Digimarc NASDAQ: DMRC outlined a commercial restructuring centered on retail and consumer packaged goods, while reporting lower second-quarter revenue and annual recurring revenue following previously disclosed customer contract changes.
Chief Executive Officer Paul Carreiro, who said he was 30 days into the role, described the company’s primary challenge as commercial execution rather than technology differentiation. He said the company is building a more focused go-to-market organization designed to convert its digital and physical watermarking technology into more repeatable and forecastable revenue.
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Retail and CPG become primary commercial focus
Carreiro said Digimarc will concentrate dedicated sales resources on retail and CPG, which he characterized as the company’s most developed verticals and the areas where its current product portfolio has the greatest differentiation.
In retail, the company is emphasizing its Secure Gift Card solution, which is deployed chainwide at Schnucks across 115 stores. Carreiro said gift card fraud represents measurable financial leakage for retailers and that Digimarc has built partnerships across the card issuance, point-of-sale, scanning, card production, serialization and packaging supply chain.
The company’s partners include Blackhawk Network and InComm for card issuance and distribution; Zebra Technologies, Datalogic and Honeywell for point-of-sale and scanning infrastructure; Graph-Tech USA and SDL Labels for card production and serialization; and WestRock for packaging integration.
Carreiro said Digimarc’s retail pipeline has grown more than 30 times since the start of the year, when it was working with one retailer. The company now has more than 31 large and mid-sized retailers in stages ranging from initial discussions to pilots and production rollouts.
Chief Financial Officer Charles Beck said two additional retailers have committed to deploy the Secure Gift Card solution across their stores. One is expected to begin rolling out later in August, while another is scheduled to begin in October. A large retailer that had postponed a pilot because of software availability constraints is now planning a smaller pilot in September, with the objective of supporting a broader deployment beginning in the first quarter of 2027, Beck said.
Several other retailers are planning rollouts during the first half of 2027. Carreiro said he did not anticipate additional gift-card-program revenue that he could commit to for the balance of 2026, as the company and its partners build demand through the second half of the year.
Within CPG, Carreiro highlighted a global rollout of the company’s Digimarc Digital Link platform covering 45,000 SKUs for a global manufacturer and distributor. He said the company sees external demand drivers from the GS1 Sunrise 2027 initiative and the European Union’s Digital Product Passport mandate.
New leadership structure and customer engagement model
Digimarc has hired a chief revenue officer with responsibility for quota, pipeline and forecasting across verticals, as well as a vice president of retail solutions. Carreiro said the company expects to add one or two senior hires by the end of August or September and complete its senior leadership buildout by the end of the third quarter. The company plans to add account executive capacity through the third and fourth quarters.
The planned structure includes dedicated retail and CPG sales teams, revenue operations, value engineering, marketing, product leadership and partner ecosystem management. Carreiro said the company will move pharma, life sciences, media and technology, and most government opportunities to a more partner-led, horizontal approach rather than maintaining dedicated vertical sales capacity.
He also said Digimarc will implement a “360-degree customer engagement model,” with go-to-market teams engaging accounts ahead of contract decision points to support retention, upselling and cross-selling. The company plans to conduct an investor roadshow in coming weeks led by Carreiro and Beck.
Second-quarter results and ARR decline
Digimarc reported second-quarter revenue of $7.4 million, down from $8 million in the same period last year. Subscription revenue declined to $3.7 million from $4.6 million, primarily due to a customer contract that expired in October 2025. Service revenue increased to $3.6 million from $3.4 million, with contributions from commercial and government business.
Ending ARR was $11.6 million, compared with $15.9 million a year earlier.
Subscription gross margin increased to 89% from 85%.
Service gross margin increased to 60% from 59%.
Operating expenses were $16.7 million, compared with $13.1 million a year earlier.
GAAP net loss per diluted share was $0.54, compared with a loss of $0.38 per share a year earlier.
Non-GAAP net loss per diluted share improved to $0.08 from $0.11.
Beck said the ARR decline reflected the expiration of a $3.1 million contract in October 2025 and a $2.6 million contract reduction in June 2026, partly offset by $1.5 million in net ARR growth. The reduction stemmed from two projects canceled after the government end customer changed requirements.
Digimarc is working with its direct customer to restructure that agreement, pursue recertification of three legacy projects and seek certification for two new projects. Beck said those efforts could restore a meaningful portion of lost ARR and potentially increase ARR, but the timing and outcome remain uncertain.
Given the contract reduction, no committed upsell from that customer and limited time left in the year, Beck said Digimarc no longer expects to achieve its original target for significant ARR growth by year-end. The company still expects meaningful ARR growth from gift cards as deployments progress, though that opportunity has shifted by several quarters.
Cash position and capital allocation
Digimarc ended the quarter with $8.8 million in cash and short-term investments and no debt. The company used $1.03 million of cash flow during the quarter, spent $600,000 repurchasing shares associated with employee equity programs, and raised $300,000 through its at-the-market program at an average share price of $12.59.
Carreiro said more than 90% of planned investment from its capital-raising efforts is expected to support the go-to-market buildout, while the company seeks to execute the expansion in as cost-neutral a manner as possible.
About Digimarc (NASDAQ:DMRC)Digimarc Corporation is a technology company specializing in digital identification and authentication solutions. Its core offering centers on embedding imperceptible digital watermarks into images, audio, video and packaging materials. These watermarks carry unique identifiers that enable secure tracking, brand protection and content provenance across print and digital channels.
The company's product suite includes software development kits and cloud-based services that allow enterprises to integrate digital watermarking into their existing workflows.
