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Note 13 - Revenue
6 Months Ended
Jun. 30, 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

 

June 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Plates, inks and other

   consumables

 

$

90

 

 

$

12

 

 

$

1

 

 

$

 

 

$

 

 

$

103

 

Ongoing service

   arrangements (1)

 

 

20

 

 

 

29

 

 

 

 

 

 

 

 

 

 

 

 

49

 

Total annuities

 

 

110

 

 

 

41

 

 

 

1

 

 

 

 

 

 

 

 

 

152

 

Equipment & software

 

 

9

 

 

 

11

 

 

 

 

 

 

 

 

 

 

 

 

20

 

Film and chemicals

 

 

 

 

 

 

 

 

33

 

 

 

 

 

 

 

 

 

33

 

Other (2)

 

 

 

 

 

 

 

 

4

 

 

 

2

 

 

 

2

 

 

 

8

 

Total

 

$

119

 

 

$

52

 

 

$

38

 

 

$

2

 

 

$

2

 

 

$

213

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

June 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Plates, inks and other

   consumables

 

$

216

 

 

$

31

 

 

$

3

 

 

$

 

 

$

 

 

$

250

 

Ongoing service

   arrangements (1)

 

 

41

 

 

 

64

 

 

 

 

 

 

 

 

 

 

 

 

105

 

Total annuities

 

 

257

 

 

 

95

 

 

 

3

 

 

 

 

 

 

 

 

 

355

 

Equipment & software

 

 

16

 

 

 

22

 

 

 

 

 

 

 

 

 

 

 

 

38

 

Film and chemicals

 

 

 

 

 

 

 

 

71

 

 

 

 

 

 

 

 

 

71

 

Other (2)

 

 

 

 

 

 

 

 

 

6

 

 

 

5

 

 

 

5

 

 

 

16

 

Total

 

$

273

 

 

$

117

 

 

$

80

 

 

$

5

 

 

$

5

 

 

$

480

 

 

Three Months Ended

 

June 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Plates, inks and other consumables

 

$

146

 

 

$

21

 

 

$

3

 

 

$

 

 

$

 

 

$

170

 

Ongoing service arrangements (1)

 

 

22

 

 

 

39

 

 

 

1

 

 

 

 

 

 

 

 

 

62

 

Total annuities

 

 

168

 

 

 

60

 

 

 

4

 

 

 

 

 

 

 

 

 

232

 

Equipment & software

 

 

13

 

 

 

9

 

 

 

 

 

 

 

 

 

 

 

 

22

 

Film and chemicals

 

 

 

 

 

 

 

 

42

 

 

 

 

 

 

 

 

 

42

 

Other (2)

 

 

 

 

 

 

 

 

6

 

 

 

2

 

 

 

3

 

 

 

11

 

Total

 

$

181

 

 

$

69

 

 

$

52

 

 

$

2

 

 

$

3

 

 

$

307

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

June 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Plates, inks and other consumables

 

$

283

 

 

$

42

 

 

$

6

 

 

$

 

 

$

 

 

$

331

 

Ongoing service arrangements (1)

 

 

43

 

 

 

79

 

 

 

2

 

 

 

 

 

 

 

 

 

124

 

Total annuities

 

 

326

 

 

 

121

 

 

 

8

 

 

 

 

 

 

 

 

 

455

 

Equipment & software

 

 

21

 

 

 

20

 

 

 

 

 

 

 

 

 

 

 

 

41

 

Film and chemicals

 

 

 

 

 

 

 

 

80

 

 

 

 

 

 

 

 

 

80

 

Other (2)

 

 

 

 

 

 

 

 

12

 

 

 

5

 

 

 

5

 

 

 

22

 

Total

 

$

347

 

 

$

141

 

 

$

100

 

 

$

5

 

 

$

5

 

 

$

598

 

 

(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

 

June 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Growth engines (1)

 

$

27

 

 

$

30

 

 

$

1

 

 

$

2

 

 

$

 

 

$

60

 

Strategic other businesses (2)

 

 

92

 

 

 

10

 

 

 

35

 

 

 

 

 

 

2

 

 

 

139

 

Planned declining

   businesses (3)

 

 

 

 

 

12

 

 

 

2

 

 

 

 

 

 

 

 

 

14

 

Total

 

$

119

 

 

$

52

 

 

$

38

 

 

$

2

 

 

$

2

 

 

$

213

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

June 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Growth engines (1)

 

$

71

 

 

$

66

 

 

$

1

 

 

$

5

 

 

$

 

 

$

143

 

Strategic other businesses (2)

 

 

202

 

 

 

25

 

 

 

74

 

 

 

 

 

 

5

 

 

 

306

 

Planned declining

   businesses (3)

 

 

 

 

 

 

26

 

 

 

5

 

 

 

 

 

 

 

 

 

31

 

Total

 

$

273

 

 

$

117

 

 

$

80

 

 

$

5

 

 

$

5

 

 

$

480

 

 

 

Three Months Ended

 

June 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Growth engines (1)

 

$

45

 

 

$

32

 

 

$

 

 

$

2

 

 

$

 

 

$

79

 

Strategic other businesses (2)

 

 

136

 

 

 

19

 

 

 

44

 

 

 

 

 

 

3

 

 

 

202

 

Planned declining

   businesses (3)

 

 

 

 

 

18

 

 

 

8

 

 

 

 

 

 

 

 

 

26

 

Total

 

$

181

 

 

$

69

 

 

$

52

 

 

$

2

 

 

$

3

 

 

$

307

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

June 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

Growth engines (1)

