Digimarc (DMRC) 10-Q 3 Nov 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Oct. 27, 2016
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2016
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3
Trading Symbol	DMRC
Entity Registrant Name	Digimarc CORP
Entity Central Index Key	1,438,231
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		10,522,466

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 24,647	$ 3,160
Marketable securities	29,819	33,027
Trade accounts receivable, net	2,521	4,616
Other current assets	1,924	1,487
Total current assets	58,911	42,290
Marketable securities	11,842	2,999
Property and equipment, net	3,443	3,010
Intangibles, net	6,459	6,613
Goodwill	1,114	1,114
Other assets	394	338
Total assets	82,163	56,364
Current liabilities:
Accounts payable and other accrued liabilities	1,487	1,657
Deferred revenue	1,605	3,023
Total current liabilities	3,092	4,680
Deferred rent and other long-term liabilities	949	226
Total liabilities	4,041	4,906
Commitments and contingencies (Note 13)
Shareholders’ equity:
Preferred stock (par value $0.001 per share, 2,500 authorized, 10 shares issued and outstanding at September 30, 2016 and December 31, 2015)	50	50
Common stock (par value $0.001 per share, 50,000 authorized, 10,509 and 8,919 shares issued and outstanding at September 30, 2016 and December 31, 2015, respectively)	11	9
Additional paid-in capital	120,017	77,439
Accumulated deficit	(41,956)	(26,040)
Total shareholders’ equity	78,122	51,458
Total liabilities and shareholders’ equity	$ 82,163	$ 56,364

Consolidated Balance Sheets (U3

Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares shares in Thousands	Sep. 30, 2016	Dec. 31, 2015
Statement Of Financial Position [Abstract]
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	2,500	2,500
Preferred stock, shares issued	10	10
Preferred stock, shares outstanding	10	10
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	50,000	50,000
Common stock, shares issued	10,509	8,919
Common stock, shares outstanding	10,509	8,919

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenue:
Service	$ 3,252	$ 3,072	$ 9,650	$ 9,808
Subscription	1,417	1,561	4,374	4,947
License	907	753	2,589	2,418
Total revenue	5,576	5,386	16,613	17,173
Cost of revenue:
Service	1,455	1,204	4,288	4,279
Subscription	600	808	1,856	2,428
License	107	86	302	256
Total cost of revenue	2,162	2,098	6,446	6,963
Gross profit	3,414	3,288	10,167	10,210
Operating expenses:
Sales and marketing	2,945	2,309	8,756	6,497
Research, development and engineering	3,291	3,236	9,975	9,345
General and administrative	2,039	1,847	6,185	6,033
Intellectual property	394	367	1,290	1,025
Total operating expenses	8,669	7,759	26,206	22,900
Operating loss	(5,255)	(4,471)	(16,039)	(12,690)
Other income, net	69	29	157	84
Loss before income taxes	(5,186)	(4,442)	(15,882)	(12,606)
Provision for income taxes	(12)	(27)	(34)	(25)
Net loss	$ (5,198)	$ (4,469)	$ (15,916)	$ (12,631)
Earnings (loss) per common share:
Loss per common share—basic	$ (0.55)	$ (0.54)	$ (1.79)	$ (1.56)
Loss per common share—diluted	$ (0.55)	$ (0.54)	$ (1.79)	$ (1.56)
Weighted average common shares outstanding—basic	9,506	8,309	8,878	8,101
Weighted average common shares outstanding—diluted	9,506	8,309	8,878	8,101

Consolidated Statements of Shar

Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Total	Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Deficit [Member]
Balance at Dec. 31, 2014	$ 52,174	$ 50	$ 8	$ 60,222	$ (8,106)
Balance, shares at Dec. 31, 2014		10	8,427
Issuance of common stock, net of issuance costs	12,896		$ 1	12,895
Issuance of common stock, net of issuance costs, shares			342
Exercise of stock options	1,321			1,321
Exercise of stock options, shares			91
Issuance of restricted common stock, shares			132
Forfeiture of restricted common stock, shares			(29)
Purchase and retirement of common stock	(1,833)			(1,833)
Purchase and retirement of common stock, shares			(57)
Stock-based compensation	3,994			3,994
Net loss	(12,631)				(12,631)
Balance at Sep. 30, 2015	55,921	$ 50	$ 9	76,599	(20,737)
Balance, shares at Sep. 30, 2015		10	8,906
Balance at Dec. 31, 2015	51,458	$ 50	$ 9	77,439	(26,040)
Balance, shares at Dec. 31, 2015		10	8,919
Issuance of common stock, net of issuance costs	39,700		$ 2	39,698
Issuance of common stock, net of issuance costs, shares			1,418
Exercise of stock options	$ 476			476
Exercise of stock options, shares	49		49
Issuance of restricted common stock, shares			191
Forfeiture of restricted common stock, shares			(7)
Purchase and retirement of common stock	$ (1,879)			(1,879)
Purchase and retirement of common stock, shares			(61)
Stock-based compensation	4,283			4,283
Net loss	(15,916)				(15,916)
Balance at Sep. 30, 2016	$ 78,122	$ 50	$ 11	$ 120,017	$ (41,956)
Balance, shares at Sep. 30, 2016		10	10,509

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities:
Net loss	$ (15,916)	$ (12,631)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation, amortization and write-off of property and equipment	1,016	930
Amortization and write-off of intangibles	876	794
Changes in allowance for doubtful accounts		16
Stock-based compensation	4,162	3,857
Changes in operating assets and liabilities:
Trade accounts receivable	2,095	1,842
Other current assets	(437)	(251)
Other assets	(56)	66
Accounts payable and other accrued liabilities	680	280
Deferred revenue	(1,407)	(1,929)
Net cash used in operating activities	(8,987)	(7,026)
Cash flows from investing activities:
Purchase of property and equipment	(1,565)	(747)
Capitalized patent costs	(623)	(646)
Maturity of marketable securities	35,182	27,151
Purchase of marketable securities	(40,817)	(25,786)
Net cash used in investing activities	(7,823)	(28)
Cash flows from financing activities:
Issuance of common stock, net of issuance costs	39,700	12,896
Exercise of stock options	476	1,321
Purchase of common stock	(1,879)	(1,833)
Net cash provided by financing activities	38,297	12,384
Net increase in cash and cash equivalents	21,487	5,330
Cash and cash equivalents at beginning of period	3,160	6,122
Cash and cash equivalents at end of period	24,647	11,452
Supplemental disclosure of cash flow information:
Cash paid for income taxes, net	27	22
Supplemental schedule of non-cash investing activities:
Property and equipment and patent costs in accounts payable	76	73
Stock-based compensation capitalized to software and patent costs	$ 121	$ 137