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BEAVERTON, Ore.--(BUSINESS WIRE)-- #digitalwatermarks--Digimarc will hold a conference call on August 13, 2026, at 5 p.m. Eastern time to discuss results for the second quarter ended June 30, 2026.
Digimarc Corporation (NASDAQ:DMRC – Get Free Report) shares passed above its two hundred day moving average during trading on Tuesday . The stock has a two hundred day moving average of $7.42 and traded as high as $7.60. Digimarc shares last traded at $7.41, with a volume of 111,218 shares traded.
Wall Street Analyst Weigh In Several equities analysts recently issued reports on DMRC shares. Weiss Ratings reissued a “sell (e+)” rating on shares of Digimarc in a report on Friday, July 17th. Wall Street Zen raised shares of Digimarc to a “hold” rating in a research note on Saturday, July 18th. Finally, Needham & Company LLC lifted their target price on shares of Digimarc from $10.00 to $15.00 and gave the company a “buy” rating in a research note on Thursday, May 14th. One investment analyst has rated the stock with a Buy rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat, Digimarc presently has a consensus rating of “Hold” and an average target price of $15.00.
View Our Latest Research Report on DMRC
Digimarc Trading Up 2.9% The company has a market capitalization of $166.06 million, a price-to-earnings ratio of -5.83 and a beta of 2.30. The company has a 50 day moving average price of $9.02 and a 200 day moving average price of $7.42.
Digimarc (NASDAQ:DMRC – Get Free Report) last issued its quarterly earnings results on Tuesday, May 12th. The information technology services provider reported ($0.07) earnings per share (EPS) for the quarter, beating the consensus estimate of ($0.36) by $0.29. The business had revenue of $7.58 million for the quarter, compared to analyst estimates of $7.05 million. Digimarc had a negative return on equity of 21.81% and a negative net margin of 85.75%.
Institutional Investors Weigh In On Digimarc A number of institutional investors and hedge funds have recently modified their holdings of the business. Vanguard Group Inc. lifted its holdings in Digimarc by 2.3% in the third quarter. Vanguard Group Inc. now owns 1,330,053 shares of the information technology services provider’s stock valued at $12,995,000 after buying an additional 30,258 shares during the period. Silverberg Bernstein Capital Management LLC raised its position in shares of Digimarc by 7.6% during the 1st quarter. Silverberg Bernstein Capital Management LLC now owns 779,255 shares of the information technology services provider’s stock valued at $3,826,000 after acquiring an additional 55,110 shares during the last quarter. Kimelman & Baird LLC raised its position in shares of Digimarc by 7.2% during the 4th quarter. Kimelman & Baird LLC now owns 680,817 shares of the information technology services provider’s stock valued at $4,466,000 after acquiring an additional 45,447 shares during the last quarter. Private Advisor Group LLC lifted its stake in shares of Digimarc by 12.8% in the 1st quarter. Private Advisor Group LLC now owns 502,001 shares of the information technology services provider’s stock valued at $2,465,000 after purchasing an additional 56,829 shares during the period. Finally, Geode Capital Management LLC lifted its stake in shares of Digimarc by 1.4% in the 2nd quarter. Geode Capital Management LLC now owns 371,835 shares of the information technology services provider’s stock valued at $4,913,000 after purchasing an additional 5,191 shares during the period. 66.85% of the stock is owned by institutional investors.
Digimarc Company Profile (Get Free Report)
Digimarc Corporation is a technology company specializing in digital identification and authentication solutions. Its core offering centers on embedding imperceptible digital watermarks into images, audio, video and packaging materials. These watermarks carry unique identifiers that enable secure tracking, brand protection and content provenance across print and digital channels.
The company’s product suite includes software development kits and cloud-based services that allow enterprises to integrate digital watermarking into their existing workflows.
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BEAVERTON, Ore.--(BUSINESS WIRE)--Digimarc Corporation (NASDAQ: DMRC), the company building the trust layer for the modern world, today announced the appointment of Ron Thomas as Chief Revenue Officer, effective August 3, 2026. Thomas will report directly to President and Chief Executive Officer Paul Carreiro and will lead Digimarc's global revenue organization, with responsibility for sales, customer success, revenue operations, solution advisory, partnerships, and the company's broader go-to-.
BEAVERTON, Ore.--(BUSINESS WIRE)--Digimarc Corporation (NASDAQ: DMRC), a leading provider in digital identity and authentication solutions, will hold a conference call on Thursday, August 13, 2026, at 5 p.m. Eastern time (2 p.m. Pacific time) to discuss results for the second quarter ended June 30, 2026. Digimarc CEO Paul Carreiro and CFO Charles Beck will host the call, and provide an update on strategic priorities, quarterly highlights, and financial results, followed by a question-and-answer.
BEAVERTON, Ore.--(BUSINESS WIRE)--Digimarc Corporation (NASDAQ: DMRC), a pioneer in digital identity and authentication solutions announced that effective today, July 6, 2026, Paul Carreiro has assumed the role of Chief Executive Officer and President following the Company's previously announced leadership transition. As Chief Executive Officer and President, Carreiro will lead Digimarc's strategy and operations as the Company advances its mission to build the trust layer for the modern world.
BEAVERTON, Ore.--(BUSINESS WIRE)--Digimarc Corporation (NASDAQ: DMRC), a pioneer in digital identity and authentication solutions, today announced that it is extending its agent-native provenance and verification infrastructure capabilities to the leading platforms used to build and deploy autonomous systems, including LangChain, ServiceNow Action Fabric, Salesforce Agentforce, Google Gemini Enterprise Agent Platform, and Microsoft Copilot Studio. These extensions of the Digimarc platform seamle.
