Eastman Kodak Co.'s stock tumbled 18 percent Wednesday after the photography icon said its fourth-quarter profit dropped 95 percent on weaker camera and film revenue and sharply lower royalties from digital-imaging inventions.
The 130-year-old picture-taking pioneer, battling to recast itself as a digital photography and printing powerhouse, missed Wall Street expectations and posted its third straight yearly loss.
The dim showing raised renewed concern about whether Kodak has become too reliant on income from intellectual property as it scrambles to build up inkjet printer businesses that have yet to turn a profit.
Kodak earned $22 million, or 8 cents a share, in the October-December period. That compares with net income of $443 million, or $1.40 a share, a year earlier when results were swelled by $421 million in one-time royalties from patent-litigation triumphs over two South Korean electronics makers.
Sales sank 25 percent to $1.93 billion.
"It was a terrible quarter in my book -- not only in sales but also because operating costs increased as a percent of sales," said Ulysses Yannas, a broker with Buckman, Buckmam & Reid in New York.
Analysts also pointed to other troubling signs: pricing pressures in Kodak's low-end digital camera business, stiff competition from Hewlett-Packard Co. in retailer kiosks, and a slump in movie-film revenue mirroring a migration to digital-cinema alternatives.
Excluding items, Kodak says it lost $99 million, or 37 cents per share. Analysts polled by FactSet expected Kodak to earn 5 cents per share on higher sales of $2.09 billion.
Kodak shares fell 81 cents to $3.71 Wednesday. The stock is trading at the lower end of a 52-week range of $3.49 to $9.08.
Revenue from its digital businesses fell 25 percent to $1.49 billion in the quarter, hurt by industry-related pricing pressures in Kodak's digital camera and commercial prepress solutions businesses. But sales in its four core growth businesses, including inkjet printers, software and packaging, rose by 23 percent.
"Those four businesses are the basis for the future of the company, so they are very important," Chief Executive Antonio Perez said.
They account for just over 10 percent of Kodak's revenue, are growing at a double-digit pace annually and "will be very significant in 2012," Perez said.
Traditional film-based revenue slid 25 percent to $439 million, hit by volume declines and surging costs for silver. The photographic film, photofinishing and entertainment film unit posted a $3 million operating loss in contrast with $53 million in operating profit a year earlier.