Company: AWRE
Filing Date: 2025-08-01
Form Type: 10-Q
Source: 0000950170-25-101395
Chunk: 23

Company: AWARE INC /MA/
Filing Date: 2025-08-01
Form: 10-Q
Item: Item 8
Chunk 23
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, including salaries, stock-based compensation, fringe benefits, and facilities; ii) engineering consultants and contractors, and iii) other engineering expenses such as supplies, equipment depreciation, dues and memberships and travel.  Engineering costs incurred to develop our technology and products are classified as research and development expense.  As described in the cost of services section, engineering costs incurred to provide engineering services for customer projects are classified as cost of services and other revenue, and are not included in research and development expense.The classification of total engineering costs to research and development expense and engineering costs to perform customer services included in cost of revenue was (in thousands): 

     Three Months EndedJune 30,
      
     For the Six MonthsEnded June 30,

     2025

     2024
      
     2025

     2024

     Research and development expense
      
     $
     1,960

     $
     1,867
      
     $
     3,881

     $
     4,049

     Engineering costs allocated to cost of revenue

     98

     82

     189

     187

     Total engineering costs
      
     $
     2,058

     $
     1,949
      
     $
     4,070

     $
     4,236

    Total engineering costs increased 6% from $1.9 million in the three months ended June 30, 2024 to $2.1 million in the three months ended June 30, 2025.  As a percentage of total revenue, total engineering costs increased from 45% in the three months ended June 30, 2024 to 53% in the same current year quarter.   Total engineering costs decreased 4% from $4.2 million in the six months ended June 30, 2024 to $4.1 million in the six months ended June 30, 2025.  As a percentage of total revenue, total engineering costs increased from 48% in the six months ended June 30, 2024 to 54% in the same current year period.   The spending increase for the three months ended June 30, 2025 compared to the same prior year quarter was primarily due to increased headcount in the first half of 2025.  The decreases for the six months ended June 30, 2025 compared to the same prior year periods was primarily due