Company: DMRC
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0001437749-25-014773
Chunk: 33

Company: Digimarc CORP
Filing Date: 2025-05-06
Form: 10-Q
Item: Part I, Item 8
Chunk 33
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 satisfy our projected working capital and capital expenditure requirements for at least the next 12 months.

We expect that our subscription revenue in fiscal 2025 will be negatively impacted by the termination of a commercial contract that contributed $3.3 million of subscription revenue in fiscal 2024. This contract ended in April 2025 and will contribute $1.1 million of subscription revenue in fiscal 2025. Our subscription revenue in fiscal 2025 may also be impacted negatively, as was the case in the first quarter, by the expiration of a commercial contract in June 2024. This contract contributed $2.1 million of subscription revenue in fiscal 2024. We expect government service revenue in fiscal 2025 to be $1.7 million to $2.0 million lower than fiscal 2024 due to a smaller approved budget for program work in 2025. 

We expect our expenses in fiscal 2025 to be significantly lower than fiscal 2024 due to the reorganization, which is expected to reduce our cash expenses by approximately $16.5 million on an annualized basis. We have also identified approximately $5.5 million of other annualized cash cost savings. 

Registered Direct Offering

On February 24, 2024, we entered into purchase agreements with certain investors providing for the issuance and sale by us of 929 thousand shares of our common stock in a registered direct stock offering. The common shares were offered at a price of $35.00 per share, and the gross cash proceeds to us were $32.5 million. We incurred $0.3 million of legal costs related to the offering. The closing of the registered direct offering occurred on February 27, 2024.

Shelf Registration

On June 23, 2023, we filed a new shelf registration statement on Form S-3 that included $34.6 million of unsold securities from our prior shelf registration statement filed on June 5, 2020. The new shelf registration statement became effective on July 19, 2023, and expires on July 19, 2026. Under the new shelf registration statement, we may sell securities in one or more offerings up to $100.0 million. As of March 31, 2025, $67.5 million remained available under the new shelf registration statement.

We may sell shares under the shelf registration and/or use similar or other financing means to raise working capital in the future, if necessary, to support continued