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Ampex Reports Net Loss for Quarter

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*May 10, 2006 – *Digital information technology empire Ampex Corporation released its first quarter results yesterday, reporting a net loss of $1.9 million. The company is singing a different song from last year’s healthy first-quarter net gain of $5.9 million. This year’s woes are mainly brought upon by the lack of a down payment from a licensing agreement. Ampex Corporation sued almost every major manufacturer from 2004-2005 over patent infringements and won. But who is left to sue?

Kodak is the last big target of Ampex Corporation and both sides of the legal fight are quite heated. Kodak insists that it did not infringe upon Ampex’s digital compression patent. Still, Ampex is so sure of its victory that it spent $9.5 million in litigation costs on the suit in 2005 and another $3.5 million in the first three months of 2006. A hearing is scheduled in June with the trial expected to hit the courtroom in December.

The legal battle with Kodak had an enormous impact on Ampex Corporation’s first quarter results. Another issue was the cash flow from the digital camera manufacturer licensing agreements. The largest sum of money came from Sony Corporation, who paid up $40 million in November 2004. The rights from that cash expired in mid-April; now Sony is expected to send royalties on sales of its digital still cameras and camcorders. Ampex predicts the royalties to brighten up its earnings by the third quarter.

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