Zedge (ZDGE) 10-Q 12 Jun 20 2020 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Apr. 30, 2020	Jun. 10, 2020
Entity Registrant Name	Zedge, Inc.
Entity Central Index Key	0001667313
Amendment Flag	false
Current Fiscal Year End Date	--07-31
Document Type	10-Q
Document Period End Date	Apr. 30, 2020
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2020
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity File Number	1-37782
Entity Interactive Data Current	Yes
Entity Incorporation State Country Code	DE
Class A common stock
Entity Common Stock, Shares Outstanding		524,775
Class B common stock
Entity Common Stock, Shares Outstanding		11,674,707

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Apr. 30, 2020	Jul. 31, 2019
Current assets:
Cash and cash equivalents	$ 4,630	$ 1,609
Trade accounts receivable, net of allowance for doubtful accounts of $0 at April 30, 2020 and July 31, 2019	935	1,133
Prepaid expenses	180	380
Other current assets	45	103
Total current assets	5,790	3,225
Property and equipment, net	2,781	3,396
Goodwill	1,937	2,266
Other assets	455	120
Total assets	10,963	9,007
Current liabilities:
Trade accounts payable	340	217
Insurance premium loan payable	16	141
Accrued expenses and other current liabilities	1,243	1,172
Deferred revenues	1,069	517
Total current liabilities	2,668	2,047
Loans Payable	218
Other liabilities	145
Total liabilities	3,031	2,047
Commitments and contingencies (Notes 8 and 12)
Stockholders' equity:
Preferred stock, $.01 par value; authorized shares-2,400; no shares issued
Additional paid-in capital	25,624	23,131
Accumulated other comprehensive loss	(1,469)	(985)
Accumulated deficit	(16,269)	(15,243)
Treasury stock, 40 shares at April 30, 2020 and 22 shares at July 31, 2019, at cost	(76)	(47)
Total stockholders' equity	7,932	6,960
Total liabilities and stockholders' equity	10,963	9,007
Class A common stock
Stockholders' equity:
Common stock value	5	5
Total stockholders' equity	5	5
Class B common stock
Stockholders' equity:
Common stock value	117	99
Total stockholders' equity	$ 117	$ 99

Consolidated Balance Sheets (_2

Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) shares in Thousands, $ in Thousands	Apr. 30, 2020	Jul. 31, 2019
Allowance for doubtful accounts	$ 0	$ 0
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	2,400	2,400
Preferred stock, shares issued
Treasury stock, shares	40	22
Class A common stock
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	2,600	2,600
Common stock, shares issued	525	525
Common stock, shares outstanding	525	525
Class B common stock
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	40,000	40,000
Common stock, shares issued	11,715	9,876
Common stock, shares outstanding	11,675	9,854

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2020	Apr. 30, 2019	Apr. 30, 2020	Apr. 30, 2019
Income Statement [Abstract]
Revenues	$ 2,079	$ 1,912	$ 6,756	$ 6,866
Costs and expenses:
Direct cost of revenues (exclusive of amortization of capitalized software and technology development costs included below)	289	353	925	1,031
Selling, general and administrative	1,569	2,289	5,408	6,761
Depreciation and amortization	348	391	1,216	1,022
Loss from operations	(127)	(1,121)	(793)	(1,948)
Interest and other income	2	3	7	48
Net loss resulting from foreign exchange transactions	(200)	(72)	(239)	(236)
Loss before income taxes	(325)	(1,190)	(1,025)	(2,136)
Provision for income taxes		5	1	6
Net loss	(325)	(1,195)	(1,026)	(2,142)
Other comprehensive loss:
Changes in foreign currency translation adjustment	(333)	(93)	(484)	(224)
Total other comprehensive loss	(333)	(93)	(484)	(224)
Total comprehensive loss	$ (658)	$ (1,288)	$ (1,510)	$ (2,366)
Loss per share attributable to Zedge, Inc. common stockholders:
Basic and diluted	$ (0.03)	$ (0.12)	$ (0.10)	$ (0.21)
Weighted-average number of shares used in calculation of loss per share:
Basic and diluted	11,979	10,116	10,793	10,063

