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Kodak to Cut Up to 23 Pct. of Work Force (By BEN DOBBIN, Associated Press Writer)
ROCHESTER, N.Y. - Eastman Kodak Co., struggling to find its footing in new digital photography markets as its signature film business fades, said Thursday it will cut 12,000 to 15,000 jobs, or up to 23 percent of its global work force, over the next three years. The announcement came as the world's biggest photography company posted a fourth-quarter profit of $19 million, or 7 cents a share, down sharply from $113 million, or 39 cents a share, a year ago.

Excluding restructuring and other one-time items, however, earnings were $199 million, or 70 cents a share. That beat the consensus forecast of 52 cents a share among analysts surveyed by Thomson First Call. Sales rose 10 percent to $3.78 billion from $3.44 billion. Kodak said its digital sector turned a profit for the first time in 2003. "To compete in digital markets, we must have a business model that lets us move even faster," said its chief executive, Dan Carp.

The company also said Thursday it has launched a $35 million tender offer to buy the remaining 41 percent of shares in Chinon Industries, a Japanese digital camera maker, that it doesn't already own. In early trading on the New York Stock Exchange, Kodak shares climbed $1.99, or 7 percent, to $29.45.

The company said the job cuts reflect reductions in global manufacturing and selected traditional businesses as it sharpens its focus on digital photography. It will trim an estimated 2,500 to 3,500 jobs this year, it said. Kodak eliminated up to 6,000 jobs in 2003, shrinking its payroll to 64,000 from a peak of 136,500 in 1983. It employed 35,500 people in the United States at the end of 2003, including 20,600 in Rochester, spokesman Jim Blamphin said.

Kodak said it would take charges of $1.3 billion to $1.7 billion through 2006, including up to $900 million in severance costs. Its president, Antonio Perez, said the cuts are "absolutely required for Kodak to succeed in traditional markets as well as the digital markets to which our businesses are rapidly shifting."

Last week, Kodak said it will stop selling reloadable 35mm film cameras in North America and Western Europe by the end of 2004. In a controversial move in September, Kodak slashed its annual dividend from $1.80 to 50 cents to help fund $3 billion in acquisitions and internal growth as it shifts away from its ailing conventional film business and into the fast-growing, highly competitive digital arena.

Filmless digital cameras, which record snapshots on computer chips, have begun outselling traditional film cameras for the first time in the United States. Kodak spent about $750 million last year for five companies. The biggest deal was its $486 million buyout of PracticeWorks Inc., an Atlanta-based dental-imaging and software maker. The company wants to boost its revenues to $16 billion by 2006.

In its photography division, fourth-quarter sales rose 9 percent to $2.6 billion as consumer digital camera sales leaped 87 percent. Revenues from its online photo-sharing service surged 55 percent and inkjet paper sales were up 11 percent. Commercial imaging sales also rose 9 percent to $432 million and health imaging sales jumped 14 percent to $704 million.

U.S. sales of consumer film products, including 35mm film and single-use cameras, sank 10 percent amid heightened competition and a sharp drop in retailer orders. Kodak controls about two-thirds of the U.S. film market but profits have been hit by falling prices and a slump in sales dating back to August 2000.

Kodak has said it expects digital imaging to account for half of its profit and 60 percent of sales by 2006, up from nearly 30 percent now. For all of 2003, Kodak earned $265 million, or 92 cents a share, down from $770 million, or $2.64 in 2002. Sales rose to $13.3 billion from $12.8 billion.

The Movie Geek

A lot of the financial stuff in there kinda makes my head hurt, but that's a huge cut. I always think of Kodak when i think of film (that's what i buy for my disposable camera), but i can see the digital market cutting into that, especially if they don't have a large digital identity (which i don't know if they do or not)

Flailing Homosapiens

Video Killed the Radio Star.

Gone Fishin

Gotta admit there's two sides to every coin though, no?

IBM to Add 15,000 New Jobs to Work Force
Sat Jan 17, 7:26 PM ET

ARMONK, N.Y. - On the heels of strong earnings reports, IBM Corp. announced Saturday that it will add 15,000 jobs worldwide. About 4,500 new hires will be made in the United States, primarily tied to high-growth areas such as software and services, company officials said. The remainder of the jobs will be in emerging markets such as China and India and in Europe.

The job additions were 50 percent over company projections and will increase Big Blue's work force to nearly 330,000, officials said. More than half of the company's employees are outside the United States.

Garrett Walker, director of strategic resource management for IBM, said the company is investing $200 million in training for what it calls "hot skills" in the information technology area.

"We're bullish on the whole IT market in 2004," Walker said.

Last week, IBM offered an upbeat outlook for 2004, announcing that fourth-quarter earnings more than doubled and surpassed Wall Street expectations. In the last three months of 2003, IBM earned $2.7 billion, or $1.55 per share, on revenue of $25.9 billion.

With the new hirings, IBM will have the most employees it has had since 1991, when it had 344,000 employees worldwide.

Adjunct

I thought the same thing John.

It sucks for the employees of Kodak big time but Kodak cannot compete by losing money every year.

Some how this will be blamed on GWB.

Flailing Homosapiens

Pyromaniac

Technology doesn't make humans obsolete, it just puts them into a different capacity. Naysayers in the auto industry raised hell that robotics and other forms of automation would doom the autoworkers. It didn't doom them but the job classifications in that industry have changed considerably.

technology kills

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