Digimarc Corporation (NASDAQ: DMRC), a pioneer in digital identity and authentication solutions, today announced that it is extending its agent-native provenance and verification infrastructure capabilities to the leading platforms used to build and deploy autonomous systems, including LangChain, ServiceNow Action Fabric, Salesforce Agentforce, Google Gemini Enterprise Agent Platform, and Microsoft Copilot Studio. These extensions of the Digimarc platform seamlessly allow any AI agent created in these agentic ecosystems to cryptographically stamp outputs at the moment of creation, establish authenticity of ingested content before taking action via submission to Digimarc’s multi-layered verification engine, and retrieve a complete lineage chain from the Digimarc Lineage Vault for audit, incident response, and compliance reporting.
Enterprise agentic AI deployments are accelerating rapidly across every major platform, yet the artifacts these agents produce and interact with – including documents, decisions, recommendations, data, and media – represent unaddressed security vulnerabilities without a verifiable record of origin, authorization, or integrity. As organizations move AI from experimentation into production workflows, trust, governance, and accountability have become mission critical requirements.
The platform integrations announced today close that security gap by making provenance a first-class, natively available capability on each Agentic AI platform. By bringing provenance and verification directly into the platforms that developers already use, Digimarc is making trusted content and trusted actions native capabilities of modern AI workflows, addressing rapidly growing security and governance concerns.
HOW IT WORKS
Digimarc’s agent-native provenance platform is grounded in three powerful capabilities: a provenance stamping service that applies cryptographic signatures to agentic output; a multi-layered verification engine that goes beyond simple signature checking to cascade through provenance pointer resolution and perceptual watermark detection, returning an actionable trust verdict rather than a binary pass or fail; and the Digimarc Lineage Vault, an immutable record of every artifact’s origin, transformation, and chain of custody that supports audit, incident reconstruction, and regulatory compliance. All three capabilities are exposed through Digimarc’s Model Context Protocol (MCP) server, making them agent-callable on any platform without framework modification. The platform integrations announced today take this a step further and are built to support the way developers already work, so leveraging Digimarc’s capabilities require no new tools, no new frameworks, and no new infrastructure to manage.
The approach is built around a simple insight: the developer who builds an agent is typically the person who selects its tools. By embedding provenance and verification directly into the platforms that developers already use, Digimarc lowers the barrier to adoption while helping organizations establish trust and traceability across increasingly autonomous workflows. By meeting developers where they already work, Digimarc makes provenance the easy choice rather than an additional integration burden.
“AI agents are being deployed into production faster than the security and governance infrastructure to support them. As organizations begin relying on autonomous systems to do more than just create content – such as make recommendations, drive business processes, and take action – the ability to verify what those systems are acting upon has become mission critical. Digimarc’s solution is not just a signing standard, it is a verification service that tells an agent what to do when it receives content it cannot fully trust and a lineage vault that preserves the complete origin story of every artifact an agent touches. Extending our provenance and verification infrastructure to where developers are already building is about making enterprise-grade governance the easy choice, not an additional burden.”
– Ken Sickles, EVP and Chief Product Officer, Digimarc
PLATFORM INTEGRATIONS
Digimarc is extending its agent-native provenance and verification infrastructure to the platforms where enterprise agentic AI is being built and deployed today:
LangChain and LangGraphServiceNow Action FabricSalesforce AgentforceGoogle Gemini Enterprise Agent Platform.Microsoft Copilot StudioAcross all platforms, the integrations expose the same three core operations powered by Digimarc’s Illuminate platform and made available through its MCP Server: cryptographic artifact stamping; multi-tiered verification logic that helps organizations determine whether content can be trusted before downstream action occurs; and full lineage retrieval for audit, incident response, and compliance reporting.
WHAT ENTERPRISE DEVELOPERS GAIN
The promise of autonomous systems is speed and scale. The challenge is ensuring organizations can trust, audit, and govern the systems within which those agents operate. Digimarc’s agent-native provenance and verification platform allows developers to overcome these challenges without requiring expertise in cryptographic infrastructure or content authenticity technology and standards. Every agent’s output is cryptographically bound to its origin and authorization context at the moment of creation, incoming artifacts are verified using Digimarc’s proprietary multi-layered verification engine before downstream action is taken, and all interactions are recorded in an immutable audit trail.
The integrations announced today represent a critical step forward in making provenance, verification, and trust fully native capabilities of increasingly autonomous digital ecosystems. The result is a more trusted foundation for autonomous systems, enabling organizations to adopt AI at greater scale and with greater confidence by ensuring that what systems create, consume, and act upon can be verified, trusted, and traced.
AVAILABILITY
More information and developer access is available at digimarc.com/solutions/agentic-trust.
About Digimarc
Digimarc (NASDAQ: DMRC) is building the trust layer for the modern world. Our solutions help people, businesses, and intelligent systems verify what’s real, protect what matters, and interact with confidence across physical and digital environments. Learn more at Digimarc.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260616796357/en/
BEAVERTON, Ore.--(BUSINESS WIRE)-- #digitalwatermarks--Digimarc will hold a conference call on March 11, 2026, at 5 p.m. Eastern time to discuss results for the fourth quarter ended December 31, 2025.
BEAVERTON, Ore.--(BUSINESS WIRE)-- #digitalwatermarks--Digimarc will hold a Q&A session on March 16, 2026, at 5 p.m. Eastern time as a supplement to the fourth quarter 2025 conference call.