Description of Business and Sig

Description of Business and Significant Accounting Policies	9 Months Ended
	Sep. 30, 2016
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Description of Business and Significant Accounting Policies	1. Description of Business and Significant Accounting Policies Description of Business Digimarc Corporation (“Digimarc” or the “Company”), an Oregon corporation, enables governments and enterprises around the world to give digital identities to media and objects that computers can sense and recognize and to which they can react. The Company has developed the Digimarc Discover ® Interim Consolidated Financial Statements The Company has adhered to the accounting policies set forth in its Annual Report on Form 10-K for the year ended December 31, 2015 in preparing the accompanying interim consolidated financial statements. The accompanying interim consolidated financial statements have been prepared from the Company’s records without audit and, in management’s opinion, include all adjustments (consisting of only normal recurring adjustments) necessary to fairly reflect the financial condition and the results of operations for the periods presented. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) have been condensed or omitted in accordance with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the SEC on February 25, 2016. The results of operations for the interim periods presented in these consolidated financial statements are not necessarily indicative of the results for the full year. Reclassifications Certain prior period amounts in the accompanying consolidated financial statements and notes thereto have been reclassified to conform to current period presentation. These reclassifications had no material effect on the results of operations or financial position for any period presented. Contingencies The Company evaluates all pending or threatened contingencies or commitments, if any, that are reasonably likely to have a material adverse effect on the Company’s operations or financial position. The Company assesses the probability of an adverse outcome and determines if it is remote, reasonably possible or probable as defined in accordance with the provisions of ASC 450 “ Contingencies. Goodwill The Company tests goodwill for impairment annually in June and whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Such reviews assess the fair value of the Company’s assets compared to their carrying value. The Company operates as a single reporting unit. The Company estimates the fair value of its single reporting unit using a market approach, which takes into account the Company’s market capitalization plus an estimated control premium. In connection with the Company’s annual impairment test of goodwill as of June 30, 2016 and 2015, it was concluded that there was no impairment as the estimated fair value of the Company’s reporting unit substantially exceeded the carrying value. Accounting Pronouncements Issued But Not Yet Adopted In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “ Revenue from Contracts with Customers (Topic 606). In February 2016, the FASB issued ASU No. 2016-02, “ Leases (Topic 842) In March 2016, the FASB issued ASU No. 2016-09, “ Compensation – Stock Compensation: Improvements to Employee Share-Based Payment Accounting (Topic 718). In August 2016, the FASB issued ASU No. 2016-15, “ Statement of Cash Flows – Classification of Certain Cash Receipts and Cash Payments (Topic 230).

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 2016
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	2. Fair Value of Financial Instruments The estimated fair values of the Company’s financial instruments, which include cash equivalents, accounts receivable, accounts payable and other accrued liabilities approximate their carrying values due to the short-term nature of these instruments. The Company records marketable securities at amortized cost, which approximates fair value. The Company’s fair value hierarchy for its cash equivalents and marketable securities as of September 30, 2016 and December 31, 2015, respectively, was as follows: September 30, 2016 Level 1 Level 2 Level 3 Total Money market securities $ 6,167 $ — $ — $ 6,167 Commercial paper — 25,671 — 25,671 Federal agency notes — 15,095 — 15,095 Corporate notes — 10,933 — 10,933 U.S. treasuries — 4,521 — 4,521 Pre-refunded municipal bonds (1) — 2,738 — 2,738 Total $ 6,167 $ 58,958 $ — $ 65,125 December 31, 2015 Level 1 Level 2 Level 3 Total Money market securities $ 2,001 $ — $ — $ 2,001 Federal agency notes — 11,722 — 11,722 U.S. treasuries — 7,059 — 7,059 Corporate notes — 6,884 — 6,884 Pre-refunded municipal bonds (1) — 4,747 — 4,747 Commercial paper — 3,794 — 3,794 Certificates of deposits — 2,220 — 2,220 Total $ 2,001 $ 36,426 $ — $ 38,427 (1) Pre-refunded municipal bonds are collateralized by U.S. treasuries. The fair value maturities of the Company’s cash equivalents and marketable securities as of September 30, 2016 are as follows: Maturities by Period Total Less 1 year 1-5 years 5 - 10 years More than 10 years Cash equivalents and marketable securities $ 65,125 $ 53,283 $ 11,842 $ — $ — The Company considers all highly liquid marketable securities with original maturities of 90 days or less at the date of acquisition to be cash equivalents. Cash equivalents include money market funds and commercial paper totaling $23,464 and $2,401 at September 30, 2016 and December 31, 2015, respectively. Cash equivalents are carried at cost or amortized cost, which approximates fair value.

Revenue Recognition

Revenue Recognition	9 Months Ended
	Sep. 30, 2016
Revenue Recognition [Abstract]
Revenue Recognition	3. Revenue Recognition The Company derives its revenue primarily from professional services, subscriptions and licensing of its intellectual property: • Service revenue consists primarily of software development and consulting services. The majority of service revenue arrangements are structured as time and materials consulting agreements. • Subscription revenue includes Digimarc Discover, Digimarc Barcode and Guardian products and services, is generally recurring, paid in advance and recognized over the term of the subscription. • License revenue originates primarily from licensing the Company’s intellectual property, where the Company receives license fees and/or royalties as its income stream. Revenue is recognized in accordance with ASC 605 “ Revenue Recognition Software (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred, (iii) the fee is fixed or determinable, and (iv) collection is reasonably assured or probable. Some customer arrangements encompass multiple deliverables, such as professional services, software licenses, and maintenance and support fees. For arrangements that include multiple deliverables, the Company identifies separate units of accounting at inception based on the consensus reached under ASC 605-25 “ Multiple-Element Arrangements, The relative selling price method allocates the consideration based on the Company’s specific assumptions rather than assumptions of a marketplace participant, and any discount in the arrangement proportionally to each deliverable on the basis of each deliverable’s selling price. Applicable revenue recognition criteria are considered separately for each separate unit of accounting as follows: • Service revenue is generally determined based on time and materials. Revenue for development and consulting services is recognized as the services are performed. Billing for services rendered generally occurs within one month after the services are provided. • Subscription revenue, which includes revenue from the sale of Digimarc Discover, Digimarc Barcode and Guardian products and services, is generally paid in advance and recognized over the term of the subscription, which is generally one to three years. • License revenue is recognized when amounts owed to the Company have been earned, are fixed or determinable (within the Company’s normal 30 to 60 day payment terms), and collection is reasonably assured. If the payment terms extend beyond the normal 30 to 60 days, the fee may not be considered to be fixed or determinable, and the revenue would then be recognized when installments are due. • The Company records revenue from certain license agreements upon cash receipt as a result of collectability not being reasonably assured. • The Company’s standard payment terms for license arrangements are 30 to 60 days. Extended payment terms on patent license arrangements are not considered to be fixed or determinable if payments are due beyond the Company’s standard payment terms, primarily because of the risk of substantial modification present in the Company’s patent licensing business. As such, revenue on license arrangements with extended payment terms is recognized as fees become fixed or determinable. Deferred revenue consists of billings in advance for professional services, subscriptions and licenses for which revenue has not been earned.

