Kodak Has Loss Despite Digital Sales Gain

For the first time, Eastman Kodak Co. is generating more sales from digital imaging than from film-based photography, yet its massive makeover brought more pain in the third quarter -- a $1.03-billion loss largely because of one-time tax charges.

Even excluding restructuring and other charges, analysts said Kodak’s results missed Wall Street forecasts.

Its stock fell $1.08, or 4.7%, to $22.06 after going as low as $20.91 in intraday trading, its lowest level since September 2003.

Kodak lost $3.58 a share in the July-September quarter, contrasted with a profit of $458 million, or $1.60, a year earlier. Its loss from continuing operations, excluding one-time charges, was $103 million.

Sales rose 5.3% to $3.55 billion, up from $3.37 billion in last year’s third quarter.

Although it was stung once more by the rapid slide in film sales, Kodak found solace in its steady drive into the digital era. Its overall digital sales in the quarter surged 47% to $1.89 billion, while revenue from film, paper and other traditional, chemical-based businesses slumped 20% to $1.66 billion.

“This is an important milestone in our transformation journey,” Chief Executive Antonio Perez said. “We’re building a strong digital company for the future.”

The quarterly loss, Kodak’s third in a row, included a noncash charge of $900 million, or $3.13 a share -- an accounting requirement directly related to its huge overhaul. In July, Kodak disclosed plans to lay off 10,000 employees on top of 12,000 to 15,000 job cuts targeted in January 2004.