Digimarc Corporation is positioned as a speculative buy after a pivotal Q4, driven by its Secure Gift Card solution targeting retail fraud. Q4 marked DMRC's first positive free cash flow and non-GAAP net income in over 12 years, with improved gross margins and sharply reduced operating expenses. DMRC's Secure Gift Card solution, already trialed successfully, is set for rollout with major retailers, addressing a multibillion-dollar fraud market opportunity.
G4S (OTCMKTS:GFSZY – Get Free Report) and Digimarc (NASDAQ:DMRC – Get Free Report) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, dividends, profitability, institutional ownership, analyst recommendations, risk and valuation.
Valuation and Earnings This table compares G4S and Digimarc”s revenue, earnings per share (EPS) and valuation.
Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio G4S N/A N/A N/A N/A N/A Digimarc $33.91 million 3.99 -$32.31 million ($1.50) -4.08 G4S has higher earnings, but lower revenue than Digimarc.
Analyst Recommendations This is a breakdown of current ratings and price targets for G4S and Digimarc, as provided by MarketBeat.com.
Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score G4S 0 0 0 0 0.00 Digimarc 1 0 1 0 2.00 Digimarc has a consensus price target of $10.00, suggesting a potential upside of 63.40%. Given Digimarc’s stronger consensus rating and higher probable upside, analysts clearly believe Digimarc is more favorable than G4S.
Insider & Institutional Ownership 66.9% of Digimarc shares are held by institutional investors. 19.3% of Digimarc shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Profitability This table compares G4S and Digimarc’s net margins, return on equity and return on assets.
Net Margins Return on Equity Return on Assets G4S N/A N/A N/A Digimarc -95.27% -38.41% -29.00% Summary Digimarc beats G4S on 6 of the 9 factors compared between the two stocks.
About G4S (Get Free Report)
G4S plc, together with its subsidiaries, operates as an integrated security company in Africa, the Americas, Asia, Europe, and the Middle East. The company offers software tools, including evidence-based risk assessment, incident management, and travel advisory systems, such as symmetry incident management; and proprietary security systems comprising symmetry connect access control and visitor management systems. It also provides retail technology solutions, comprising of Retail Cash Solutions, CASH360, and South Africa-Deposita; security advice, risk mitigation strategies, secure support, and integrated solutions; and offer custody, detention, rehabilitation, and care services. The company serves corporates, financial institutions, private energy/utilities, retail, leisure and consumers, private energy/utilities, transport, ports, and aviation. G4S plc was founded in 1901 and is headquartered in London, the United Kingdom. G4S plc is a subsidiary of Atlas UK Bidco Limited.
About Digimarc (Get Free Report)
Digimarc Corporation, together with its subsidiaries, provides automatic identification solutions to commercial and government customers in the United States and internationally. The company offers Digimarc Validate protects, a cloud-based record of product authentication information; Digimarc Engage, an interactive communications channel connecting brands and consumers; and Digimarc Recycle. Its solutions are used in various application solutions, such as sorting of consumer-packaged goods in recycling streams. The company offers its solutions through its sales personnel and business partners. Digimarc Corporation was incorporated in 2008 and is based in Beaverton, Oregon.
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BEAVERTON, Ore.--(BUSINESS WIRE)--Digimarc Corporation (NASDAQ: DMRC), a leading provider in digital identity and authentication solutions, will attend the 21st Annual Needham Technology, Media & Consumer Conference in New York on Wednesday, May 13, 2026. Digimarc President and CEO Riley McCormack and CFO Charles Beck will host meetings at the event, which is being held at the Westin Grand Central Hotel.
The Needham research team has individually selected the attending companies. If you want additional information or to schedule a one-on-one meeting with Digimarc management, please contact your Needham representative.
About Digimarc
Digimarc (NASDAQ: DMRC) is building the trust layer for the modern world. As AI accelerates how we produce, share, and interact with the world, the risks of fraud, counterfeiting, and misinformation are growing exponentially. Our innovative, highly scalable, and ultra-secure solutions make it possible for consumers, businesses, and intelligent systems to instantly verify what’s real, protect what matters, and transact with confidence. Digimarc’s solutions for loss prevention, authentication, and digital are built to counter the speed and sophistication of today’s AI-enabled threats. Trusted by the world’s central banks to deter the counterfeiting of global currency, we exist to protect truth in every interaction, spanning both the physical and digital worlds. Learn more at Digimarc.com.
BEAVERTON, Ore.--(BUSINESS WIRE)--Digimarc Corporation (NASDAQ: DMRC) reported financial results for the first quarter ended March 31, 2026.
“Digimarc is capitalizing on the convergence of key trends driving increased demand for our solutions, positioning ourselves to benefit from the relentless advance of AI," said Riley McCormack, Digimarc CEO. "In Q1 2026, we made significant progress against our strategy of building the trust layer for the modern world while delivering a 9% sequential increase in ending ARR(1) and expanding our subscription gross profit margin(2) 400 basis points year-over year."
First Quarter 2026 Financial Results
Subscription revenue for the first quarter of 2026 was $4.4 million compared to $5.3 million for the first quarter of 2025. The decrease reflects $1.5 million lower subscription revenue from the expiration of two commercial contracts in 2025, partially offset by an increase from new and existing commercial contracts.
Service revenue for the first quarter of 2026 was $3.2 million compared to $4.1 million for the first quarter of 2025. The decrease primarily reflects $0.5 million of lower commercial service revenue from HolyGrail 2.0 recycling projects, as that work was previously completed.
Total revenue for the first quarter of 2026 was $7.6 million compared to $9.4 million for the first quarter of 2025.
