Beaverton, Ore. — February 24, 2016 — Digimarc Corporation (NASDAQ: DMRC) reported financial results for the fourth quarter and full year ended December 31, 2015.
Fourth Quarter 2015 Operational Highlights
- Partnered with GS1 US to accelerate industry adoption of the Digimarc® Barcode. The parent organization, GS1, maintains global standards for barcodes, which are adopted by more than two million member companies to scan over five billion barcodes globally each day.
- Added global brand deployment provider, Schawk, as a new channel partner, to facilitate adoption of Digimarc Barcode by retailers and consumer brands.
- Launched Digimarc Discover® mobile software development kit, featuring unparalleled ease of use, reliability and speed for scanning traditional barcodes and Digimarc Barcodes, using smartphones.
- Launched Digimarc Discover in Rockfish’s mobile app that provides Walmart suppliers instant access to in store inventory information.
- Announced a joint venture with Nielsen to assist their clients in expanding the utility of Nielsen Watermarks in radio and television to new applications.
- Announced an agreement with Scanbuy to integrate Digimarc Discover into their ScanLife mobile app.
Fourth Quarter 2015 Financial Results
Revenue for the fourth quarter of 2015 totaled $5.0 million compared to $5.9 million in the same quarter a year-ago. Most of the difference was due to lower licensing revenues and timing differences in when services were performed.
Operating expenses for the fourth quarter of 2015 increased 6% to $8.3 million from $7.9 million in the same quarter a year-ago. The increase was due to higher investment in sales and marketing related to market development and delivery for Digimarc Discover and Digimarc Barcode, partially offset by lower spending in other areas of the business.
Operating loss for the fourth quarter of 2015 totaled $5.3 million compared to an operating loss of $4.2 million in the same quarter a year-ago. The higher operating loss was primarily due to lower revenue.
Net loss for the fourth quarter of 2015 totaled $5.3 million or $(0.62) per diluted share, compared to a net loss of $9.2 million or $(1.23) per diluted share in the fourth quarter of 2014. The lower net loss was largely due to a $6.8 million non-cash income tax charge in the fourth quarter of last year to record a full valuation allowance against deferred tax assets.
Cash, cash equivalents and marketable securities totaled $39.2 million at December 31, 2015, compared to $43.0 million at September 30, 2015.
Full Year 2015 Financial Results
Revenue for 2015 was $22.2 million compared to $25.7 million in 2014. Revenues for the year were down $3.5 million, reflecting a $4.4 million decline in license revenue due largely to completion of payments from certain licensees. The decrease in license revenue was partially offset by growth in service and subscription revenue.
Operating expenses for 2015 decreased 4% to $31.2 million from $32.5 million in 2014. The decrease was due to lower spending in research, development and engineering, general and administrative and intellectual property, partially offset by higher investment in sales and marketing related to market development and delivery for Digimarc Discover and Digimarc Barcode.
Operating loss for 2015 totaled $18.0 million compared to an operating loss of $15.2 million in 2014. The higher operating loss was primarily due to lower license revenue.
Net loss for 2015 totaled $17.9 million or $(2.19) per diluted share compared to a net loss of $15.8 million or $(2.22) per diluted share in 2014.
Digimarc will hold a conference call later today (Wednesday, February 24, 2016) to discuss these results, as well as provide an update on market conditions and execution of strategy. Chairman and CEO Bruce Davis and CFO Charles Beck 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 conference call will be broadcast live and available for replay via the investor section of the company's website here.
For those who wish to listen to the call via telephone, please dial the number below at least five minutes prior to the scheduled start time:
Toll-Free Number: 866-562-9934
International Number: 706-634-1493
Conference ID: 27179684
If you have any difficulty connecting with the conference call, please contact Liolios Group at 949-574-3860.
Digimarc Corp. (NASDAQ: DMRC), based in Beaverton, Oregon, is the inventor of the Digimarc Discover® platform featuring the imperceptible Digimarc Barcode for automatically identifying and interacting with virtually any media. The platform enables industrial scanners, smartphones, tablets and other computer interfaces to reliably, efficiently and economically identify traditional barcoded items, along with many other media objects. Digimarc Barcodes are imperceptible to people and do all that visible barcodes do, but perform better. They can be applied to virtually all forms of media. These remarkable capabilities have allowed Digimarc and its business partners to supply a wide range of patented consumer engagement, media management and security solutions across multiple consumer and government industry sectors. Digimarc owns an extensive intellectual property portfolio, with patents in digital watermarking, content identification and management, media object discovery, and intuitive computing more generally. For more information and the latest news, please visit www.digimarc.com and follow on Twitter at @Digimarc.
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 growth in service and subscription revenue, lower license revenue, lower spending in research, development and engineering, general and administrative, and intellectual property, and higher investment in sales and marketing, 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, 2014 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.
Chief Financial Officer
Liolios Group, Inc.
Investor Relations for Digimarc