Company: DMRC
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001437749-25-026996
Chunk: 13

Company: Digimarc CORP
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 8
Chunk 13
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-lived assets by geographic area were as follows:

       June 30,    December 31,  
   2025    2024  
 United States  $1,035  $1,026 
 Europe   7   14 
 Total  $1,042  $1,040 

   5. Stock-Based Compensation
    
   Stock-based compensation includes expense charges for all stock-based awards to employees and directors. These awards include restricted stock awards, restricted stock units, and performance restricted stock units.
    
   Stock-based compensation expense related to internal labor is capitalized to software and patent costs based on direct labor hours charged to capitalized software and patent costs.
    
   Determining Fair Value
    
   Restricted Stock Awards
    
   The fair value of restricted stock awards (“RSA”) that vest upon meeting a service condition is based on the fair market value of the Company’s common stock on the date of the grant (measurement date) and is recognized on a straight-line basis over the service period of the award, which is generally three to four years for employee grants and one to three years for director grants.

       11

        DIGIMARC CORPORATION

        NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

        (In thousands, except per share data)

        (UNAUDITED)

   Restricted Stock Units
    
   The fair value of restricted stock unit (“RSU”) awards that vest upon meeting a service condition is based on the fair market value of the Company’s common stock on the date of the grant (measurement date) and is recognized on a straight-line basis over the service period of the award, which is generally three to four years for employee grants.
    
   Performance Restricted Stock Units
    
   The fair value of performance restricted stock unit (“PRSU”) awards that vest upon meeting a service condition and a performance condition, such as the Company exceeding a future annual recurring revenue target, is determined based on the fair market value of the Company’s common stock on the date of the grant (measurement date), adjusted for probability of achievement of the performance criteria as of each reporting date, and is recognized on a straight-line basis over the service period of the award, which is generally three years for employee grants. The probability of achievement is subject to judgment, and could change from period to period, impacting the amount of expense to be recognized. 
    
   The fair value of PRSU awards that vest upon meeting