Segment Information

Segment Information	9 Months Ended
	Sep. 30, 2016
Segment Reporting [Abstract]
Segment Information	4. Segment Information Geographic Information The Company derives its revenue from a single reporting segment: media management solutions. Revenue is generated in this segment through development services, subscriptions and licensing of intellectual property. The Company markets its products in the U.S. and in non-U.S. countries through its sales and licensing personnel. Revenue by geographic area, based upon the “bill-to” location, was as follows: Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Domestic $ 1,210 $ 1,733 $ 3,494 $ 5,178 International (1) 4,366 3,653 13,119 11,995 Total $ 5,576 $ 5,386 $ 16,613 $ 17,173 (1) Revenue from the Central Banks, consisting of a consortium of central banks around the world, is classified as international revenue. Reporting revenue by country for this customer is not practicable. Major Customers Customers who accounted for 10% or more of the Company’s revenue are as follows: Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Central Banks 62 % 53 % 63 % 56 % Long-lived assets by geographical area The Company’s long-lived assets are all domestic, domiciled in the U.S.

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Sep. 30, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Stock-Based Compensation	5. Stock-Based Compensation Stock-based compensation includes expense charges for all stock-based awards to employees and directors. These awards include option grants and restricted stock awards. Stock-based compensation expense related to internal labor is capitalized to software and patents based on direct labor hours charged to capitalized software and patent costs. Determining Fair Value Stock Options The Company estimates the fair value of stock options granted using the Black-Scholes option pricing model. The fair value of stock options is determined on the date of the grant (measurement date), and is recognized over the vesting period of the option using the straight-line method. There were no stock options granted during the three and nine months ended September 30, 2016 and 2015. The Company records stock-based compensation expense for stock option awards only for those awards that are expected to vest. Restricted Stock The fair value of restricted stock awarded is based on the fair market value of the Company’s common stock on the date of the grant (measurement date), and is recognized over the vesting period of the award using the straight-line method. The Company records stock-based compensation expense for restricted stock awards only for those awards that are expected to vest. Stock-based Compensation Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Stock-based compensation: Cost of revenue $ 196 $ 171 $ 553 $ 569 Sales and marketing $ 265 $ 251 $ 715 $ 585 Research, development and engineering $ 346 $ 396 $ 1,050 $ 1,011 General and administrative $ 568 $ 485 $ 1,613 $ 1,487 Intellectual property $ 80 $ 74 $ 231 $ 205 Stock-based compensation expense $ 1,455 $ 1,377 $ 4,162 $ 3,857 Capitalized to software and patent costs $ 46 $ 46 $ 121 $ 137 Total stock-based compensation expense $ 1,501 $ 1,423 $ 4,283 $ 3,994 The following table sets forth total unrecognized compensation cost related to non-vested stock-based awards granted under all equity compensation plans, including stock options and restricted stock: As of As of September 30, December 31, 2016 2015 Total unrecognized compensation costs $ 10,620 $ 9,549 Total unrecognized compensation costs will be adjusted for any future changes in estimated forfeitures. The Company expects to recognize the unrecognized compensation costs as of September 30, 2016 for stock options and restricted stock over weighted average periods through September 2020 as follows: Stock Restricted Options Stock Weighted average period 0.0 years 1.4 years As of September 30, 2016, under all of the Company’s stock-based compensation plans, equity awards to purchase an additional 1,319 shares were authorized for future grants under the plans. The Company issues new shares upon option exercises. Stock Option Activity The following table reconciles the outstanding balance of stock options: Three months ended September 30, 2016: Options Weighted Average Exercise Price Weighted Average Grant Date Fair Value Aggregate Intrinsic Value Outstanding at June 30, 2016 458 $ 18.29 $ 8.79 Options granted — — — Options exercised (17 ) 9.64 6.30 Options forfeited or expired — — — Outstanding at September 30, 2016 441 $ 18.63 $ 8.88 $ 8,687 Nine months ended September 30, 2016: Options Weighted Average Exercise Price Weighted Average Grant Date Fair Value Aggregate Intrinsic Value Outstanding at December 31, 2015 490 $ 17.73 $ 8.69 Granted — — — Exercised (49 ) 9.64 6.94 Forfeited or expired — — — Outstanding at September 30, 2016 441 $ 18.63 $ 8.88 $ 8,687 Exercisable at September 30, 2016 441 $ 18.63 $ 8,687 The aggregate intrinsic value is based on the closing price of $38.35 per share of Digimarc common stock on September 30, 2016, which would have been received by the optionees had all of the options with exercise prices less than $38.35 per share been exercised on that date. Restricted Stock Activity The following table reconciles the unvested balance of restricted stock: Three months ended September 30, 2016: Number Shares Weighted Average Grant Date Fair Value Unvested balance, June 30, 2016 470 $ 25.59 Granted 14 $ 35.38 Vested (54 ) $ 25.50 Forfeited (4 ) $ 28.15 Unvested balance, September 30, 2016 426 $ 25.89 Nine months ended September 30, 2016: Number Shares Weighted Average Grant Date Fair Value Unvested balance, December 31, 2015 408 $ 24.30 Granted 191 $ 29.11 Vested (166 ) $ 25.51 Forfeited (7 ) $ 30.14 Unvested balance, September 30, 2016 426 $ 25.89 The following table indicates the fair value of all restricted stock awards that vested during the three and nine months ended September 30, 2016 and 2015: Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Fair value of restricted stock awards vested $ 1,912 $ 1,961 $ 5,029 $ 4,840

Shareholders_ Equity

Shareholders’ Equity	9 Months Ended
	Sep. 30, 2016
Equity [Abstract]
Shareholders' Equity	6. Shareholders’ Equity During the three months ended September 30, 2016, the Company sold 1,233 shares of its common stock in an underwritten public offering, plus an additional 185 shares in full exercise of the underwriters’ option to purchase additional shares of common stock, at the price to the public of $30.00 per share. The Company received $39,953 of cash proceeds, net of discount of $2,447 and underwriter fees of $150, from the offering, and paid $253 in stock issuance costs. During the three months ended September 30, 2015, the Company sold 342 shares of its common stock under an Equity Distribution Agreement with Wells Fargo, LLC, as a sales agent, at a weighted average price of $38.83. The Company received $12,978 of cash proceeds, net of sales commissions of $299, and paid $82 in stock issuance costs. As of December 31, 2015, there were no shares remaining to be sold under the Equity Distribution Agreement.