ARR(1) as of March 31, 2026 was $15.0 million compared to $20.0 million as of March 31, 2025. The decrease primarily reflects the expiration of two commercial contracts, one in April 2025 that accounted for a total of $3.7 million of ARR and the other in October 2025 that accounted for $3.1 million of ARR, partially offset by $1.8 million of net increases to ARR from new and existing commercial contracts.
Gross profit margin for the first quarter of 2026 was 60% compared to 65% for the first quarter of 2025. Subscription gross profit margin(2) increased to 90% from 86% and service gross profit margin(2) decreased to 57% from 65% for the first quarter of 2026 compared to the first quarter of 2025.
Non-GAAP gross profit margin for the first quarter of 2026 was 83% compared to 81% for the first quarter of 2025.
Operating expenses for the first quarter of 2026 were $11.7 million compared to $18.2 million for the first quarter of 2025. The decrease primarily reflects $4.2 million of lower cash compensation costs largely due to lower headcount and $3.2 million of lower cash severance costs resulting from the reduction in force in the first quarter of 2025, partially offset by $1.0 million of legal costs associated with the corporate reorganization.
Non-GAAP operating expenses for the first quarter of 2026 were $8.1 million compared to $16.5 million for the first quarter of 2025.
Net loss for the first quarter of 2026 was $7.0 million or ($0.32) per diluted share compared to $11.7 million or ($0.55) per diluted share for the first quarter of 2025.
Non-GAAP net loss for the first quarter of 2026 was $1.6 million or ($0.07) per diluted share compared to $8.5 million or ($0.40) per diluted share for the first quarter of 2025.
At March 31, 2026, cash, cash equivalents and marketable securities totaled $10.0 million compared to $12.9 million at December 31, 2025. Free cash flow usage for the first quarter of 2026 was $2.0 million compared to $5.6 million for the first quarter of 2025.
Conference Call
Digimarc will hold a conference call today (Tuesday, May 12, 2026) to discuss these financial results and to provide a business update. CEO Riley McCormack and CFO Charles Beck will host the call starting at 5:00 p.m. Eastern time (2:00 p.m. Pacific time). A question and answer session will follow management’s prepared remarks.
The conference call and investor presentation will be broadcast live and available for replay here and in the investor section of the company’s website. The conference call script and investor presentation will also be posted to the company’s website shortly before the call.
For those who wish to call in via telephone to ask a question, please dial the number below at least five minutes before the scheduled start time. We encourage you to also login to the live broadcast so you can follow along with the investor presentation.
Toll Free number: 877-407-0832
International number: 201-689-8433
Conference ID number: 13754826
About Digimarc
Digimarc Corporation (NASDAQ: DMRC) is building the trust layer for the modern world. As AI accelerates how we produce, share, and interact with the world, the risks of fraud, counterfeiting, and misinformation are growing exponentially. Our innovative, highly scalable, and ultra-secure solutions make it possible for consumers, businesses, and intelligent systems to instantly verify what's real, protect what matters, and transact with confidence. Digimarc's solutions for loss prevention, authentication, and digital are built to counter the speed and sophistication of today's AI-enabled threats. Trusted by the world's central banks to deter the counterfeiting of global currency, we exist to protect truth in every interaction, spanning both the physical and digital worlds. Learn more at Digimarc.com.
Forward-Looking Statements
Except for historical information contained in this release, the matters described in this release contain various “forward-looking statements.” These forward-looking statements include statements identified by terminology such as “will,” “should,” "may," “expects,” “estimates,” “predicts” and “continue” or other derivations of these or other comparable terms. These forward-looking statements are statements of management’s opinion and are subject to various assumptions, risks, uncertainties and changes in circumstances. Actual results may vary materially from those expressed or implied from the statements in this release as a result of changes in economic, business and regulatory factors. More detailed information about risk factors that may affect actual results are outlined in the company’s Form 10-K for the year ended December 31, 2025, and in subsequent periodic reports filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s opinions only as of the date of this release. Except as required by law, Digimarc undertakes no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this release.
Non-GAAP Financial Measures
This release contains the following non-GAAP financial measures: Non-GAAP gross profit, Non-GAAP gross profit margin, Non-GAAP operating expenses, Non-GAAP net loss, Non-GAAP net loss per diluted share, and free cash flow. See below for a reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure. These non-GAAP financial measures are an important measure of our operating performance because they allow management, investors and analysts to evaluate and assess our core operating results from period-to-period after removing non-cash and non-recurring activities that affect comparability. Our management uses these non-GAAP financial measures in evaluating its financial and operational decision making and as a means to evaluate period-to-period comparisons.
Digimarc believes that providing these non-GAAP financial measures, together with the reconciliation to GAAP, helps management and investors make comparisons between us and other companies. In making any comparisons to other companies, investors need to be aware that companies use different non-GAAP measures to evaluate their financial performance. Investors should pay close attention to the specific definition being used and to the reconciliation between such measures and the corresponding GAAP measures provided by each company under applicable SEC rules. These non-GAAP financial measures are not measurements of financial performance or liquidity under GAAP. In order to facilitate a clear understanding of its consolidated historical operating results, investors should examine Digimarc’s non-GAAP financial measures in conjunction with its historical GAAP financial information, and investors should not consider non-GAAP financial measures in isolation or as substitutes for performance measures calculated in accordance with GAAP. Non-GAAP financial measures should be viewed as supplemental to, and should not be considered as alternatives to, GAAP financial measures. Non-GAAP financial measures may not be indicative of the historical operating results of the Company nor are they intended to be predictive of potential future results.
