Company: DMRC
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001437749-25-014773
Chunk: 30

Company: Digimarc CORP
Filing Date: 2025-05-06
Form: 10-Q
Item: Part I, Item 8
Chunk 30
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, 2024. The decrease primarily reflects lower revenue, partially offset by lower cost of service revenue. 

Non-GAAP gross profit margin for the three months ended March 31, 2025, increased to 80% compared to 78% for the three months ended March 31, 2024. The increase primarily reflects a more favorable mix of service revenue in 2025.

Non-GAAP operating expenses for the three months ended March 31, 2025, increased by $2.7 million compared to the three months ended March 31, 2024. The increase primarily reflects $3.2 million of higher cash severance costs incurred as a result of the reorganization we announced on February 26, 2025, and $0.9 million of higher professional services costs, partially offset by $1.4 million of lower cash compensation costs due to lower headcount.

       28

Liquidity and Capital Resources

      March 31, 

      December 31, 

      2025 

      2024 

      Working capital 
      
     $
     19,479

     $
     30,193

      Current ratio (1) 

     2.7:1

     4.3:1

      Cash, cash equivalents and short-term marketable securities 
      
     $
     21,567

     $
     28,730

      Long-term marketable securities 

     —

     —

      Total cash, cash equivalents and marketable securities 
      
     $
     21,567

     $
     28,730

      (1) 
      The current ratio is calculated by dividing total current assets by total current liabilities. 

The $7.2 million decrease in cash, cash equivalents and marketable securities at March 31, 2025, from December 31, 2024, resulted primarily from:

      • 
      cash used in operations; 

      • 
      purchases of common stock related to tax withholding in connection with the vesting of restricted stock, restricted stock units, and performance restricted stock units; and 

      • 
      purchases of property and equipment and capitalized patent costs. 

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, marketable securities, and trade accounts receivable. We place our cash and cash equivalents with major banks and financial