Digimarc Reports First Quarter 2023 Financial Results

About this update from Digimarc Corporation

[{"type":"text","content":" BEAVERTON, Ore.--(BUSINESS WIRE)--\nDigimarc Corporation (NASDAQ: DMRC) reported financial results for the first quarter ended March 31, 2023.\n\n\nFirst Quarter 2023 Financial Results\n\n\nSubscription revenue for the first quarter of 2023 increased 2% to $3.9 million compared to $3.8 million in the first quarter of 2022, primarily reflecting $1.0 million of higher subscription revenue from new commercial contracts, partially offset by $0.6 million of lower subscription revenue as a result of sunsetting our Piracy Intelligence product in 2022.\n\n\nService revenue for the first quarter of 2023 increased 9% to $4.0 million compared to $3.6 million in the first quarter of 2022, primarily reflecting the impact of a larger annual budget from the Central Banks for project work in 2023 than 2022, which includes both higher billing rates and project hours.\n\n\nTotal revenue for the first quarter of 2023 increased 6% to $7.8 million compared to $7.4 million in the first quarter of 2022.\n\n\nGross profit for the first quarter of 2023 increased $0.9 million, or 27%, to $4.2 million compared to $3.3 million in the first quarter of 2022, primarily reflecting $0.5 million of higher service gross profit contribution due to higher service revenue and lower professional services costs and $0.3 million of higher subscription gross profit contribution due to higher subscription revenue, a favorable mix of subscription revenue, and lower platform costs.\n\n\nGross profit margin for the first quarter of 2023 increased to 54%, compared to 45% in the first quarter of 2022. Excluding amortization expense on acquired intangible assets, subscription gross margins improved from 73% to 80% and service gross margins improved from 49% to 57% from the first quarter of 2022 to the first quarter of 2023.\n\n\nNon-GAAP gross profit for the first quarter of 2023 increased $0.8 million, or 17%, to $5.7 million compared to $4.9 million in the first quarter of 2022.\n\n\nNon-GAAP gross profit margin for the first quarter of 2023 increased to 73%, compared to 66% in the first quarter of 2022.\n\n\nOperating expenses for the first quarter of 2023 decreased $2.3 million, or 11%, to $19.0 million compared to $21.4 million in the first quarter of 2022, primarily reflecting $1.3 million of lower compensation costs due to lower headcount partially offset by annual com...

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