Kodak Stock Dives 21% After Warning It May Cease Operations Without Financial Support

The 133-year-old photography icon, Eastman Kodak Co., is facing an existential threat as it disclosed in a recent filing that it cannot assure its continued operations without significant external financial support [1]. The warning came alongside the release of its second-quarter earnings report, which revealed mounting financial pressure from $500 million in debt due within 12 months and limited access to refinancing [1]. The announcement caused a sharp drop in its stock price, which fell 21% to $5.43 by Wednesday morning [1].

Kodak reported $263 million in revenue for the quarter, down 1% from the previous year. However, the decline in gross profit—falling 12% to $51 million—highlighted the company's struggle to maintain profitability. Its profit margins shrank from 22% to 19%, and it recorded a $26 million loss, a reversal from the $26 million profit in the same period last year [1]. Operational EBITDA also declined to $9 million from $12 million, reflecting weaker sales and rising production costs [1].

The company’s cash reserves have also been under pressure. Kodak ended the quarter with $155 million in cash, with only $70 million based in the U.S., a $46 million drop from December 2024 [1]. Chief financial officer David Bullwinkle noted the company is considering terminating its U.S. Kodak Retirement Income Plan and using excess assets to reduce debt [1]. The firm expects to finalize the process by December after securing clarity on obligations to plan participants by mid-August [1].

Analysts suggest Kodak's challenges reflect broader industry pressures. According to Dave Zhang from WhatTheyThink, the commercial printing sector globally is under strain, with customers delaying large purchases amid tariffs and economic uncertainty [1]. Kodak, once dominant in the photography market, has undergone multiple transformations since its bankruptcy in 2012, including a pivot to commercial printing, packaging, and specialty chemicals [1]. Its recent efforts in advanced materials, including film for the movie industry and pharmaceutical components, have shown some promise, but the company still lacks the financial flexibility to stabilize its operations [1].

Kodak’s journey from its founding in the late 19th century to becoming a household name in photography has been marked by innovation and missteps. While the company once held 90% of the U.S. film market, its failure to fully embrace digital technology in the early days of the digital revolution led to a steep decline. The mid-2000s under former CEO Antonio Pérez saw significant divestitures in core manufacturing, further eroding the company's competitive edge [1].

Today, Kodak is attempting to leverage nostalgia and its heritage in film, with hundreds of retail stores operating internationally. However, the company’s current strategy faces scrutiny. Timothy Calkins, a marketing professor at Northwestern University’s Kellogg School of Management, described Kodak’s brand licensing strategy as “striking” and “sad,” signaling a sense of desperation [1].

Despite these challenges, Kodak has seen some progress in its Advanced Materials & Chemicals division, which contributed to revenue growth during the second quarter. CEO Jim Continenza emphasized the importance of expanding this segment, noting that U.S. manufacturing capacity could offer some protection against tariff-related disruptions [1]. However, the company’s ability to execute its strategic plans remains contingent on external factors, including access to financing and the success of its debt restructuring [1].

The road ahead for Kodak remains uncertain. While the company has demonstrated resilience through multiple reinventions, its current financial position suggests that its survival is far from guaranteed. Investors and industry observers are now watching closely to see whether Kodak can overcome its debt crisis and find a new path to growth—or whether this is the end of the road for one of the most iconic names in photographic history [1].

Source: [1] Kodak’s corporate doom: 133-year-old photo icon warns investors it may cease operations with $500 million debt problem (https://fortune.com/2025/08/13/kodak-financial-troubles-survival-risk-debt-declining-sales/)