expense by segment are not included in the segment measure of profit and loss but are regularly provided to the CODM.

 

(in millions)

Year Ended December 31,

 

Intangible asset amortization expense from continuing operations:

2024

 

 

2023

 

 

2022

 

Print

$

4

 

 

$

4

 

 

$

4

 

Brand

 

—

 

 

 

—

 

 

 

1

 

Total

$

4

 

 

$

4

 

 

$

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

Year Ended December 31,

 

Depreciation expense from continuing operations:

2024

 

 

2023

 

 

2022

 

Print

$

17

 

 

$

17

 

 

$

17

 

Advanced Materials and Chemicals

 

6

 

 

 

7

 

 

 

6

 

All Other

 

1

 

 

 

1

 

 

 

1

 

Total

$

24

 

 

$

25

 

 

$

24

 

 

(in millions)

Year Ended December 31,

 

Long-lived assets located in: (1)

2024

 

 

2023

 

The United States

$

147

 

 

$

112

 

Europe, Middle East and Africa

 

5

 

 

 

6

 

Asia Pacific

 

5

 

 

 

5

 

Canada and Latin America

 

36

 

 

 

46

 

Non-U.S. countries total (2)

 

46

 

 

 

57

 

Total

$

193

 

 

$

169

 

 

(1)
Long-lived assets are comprised of property, plant and equipment, net.
(2)
Of the total non-U.S. property, plant and equipment in 2024, $35 million was located in Brazil. Of the total non-U.S. property, plant and equipment in 2023, $45 million was located in Brazil.

Major Customers

No single customer represented 10% or more of Kodak’s total net revenue in any year presented.