Digimarc Corporation
Consolidated Statements of Operations
(in thousands, except per share amounts)
(Unaudited)
Three Months Ended
March 31,
2026
2025
Revenue:
Subscription
$
4,369
$
5,314
Service
3,210
4,054
Total revenue
7,579
9,368
Cost of revenue:
Subscription (2)
456
744
Service (2)
1,378
1,407
Amortization expense on acquired intangible assets
1,208
1,132
Total cost of revenue
3,042
3,283
Gross profit:
Subscription (2)
3,913
4,570
Service (2)
1,832
2,647
Amortization expense on acquired intangible assets
(1,208
)
(1,132
)
Total gross profit
4,537
6,085
Gross profit margin:
Subscription (2)
90
%
86
%
Service (2)
57
%
65
%
Total
60
%
65
%
Operating expenses:
Sales and marketing
2,082
5,078
Research, development and engineering
3,747
7,634
General and administrative
5,555
5,181
Amortization expense on acquired intangible assets
289
271
Total operating expenses
11,673
18,164
Operating loss
(7,136
)
(12,079
)
Other income, net
171
369
Loss before income taxes
(6,965
)
(11,710
)
Provision for income taxes
(1
)
(20
)
Net loss
$
(6,966
)
$
(11,730
)
Net loss per share:
Net loss per share — basic
$
(0.32
)
$
(0.55
)
Net loss per share — diluted
$
(0.32
)
$
(0.55
)
Weighted average shares outstanding — basic
22,008
21,521
Weighted average shares outstanding — diluted
22,008
21,521
Digimarc Corporation
Reconciliation of GAAP to Non-GAAP Financial Measures
(in thousands, except per share amounts)
(Unaudited)
Three Months Ended
March 31,
2026
2025
GAAP gross profit
$
4,537
$
6,085
Amortization of acquired intangible assets
1,208
1,132
Amortization and write-off of other intangible assets (3)
207
220
Stock-based compensation
347
137
Non-GAAP gross profit
$
6,299
$
7,574
Non-GAAP gross profit margin
83
%
81
%
GAAP operating expenses
$
11,673
$
18,164
Depreciation and write-off of property and equipment
(154
)
(146
)
Amortization of acquired intangible assets
(289
)
(271
)
Amortization and write-off of other intangible assets
(121
)
(59
)
Amortization of lease right of use assets under operating leases
(117
)
(98
)
Stock-based compensation
(1,662
)
(1,123
)
Corporate reorganization expenses
(1,223
)
—
Non-GAAP operating expenses
$
8,107
$
16,467
GAAP net loss
$
(6,966
)
$
(11,730
)
Total adjustments to gross profit
1,762
1,489
Total adjustments to operating expenses
3,566
1,697
Non-GAAP net loss
$
(1,638
)
$
(8,544
)
GAAP net loss per diluted share
$
(0.32
)
$
(0.55
)
Non-GAAP net loss
$
(1,638
)
$
(8,544
)
Non-GAAP net loss per diluted share
$
(0.07
)
$
(0.40
)
Free cash flow
Cash flows from operating activities
$
(1,847
)
$
(5,486
)
Purchase of property and equipment
(44
)
(55
)
Capitalized patent costs
(77
)
(88
)
Free cash flow
$
(1,968
)
$
(5,629
)
Digimarc Corporation
Consolidated Balance Sheet Information
(in thousands)
(Unaudited)
March 31,
December 31,
2026
2025
ASSETS
Current assets:
Cash and cash equivalents
$
8,818
$
9,820
Marketable securities
1,145
3,046
Trade accounts receivable, net
7,092
6,513
Other current assets
1,988
1,961
Total current assets
19,043
21,340
Property and equipment, net
989
1,104
Intangibles, net
15,244
17,045
Goodwill
8,923
9,056
Lease right of use assets
3,121
3,238
Other assets
1,190
1,175
Total assets
$
48,510
$
52,958
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable and other accrued liabilities
$
6,004
$
4,359
Deferred revenue
4,227
3,993
Total current liabilities
10,231
8,352
Long-term lease liabilities
4,073
4,314
Other long-term liabilities
140
63
Total liabilities
14,444
12,729
Shareholders’ equity:
Preferred stock
50
50
Common stock
22
22
Additional paid-in capital
425,789
424,665
Accumulated deficit
(390,053
)
(383,087
)
Accumulated other comprehensive loss
(1,742
)
(1,421
)
Total shareholders’ equity
34,066
40,229
Total liabilities and shareholders’ equity
$
48,510
$
52,958
Digimarc Corporation
Consolidated Cash Flow Information
(in thousands)
(Unaudited)
Three Months Ended
March 31,
2026
2025
Cash flows from operating activities:
Net loss
$
(6,966
)
$
(11,730
)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and write-off of property and equipment
154
146
Amortization of acquired intangible assets
1,497
1,403
Amortization and write-off of other intangible assets
328
193
Amortization of lease right of use assets under operating leases
117
98
Stock-based compensation
2,009
1,260
Increase (decrease) in allowance for doubtful accounts
21
—
Changes in operating assets and liabilities:
Trade accounts receivable
(566
)
(149
)
Other current assets
(44
)
1,331
Other assets
(44
)
(105
)
Accounts payable and other accrued liabilities
1,624
1,549
Deferred revenue
231
689
Lease liability and other long-term liabilities
(208
)
(171
)
Net cash provided by (used in) operating activities
(1,847
)
(5,486
)
Cash flows from investing activities:
Purchase of property and equipment
(44
)
(55
)
Capitalized patent costs
(77
)
(88
)
Proceeds from maturities of marketable securities
2,128
6,564
Purchases of marketable securities
(227
)
(2,864
)
Net cash provided by (used in) investing activities
1,780
3,557
Cash flows from financing activities:
Purchase of common stock
(885
)
(1,545
)
Repayment of loans
(3
)
(15
)
Net cash provided by (used in) financing activities
(888
)
(1,560
)
Effect of exchange rate on cash
(47
)
26
Net increase (decrease) in cash and cash equivalents
$
(1,002
)
$
(3,463
)
Cash, cash equivalents and marketable securities at beginning of period
$
12,866
$
28,730
Cash, cash equivalents and marketable securities at end of period
9,963
21,567
Net increase (decrease) in cash, cash equivalents and marketable securities
Digimarc NASDAQ: DMRC reported sequential annual recurring revenue growth in the first quarter of 2026 while outlining progress and timing changes in its secure gift card, anti-counterfeiting and digital trust initiatives.