Earnings Per Common Share

Earnings Per Common Share	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Earnings Per Common Share	7. Earnings Per Common Share The Company calculates basic and diluted earnings per common share in accordance with ASC 260 “ Earnings Per Share, Basic earnings per common share excludes dilution and is calculated by dividing earnings to common shares by the weighted-average number of common shares outstanding for the period. Diluted earnings per common share is calculated by dividing earnings to common shares by the weighted-average number of common shares, as adjusted for the potentially dilutive effect of stock options. The following table reconciles earnings (loss) per common share for the three and nine months ended September 30, 2016 and 2015: Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Basic Earnings (Loss) per Common Share: Numerator: Net loss $ (5,198 ) $ (4,469 ) $ (15,916 ) $ (12,631 ) Distributed earnings to common shares — — — — Distributed earnings to participating securities — — — — Total distributed earnings — — — — Undistributed loss allocable to common shares (5,198 ) (4,469 ) (15,916 ) (12,631 ) Undistributed earnings allocable to participating securities — — — — Total undistributed loss (5,198 ) (4,469 ) (15,916 ) (12,631 ) Loss to common shares—basic $ (5,198 ) $ (4,469 ) $ (15,916 ) $ (12,631 ) Denominator Weighted average common shares outstanding—basic 9,506 8,309 8,878 8,101 Basic earnings (loss) per common share $ (0.55 ) $ (0.54 ) $ (1.79 ) $ (1.56 ) Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Diluted Earnings (Loss) per Common Share: Numerator: Loss to common shares—basic $ (5,198 ) $ (4,469 ) $ (15,916 ) $ (12,631 ) Undistributed earnings allocated to participating securities — — — — Undistributed earnings reallocated to participating securities — — — — Loss to common shares—diluted $ (5,198 ) $ (4,469 ) $ (15,916 ) $ (12,631 ) Denominator Weighted average common shares outstanding—basic 9,506 8,309 8,878 8,101 Dilutive effect of stock options — — — — Weighted average common shares outstanding—dilutive 9,506 8,309 8,878 8,101 Diluted earnings (loss) per common share $ (0.55 ) $ (0.54 ) $ (1.79 ) $ (1.56 ) There were no common stock equivalents related to stock options that were anti-dilutive and excluded from diluted earnings per common share calculations for the three and nine months ended September 30, 2016 and 2015, respectively, because their exercise prices were higher than the average market price of the underlying common stock for the period. Potentially dilutive common stock equivalents are determined by applying the treasury stock method to the assumed exercise of outstanding stock options. There were 211 and 195 common stock equivalents related to stock options that were anti-dilutive and excluded from diluted earnings per common share for the three and nine months ended September 30, 2016, respectively, as the Company incurred a net loss for the periods. There were 272 and 234 common stock equivalents related to stock options that were anti-dilutive and excluded from diluted earnings per common share for the three and nine months ended September 30, 2015, respectively, as the Company incurred a net loss for the periods.

Trade Accounts Receivable

Trade Accounts Receivable	9 Months Ended
	Sep. 30, 2016
Receivables [Abstract]
Trade Accounts Receivable	8. Trade Accounts Receivable Trade Accounts Receivable Trade accounts receivable are recorded at the invoiced amount. September 30, December 31, 2016 2015 Trade accounts receivable $ 2,536 $ 4,631 Allowance for doubtful accounts (15 ) (15 ) Trade accounts receivable, net $ 2,521 $ 4,616 Unpaid deferred revenue included in trade accounts receivable $ 556 $ 2,012 Allowance for doubtful accounts The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing trade accounts receivable. The Company determines the allowance based on historical write-off experience and current information. The Company reviews its allowance for doubtful accounts each reporting period. Account balances are charged against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Unpaid deferred revenue The unpaid deferred revenue that is included in trade accounts receivable is billed in accordance with the provisions of the contracts with the Company’s customers. Unpaid deferred revenue from the Company’s cash-basis customers is not included in trade accounts receivable nor deferred revenue. Major customers Customers who accounted for 10% or more of trade accounts receivable, net are as follows: September 30, December 31, 2016 2015 Central Banks 43 % 62 %

Property and Equipment

Property and Equipment	9 Months Ended
	Sep. 30, 2016
Property Plant And Equipment [Abstract]
Property and Equipment	9. Property and Equipment Property and equipment are stated at cost. Repairs and maintenance are charged to expense when incurred. Depreciation on property and equipment is calculated using the straight-line method over the estimated useful lives of the assets, generally two to seven years. Leasehold improvements are amortized using the straight-line method over the shorter of the estimated useful life or the lease term. September 30, December 31, 2016 2015 Office furniture and fixtures $ 1,052 $ 1,068 Software 1,957 1,748 Equipment 3,990 3,416 Leasehold improvements 1,589 1,276 Gross property and equipment 8,588 7,508 Less accumulated depreciation and amortization (5,145 ) (4,498 ) Property and equipment, net $ 3,443 $ 3,010

Intangibles

Intangibles	9 Months Ended
	Sep. 30, 2016
Goodwill And Intangible Assets Disclosure [Abstract]
Intangibles	10. Intangibles Intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Amortization of capitalized patent costs associated with the application and award of patents in the U.S. and various other countries are capitalized and amortized on a straight-line basis over the term of the patents as determined at the award date, which varies depending on the pendency period of the application, generally approximating seventeen years. Amortization of intangible assets acquired is calculated using the straight-line method over the estimated useful lives of the assets. September 30, December 31, 2016 2015 Capitalized patent costs $ 7,136 $ 6,779 Intangible assets acquired: Purchased patents and intellectual property 250 250 Existing technology 1,560 1,560 Customer relationships 290 290 Backlog 760 760 Tradenames 290 290 Non-solicitation agreements 120 120 Gross intangible assets 10,406 10,049 Accumulated amortization (3,947 ) (3,436 ) Intangibles, net $ 6,459 $ 6,613

Joint Ventures and Related Part

Joint Ventures and Related Party Transactions	9 Months Ended
	Sep. 30, 2016
Related Party Transactions [Abstract]
Joint Ventures and Related Party Transactions	11. Joint Ventures and Related Party Transactions In March 2012, Digimarc and Nielsen reduced the investments in their two joint ventures, TVaura LLC (in which Digimarc holds a 51% ownership interest) and TVaura Mobile LLC (in which Digimarc holds a 49% ownership interest), to minimal levels while assessing alternative approaches to achieving each of their goals in the emerging market opportunity of synchronized second screen television. In October 2015, Digimarc and Nielsen reactivated the TVaura Mobile LLC joint venture to allow it to provide solutions to programmers and advertisers for engaging with consumers on second screens and otherwise provide enhanced flexibility to brand strategies targeting modern consumers. The enhanced cooperation represents another building block in developing the market for Digimarc Discover and Digimarc Barcode. Neither Digimarc nor Nielsen contributed any capital to the joint venture upon reactivation. As of September 30, 2016, both Digimarc and Nielsen continued to assess the market opportunities of TVaura LLC joint venture. Summarized financial information for the joint ventures has not been provided because the disclosures are immaterial to the Company’s filing. TVaura LLC and TVaura Mobile LLC had no revenue or expenses for the three and nine months ended September 30, 2016 and 2015. The Company’s investment in each joint venture was $0 as of September 30, 2016 and December 31, 2015.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2016
Income Tax Disclosure [Abstract]
Income Taxes	12. Income Taxes The provision for income taxes for the three and nine months ended September 30, 2016 and 2015 reflects current taxes, deferred taxes, and withholding taxes in certain foreign jurisdictions. The effective tax rate for the nine months ended September 30, 2016 and 2015 was 0% and 0%, respectively. The valuation allowance against net deferred tax assets as of September 30, 2016 was $22,283, an increase of $6,863 from $15,420 as of December 31, 2015.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2016
Commitments And Contingencies Disclosure [Abstract]
Commitments and Contingencies	13. Commitments and Contingencies Certain of the Company’s product license and services agreements include an indemnification provision for claims from third parties relating to the Company’s intellectual property. These indemnification provisions are accounted for in accordance with ASC 450 “ Contingencies. The Company is subject from time to time to other legal proceedings and claims arising in the ordinary course of business. At this time, we do not believe that the resolution of any such matters will have a material adverse effect on our financial position, results of operations or cash flows.