Consolidated Statements of Chan

Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Class A Common Stock	Class B Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit	Treasury Stock	Total
Balance at Jul. 31, 2018	$ 5	$ 98	$ 22,508	$ (702)	$ (11,899)		$ 10,010
Balance, shares at Jul. 31, 2018	525	9,786
Stock-based compensation			121				121
Stock-based compensation, shares
Purchase of treasury stock						(31)	(31)
Foreign currency translation adjustment				(131)			(131)
Net Income/loss					(706)		(706)
Balance at Oct. 31, 2018	$ 5	$ 98	22,629	(833)	(12,605)	(31)	9,263
Balance, shares at Oct. 31, 2018	525	9,786
Balance at Jul. 31, 2018	$ 5	$ 98	22,508	(702)	(11,899)		10,010
Balance, shares at Jul. 31, 2018	525	9,786
Net Income/loss							(2,142)
Balance at Apr. 30, 2019	$ 5	$ 98	22,958	(926)	(14,040)	(31)	8,064
Balance, shares at Apr. 30, 2019	525	9,832
Balance at Oct. 31, 2018	$ 5	$ 98	22,629	(833)	(12,605)	(31)	9,263
Balance, shares at Oct. 31, 2018	525	9,786
Exercise of stock options
Exercise of stock options, shares		3
Stock-based compensation			162				162
Stock-based compensation, shares		16
Stock issued for matching contributions to the 401(k) Plan			48				48
Stock issued for matching contributions to the 401(k) Plan, shares		19
Net Income/loss					(240)		(240)
Balance at Jan. 31, 2019	$ 5	$ 98	22,839	(833)	(12,845)	(31)	9,233
Balance, shares at Jan. 31, 2019	525	9,824
Exercise of stock options			1				1
Exercise of stock options, shares		8
Stock-based compensation			118				118
Stock-based compensation, shares
Foreign currency translation adjustment				(93)			(93)
Net Income/loss					(1,195)		(1,195)
Balance at Apr. 30, 2019	$ 5	$ 98	22,958	(926)	(14,040)	(31)	8,064
Balance, shares at Apr. 30, 2019	525	9,832
Balance at Jul. 31, 2019	$ 5	$ 99	23,131	(985)	(15,243)	(47)	6,960
Balance, shares at Jul. 31, 2019	525	9,876
Stock-based compensation			98				98
Stock-based compensation, shares
Purchase of treasury stock						(22)	(22)
Foreign currency translation adjustment				(143)			(143)
Net Income/loss					(801)		(801)
Balance at Oct. 31, 2019	$ 5	$ 99	23,229	(1,128)	(16,044)	(69)	6,092
Balance, shares at Oct. 31, 2019	525	9,876
Balance at Jul. 31, 2019	$ 5	$ 99	23,131	(985)	(15,243)	(47)	6,960
Balance, shares at Jul. 31, 2019	525	9,876
Net Income/loss							(1,026)
Balance at Apr. 30, 2020	$ 5	$ 117	25,624	(1,469)	(16,269)	(76)	7,932
Balance, shares at Apr. 30, 2020	525	11,715
Balance at Oct. 31, 2019	$ 5	$ 99	23,229	(1,128)	(16,044)	(69)	6,092
Balance, shares at Oct. 31, 2019	525	9,876
Exercise of stock options			4				4
Exercise of stock options, shares		30
Stock-based compensation		$ 1	156				157
Stock-based compensation, shares		48
Stock issued for matching contributions to the 401(k) Plan			41				41
Stock issued for matching contributions to the 401(k) Plan, shares		26
Proceeds from sales of Class B Common Stock			275				275
Foreign currency translation adjustment				(8)			(8)
Net Income/loss					100		100
Balance at Jan. 31, 2020	$ 5	$ 100	23,705	(1,136)	(15,944)	(76)	6,654
Balance, shares at Jan. 31, 2020	525	9,980
Stock-based compensation			102				102
Stock-based compensation, shares
Net proceeds from sales of Class B Common Stock		$ 17	1,817				1,834
Net proceeds from sales of Class B Common Stock, shares		1,735
Foreign currency translation adjustment				(333)			(333)
Net Income/loss					(325)		(325)
Balance at Apr. 30, 2020	$ 5	$ 117	$ 25,624	$ (1,469)	$ (16,269)	$ (76)	$ 7,932
Balance, shares at Apr. 30, 2020	525	11,715

