Note 10 - Revenue

9 Months Ended

Sep. 30, 2023

Notes to Financial Statements

Revenue from Contract with Customer [Text Block]

NOTE 10: REVENUE

Disaggregation of Revenue

The following tables present revenue disaggregated by major product and geography:

Major Product:

Three Months Ended
September 30, 2023
			Advanced
			Materials
			and
(in millions)	Print		Chemicals		Brand		All Other		Total
Core products (1)
Plates, inks and other consumables	$	135	$	7	$	—	$	—	$	142
Ongoing service arrangements		45		—		—		—		45
Total annuities		180		7		—		—		187
Equipment & software		16		—		—		—		16
Film and chemicals		—		53		—		—		53
Total Core		196		60		—		—		256
Growth products (2)		—		4		—		—		4
Other (3)		—		—		4		5		9
Total	$	196	$	64	$	4	$	5	$	269

Nine Months Ended
September 30, 2023
			Advanced
			Materials
			and
(in millions)	Print		Chemicals		Brand		All Other		Total
Core products (1)
Plates, inks and other consumables	$	427	$	19	$	—	$	—	$	446
Ongoing service arrangements		142		—		—		—		142
Total annuities		569		19		—		—		588
Equipment & software		51		—		—		—		51
Film and chemicals		—		166		—		—		166
Total Core		620		185		—		—		805
Growth products (2)		—		12		—		—		12
Other (3)		—		—		12		13		25
Total	$	620	$	197	$	12	$	13	$	842

Three Months Ended
September 30, 2022
			Advanced
			Materials
			and
(in millions)	Print		Chemicals		Brand		All Other		Total
Core products (1)
Plates, inks and other consumables	$	153	$	7	$	—	$	—	$	160
Ongoing service arrangements		51		—		—		—		51
Total annuities		204		7		—		—		211
Equipment & software		20		—		—		—		20
Film and chemicals		—		47		—		—		47
Total Core		224		54		—		—		278
Growth products (2)		—		4		—		—		4
Other (3)		—		—		3		4		7
Total	$	224	$	58	$	3	$	4	$	289

Nine Months Ended
September 30, 2022
			Advanced
			Materials
			and
(in millions)	Print		Chemicals		Brand		All Other		Total
Core products (1)
Plates, inks and other consumables	$	496	$	20	$	—	$	—	$	516
Ongoing service arrangements		156		—		—		—		156
Total annuities		652		20		—		—		672
Equipment & software		52		—		—		—		52
Film and chemicals		—		142		—		—		142
Total Core		704		162		—		—		866
Growth products (2)		—		11		—		—		11
Other (3)		—		—		11		12		23
Total	$	704	$	173	$	11	$	12	$	900

⁽¹⁾ Core includes the Print segment and the Motion Picture and Industrial Film and Chemicals businesses within the Advanced Materials and Chemicals segment, excluding coating and product commercialization services (“Coating Services”).

⁽²⁾ Growth consists of Coating Services and Advanced Materials and Functional Printing within the Advanced Materials and Chemicals segment.

⁽³⁾ Other consists of Intellectual Property Licensing ("IP Licensing"), Brand Licensing and Eastman Business Park. 

Geography ^(1):

Three Months Ended
September 30, 2023
			Advanced
			Materials
			and
(in millions)	Print		Chemicals		Brand		All Other		Total
United States	$	60	$	48	$	4	$	5	$	117
Canada		5		—		—		—		5
North America		65		48		4		5		122
Europe, Middle East and Africa		86		5		—		—		91
Asia Pacific		40		10		—		—		50
Latin America		5		1		—		—		6
Total	$	196	$	64	$	4	$	5	$	269

Nine Months Ended
September 30, 2023
			Advanced
			Materials
			and
(in millions)	Print		Chemicals		Brand		All Other		Total
United States	$	192	$	155	$	12	$	13	$	372
Canada		13		1		—		—		14
North America		205		156		12		13		386
Europe, Middle East and Africa		267		15		—		—		282
Asia Pacific		131		25		—		—		156
Latin America		17		1		—		—		18
Total	$	620	$	197	$	12	$	13	$	842

Three Months Ended
September 30, 2022
			Advanced
			Materials
			and
(in millions)	Print		Chemicals		Brand		All Other		Total
United States	$	68	$	44	$	3	$	4	$	119
Canada		5		—		—		—		5
North America		73		44		3		4		124
Europe, Middle East and Africa		95		6		—		—		101
Asia Pacific		48		8		—		—		56
Latin America		8		—		—		—		8
Total	$	224	$	58	$	3	$	4	$	289

Nine Months Ended
September 30, 2022
			Advanced
			Materials
			and
(in millions)	Print		Chemicals		Brand		All Other		Total
United States	$	203	$	130	$	11	$	12	$	356
Canada		15		1		—		—		16
North America		218		131		11		12		372
Europe, Middle East and Africa		315		15		—		—		330
Asia Pacific		146		27		—		—		173
Latin America		25		—		—		—		25
Total	$	704	$	173	$	11	$	12	$	900

⁽¹⁾ Sales are reported in the geographic area in which they originate.

Contract Balances

The timing of revenue recognition, billings and cash collections results in billed trade receivables, unbilled receivables (contract assets), and customer advances and deposits (contract liabilities) in the Consolidated Statement of Financial Position. The contract assets are transferred to trade receivables when the rights to consideration become unconditional. The amount recorded for contract assets at both  September 30, 2023 and December 31, 2022 was $1 million and is reported in Other current assets in the Consolidated Statement of Financial Position. The contract liabilities primarily relate to prepaid service contracts, upfront payments for certain equipment purchases or prepaid royalties on intellectual property arrangements. The amount recorded for contract liabilities in the Consolidated Statement of Financial Position at  September 30, 2023 and December 31, 2022 was $106 million and $51 million, respectively, of which $42 million and $40 million, respectively, was reported in Other current liabilities and $64 million and $11 million, respectively, was reported in Other long-term liabilities.

Revenue recognized for the three and nine months ended September 30, 2023 and 2022 that was included in the contract liability balance at the beginning of the year was $6 million and $31 million, respectively, in 2023 and $7 million and $36 million, respectively, in 2022 and primarily represented revenue from prepaid service contracts and equipment revenue recognition. Contract liabilities as of September 30, 2023 included $74 million and $85 million of cash payments received and amounts recorded in accounts receivable during the three and nine months ended September 30, 2023, respectively, including $49 million recorded in accounts receivable for long-term brand licensing agreements executed in the third quarter.  Refer to Note 4, "Long-term Liabilities" for additional information. Contract liabilities as of  September 30, 2022 included $19 million and $33 million of cash payments received during the three and nine months ended September 30, 2022, respectively. 

Kodak does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less or for which revenue is recognized at the amount to which Kodak has the right to invoice for services performed. Performance obligations with an original expected length of greater than one year generally consist of deferred service contracts, operating leases and licensing arrangements. As of September 30, 2023, there was approximately $100 million of unrecognized revenue from unsatisfied performance obligations. Approximately 5% of the revenue from unsatisfied performance obligations is expected to be recognized in the remainder of 2023, 15% in 2024, 10% in 2025 and 70% thereafter.