Description of Business and S20

Description of Business and Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2016
Commitments And Contingencies Disclosure [Abstract]
Description of Business	Description of Business Digimarc Corporation (“Digimarc” or the “Company”), an Oregon corporation, enables governments and enterprises around the world to give digital identities to media and objects that computers can sense and recognize and to which they can react. The Company has developed the Digimarc Discover ®
Interim Consolidated Financial Statements	Interim Consolidated Financial Statements The Company has adhered to the accounting policies set forth in its Annual Report on Form 10-K for the year ended December 31, 2015 in preparing the accompanying interim consolidated financial statements. The accompanying interim consolidated financial statements have been prepared from the Company’s records without audit and, in management’s opinion, include all adjustments (consisting of only normal recurring adjustments) necessary to fairly reflect the financial condition and the results of operations for the periods presented. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) have been condensed or omitted in accordance with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the SEC on February 25, 2016. The results of operations for the interim periods presented in these consolidated financial statements are not necessarily indicative of the results for the full year.
Reclassifications	Reclassifications Certain prior period amounts in the accompanying consolidated financial statements and notes thereto have been reclassified to conform to current period presentation. These reclassifications had no material effect on the results of operations or financial position for any period presented.
Contingencies	Contingencies The Company evaluates all pending or threatened contingencies or commitments, if any, that are reasonably likely to have a material adverse effect on the Company’s operations or financial position. The Company assesses the probability of an adverse outcome and determines if it is remote, reasonably possible or probable as defined in accordance with the provisions of ASC 450 “ Contingencies.
Goodwill	Goodwill The Company tests goodwill for impairment annually in June and whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Such reviews assess the fair value of the Company’s assets compared to their carrying value. The Company operates as a single reporting unit. The Company estimates the fair value of its single reporting unit using a market approach, which takes into account the Company’s market capitalization plus an estimated control premium. In connection with the Company’s annual impairment test of goodwill as of June 30, 2016 and 2015, it was concluded that there was no impairment as the estimated fair value of the Company’s reporting unit substantially exceeded the carrying value.
Accounting Pronouncements Issued But Not Yet Adopted	Accounting Pronouncements Issued But Not Yet Adopted In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “ Revenue from Contracts with Customers (Topic 606). In February 2016, the FASB issued ASU No. 2016-02, “ Leases (Topic 842) In March 2016, the FASB issued ASU No. 2016-09, “ Compensation – Stock Compensation: Improvements to Employee Share-Based Payment Accounting (Topic 718). In August 2016, the FASB issued ASU No. 2016-15, “ Statement of Cash Flows – Classification of Certain Cash Receipts and Cash Payments (Topic 230).
Earnings Per Share	The Company calculates basic and diluted earnings per common share in accordance with ASC 260 “ Earnings Per Share,

Fair Value of Financial Instr21

Fair Value of Financial Instruments (Tables)	9 Months Ended
	Sep. 30, 2016
Fair Value Disclosures [Abstract]
Summary of Fair Value Hierarchy for Financial Assets	The Company’s fair value hierarchy for its cash equivalents and marketable securities as of September 30, 2016 and December 31, 2015, respectively, was as follows: September 30, 2016 Level 1 Level 2 Level 3 Total Money market securities $ 6,167 $ — $ — $ 6,167 Commercial paper — 25,671 — 25,671 Federal agency notes — 15,095 — 15,095 Corporate notes — 10,933 — 10,933 U.S. treasuries — 4,521 — 4,521 Pre-refunded municipal bonds (1) — 2,738 — 2,738 Total $ 6,167 $ 58,958 $ — $ 65,125 December 31, 2015 Level 1 Level 2 Level 3 Total Money market securities $ 2,001 $ — $ — $ 2,001 Federal agency notes — 11,722 — 11,722 U.S. treasuries — 7,059 — 7,059 Corporate notes — 6,884 — 6,884 Pre-refunded municipal bonds (1) — 4,747 — 4,747 Commercial paper — 3,794 — 3,794 Certificates of deposits — 2,220 — 2,220 Total $ 2,001 $ 36,426 $ — $ 38,427 (1) Pre-refunded municipal bonds are collateralized by U.S. treasuries.
Summary of Fair Value Maturities for Financial Asset	The fair value maturities of the Company’s cash equivalents and marketable securities as of September 30, 2016 are as follows: Maturities by Period Total Less 1 year 1-5 years 5 - 10 years More than 10 years Cash equivalents and marketable securities $ 65,125 $ 53,283 $ 11,842 $ — $ —

Segment Information (Tables)

Segment Information (Tables)	9 Months Ended
	Sep. 30, 2016
Segment Reporting [Abstract]
Geographical Segment Revenue	Revenue by geographic area, based upon the “bill-to” location, was as follows: Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Domestic $ 1,210 $ 1,733 $ 3,494 $ 5,178 International (1) 4,366 3,653 13,119 11,995 Total $ 5,576 $ 5,386 $ 16,613 $ 17,173 (1) Revenue from the Central Banks, consisting of a consortium of central banks around the world, is classified as international revenue. Reporting revenue by country for this customer is not practicable.
Customers Who Accounted for 10% or More of Company's Revenue	Customers who accounted for 10% or more of the Company’s revenue are as follows: Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Central Banks 62 % 53 % 63 % 56 %