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Apr. 30, 2020	Apr. 30, 2019
Operating activities
Net loss	$ (1,026)	$ (2,142)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	1,216	1,022
Loss on disposal of furniture and fixtures		3
Stock-based compensation	397	449
Change in assets and liabilities:
Trade accounts receivable	198	573
Prepaid expenses and other current assets	259	178
Other assets	24	6
Trade accounts payable and accrued expenses and other current liabilities	(37)	99
Due to IDT Corporation		(1)
Deferred revenues	552	284
Net cash provided by operating activities	1,583	471
Investing activities
Capitalized software and technology development costs and purchase of equipment	(613)	(1,277)
Investment in privately-held company		(250)
Net cash used in investing activities	(613)	(1,527)
Financing activities
Proceeds from sales of Class B Common Stock	2,250
Payment of issuance costs	(141)
Proceeds from PPP loan payable	218
Repayment of insurance premium loan payable	(125)
Proceeds from exercise of stock options	4	2
Purchase of treasury stock in connection with restricted stock vesting	(29)	(31)
Net cash provided by (used in) financing activities	2,177	(29)
Effect of exchange rate changes on cash and cash equivalents	(126)	(75)
Net increase (decrease) in cash and cash equivalents	3,021	(1,160)
Cash and cash equivalents at beginning of period	1,609	3,408
Cash and cash equivalents at end of period	4,630	2,248
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash payments made for interest expenses	3
Cash payments made for income taxes	$ 1

Basis of Presentation and Recen

Basis of Presentation and Recently Adopted Accounting Pronouncements	9 Months Ended
	Apr. 30, 2020
Accounting Policies [Abstract]
Basis of Presentation and Recently Adopted Accounting Pronouncements	Note 1—Basis of Presentation and Recently Adopted Accounting Pronouncements Basis of Presentation The accompanying unaudited consolidated financial statements of Zedge, Inc. and its subsidiaries, Zedge Europe AS and Zedge Canada, Inc. (dissolved as of May 2, 2019) (the "Company") have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months and nine months ended April 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending July 31, 2020 or any other period. The balance sheet at July 31, 2019 has been derived from the Company's audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. For further information, please refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the year ended July 31, 2019, as filed with the U.S. Securities and Exchange Commission (the "SEC"). The Company's fiscal year ends on July 31 of each calendar year. Each reference below to a fiscal year refers to the fiscal year ending in the calendar year indicated (e.g., fiscal 2020 refers to the fiscal year ending July 31, 2020). COVID-19 Impacts on Financial and Operational Results The COVID-19 pandemic has caused widespread economic disruption impacting the Company in a number of ways, most notably, with a significant decrease in global advertising spend. As such, the Company lacks clarity about how the pandemic will influence its future financial and operational results. In light of the current operating and economic environment, the Company has shifted resources and priorities to increase focus on generating incremental revenue at the expense of delivering new product. The Company imposed a temporary hiring freeze and lowered its discretionary spend to preserve cash for mission critical projects. The Company has responded quickly and decisively to the challenges presented by the pandemic in order to ensure the continuity of its service. As of April 30, 2020, the Company had $4.6 million of cash and cash equivalents. The Company has developed certain contingency plans to preserve liquidity if such actions may be determined to be necessary due to worsening conditions, including related to an increase in impacts from the COVID-19 pandemic or if the effects of the pandemic last longer than currently anticipated. At the current time, the Company does not believe taking such actions is prudent nor, does it expect to need to take such action based on its current forecasts. The Company believes that its existing cash and cash equivalents, together with cash generated by operations will be sufficient to meet its working capital and capital expenditure requirements for the foreseeable future when accounting for the ill effects of the COVID-19 pandemic. The Company considered the impacts of the COVID-19 pandemic on its significant estimates and judgments used in applying its accounting policies in the three months ended April 30, 2020. In light of the pandemic, there is a greater degree of uncertainty in applying these judgments and depending on the duration and severity of the pandemic, changes to its estimates and judgments could result in a meaningful impact to its financial statements in future periods. Of the more significant items subject to a greater degree of uncertainty during this time include estimates of revenue collectability and credit losses related to accounts receivable. Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02 —Leases The Company adopted this standard in the first quarter of fiscal 2020, effective as of August 1, 2019, using the modified retrospective approach. The adoption of Topic 842 had a material impact on the Company's consolidated balance sheets, but did not impact its consolidated statements of comprehensive loss, consolidated statements of stockholders' equity, or consolidated statements of cash flows. There was no adjustment to beginning retained earnings on August 1, 2019. The Company elected the short-term lease recognition exemption for all leases that qualify. Accordingly, the Company did not recognize ROU assets or lease liabilities for leases that qualify, including leases for existing short-term leases in effect at transition and continue to recognize those lease payments as expenses on the Company's consolidated statements of comprehensive loss on a straight-line basis over the lease term. The Company elected the practical expedient to not separate lease and non-lease components for all its leases. Upon adoption, the Company recognized new ROU assets and lease obligations on the Consolidated Balance Sheet for its operating leases of $538,000 and $512,000, respectively. See Note 12 – Lease for further details. In August 2017, the FASB issued ASU 2017-12 – Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting Hedging Activities