Chief Executive Riley McCormack said the company made “significant progress” in advancing adoption of its secure gift card solution, including the first commercial order for the product and a growing number of retailer discussions. Chief Financial Officer Charles Beck said ending ARR was $15 million in the first quarter, down from $20 million a year earlier but up 9% sequentially.
The year-over-year decline in ARR reflected the previously disclosed loss of two customer contracts in 2025, which accounted for $6.8 million of ARR, Beck said. Excluding those two contracts, ARR increased $1.8 million year over year, including $500,000 of ARR from gift cards in the first quarter.
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Secure Gift Card Rollouts Advance, With One Broader Launch Delayed McCormack said Digimarc closed its first secure gift card commercial order in the quarter, representing more than $500,000 of ARR and covering gift cards from six closed-loop and open-loop brands. The company is now advancing rollout plans with 15 North American retailers, including eight of the 20 largest by sales, up from eight retailers and four of the top 20 at the time of the company’s prior earnings call two months earlier.
McCormack said market engagement has increased across retailers, brands and gift card networks, citing industry summits and meetings with large retailers and a leading program manager. He said some retailers are encouraging major brands to adopt Digimarc’s solution and are engaging with other retailers to create incentives for widely sold brands to move faster.
Digimarc’s rollout with Schnucks is underway, McCormack said. During the question-and-answer portion of the call, he said Schnucks had expanded the cards from 10 stores to 15 stores and is moving toward all of its locations. “They’re very happy with the solution, and we’re really thrilled with them as a wonderful partner,” McCormack said.
However, another retailer’s rollout planned for the summer will be more limited than originally expected, with a full rollout to nearly 600 locations now targeted for January 2027. McCormack attributed the delay to scanner vendor firmware timing, saying two scanner models did not become generally available in the required timeframe, including one model critical to the retailer’s front end. He said the issue was not related to Digimarc’s software, but to base functionality needed for the retailer to push firmware updates at scale. The scanner vendor has since shipped updated firmware, which is undergoing the retailer’s normal acceptance testing.
Beck said the timing shift means gift cards are no longer expected to be the largest contributor to ARR growth in 2026, though the company still expects “significant ARR growth” for the year. He said the change reflects timing of initial rollouts rather than a change in Digimarc’s conviction in the opportunity.
Anti-Counterfeiting and Digital Trust Businesses See Upsells Digimarc also reported momentum in its product authentication business. McCormack said ARR from the company’s anti-counterfeiting solution continues to grow, driven by upsells and new customer wins. In the first quarter, Digimarc closed three upsell deals with existing anti-counterfeiting customers in pharmaceuticals, food and beverage, and consumer goods.
Asked what was driving the anti-counterfeiting upsells, McCormack said it varied by customer. “Sometimes it’s adding new brands, sometimes it’s adding new geography, sometimes it’s adding new functionality,” he said.
In digital trust and integrity, McCormack said Digimarc secured a six-figure upsell with a global technology company that adopted its leak detection solution for web content. He also said the company is progressing discussions with an industry trade group seeking an industrywide solution to a problem made worse by advances in artificial intelligence.
McCormack emphasized Digimarc’s positioning around digital watermarking and the Coalition for Content Provenance and Authenticity, or C2PA, standard. He also said the company is developing an extension of its “trust layer” strategy aimed at agentic AI, where autonomous systems may need scalable ways to verify what is real, authentic and authorized.
First-Quarter Revenue Declines, But Loss Narrows Total revenue for the first quarter was $7.6 million, down from $9.4 million in the same quarter last year. Beck said the $1.8 million decline was evenly split between subscription and service revenue.
Subscription revenue was $4.4 million, down from $5.3 million a year earlier. Service revenue was $3.2 million, down from $4.1 million a year earlier. Subscription gross margin was 90%, up 400 basis points year over year. Service gross margin was 57%, compared with 65% a year earlier. Beck said subscription revenue would have increased $600,000 excluding the two lost customer contracts, which contributed $1.5 million of subscription revenue in the prior-year quarter. Service revenue in the year-ago period included $500,000 from HolyGrail 2.0 recycling projects, compared with none in the latest quarter. He said Digimarc does not expect further service revenue from HolyGrail 2.0 because that program has ended.
Operating expenses were $11.7 million, down 36% from $18.2 million a year earlier. Beck said the decline reflected lower cash compensation costs due to reduced headcount, severance costs incurred last year, and lower consulting, software and hardware costs. Those savings were partly offset by $1.2 million in one-time legal and other costs tied to the corporate reorganization, as well as $500,000 in higher stock-based compensation.
Digimarc reported a net loss of $0.32 per diluted share, compared with a loss of $0.55 per diluted share in the prior-year quarter. On a non-GAAP basis, the company reported a loss of $0.07 per diluted share, compared with a loss of $0.40 per diluted share a year earlier.