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Allocation of Stock-Based Compensation	Stock-based Compensation Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Stock-based compensation: Cost of revenue $ 196 $ 171 $ 553 $ 569 Sales and marketing $ 265 $ 251 $ 715 $ 585 Research, development and engineering $ 346 $ 396 $ 1,050 $ 1,011 General and administrative $ 568 $ 485 $ 1,613 $ 1,487 Intellectual property $ 80 $ 74 $ 231 $ 205 Stock-based compensation expense $ 1,455 $ 1,377 $ 4,162 $ 3,857 Capitalized to software and patent costs $ 46 $ 46 $ 121 $ 137 Total stock-based compensation expense $ 1,501 $ 1,423 $ 4,283 $ 3,994
Unrecognized Compensation Cost Related to Non-Vested Stock-Based Awards Granted	The following table sets forth total unrecognized compensation cost related to non-vested stock-based awards granted under all equity compensation plans, including stock options and restricted stock: As of As of September 30, December 31, 2016 2015 Total unrecognized compensation costs $ 10,620 $ 9,549
Weighted Average Period for Recognition of Unrecognized Compensation Cost for Stock Options and Restricted Stock	The Company expects to recognize the unrecognized compensation costs as of September 30, 2016 for stock options and restricted stock over weighted average periods through September 2020 as follows: Stock Restricted Options Stock Weighted average period 0.0 years 1.4 years
Reconciliation of Outstanding Balance of Stock Options	The following table reconciles the outstanding balance of stock options: Three months ended September 30, 2016: Options Weighted Average Exercise Price Weighted Average Grant Date Fair Value Aggregate Intrinsic Value Outstanding at June 30, 2016 458 $ 18.29 $ 8.79 Options granted — — — Options exercised (17 ) 9.64 6.30 Options forfeited or expired — — — Outstanding at September 30, 2016 441 $ 18.63 $ 8.88 $ 8,687 Nine months ended September 30, 2016: Options Weighted Average Exercise Price Weighted Average Grant Date Fair Value Aggregate Intrinsic Value Outstanding at December 31, 2015 490 $ 17.73 $ 8.69 Granted — — — Exercised (49 ) 9.64 6.94 Forfeited or expired — — — Outstanding at September 30, 2016 441 $ 18.63 $ 8.88 $ 8,687 Exercisable at September 30, 2016 441 $ 18.63 $ 8,687
Reconciliation of Unvested Balance of Restricted Stock	The following table reconciles the unvested balance of restricted stock: Three months ended September 30, 2016: Number Shares Weighted Average Grant Date Fair Value Unvested balance, June 30, 2016 470 $ 25.59 Granted 14 $ 35.38 Vested (54 ) $ 25.50 Forfeited (4 ) $ 28.15 Unvested balance, September 30, 2016 426 $ 25.89 Nine months ended September 30, 2016: Number Shares Weighted Average Grant Date Fair Value Unvested balance, December 31, 2015 408 $ 24.30 Granted 191 $ 29.11 Vested (166 ) $ 25.51 Forfeited (7 ) $ 30.14 Unvested balance, September 30, 2016 426 $ 25.89
Fair Value of Restricted Stock Awards Vested	The following table indicates the fair value of all restricted stock awards that vested during the three and nine months ended September 30, 2016 and 2015: Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Fair value of restricted stock awards vested $ 1,912 $ 1,961 $ 5,029 $ 4,840

Earnings Per Common Share (Tabl

Earnings Per Common Share (Tables)	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Summary of Reconciliation of Earnings (Loss) Per Common Share	The following table reconciles earnings (loss) per common share for the three and nine months ended September 30, 2016 and 2015: Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Basic Earnings (Loss) per Common Share: Numerator: Net loss $ (5,198 ) $ (4,469 ) $ (15,916 ) $ (12,631 ) Distributed earnings to common shares — — — — Distributed earnings to participating securities — — — — Total distributed earnings — — — — Undistributed loss allocable to common shares (5,198 ) (4,469 ) (15,916 ) (12,631 ) Undistributed earnings allocable to participating securities — — — — Total undistributed loss (5,198 ) (4,469 ) (15,916 ) (12,631 ) Loss to common shares—basic $ (5,198 ) $ (4,469 ) $ (15,916 ) $ (12,631 ) Denominator Weighted average common shares outstanding—basic 9,506 8,309 8,878 8,101 Basic earnings (loss) per common share $ (0.55 ) $ (0.54 ) $ (1.79 ) $ (1.56 ) Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September 30, September 30, September 30, September 30, 2016 2015 2016 2015 Diluted Earnings (Loss) per Common Share: Numerator: Loss to common shares—basic $ (5,198 ) $ (4,469 ) $ (15,916 ) $ (12,631 ) Undistributed earnings allocated to participating securities — — — — Undistributed earnings reallocated to participating securities — — — — Loss to common shares—diluted $ (5,198 ) $ (4,469 ) $ (15,916 ) $ (12,631 ) Denominator Weighted average common shares outstanding—basic 9,506 8,309 8,878 8,101 Dilutive effect of stock options — — — — Weighted average common shares outstanding—dilutive 9,506 8,309 8,878 8,101 Diluted earnings (loss) per common share $ (0.55 ) $ (0.54 ) $ (1.79 ) $ (1.56 )

Trade Accounts Receivable (Tabl

Trade Accounts Receivable (Tables)	9 Months Ended
	Sep. 30, 2016
Receivables [Abstract]
Summary of Trade Accounts Receivable	Trade accounts receivable are recorded at the invoiced amount. September 30, December 31, 2016 2015 Trade accounts receivable $ 2,536 $ 4,631 Allowance for doubtful accounts (15 ) (15 ) Trade accounts receivable, net $ 2,521 $ 4,616 Unpaid deferred revenue included in trade accounts receivable $ 556 $ 2,012
Customers Who Accounted for 10% or More of Trade Accounts Receivable, Net	Customers who accounted for 10% or more of trade accounts receivable, net are as follows: September 30, December 31, 2016 2015 Central Banks 43 % 62 %

Property and Equipment (Tables)

Property and Equipment (Tables)	9 Months Ended
	Sep. 30, 2016
Property Plant And Equipment [Abstract]
Depreciation and Amortization on Property and Equipment Using the Straight-Line Method	Depreciation on property and equipment is calculated using the straight-line method over the estimated useful lives of the assets, generally two to seven years. Leasehold improvements are amortized using the straight-line method over the shorter of the estimated useful life or the lease term. September 30, December 31, 2016 2015 Office furniture and fixtures $ 1,052 $ 1,068 Software 1,957 1,748 Equipment 3,990 3,416 Leasehold improvements 1,589 1,276 Gross property and equipment 8,588 7,508 Less accumulated depreciation and amortization (5,145 ) (4,498 ) Property and equipment, net $ 3,443 $ 3,010

Intangibles (Tables)

Intangibles (Tables)	9 Months Ended
	Sep. 30, 2016
Goodwill And Intangible Assets Disclosure [Abstract]
Amortization of Intangible Assets Acquired	Amortization of intangible assets acquired is calculated using the straight-line method over the estimated useful lives of the assets. September 30, December 31, 2016 2015 Capitalized patent costs $ 7,136 $ 6,779 Intangible assets acquired: Purchased patents and intellectual property 250 250 Existing technology 1,560 1,560 Customer relationships 290 290 Backlog 760 760 Tradenames 290 290 Non-solicitation agreements 120 120 Gross intangible assets 10,406 10,049 Accumulated amortization (3,947 ) (3,436 ) Intangibles, net $ 6,459 $ 6,613