Revenue

Revenue	9 Months Ended
	Apr. 30, 2020
Revenue from Contract with Customer [Abstract]
Revenue	Note 2—Revenue Revenue Recognition The Company generates revenue from three sources: (1) advertising; (2) subscriptions and Zedge Premium; and (3) in prior periods, service. Most of the Company's revenue is generated from selling its advertising inventory ("Advertising Revenue") to advertising networks, advertising exchanges, and direct arrangements with advertisers. The Company also earns revenue from subscriptions and Zedge Premium ("Other Revenue") which were launched in January 2019 and March 2018, respectively. Prior to May 31, 2019, the Company generated service revenue by managing and optimizing the advertising inventory of a third-party mobile application publisher, as well as overseeing the billing, collections and reporting related to advertising for this publisher ("Service Revenue"). The contract with this publisher was terminated effective May 31, 2019. The Company's current subscription offering allows users to pay a monthly or annual fee to remove unsolicited advertisements from the Zedge app. The Company is exploring adding additional features to its subscription offering. On the Zedge Premium platform, the Company retains 30% as fee revenue when users purchase licensed content using Zedge Credits or unlock licensed content by watching a video. Additionally, the Company earns revenue from breakage related to expired Zedge Credits. The following table summarizes revenue by type of service for the periods presented: Three Months Ended Nine Months Ended April 30, April 30, 2020 2019 2020 2019 (in thousands) (in thousands) Advertising revenue $ 1,501 $ 1,670 $ 5,428 $ 6,243 Subscription and Zedge Premium revenue 578 63 1,328 95 Service revenue - 179 - 528 Total Revenue $ 2,079 $ 1,912 $ 6,756 $ 6,866 Contract Balances Deferred revenues The Company records deferred revenues when users purchase or earn Zedge Credits. Unused Zedge Credits represent the value of the Company's unsatisfied performance obligation to its users. Revenue is recognized when Zedge App users use Zedge Credits to acquire Zedge Premium content or upon expiration of the Zedge Credits upon 180 days of account inactivity. As of April 30, 2020, and July 31, 2019, the Company's deferred revenue balance related to Zedge Premium was approximately $170,000 and $155,000, respectively. In the three months and nine months ended April 30, 2020, the Company recognized $62,000 and $124,000 in revenue from breakage upon expiration of Zedge Credits. The Company also records deferred revenues related to the unsatisfied performance obligations with respect to subscription revenue. As of April 30, 2020, the Company's deferred revenue balance related to subscriptions was approximately $899,000, representing approximately 394,000 active subscribers. As of July 31, 2019, the Company's deferred revenue balance related to paid subscriptions was approximately $362,000, representing approximately 129,000 active subscribers. The amount of revenue recognized in the nine months ended April 30, 2020 that was included in the deferred balance at July 31, 2019 was $329,000. Practical Expedients The Company expenses the fees retained by Google Play related to subscription revenue when incurred as marketing expense because the duration of the contracts for which the Company pay commissions are less than one year. These costs are included in the selling, general and administrative expenses of the Consolidated Statements of Comprehensive Loss.

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Apr. 30, 2020
Fair Value Disclosures [Abstract]
Fair Value Measurements	Note 3—Fair Value Measurements The following tables present the balance of assets and liabilities measured at fair value on a recurring basis: Level 1 (1) Level 2 (2) Level 3 (3) Total 30-Apr-20 (in thousands) Assets: Foreign exchange forward contracts $ - $ - $ - $ - Liabilities: Foreign exchange forward contracts $ - $ 145 $ - $ 145 31-Jul-19 Assets: Foreign exchange forward contracts $ - $ - $ - $ - Liabilities: Foreign exchange forward contracts $ - $ 38 $ - $ 38 (1) – quoted prices in active markets for identical assets or liabilities (2) – observable inputs other than quoted prices in active markets for identical assets and liabilities (3) – no observable pricing inputs in the market Fair Value of Other Financial Instruments The Company's other financial instruments at April 30, 2020 and July 31, 2019 included trade accounts receivable, trade accounts payable, loans payable, and lease liabilities. The carrying amounts of the trade accounts receivable, trade accounts payable, loan payables, and lease liabilities approximated fair value due to their short-term nature.

