Company: DMRC
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001437749-25-034816
Chunk: 40

Company: Digimarc CORP
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 8
Chunk 40
---
4,315

     $
     6,488

     $
     (2,173
     )

     (33
     )%
      
     $
     16,485

     $
     19,873

     $
     (3,388
     )

     (17
     )%

      Research, development and engineering (as % of total revenue) 

     57
     %

     69
     %

     66
     %

     67
     %

Research, development and engineering expenses consist primarily of:

      • 
      compensation, benefits, incentive compensation in the form of cash and stock-based compensation and related costs of our software and hardware developers and quality assurance personnel; 

      • 
      payments to outside contractors for software development services; 

      • 
      the purchase of materials and services for platform and product development; and 

      • 
      the allocation of facilities and information technology costs. 

       25

The $2.2 million decrease in research, development and engineering expenses for the three months ended September 30, 2025, compared to the corresponding three months ended September 30, 2024, primarily reflects:

      • 
      lower cash compensation costs of $2.6 million largely due to lower headcount; and 

      • 
      lower professional services costs of $0.2 million; partially offset by 

      • 
      higher stock compensation costs of $0.6 million; and 

      • 
      lower allocation out of operating expenses of $0.2 million primarily due to lower billable service hours. 

The $3.4 million decrease in research, development and engineering expenses for the nine months ended September 30, 2025, compared to the corresponding nine months ended September 30, 2024, primarily reflects:

      • 
      lower cash compensation costs of $5.3 million largely due to lower headcount; 

      • 
      lower professional service costs of $0.6 million; and 

      • 
      lower allocation in for facilities and information technology costs of $0.3 million primarily due to lower allocable costs; partially offset by 

      • 
      higher cash severance costs of $1.6 million incurred as a result of the reorganization; 

      • 
      higher stock compensation costs of $1.0 million; and 

      • 
      lower allocation out of operating expenses of $0.5 million