Description of Business and S28

Description of Business and Significant Accounting Policies - Additional Information (Detail) - USD ($)	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Accounting Policies [Abstract]
Impairment of goodwill	$ 0	$ 0

Fair Value of Financial Instr29

Fair Value of Financial Instruments - Summary of Fair Value Hierarchy for Financial Assets (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	$ 65,125
Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	65,125	$ 38,427
Fair Value, Measurements, Recurring [Member] | Pre-refunded Municipal Bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	2,738	4,747
Fair Value, Measurements, Recurring [Member] | Money Market Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	6,167	2,001
Fair Value, Measurements, Recurring [Member] | Commercial Paper [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	25,671	3,794
Fair Value, Measurements, Recurring [Member] | U.S. Treasuries [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	4,521	7,059
Fair Value, Measurements, Recurring [Member] | Corporate Notes [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	10,933	6,884
Fair Value, Measurements, Recurring [Member] | Federal Agency Notes [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	15,095	11,722
Fair Value, Measurements, Recurring [Member] | Certificates of Deposits [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total		2,220
Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	6,167	2,001
Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Money Market Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	6,167	2,001
Level 2 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	58,958	36,426
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Pre-refunded Municipal Bonds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	2,738	4,747
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Commercial Paper [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	25,671	3,794
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | U.S. Treasuries [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	4,521	7,059
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Corporate Notes [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	10,933	6,884
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Federal Agency Notes [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	$ 15,095	11,722
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Certificates of Deposits [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total		$ 2,220

Fair Value of Financial Instr30

Fair Value of Financial Instruments - Summary of Fair Value Maturities for Financial Asset (Detail) $ in Thousands	Sep. 30, 2016USD ($)
Fair Value Disclosures [Abstract]
Maturities, Total	$ 65,125
Maturities, Less than 1 year	53,283
Maturities, 1-5 years	$ 11,842

Fair Value of Financial Instr31

Fair Value of Financial Instruments - Additional Information (Detail) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Fair Value Disclosures [Abstract]
Highly liquid marketable securities with original maturities	90 days or less
Cash equivalents include money market funds and commercial paper	$ 23,464	$ 2,401

Revenue Recognition - Additiona

Revenue Recognition - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2016
Revenue Recognition [Abstract]
Period of revenue from services	1 month
Subscription revenue term, minimum	1 year
Subscription revenue term, maximum	3 years
License revenue recognized payment terms, maximum	60 days
License revenue recognized payment terms, minimum	30 days

Segment Information - Additiona

Segment Information - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2016Segment
Revenue, Major Customer [Line Items]
Number of reporting segment	1
Sales [Member] | Minimum [Member] | Customer Concentration Risk [Member]
Revenue, Major Customer [Line Items]
Revenue from segment	10.00%

Segment Information - Geographi

Segment Information - Geographical Segment Revenue (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenues from External Customers and Long-Lived Assets [Line Items]
Total	$ 5,576	$ 5,386	$ 16,613	$ 17,173
Domestic [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total	1,210	1,733	3,494	5,178
International [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total	$ 4,366	$ 3,653	$ 13,119	$ 11,995

Segment Information - Customers

Segment Information - Customers Who Accounted for 10% or More of Company's Revenue (Detail)	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Customer Concentration Risk [Member] | Sales [Member] | Central Banks [Member]
Revenue, Major Customer [Line Items]
Entity wide revenue major customers percentage	62.00%	53.00%	63.00%	56.00%

Stock-Based Compensation - Addi

Stock-Based Compensation - Additional Information (Detail) - $ / shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options granted	0	0	0	0
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation plans, number of additional shares authorized for future grants			1,319
Closing price per share of Digimarc common stock	$ 38.35		$ 38.35

Stock-Based Compensation - Allo

Stock-Based Compensation - Allocation of Stock-Based Compensation (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 1,455	$ 1,377	$ 4,162	$ 3,857
Capitalized to software and patent costs	46	46	121	137
Total stock-based compensation expense	1,501	1,423	4,283	3,994
Cost of Revenue [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	196	171	553	569
Sales and Marketing [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	265	251	715	585
Research, Development and Engineering [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	346	396	1,050	1,011
General and Administrative [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	568	485	1,613	1,487
Intellectual Property [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 80	$ 74	$ 231	$ 205

Stock-Based Compensation - Unre

Stock-Based Compensation - Unrecognized Compensation Cost Related to Non-Vested Stock-Based Awards Granted (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Total unrecognized compensation costs	$ 10,620	$ 9,549

Stock-Based Compensation - Weig

Stock-Based Compensation - Weighted Average Period for Recognition of Unrecognized Compensation Cost for Stock Options and Restricted Stock (Detail)	9 Months Ended
	Sep. 30, 2016
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average period	0 years
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average period	1 year 4 months 24 days

Stock-Based Compensation - Reco

Stock-Based Compensation - Reconciliation of Outstanding Balance of Stock Options (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Options, Outstanding at beginning	458		490
Options granted	0	0	0	0
Options exercised	(17)		(49)
Options forfeited or expired	0		0
Options, Outstanding at ending	441		441
Options, Exercisable at ending	441		441
Weighted Average Exercise Price, Outstanding at beginning	$ 18.29		$ 17.73
Weighted Average Exercise Price, Granted	0		0
Weighted Average Exercise Price, Exercised	9.64		9.64
Weighted Average Exercise Price, Forfeited or expired	0		0
Weighted Average Exercise Price, Outstanding at ending	18.63		18.63
Weighted Average Exercise Price, Exercisable at ending	18.63		18.63
Weighted Average Grant Date Fair Value, Outstanding at beginning	8.79		8.69
Weighted Average Grant Date Fair Value, Granted	0		0
Weighted Average Grant Date Fair Value, Exercised	6.30		6.94
Weighted Average Grant Date Fair Value, Forfeited or expired	0		0
Weighted Average Grant Date Fair Value, Outstanding at ending	$ 8.88		$ 8.88
Aggregate Intrinsic Value, Outstanding	$ 8,687		$ 8,687
Aggregate Intrinsic Value, Exercisable	$ 8,687		$ 8,687

Stock-Based Compensation - Re41

Stock-Based Compensation - Reconciliation of Unvested Balance of Restricted Stock (Detail) - Restricted Stock [Member] - $ / shares shares in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2016
Number of Shares
Unvested, beginning balance	470	408
Granted	14	191
Vested	(54)	(166)
Forfeited	(4)	(7)
Unvested, ending balance	426	426
Weighted Average Grant Date Fair Value
Unvested, beginning balance	$ 25.59	$ 24.30
Granted	35.38	29.11
Vested	25.50	25.51
Forfeited	28.15	30.14
Unvested, ending balance	$ 25.89	$ 25.89

Stock-Based Compensation - Fair

Stock-Based Compensation - Fair Value of Restricted Stock Awards Vested (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of restricted stock awards vested	$ 1,912	$ 1,961	$ 5,029	$ 4,840