Derivative Instruments

Derivative Instruments	9 Months Ended
	Apr. 30, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Instruments	Note 4—Derivative Instruments The primary risk managed by the Company using derivative instruments is foreign exchange risk. Foreign exchange forward contracts are entered into as hedges against unfavorable fluctuations in the U.S. Dollar – Norwegian Kroner (NOK) exchange rate. The Company is party to a Foreign Exchange Agreement with Western Alliance Bank allowing the Company to enter into foreign exchange contracts under its revolving credit facility with the bank (see Note 9). The Company does not apply hedge accounting to these contracts, and therefore the changes in fair value are recorded in consolidated statements of comprehensive loss. By using derivative instruments to mitigate exposures to changes in foreign exchange rates, the Company is exposed to credit risk from the failure of the counterparty to perform under the terms of the contract. The credit or repayment risk is minimized by entering into transactions with high-quality counterparties. The outstanding contracts at April 30, 2020, are as follows: Settlement Date U.S. Dollar Amount NOK Amount May-20 350,000 3,216,464 Jun-20 350,000 3,216,359 Jul-20 350,000 3,216,114 Aug-20 350,000 3,216,324 Total $ 1,400,000 12,865,261 The fair value of outstanding derivative instruments recorded as liabilities in the accompanying consolidated balance sheets were as follows: Derivatives Instruments Balance Sheet Location April 30, July 31, (in thousands) Derivatives not designated or not qualifying as hedging instruments: Foreign exchange forward contracts Accrued expenses and other current liabilities $ 145 $ 38 The effects of derivative instruments on the consolidated statements of comprehensive loss were as follows: Amount of Loss Recognized on Derivatives Three Months Ended Nine Months Ended April 30, April 30, Derivatives not designated or not qualifying as hedging instruments Statement of Comprehensive Loss Location 2020 2019 2020 2019 (in thousands) (in thousands) Foreign exchange forward contracts Net loss resulting from foreign exchange transactions $ 273 $ 80 $ 327 $ 254

Accrued Expenses and Other Curr

Accrued Expenses and Other Current Liabilities	9 Months Ended
	Apr. 30, 2020
Payables and Accruals [Abstract]
Accrued Expenses and Other Current Liabilities	Note 5—Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following: April 30, 2020 July 31, 2019 (in thousands) Accrued vacation $ 459 $ 503 Accrued payroll taxes 198 183 Accrued payroll and bonuses 135 235 Operating lease liability 198 - Derivative liability 145 38 Accrued professional fees - 57 Due to artists 44 56 Other 64 100 Total accrued expenses and other current liabilities $ 1,243 $ 1,172

