- Kodak might have to cease its operations after 133 years since it does not have the funds to pay off its $500 million loan.
- The company reported this in its second quarterly earnings report, where it also raised concerns about its future.
- As a measure to pay off a portion of the loan, Kodak will be ceasing pension plan payments to its employees.
Kodak, the company that revolutionized photography, might be on the brink after 133 years of service. The company has warned investors that it does not have the funds to pay off its $500 million loan, raising concerns it may be forced to cease its operations in the future.
Eastman Kodak shared its quarterly earnings report on Monday, warning that it does not have the necessary financing or liquidity to pay off its upcoming $500 million debt obligations. Kodak’s report further mentions, “These conditions raise substantial doubt about the company’s ability to continue as a going concern.”
The report has resulted in a 25% drop in Kodak’s (KODK) shares on Tuesday. As a recovery measure, Kodak will stop pension plan payments to its employees to pay off its debts. It also states that it doesn’t expect Trump’s latest tariffs to have any impact, since most of its products are made in the United States.
Kodak has had a tumultuous past, from being at the top of its game, responsible for 90% of film cameras in the United States in the 1970s, to filing for bankruptcy in 2012 and later turning into a pharmaceutical brand in 2020. Yet here we are again, as the company’s future looms in the dark.
A Kodak spokesperson told CNN that it is “confident it will be able to pay off a significant portion of its term loan well before it becomes due, and amend, extend or refinance our remaining debt and/or preferred stock obligations.” These measures may address the current threat, but the company’s future remains uncertain.