Shareholders' Equity - Addition

Shareholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	Dec. 31, 2015	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Shareholders Equity [Line Items]
Discount on common stock		$ 2,447		$ 2,447
Underwriter fees		150
Stock issuance cost		$ 253
Equity Distribution Agreement [Member]
Shareholders Equity [Line Items]
Stock issuance cost			$ 82
Net sales commissions			$ 299
Shares sold under equity distribution agreement	0
Common Stock [Member]
Shareholders Equity [Line Items]
Issuance of common stock		1,233,000		1,418,000	342,000
Common stock price per share		$ 30		$ 30
Cash proceeds from sale of common stock		$ 39,953
Common Stock [Member] | Equity Distribution Agreement [Member]
Shareholders Equity [Line Items]
Issuance of common stock			342,000
Cash proceeds from sale of common stock			$ 12,978
Weighted average price per share			$ 38.83
Over Allotment Option [Member] | Common Stock [Member]
Shareholders Equity [Line Items]
Issuance of common stock		185,000

Earnings Per Common Share - Sum

Earnings Per Common Share - Summary of Reconciliation of Earnings (Loss) Per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Basic Earnings (Loss) per Common Share:
Net loss	$ (5,198)	$ (4,469)	$ (15,916)	$ (12,631)
Distributed earnings to common shares	0	0	0	0
Distributed earnings to participating securities	0	0	0	0
Total distributed earnings	0	0	0	0
Undistributed loss allocable to common shares	(5,198)	(4,469)	(15,916)	(12,631)
Undistributed earnings allocable to participating securities	0	0	0	0
Total undistributed loss	(5,198)	(4,469)	(15,916)	(12,631)
Loss to common shares—basic	$ (5,198)	$ (4,469)	$ (15,916)	$ (12,631)
Weighted average common shares outstanding—basic	9,506	8,309	8,878	8,101
Basic earnings (loss) per common share	$ (0.55)	$ (0.54)	$ (1.79)	$ (1.56)
Diluted Earnings (Loss) per Common Share:
Loss to common shares—basic	$ (5,198)	$ (4,469)	$ (15,916)	$ (12,631)
Undistributed earnings allocated to participating securities	0	0	0	0
Undistributed earnings reallocated to participating securities	0	0	0	0
Loss to common shares—diluted	$ (5,198)	$ (4,469)	$ (15,916)	$ (12,631)
Weighted average common shares outstanding—basic	9,506	8,309	8,878	8,101
Dilutive effect of stock options	0	0	0	0
Weighted average common shares outstanding—dilutive	9,506	8,309	8,878	8,101
Diluted earnings (loss) per common share	$ (0.55)	$ (0.54)	$ (1.79)	$ (1.56)

Earnings Per Common Share - Add

Earnings Per Common Share - Additional Information (Detail) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Common stock equivalents related to stock options that were anti-dilutive and excluded from diluted net income per share	211,000	272,000	195,000	234,000
Higher Than Average Market Price [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Common stock equivalents related to stock options that were anti-dilutive and excluded from diluted net income per share	0	0	0	0

Trade Accounts Receivable - Sum

Trade Accounts Receivable - Summary of Trade Accounts Receivable (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Accounts Receivable Net Current [Abstract]
Trade accounts receivable	$ 2,536	$ 4,631
Allowance for doubtful accounts	(15)	(15)
Trade accounts receivable, net	2,521	4,616
Unpaid deferred revenue included in trade accounts receivable	$ 556	$ 2,012

Trade Accounts Receivable - Add

Trade Accounts Receivable - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2016
Accounts Receivable [Member] | Minimum [Member] | Credit Concentration Risk [Member]
Concentration Risk [Line Items]
Percentage of trade accounts receivable of major customers	10.00%

Trade Accounts Receivable - Cus

Trade Accounts Receivable - Customers Who Accounted for 10% or More of Trade Accounts Receivable, Net (Detail)	Sep. 30, 2016	Dec. 31, 2015
Accounts Receivable [Member] | Credit Concentration Risk [Member] | Central Banks [Member]
Concentration Risk [Line Items]
Percentage of trade accounts receivable of major customers	43.00%	62.00%

Property and Equipment - Additi

Property and Equipment - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2016
Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives of the assets	2 years
Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives of the assets	7 years

Property and Equipment - Deprec

Property and Equipment - Depreciation and Amortization on Property and Equipment Using the Straight-Line Method (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Property Plant And Equipment [Abstract]
Office furniture and fixtures	$ 1,052	$ 1,068
Software	1,957	1,748
Equipment	3,990	3,416
Leasehold improvements	1,589	1,276
Gross property and equipment	8,588	7,508
Less accumulated depreciation and amortization	(5,145)	(4,498)
Property and equipment, net	$ 3,443	$ 3,010

Intangibles - Additional Inform

Intangibles - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2016
Capitalized Patent Costs [Member]
Finite-Lived Intangible Assets [Line Items]
Estimated useful life	17 years

Intangibles - Amortization of I

Intangibles - Amortization of Intangible Assets Acquired (Detail) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2016	Dec. 31, 2015
Finite-Lived Intangible Assets [Line Items]
Capitalized patent costs	$ 7,136	$ 6,779
Intangible assets acquired:
Gross intangible assets	10,406	10,049
Accumulated amortization	(3,947)	(3,436)
Intangibles, net	6,459	6,613
Purchased Patents and Intellectual Property [Member]
Intangible assets acquired:
Intangible assets amount	250	250
Existing Technology [Member]
Intangible assets acquired:
Intangible assets amount	1,560	1,560
Customer Relationships [Member]
Intangible assets acquired:
Intangible assets amount	290	290
Backlog [Member]
Intangible assets acquired:
Intangible assets amount	760	760
Tradenames [Member]
Intangible assets acquired:
Intangible assets amount	290	290
Non-solicitation Agreements [Member]
Intangible assets acquired:
Intangible assets amount	$ 120	$ 120

Joint Ventures and Related Pa53

Joint Ventures and Related Party Transactions - Additional Information (Detail) $ in Thousands	1 Months Ended
	Mar. 31, 2012JointVenture	Sep. 30, 2016USD ($)	Dec. 31, 2015USD ($)
Related Party Transaction [Line Items]
Number of joint venture agreements | JointVenture	2
TVaura LLC [Member]
Related Party Transaction [Line Items]
Equity method investment, ownership percentage	51.00%
Investment in joint venture		$ 0	$ 0
TVaura Mobile LLC [Member]
Related Party Transaction [Line Items]
Equity method investment, ownership percentage	49.00%
Investment in joint venture		$ 0	$ 0

Income Taxes - Additional Infor

Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Deferred tax assets, valuation allowance	$ 22,283		$ 15,420
Effective tax rate	0.00%	0.00%
Change in valuation allowance	$ 6,863