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Note 13 - Revenue
3 Months Ended
Mar. 31, 2020
Revenue From Contract With Customer [Abstract]  
Revenue

NOTE 13:  REVENUE

 

Disaggregation of Revenue

 

The following tables present revenue disaggregated by major product, portfolio summary and geography.

 

 

 

Three Months Ended

 

 

 

March 31, 2020

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Plates, inks and other

   consumables

 

$

126

 

 

$

18

 

 

$

2

 

 

$

 

 

$

 

 

$

146

 

Ongoing service

   arrangements (1)

 

 

21

 

 

 

35

 

 

 

 

 

 

 

 

 

 

 

 

56

 

Total Annuities

 

 

147

 

 

 

53

 

 

 

2

 

 

 

 

 

 

 

 

 

202

 

Equipment & Software

 

 

7

 

 

 

12

 

 

 

 

 

 

 

 

 

 

 

 

19

 

Film and chemicals

 

 

 

 

 

 

 

 

38

 

 

 

 

 

 

 

 

 

38

 

Other (2)

 

 

 

 

 

 

 

 

2

 

 

 

3

 

 

 

3

 

 

 

8

 

Total

 

$

154

 

 

$

65

 

 

$

42

 

 

$

3

 

 

$

3

 

 

$

267

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

March 31, 2019

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Plates, inks and other consumables

 

$

137

 

 

$

21

 

 

$

4

 

 

$

 

 

$

 

 

$

162

 

Ongoing service arrangements (1)

 

 

21

 

 

 

40

 

 

 

1

 

 

 

 

 

 

 

 

 

62

 

Total Annuities

 

 

158

 

 

 

61

 

 

 

5

 

 

 

 

 

 

 

 

 

224

 

Equipment & Software

 

 

8

 

 

 

11

 

 

 

 

 

 

 

 

 

 

 

 

19

 

Film and chemicals

 

 

 

 

 

 

 

 

38

 

 

 

 

 

 

 

 

 

38

 

Other (2)

 

 

 

 

 

 

 

 

5

 

 

 

3

 

 

 

2

 

 

 

10

 

Total

 

$

166

 

 

$

72

 

 

$

48

 

 

$

3

 

 

$

2

 

 

$

291

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Service revenue in the Consolidated Statement of Operations includes the ongoing service revenue shown above as well as revenue from project-based document management and managed print services businesses, which is included in Other above.

 

(2)

Other includes revenue from professional services, non-recurring engineering services, print and managed media services, tenant rent and related property management services and licensing.

 

Product Portfolio Summary:

 

 

 

Three Months Ended

 

 

 

March 31, 2020

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Growth engines (1)

 

$

44

 

 

$

36

 

 

$

 

 

$

3

 

 

$

 

 

$

83

 

Strategic other businesses (2)

 

 

110

 

 

 

15

 

 

 

39

 

 

 

 

 

 

3

 

 

 

167

 

Planned declining

   businesses (3)

 

 

 

 

 

14

 

 

 

3

 

 

 

 

 

 

 

 

 

17

 

 

 

$

154

 

 

$

65

 

 

$

42

 

 

$

3

 

 

$

3

 

 

$

267

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

March 31, 2019

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Growth engines (1)

 

$

39

 

 

$

35

 

 

$

2

 

 

$

3

 

 

$

 

 

$

79

 

Strategic other businesses (2)

 

 

127

 

 

 

17

 

 

 

39

 

 

 

 

 

 

2

 

 

 

185

 

Planned declining

   businesses (3)

 

 

 

 

 

20

 

 

 

7

 

 

 

 

 

 

 

 

 

27

 

 

 

$

166

 

 

$

72

 

 

$

48

 

 

$

3

 

 

$

2

 

 

$

291

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Growth engines consist of Sonora in the Traditional Printing segment, PROSPER and Software in the Digital Printing segment, brand licensing and Advanced Materials and Functional Printing in the Advanced Materials and Chemicals segment, excluding intellectual property (IP) licensing.

 

(2)

Strategic other businesses include plates in the Traditional Printing segment; Computer to Plate (“CTP”) equipment and related service and Nexpress and related toner business in the Digital Printing segment and Motion Picture and Industrial Film and Chemicals (including external inks) and IP licensing in the Advanced Materials and Chemicals segment.

 

(3)

Planned declining businesses are product lines where the decision has been made to stop new product development and manage an orderly expected decline in the installed product and annuity base or are otherwise not strategic to Kodak. These product families consist of Consumer Inkjet, Kodak Services for Business and Kodakit in the Advanced Materials and Chemicals segment and Versamark and Digimaster in the Digital Printing segment.

 

Geography (1):

 

 

Three Months Ended

 

 

 

March 31, 2020

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

United States

 

$

35

 

 

$

28

 

 

$

30

 

 

$

3

 

 

$

3

 

 

$

99

 

Canada

 

 

3

 

 

 

2

 

 

 

 

 

 

 

 

 

 

 

 

5

 

North America

 

 

38

 

 

 

30

 

 

 

30

 

 

 

3

 

 

 

3

 

 

 

104

 

Europe, Middle East and Africa

 

 

68

 

 

 

24

 

 

 

3

 

 

 

 

 

 

 

 

 

95

 

Asia Pacific

 

 

39

 

 

 

10

 

 

 

9

 

 

 

 

 

 

 

 

 

58

 

Latin America

 

 

9

 

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

10

 

Total Sales

 

$

154

 

 

$

65

 

 

$

42

 

 

$

3

 

 

$

3

 

 

$

267

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

March 31, 2019

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

United States

 

$

36

 

 

$

39

 

 

$

30

 

 

$

3

 

 

$

2

 

 

$

110

 

Canada

 

 

2

 

 

 

1

 

 

 

1

 

 

 

 

 

 

 

 

 

4

 

North America

 

 

38

 

 

 

40

 

 

 

31

 

 

 

3

 

 

 

2

 

 

 

114

 

Europe, Middle East and Africa

 

 

72

 

 

 

20

 

 

 

4

 

 

 

 

 

 

 

 

 

96

 

Asia Pacific

 

 

45

 

 

 

10

 

 

 

13

 

 

 

 

 

 

 

 

 

68

 

Latin America

 

 

11

 

 

 

2

 

 

 

 

 

 

 

 

 

 

 

 

13

 

Total Sales

 

$

166

 

 

$

72

 

 

$

48

 

 

$

3

 

 

$

2

 

 

$

291

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(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 amounts recorded for contract assets at March 31, 2020 and December 31, 2019 were $1 million and $4 million, respectively, and are 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 amounts recorded for contract liabilities at March 31, 2020 and December 31, 2019 were $56 million and $61 million, respectively, of which $39 million and $43 million are reported in Other current liabilities, respectively and $17 million and $18 million, respectively, are reported in Other long-term liabilities in the Consolidated Statement of Financial Position.

 

Revenue recognized for the three months ended March 31, 2020 and 2019 that was included in the contract liability balance at the beginning of the year was $26 million and $24 million, respectively, and primarily represented revenue from prepaid service contracts and equipment revenue recognition.  Contract liabilities as of March 31, 2020 and 2019 included $19 million and $20 million of cash payments received during the three months ended March 31, 2020 and 2019, 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 March 31, 2020, there was approximately $70 million of unrecognized revenue from unsatisfied performance obligations. Approximately 25% of the revenue from unsatisfied performance obligations is expected to be recognized in each of the rest of 2020 and in 2021, with 15% expected to be recognized in 2022 and 35% thereafter.