Company: DMRC
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001437749-25-034816
Chunk: 32

Company: Digimarc CORP
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 8
Chunk 32
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 revenue in fiscal 2025 has been negatively impacted by the expiration of a commercial contract that ended in April 2025 with an international customer. The contract contributed $0.8 million and $2.5 million of subscription revenue during the three and nine months ended September 30, 2024, compared to $0.0 million and $1.1 million of subscription revenue during the three and nine months ended September 30, 2025. Our commercial subscription revenue in fiscal 2025 has also been negatively impacted by the expiration of a commercial contract that ended in June 2024 with a domestic customer. The contract contributed $0.0 million and $2.1 million of subscription revenue during the three and nine months ended September 30, 2024, compared to $0.0 million of subscription revenue for both the three and nine months ended September 30, 2025. Our commercial subscription revenue in the fourth quarter of fiscal 2025 will also be impacted by the conclusion of a contract renegotiation with a domestic customer that will negatively impact future revenue by $3.1 million on an annualized basis.

Our government service revenue in fiscal 2025 has been negatively impacted by a smaller approved budget by the Central Banks for program work in 2025. We expect government service revenue in fiscal 2025 to be $1.7 million to $1.8 million lower than in fiscal 2024.

Total revenue for the three months ended September 30, 2025, decreased $1.8 million, to $7.6 million, compared to $9.4 million for the corresponding three months ended September 30, 2024. Subscription revenue decreased $0.7 million, primarily reflecting a decrease of $0.8 million from the expiration of the commercial contract in April 2025 referenced above. Service revenue decreased $1.1 million, primarily reflecting $0.7 million of lower government service revenue from the Central Banks and $0.4 million of lower commercial service revenue from HolyGrail 2.0 recycling projects. 

Total revenue for the nine months ended September 30, 2025, decreased $4.8 million, to $25.0 million, compared to $29.8 million for the corresponding nine months ended September 30, 2024. Subscription revenue decreased $2.9 million, primarily reflecting