Cash Position and Corporate Structure Update Digimarc ended the quarter with $10 million in cash and short-term investments and no debt. The company used a little under $2 million in free cash flow and $900,000 to buy back 169,000 shares as part of its employee stock program. Beck said free cash flow usage improved by $3.7 million from the prior-year period despite revenue headwinds and a $3.4 million unfavorable change in working capital and other activity.
Beck also said Digimarc expects to finalize its new corporate structure, which shareholders approved, on or around May 16. The change will result in a new CUSIP, and transfer agent Broadridge will contact investors about exchanging shares.
McCormack said Digimarc remains focused on three core areas: retail loss prevention, product authentication, and digital trust and integrity. He also said the company continues to selectively pursue opportunities outside those focus areas, including recycling, where Belgian and German market demonstrations remain on track.
About Digimarc NASDAQ: DMRCDigimarc Corporation is a technology company specializing in digital identification and authentication solutions. Its core offering centers on embedding imperceptible digital watermarks into images, audio, video and packaging materials. These watermarks carry unique identifiers that enable secure tracking, brand protection and content provenance across print and digital channels.
The company's product suite includes software development kits and cloud-based services that allow enterprises to integrate digital watermarking into their existing workflows.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
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BEAVERTON, Ore.--(BUSINESS WIRE)--Digimarc Corporation (NASDAQ: DMRC), a pioneer in digital identity and authentication solutions, today announced the introduction of new provenance and verification infrastructure designed to secure emerging autonomous and AI-enabled workflows. As enterprises increasingly adopt AI systems capable of generating content, orchestrating workflows, and taking action with minimal human intervention, establishing trusted provenance and verifiable authenticity is becom.
Digimarc Corporation (NASDAQ: DMRC), a pioneer in digital identity and authentication solutions, today announced the introduction of new provenance and verification infrastructure designed to secure emerging autonomous and AI-enabled workflows.
As enterprises increasingly adopt AI systems capable of generating content, orchestrating workflows, and taking action with minimal human intervention, establishing trusted provenance and verifiable authenticity is becoming mission critical. Digimarc’s new capabilities are designed to help organizations determine whether digital content and artifacts produced or consumed by autonomous AI agents can be trusted before downstream action occurs.
The OWASP Top 10 for Agentic Applications 2026 identifies artifact integrity, supply chain vulnerabilities, and audit non-repudiation among the highest-impact risks facing agentic deployments today. Without cryptographically verifiable records of what agents consumed and produced, and under what authority they acted, organizations cannot confidently audit agent behavior, satisfy emerging regulatory requirements, or defend against the tampering and manipulation scenarios the OWASP framework was created to defeat.
Grounded in the Coalition for Content Provenance and Authenticity (C2PA) standard—the open specification adopted by organizations including Adobe, Google, Microsoft, OpenAI, and others—Digimarc’s approach combines provenance, verification, and audit capabilities into a standards-based trust layer for AI-powered workflows. Digimarc extends C2PA’s output attestation capability with a trust enforcement layer purpose-built for agentic environments. Every provenance seal is policy-gated, issued only when the identity of the agent, the integrity of the artifact, and the timing of the request all satisfy defined trust criteria.
The initial release centers on a new Model Context Protocol (MCP) server that enables systems and orchestration frameworks to stamp, verify, log, audit, and retrieve provenance information through MCP-compatible interfaces. By exposing provenance as a native capability within modern workflow architectures, organizations can introduce trusted verification and traceability directly into content and automation pipelines without requiring systems to manage the underlying cryptographic infrastructure themselves.
The MCP server is backed by Digimarc’s Illuminate platform and the company’s decades of experience in authentication, watermarking, and trusted identification technologies. For workflows requiring additional durability, Digimarc can combine C2PA manifests with its watermarking technology to help maintain provenance continuity even when metadata is altered or removed during processing.
“The agentic AI era is arriving faster than the trust infrastructure to support it,” said Ken Sickles, EVP and Chief Product Officer at Digimarc. “Organizations are deploying autonomous agents that produce, consume, and act on content at machine speed, and most have no reliable way to verify that the content those agents touched is genuine, unaltered, and attributable. Gartner projects that by 2028, 25% of enterprise AI applications will experience multiple security-related incidents annually. We built this solution because provenance cannot be an afterthought bolted on after deployment. It has to be atomic with the agent’s work, enforced by the runtime, and verifiable by anyone downstream.By grounding our approach in open standards like C2PA and exposing these capabilities through our MCP server, we’re helping to make trusted provenance a native capability for modern digital workflows.”
Digimarc is launching the initiative with a select group of early build partners and platform collaborators to help shape real-world use cases and future roadmap priorities. Initial areas of focus include trusted content workflows, provenance verification, and governed traceability across emerging automation ecosystems.
If interested, contact Digimarc or visit https://www.digimarc.com/solutions/agentic-trust.
About Digimarc
Digimarc (NASDAQ: DMRC) is building the trust layer for the modern world. Our solutions help people, businesses, and intelligent systems verify what’s real, protect what matters, and interact with confidence across physical and digital environments. Learn more at Digimarc.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260528177770/en/
BEAVERTON, Ore.--(BUSINESS WIRE)--Digimarc Corporation (NASDAQ: DMRC), the company building the trust layer for the modern world, today announced the appointment of Paul Carreiro as Chief Executive Officer, effective July 6, 2026. Riley McCormack will remain a member of the Company's Board of Directors, supporting Carreiro and the Company in this next phase of growth. Carreiro brings more than twenty-five years of experience scaling global enterprise software platforms and commercializing advan.
