Bankruptcy

Layoffs, Restructuring Tougher for Kodak

Analog-to-digital conversion will entail more job cuts, higher charges.
Stephen TaubFebruary 8, 2007

Eastman Kodak announced that its latest efforts to transform itself from an icon of print photography to a player in a digital marketplace will be costlier than it had anticipated.

Kodak now expects that total employment reductions will range between 28,000 and 30,000 positions; total charges, between $3.6 billion and $3.8 billion.

As of last August, the company had anticipated reductions of between 25,000 and 27,000 positions and charges totaling $3 billion to $3.4 billion. During the fourth quarter, the company announced that it had eliminated about 1,200 positions, for a total of about 23,400 at that time, and cumulative charges of $2.7 billion.

By the end of 2007, Kodak’s work force will fall below 30,000, less than half its size just three years ago.

Kodak has suffered through a number of outsized restructurings over the past 25 years with very spotty success. This year alone, stated the company, it expects to make restructuring payments of between $575 million and $625 million.

The company also pledged to complete its major business restructuring by the end of 2007. “I want this [spending] to stop this year,” said chairman and chief executive officer Antonio M. Perez during a meeting with investors, according to Reuters.