Kodak Reports Continuing Progress in Digital Strategy

Graphic Communications Group Integration Activities Ahead of Schedule; New Products and New Market Segments Drive Growth Consumer Digital Group Launches New Consumer Inkjet Business; Image Sensor Sales to Accelerate Strengthened Financial Position and Positive Cash Flow Continues for 2007 Company Details Plans to Implement SG&A Reductions and Complete Major Restructuring by End of 2007

Eastman Kodak Company today reported significant progress in the implementation of its digital business strategy, led by new product introductions across its consumer and commercial portfolio, the continued integration and growth of its Graphic Communications Group, and accelerated cost reductions that will follow the divestiture of its Health Group.

At a meeting today with investors, Kodak will detail the plan that the company is following to generate profitable digital growth in 2007 and to position itself for further success in 2008 and beyond. The presentation also will cover Kodak's plan to complete its major business restructuring by the end of 2007, as the company progresses toward its target business model. The company expects that target business model to yield gross profit margins of 28% to 29% with earnings from operations equal to 8% to 9% of revenue in 2009.

"During the past three years we have made visible and significant progress in creating the new Kodak," said Antonio M. Perez, Chairman and Chief Executive Officer, Eastman Kodak Company. "We have built the industry's leading provider of products and services for commercial printers, and this week we launched a long-awaited breakthrough value proposition for consumers in the inkjet market. In 2007, we are continuing to move aggressively to complete the transformation of our business operations and fully implement a business model which will power our future success in digital markets" - Kodak.