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Apr. 30, 2020
Share-based Payment Arrangement [Abstract]
Stock-Based Compensation	Note 6—Stock-Based Compensation 2016 Stock Option and Incentive Plan On November 7, 2019, our Board of Directors amended the Company's 2016 Stock Option and Incentive Plan (as amended to date, the "2016 Incentive Plan") to increase the number of shares of the Company's Class B common stock available for the grant of awards thereunder by an additional 230,000 shares, to an aggregate of 1,271,000 shares. This amendment was ratified by the Company's stockholders at the Annual Meeting of Stockholders held on January 13, 2020. At April 30, 2020, there were 295,000 shares of Class B Stock available for awards under the 2016 Incentive Plan. The exercise prices of options granted pursuant to the 2016 Incentive Plan must not equal to or greater than the Fair Market Value of the shares of Class B Stock covered by the option award on the date of grant. In general, Fair Market Value means the closing sale price per share of Class B Stock on the exchange on which the Class B Stock is principally traded for the last preceding date on which there was a sale of Class B Stock on such exchange. Stock Options On October 18, 2017, the Compensation Committee of our Board of Directors approved the grant of options to purchase an aggregate of 124,435 shares of Class B Stock to 55 non-executive employees. The options vest over a three-year period from December 8, 2017. On the grant date, unrecognized compensation expense related to this grant was an aggregate of $159,000 based on the estimated fair value of the options on the grant date. The unrecognized compensation expense is being recognized on a straight-line basis over the vesting period. In fiscal 2019, the Compensation Committee approved two equity grants of options to purchase an aggregate of 27,493 shares of Class B Stock to 6 non-executive employees. The options vest over a three-year period. Unrecognized compensation expense related to this grant was an aggregate of $33,000 based on the estimated fair value of the options on the grant dates. The unrecognized compensation expense is being recognized on a straight-line basis over the vesting period. On November 7, 2019 and January 13, 2020, the Compensation Committee approved two equity grants of options to purchase an aggregate of 180,996 shares of Class B Stock to four employees and one consultant. The options vest over a three-year period. Unrecognized compensation expense related to these grants was an aggregate of $242,000 based on the estimated fair value of the options on the grant dates. The unrecognized compensation expense is being recognized on a straight-line basis over the vesting period. At April 30, 2020, unrecognized compensation expense related to unvested stock options was an aggregate of $221,000. Deferred Stock Units On August 28, 2019, the Compensation Committee approved the grant of 90,000 Deferred Stock Units (DSUs) to 11 of its non-executive employees based in Norway and Lithuania. Each DSU represents a right to receive one share of Class B Common Stock. The DSUs vest over a four-year period from August 1, 2019. On the grant date, unrecognized compensation expense related to this grant was an aggregate of $139,000 based on the estimated fair value of the DSUs on the grant date. The unrecognized compensation expense is being recognized on a straight-line basis over the vesting period. At April 30, 2020, unrecognized compensation expense related to unvested DSUs was an aggregate of $86,000. Restricted Stock Awards On February 7, 2018, the Compensation Committee and the Corporate Governance Committee of our Board of Directors approved a grant of 108,553 restricted shares of Class B Common Stock to our Executive Chairman Michael Jonas. Mr. Jonas agreed to accept all of his compensation for his service as Executive Chairman during fiscal 2018 in the form of equity in the Company and to make receipt of such equity compensation contingent on the Company achieving certain milestones relative to its fiscal 2018 budget. The grant was made at the time that the milestones previously set were achieved. Two-thirds of the shares have vested and the remaining shares vest on February 7, 2021. These shares had an aggregate grant date fair value of $330,000 which is being amortized on a straight-line basis over the vesting period. Additionally, on November 7, 2019, Mr. Jonas received 1,411 restricted shares of the Company's Class B common stock to vest in substantially equal amounts on November 7, 2020, 2021 2022. At April 30, 2020, unrecognized compensation expense related to unvested restricted stock was an aggregate of $85,000. On November 7, 2019, the Compensation Committee approved a grant of 30,534 restricted shares of Class B Common Stock to Mr. Elliot Gibber, our Interim Chief Executive Officer in respect of his service in that capacity through the remainder of Fiscal 2020 (or such shorter period as he shall serve in that capacity), 15,267 shares of which vested on February 7, 2020 and the remainder will vest on May 7, 2020. These shares had an aggregate grant date fair value of $60,000 which is fully amortized as of April 30, 2020. In connection with the Freeform acquihire in September 2017, the Company granted a total of 192,953 restricted shares of Class B Common Stock to former Freeform employees, which vest over a four-year period subject to continued employment. These shares had an aggregate grant date fair value of $369,000 which is being amortized on a straight-line basis over the vesting period. At April 30, 2020, unrecognized compensation expense related to unvested restricted stock was an aggregate of $91,000. For the nine months ended April 30, 2020 and 2019, we purchased 18,441 shares and 14,137 shares respectively of Class B Stock from former Freeform employees for $29,072 and $30,543 respectively, to satisfy tax withholding obligations in connection with the vesting of restricted stock.

Earnings Per Share

Earnings Per Share	9 Months Ended
	Apr. 30, 2020
Earnings Per Share [Abstract]
Earnings Per Share	Note 7—Earnings Per Share Basic earnings per share is computed by dividing net income attributable to all classes of common stockholders of the Company by the weighted average number of shares of all classes of common stock outstanding during the applicable period. Diluted earnings per share is computed in the same manner as basic earnings per share, except that the number of shares is increased to include restricted stock still subject to risk of forfeiture, issuances to be made on the vesting of unvested DSUs and the exercise of potentially dilutive stock options using the treasury stock method, unless the effect of such increase is anti-dilutive. The weighted-average number of shares used in the calculation of basic and diluted earnings per share attributable to the Company's common stockholders consists of the following: Three Months Ended Nine Months Ended April 30, April 30, 2020 2019 2020 2019 (in thousands) Basic weighted-average number of shares 11,979 10,116 10,793 10,063 Effect of dilutive securities: Stock options - - - - Non-vested restricted Class B common stock - - - - Deferred stock units - - - - Diluted weighted-average number of shares 11,979 10,116 10,793 10,063 The following shares were excluded from the dilutive earnings per share computations because their inclusion would have been anti-dilutive: Three Months Ended Nine Months Ended April 30, April 30, 2020 2019 2020 2019 (in thousands) Stock options 1,326 1,277 1,326 1,277 Non-vested restricted Class B common stock 120 217 120 217 Deferred stock units 69 - 69 - Shares excluded from the calculation of diluted earnings per share 1,515 1,494 1,515 1,494 For the three and nine months ended April 30, 2020 and 2019, the diluted earnings per share equals basic earnings per share because the Company incurred a net loss during those periods and the impact of the assumed exercise of stock options and vesting of restricted stock would have been anti-dilutive.

