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Eastman Kodak (KODK) Q2 FY26 earnings call

Earnings call· Jun 2026 (Q2 FY26)· Industrials· Aug 4, 2026

Source: earnings call transcript

Executive summary

Eastman Kodak Q2 FY26 — Strong Growth and Balance Sheet Improvement

Eastman Kodak delivered a strong second quarter, marking its fourth consecutive quarter of year-over-year growth across key financial metrics. The company highlighted significant improvements in revenue, gross profit, and operational EBITDA, driven by strategic focus on core competencies and operational excellence. The balance sheet was further strengthened through substantial debt reduction. The call was a monologue with no Q&A session.

Highlights

5

  • Consolidated revenues increased by $48 million or 18% year-over-year to $311 million.

  • Gross profit grew by $31 million or 61% year-over-year to $82 million.

  • Operational EBITDA improved by $27 million or 300% year-over-year to $36 million.

  • Debt to EBITDA ratio significantly reduced to 1x in Q2 FY26 from 23x in Q2 FY25.

  • Net cash position increased by $52 million to $180 million at June 30, 2026.

Concerns

3

  • Unrestricted cash was down $47 million from December 31, 2025, primarily due to term loan repayments.

  • Inventory increased by $37 million, mainly in AM&C due to higher silver prices and building ahead of a maintenance shutdown.

  • Non-cash pension income declined by $11 million year-over-year following the termination of the CRIP pension plan.

Segment performance

SegmentRevenueYoYQoQMargin
Advanced Materials and Chemicals
Revenues increased significantly, driven by reinvestment in core competencies like motion picture film and new initiatives in pharma and battery coating.
$105 million40%——
Commercial Print
Achieved growth despite competitive market, supply shortages, and inflation, reflecting product and service superiority.
$195 million10%——

Product announcements

ProductTypeDetails
Kodak Pharmaceutical Websitelaunch
Vision 3 AHU film structureupdate

Capital programs

Battery Coating Investment underway

Benefit:additional capabilities such as coating electrodes at a large scale and using pilot facility to help other customers scale new technologies

Investing CapEx into the machine to add additional capabilities for battery coating.

Risks & headwinds

Continued volatility in commodity costs

Higher commodity costs for aluminum and silver offset some gross profit gains.

Mitigation:Focus on operational excellence and improving efficiency to navigate challenging business environment.

Ongoing inflationary pressures

Impacted commercial print business.

Mitigation:Superior products and service allowed continued delivery and support to customers.

Shortage in supply

Impacted commercial print business.

Mitigation:Superior products and service allowed continued delivery and support to customers.

Lower non-cash pension income Expected to remain below prior year levels throughout 2026.

$11 million decline YoY in Q2 FY26.

Mitigation:Result of CRIP plan termination and asset reversion in Q4 2025.

Increased inventory levels

$37 million increase.

Mitigation:Partially strategic (building ahead of maintenance shutdown) and partially due to higher silver prices and increased volume carried.

What to watch in Q3 FY26

Battery Coating Capabilities Expansion

next quarter
Current CapEx being invested
Target Progress on large-scale electrode coating and pilot facility utilization

Why it matters

This investment is key to expanding into new, higher-margin areas within Advanced Materials and Chemicals.

We continue to invest in our battery coating. We're putting CapEx into the machine to add additional capabilities, such as coating electrodes at a large scale and using our pilot facility to help other customers scale new technologies.

Find out whether KODK delivers this. Inve re-checks your case every morning.

2 min read 6 chapters

Detailed narrative

Strategic Focus and Core Strengths

Management emphasized a consistent focus on leveraging core strengths in layering and coating, which they consider a core competency where Kodak excels. This strategy has led to year-over-year improvements in key metrics for four consecutive quarters, indicating a stable and growing business. The company plans to continue focusing on execution and innovating new products.

Advanced Materials and Chemicals (AM&C) Performance

The AM&C segment reported revenues of $105 million, a 40% increase from Q2 2025. This growth was attributed to reinvestment in core competencies, particularly in motion picture film, with two blockbuster movies ('The Odyssey' and 'Disclosure Day') shot on Kodak Film. The segment also launched its first pharmaceutical website and continues to invest in battery coating capabilities.

Commercial Print Segment Growth

Commercial Print, now the largest division, saw revenues of $195 million, a 10% increase year-over-year. This growth was achieved despite a competitive marketplace, supply shortages, and inflationary pressures. Management highlighted the superiority of their products and service as key drivers for this performance across global markets.

Balance Sheet Strengthening and Debt Reduction

Kodak significantly improved its balance sheet, reducing its debt to EBITDA ratio to 1x in Q2 2026 from 23x in Q2 2025. The company made $50 million in principal payments on term loans during the quarter, bringing the year-to-date total to $100 million.

These repayments were primarily funded by $41 million in cash proceeds from CRIP pension asset redemptions, contributing to a $52 million increase in net cash position.

Operational Excellence and Profitability

The company achieved a gross profit percentage of 26% in Q2 2026, up from 19% in the prior year quarter, reflecting strong operational execution. This was driven by favorable pricing and higher volumes, which more than offset increased commodity costs for aluminum and silver. The improvement in operational EBITDA also contributed to a $43 million improvement in GAAP net income.

Investment in Innovation and R&D

Kodak is accelerating its investment in R&D, including the acquisition of an R&D division. This move is aimed at focusing on innovation, efficiency, and quality control. Specific investments include CapEx for battery coating machines to add capabilities like large-scale electrode coating and using pilot facilities to help customers scale new technologies.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.