Company: DMRC
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001437749-25-014773
Chunk: 7

Company: Digimarc CORP
Filing Date: 2025-05-06
Form: 10-Q
Item: Part I, Item 8
Chunk 7
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 When they are not capable of being distinct, they are combined with other subscriptions or services until a distinct performance obligation is identified. To determine the transaction price, management considers the terms of the contract and the Company’s customary business practices. Some contracts  may contain variable consideration. In those cases, management estimates the amount of variable consideration based on the sum of probability-weighted amounts in a range of possible consideration amounts. As part of this assessment, management evaluates whether any of the variable consideration is constrained and if it is, it is not included in the transaction price. The consideration is allocated between distinct performance obligations based on their stand-alone selling prices. When the standalone selling prices are not directly observable, management makes estimates based on reasonably available information, including market conditions, specific factors affecting the Company, and information about the customer. The Company recognizes the revenue associated with each performance obligation as the obligation is fulfilled, which for subscriptions is typically recognized ratably over time and for services is typically recognized when they are performed.
    
   All revenue recognized in the Consolidated Statements of Operations and Comprehensive Loss is considered to be revenue from contracts with customers.
    
   The following table provides information about disaggregated revenue by major target market in the Company’s single reporting segment:

        Three Months Ended March 31, 

        2025 

        2024 

        Commercial: 

        Subscription 
        
       $
       5,014

       $
       5,462

        Service 

       796

       257

        Total Commercial 
        
       $
       5,810

       $
       5,719

        Government: 

        Subscription 
        
       $
       300

       $
       300

        Service 

       3,258

       3,919

        Total Government 

       3,558

       4,219

        Total 
        
       $
       9,368

       $
       9,938

   The Company has contract assets from contracts with customers that are classified as “trade accounts receivable” in the Consolidated Balance Sheets. See Note 8 for more information about trade accounts receivable.
    
   The Company has contract assets from capitalized contract acquisition costs that are classified as “other current assets” and “other assets” in the Consolidated Balance Sheets. These contract acquisition costs are recognized in proportion to the revenue recognized from the contract they are associated with.
    
   The following table provides information about contract assets:

        March