The company sought bankruptcy protection from creditors last month in a case that covers $6.7 billion in debt. It has a year to devise a restructuring plan. Citigroup Inc. was approved to lend the company $650 million to continue operating.
Exiting the digital-camera business is especially poignant for Kodak. In 1975, using an electronic sensor invented six years earlier at Bell Labs, a Kodak engineer named Steven Sasson created the world's first digital camera. It was an eight-pound, toaster-size device that captured low-resolution black-and-white images.
Reached at home Thursday, Sasson said that seeing Kodak exit the business is "a bit sad" but part of a transition facing all companies that use evolving technology.
"The average person probably owns more digital cameras than they realize," he said. "It's just the reality that digital imaging is a part of our lives."
Through the 1990s, Kodak spent some $4 billion developing the photo technology inside most of today's cellphones and digital devices. But fearing that it might cannibalize its celluloid-film business, Kodak waited until 2001 to bring its digital cameras to the consumer market. By then, it faced strong competitors like Sony Corp. and Canon.
These days, sales of digital cameras are suffering as consumers increasingly take photos on smartphones. Certain smartphone-makers such as LG, Nokia, Motorola, and Samsung have agreed to pay Kodak to license its digital-camera technology, while companies such as Apple are fighting its patent claims.
Before Thursday's announcement, Kodak had already been trying to shrink its product line and sell in fewer retail venues. But as sales declines worsened, the company saw no way to make the business profitable.
"We made the logical conclusion that there was no clear path to profitability, and we have to focus on generating profits at this point," Kodak spokesman Chris Veronda said.
Kodak said getting out of the digital-camera business by June should help cut losses by about $100 million a year as it struggles to emerge from Chapter 11 bankruptcy.
For the nine months through September, total company sales plunged 18 percent to $4.3 billion and it lost $647 million.
Kodak sees home photo printers, high-speed commercial ink-jet presses, workflow software, and packaging as the core of its future business. Kodak will continue to honor product warranties.