Contingencies

Contingencies	9 Months Ended
	Apr. 30, 2020
Commitments and Contingencies Disclosure [Abstract]
Contingencies	Note 8—Contingencies Legal Proceedings In March 2014, Saregama India, Limited filed a lawsuit against the Company before the Barasat District Court, seeking approximately $1.6 million as damages and an injunction for copyright infringement. Saregama India alleged that the Company made available Saregama India's sound recordings through the Company's platform with full knowledge that the sound recordings had been uploaded and were being communicated to the public without obtaining any license from Saregama India. On August 20, 2019, the Court lifted the injunction and, subsequently, Saregama India executed a consent pursuant to which the case against the Company was dismissed. The Company may from time to time be subject to other legal proceedings that arise in the ordinary course of business. Although there can be no assurance in this regard, the Company does not expect any of those legal proceedings to have a material adverse effect on the Company's results of operations, cash flows or financial condition.

Revolving Credit Facility

Revolving Credit Facility	9 Months Ended
	Apr. 30, 2020
Revolving Credit Facility [Abstract]
Revolving Credit Facility	Note 9—Revolving Credit Facility As of September 27, 2016, the Company entered into a loan and security agreement with Western Alliance Bank for a revolving credit facility of up to $2.5 million for an initial two years term which was extended for another two years term expiring September 26, 2020. Advances under this facility may not exceed the lesser of $2.5 million or 80% of the Company's eligible accounts receivable, subject to certain concentration limits. The revolving credit facility is secured by a lien on substantially all of the Company's assets. The outstanding principal amount bears interest per annum at the greater of 5.0% or the prime rate plus 1.25%. Interest is payable monthly and all outstanding principal and any accrued and unpaid interest is due on the maturity date of September 26, 2020. The Company is required to pay an annual facility fee of $12,500 to Western Alliance Bank. The Company is also required to comply with various affirmative and negative covenants and to maintain certain financial ratios during the term of the revolving credit facility. The covenants include a prohibition on the Company paying any dividend on its capital stock. The Company may terminate this agreement at any time without penalty or premium provided that it pays down any outstanding principal, accrued interest and bank expenses. At April 30, 2020, there were no amounts outstanding under the revolving credit facility and the Company was in compliance with all of the covenants. As of November 16, 2016, the Company entered into a Foreign Exchange Agreement with Western Alliance Bank to allow the Company to enter into foreign exchange contracts not to exceed $5.0 million in the aggregate at any point in time under its revolving credit facility. This limit was raised to approximately $6.5 million pursuant to the Loan and Security Modification Agreement dated May 30, 2018. The available borrowing under the revolving credit facility is reduced by an applicable foreign exchange reserve percentage as determined by Western Alliance Bank, in its reasonable discretion from time to time, which was initially set at 10% of the nominal amount of the foreign exchange contracts in effect at the relevant time. In December 2016, the applicable foreign exchange reserve percentage was changed so that the reduction of available borrowing for major currency forward contracts of less than nine months tenor is set at 10% of the nominal amount of the foreign exchange contracts, and for contracts over six months tenor, 12.5% of the nominal amount of the foreign exchange contracts. At April 30, 2020, there were $1.4 million of outstanding foreign exchange contracts with less than six months tenor under the credit facility, which reduced the available borrowing under the revolving credit facility by $140,000.

