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Press Contact: Lara Burhenn

lara.burhenn@digimarc.com | 503-469-4704

| Oct 15, 2011

Digimarc Reports Third Quarter 2011 Financial Results

by Oct 15, 2011

Beaverton, Ore. — October 25, 2011 — Digimarc Corporation (NASDAQ: DMRC) reported financial results for the third quarter ended September 30, 2011.

Revenues for the third quarter of 2011 increased 63% to $8.6 million from $5.2 million in the same quarter a year ago. The increase was primarily due to a 120% increase in license revenues.

Operating income for the third quarter of 2011 totaled $1.4 million, an improvement of $2.2 million from an operating loss of $0.8 million in the same quarter a year ago. The increase primarily reflected higher licensing revenues, net of higher product development and marketing expenses associated with the launch of Digimarc Discover, as well as litigation expenses associated with the Verance dispute.

Net income for the third quarter of 2011 totaled $0.6 million or $0.09 per diluted share, up by $2.1 million or $0.30 per diluted share over a net loss of $1.5 million or $(0.21) per diluted share in the same quarter a year ago. Q3 2011 net income also included $0.7 million for Digimarc's share of the net loss from its research and development joint ventures with Nielsen, up from $0.6 million for the company's share of the net loss last year.

At September 30, 2011, cash and cash equivalents and marketable securities totaled $31.2 million, down from $33.7 million at June 30, 2011, reflecting nearly $4 million of stock repurchases during the quarter.

Conference Call

Digimarc will hold a conference call later today (Tuesday, October 25, 2011) to discuss third quarter 2011. Chairman and CEO, Bruce Davis and CFO, Mike McConnell will host the call starting at 5:00 p.m. Eastern time (2:00 p.m. Pacific time). A question and answer session will follow management's presentation.

The call will be simulcast via a link available on Digimarc's home page at www.digimarc.com, and will be available for replay until November 8, 2011. Thereafter, the webcast will be archived at www.digimarc.com/investors/events.asp.

About Digimarc

Digimarc Corporation (NASDAQ: DMRC), based in Beaverton, Oregon, is a leading innovator and provider of enabling technologies that create digital identities for all forms of media and many everyday objects. The embedded digital IDs are imperceptible to humans, but not to computers, networks and devices like mobile phones, which can now use cameras and microphones as sensory inputs to "see, hear and understand" the world around them within the context of their environment. Digimarc has built an extensive intellectual property portfolio with patents in digital watermarking, content identification and management, media and object discovery to enable ubiquitous computing, and related technologies. Digimarc develops solutions, licenses its intellectual property, and provides development services to business partners across a range of industries. For more information, please visit www.digimarc.com.

Forward-looking Statements

With the exception of historical information contained in this release, the matters described in this release contain various "forward-looking statements." These forward-looking statements include statements and any related inferences regarding Digimarc's investment in marketing and research and development associated with the launch of Digimarc Discover, increases in license revenues, and other statements identified by terminology such as "will," "should," "expects," "estimates," "predicts" and "continue" or other derivations of these or other comparable terms. These forward-looking statements are statements of management's opinion and are subject to various assumptions, risks, uncertainties and changes in circumstances. Actual results may vary materially from those expressed or implied from the statements in this release as a result of changes in economic, business and/or regulatory factors. More detailed information about risk factors that may affect actual results are set forth in the company's Form 10-K for the year ended December 31, 2010 and in subsequent periodic reports filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date of this release. Except as required by law, Digimarc undertakes no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this release.

Company Contacts

Michael McConnell
Chief Financial Officer
+1 503 469 4652
mmcconnell@digimarc.com

Scott Liolios or Matt Glover
Liolios Group, Inc.
Investor Relations for Digimarc
+1 949 574 3860
info@liolios.com

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