 

$

84

 

 

$

67

 

 

$

2

 

 

$

5

 

 

$

 

 

$

158

 

Strategic other businesses (2)

 

 

263

 

 

 

36

 

 

 

83

 

 

 

 

 

 

5

 

 

 

387

 

Planned declining

   businesses (3)

 

 

 

 

 

38

 

 

 

15

 

 

 

 

 

 

 

 

 

53

 

Total

 

$

347

 

 

$

141

 

 

$

100

 

 

$

5

 

 

$

5

 

 

$

598

 

 

(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

 

June 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

United States

 

$

26

 

 

$

24

 

 

$

25

 

 

$

2

 

 

$

2

 

 

$

79

 

Canada

 

 

3

 

 

 

1

 

 

 

1

 

 

 

 

 

 

 

 

 

5

 

North America

 

 

29

 

 

 

25

 

 

 

26

 

 

 

2

 

 

 

2

 

 

 

84

 

Europe, Middle East and Africa

 

 

49

 

 

 

18

 

 

 

2

 

 

 

 

 

 

 

 

 

69

 

Asia Pacific

 

 

36

 

 

 

8

 

 

 

10

 

 

 

 

 

 

 

 

 

54

 

Latin America

 

 

5

 

 

 

1

 

 

 

 

 

 

 

 

 

 

 

 

6

 

Total

 

$

119

 

 

$

52

 

 

$

38

 

 

$

2

 

 

$

2

 

 

$

213

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

June 30, 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

United States

 

$

61

 

 

$

52

 

 

$

55

 

 

$

5

 

 

$

5

 

 

$

178

 

Canada

 

 

6

 

 

 

3

 

 

 

1

 

 

 

 

 

 

 

 

 

10

 

North America

 

 

67

 

 

 

55

 

 

 

56

 

 

 

5

 

 

 

5

 

 

 

188

 

Europe, Middle East and Africa

 

 

117

 

 

 

42

 

 

 

5

 

 

 

 

 

 

 

 

 

164

 

Asia Pacific

 

 

75

 

 

 

18

 

 

 

19

 

 

 

 

 

 

 

 

 

112

 

Latin America

 

 

14

 

 

 

2

 

 

 

 

 

 

 

 

 

 

 

 

16

 

Total

 

$

273

 

 

$

117

 

 

$

80

 

 

$

5

 

 

$

5

 

 

$

480

 

 

Three Months Ended

 

June 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

United States

 

$

41

 

 

$

32

 

 

$

32

 

 

$

2

 

 

$

3

 

 

$

110

 

Canada

 

 

3

 

 

 

3

 

 

 

 

 

 

 

 

 

 

 

 

6

 

North America

 

 

44

 

 

 

35

 

 

 

32

 

 

 

2

 

 

 

3

 

 

 

116

 

Europe, Middle East and Africa

 

 

75

 

 

 

23

 

 

 

6

 

 

 

 

 

 

 

 

 

104

 

Asia Pacific

 

 

51

 

 

 

9

 

 

 

13

 

 

 

 

 

 

 

 

 

73

 

Latin America

 

 

11

 

 

 

2

 

 

 

1

 

 

 

 

 

 

 

 

 

14

 

Total

 

$

181

 

 

$

69

 

 

$

52

 

 

$

2

 

 

$

3

 

 

$

307

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

June 30, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in millions)

 

Traditional Printing

 

 

Digital Printing

 

 

Advanced Materials and Chemicals

 

 

Brand

 

 

All Other

 

 

Total

 

United States

 

$

77

 

 

$

71

 

 

$

62

 

 

$

5

 

 

$

5

 

 

$

220

 

Canada

 

 

5

 

 

 

4

 

 

 

1

 

 

 

 

 

 

 

 

 

10

 

North America

 

 

82

 

 

 

75

 

 

 

63

 

 

 

5

 

 

 

5

 

 

 

230

 

Europe, Middle East and Africa

 

 

147

 

 

 

43

 

 

 

10

 

 

 

 

 

 

 

 

 

200

 

Asia Pacific

 

 

96

 

 

 

19

 

 

 

26

 

 

 

 

 

 

 

 

 

141

 

Latin America

 

 

22

 

 

 

4

 

 

 

1

 

 

 

 

 

 

 

 

 

27

 

Total

 

$

347

 

 

$

141

 

 

$

100

 

 

$

5

 

 

$

5

 

 

$

598

 

 

(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 June 30, 2020 and December 31, 2019 were $2 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 June 30, 2020 and December 31, 2019 were $55 million and $61 million, respectively, of which $40 million and $43 million are reported in Other current liabilities, respectively, and $15 million and $18 million, respectively, are reported in Other long-term liabilities in the Consolidated Statement of Financial Position.

 

Revenue recognized for the three and six months ended June 30, 2020 and 2019 that was included in the contract liability balance at the beginning of the year was $5 million and $31 million in 2020, respectively, and $5 million and $30 million in 2019, respectively, and primarily represented revenue from prepaid service contracts and equipment revenue recognition.  Contract liabilities as of June 30, 2020 included $19 million and $21 million of cash payments received during the three and six months ended June 30, 2020, respectively.  Contract liabilities as of June 30, 2019 included $20 million and $23 million of cash payments received during the three and six months ended June 30, 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 June 30, 2020, there was approximately $65 million of unrecognized revenue from unsatisfied performance obligations. Approximately 20% of the revenue from unsatisfied performance obligations is expected to be recognized in the rest of 2020, 25% in 2021, 20% in 2022 and 35% thereafter.