Investment in Privately-Held Co

Investment in Privately-Held Company	9 Months Ended
	Apr. 30, 2020
Investment in Privately-held Company [Abstract]
Investment in Privately-held Company	Note 10—Investment in Privately-held Company In August 2018, the Company made a $250,000 investment in TreSensa, Inc. ("TreSensa"), representing a less than 1% equity ownership interest on a fully-diluted basis, and concurrently entered into a playable ad distribution agreement with TreSensa under which the Company shall be paid a higher percentage (when compared to industry norms) of revenue derived from all playable ads provided by TreSensa, from its available catalogue for distribution through the Zedge App. This distribution agreement was terminated in April 2019. The Company's ownership interest in TreSensa, a privately held company, is comprised of non-marketable equity securities without a readily determinable fair value. On August 1, 2018, the Company adopted ASU 2016-01, a new standard on the classification and measurement for non-marketable securities. The Company adjusts the carrying value of its non-marketable equity securities to fair value upon observable transactions for identical or similar investments of the same issuer or upon impairment (referred to as the measurement alternative). All gains and losses on non-marketable equity securities, realized and unrealized, are recognized in interest and other income (expense), net. The Company periodically evaluates the carrying value of the investments in privately held company when events and circumstances indicate that the carrying amount of the investment may not be recovered. The Company estimates the fair value of the investments to assess whether impairment losses shall be recorded using Level 3 inputs. These investments include the Company's holdings in privately held company that are not exchange traded and therefore not supported with observable market prices; hence, the Company may determine the fair value by reviewing equity valuation reports, current financial results, long-term plans of the privately held company, the amount of cash that the privately held company have on-hand, the ability to obtain additional financing and overall market conditions in which the privately held company operate or based on the price observed from the most recent completed financing round. In the fourth quarter of fiscal 2019, management performed its qualitative assessment using the above factors, which indicated the investment's fair value was below its carrying value, and therefore recorded an impairment charges of $250,000 in July 2019 and reduced the carrying value of the Company's non-marketable equity securities to $0 as of July 31, 2019.

Business Segment and Geographic

Business Segment and Geographic Information	9 Months Ended
	Apr. 30, 2020
Segment Reporting [Abstract]
Business Segment and Geographic Information	Note 11—Business Segment and Geographic Information The Company offers a state-of-the-art digital publishing platform. The Company use this platform to power its consumer-facing mobile personalization app, called Zedge, available in the Google Play store and the App Store, which offers an easy, entertaining and immersive way for end-users to engage with its rich and diverse catalogue of wallpapers, stickers, ringtones, notification sounds and video wallpapers. The Company is evolving by developing new, entertainment-focused apps, that will run on its publishing platform. The Company conducts business as a single operating segment. Net long-lived assets and total assets held outside of the United States, which are located primarily in Norway, were as follows: United States Foreign Total Long-lived assets, net: (in thousands) 30-Apr-20 $ 2,720 $ 516 $ 3,236 31-Jul-19 $ 3,304 $ 212 $ 3,516 Total assets: 30-Apr-20 $ 7,303 $ 3,660 $ 10,963 31-Jul-19 $ 5,508 3,499 $ 9,007

Leases

Leases	9 Months Ended
	Apr. 30, 2020
Leases [Abstract]
Leases	Note 12— Leases At the inception of certain arrangements, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present. Operating leases are included in other assets, accrued expenses and other current liabilities, and other liabilities on the Company's Consolidated Balance Sheets. The Company does not have any finance leases. Leases with a term greater than one year are recognized on the Consolidated Balance Sheet as right-of-use ("ROU") assets, lease obligations and, if applicable, long-term lease obligations in the line items cited above. The Company has elected not to recognize leases with terms of one year or less on the Consolidated Balance Sheets. Lease obligations and their corresponding ROU assets are recorded based on the present value of lease payments over the expected lease term. As the interest rate implicit in lease contracts is typically not readily determinable, the Company utilizes the appropriate incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. The lease term may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company has elected to combine lease components (including land, building or other similar items) and non-lease components (including common area maintenance, maintenance, consumables, or other similar items) as a single component and therefore the non-lease components are included the calculation of the present value of lease payments. The lease expense is recognized over the expected term on a straight-line basis. The Company currently leases 11,578 square feet of office space for its technology development center located in Trondheim, Norway, under a noncancelable lease that expires in 2021. The Company uses these facilities to accommodate its product, design and technology team. Additionally, the Company also has short-term leases for its offices in 1) New York to house its commercial operations including sales, accounting and finance, and business development, 2) Vilnius, Lithuania, a satellite development center and 3) Bodo, Norway that meet short-term lease criteria and are not recognized on the Consolidated Balance Sheets. Most leases include one or more options to renew, and the exercise of these options is at the Company's sole discretion. The Company determined that its options to break or renew would not be reasonably certain in determining the expected lease term, and therefore are not included as part of its ROU assets and lease liabilities. In calculating the present value of the lease payments, the Company has elected to utilize its estimated incremental borrowing rate based on the remaining lease term and not the original lease term. The depreciable life of assets and leasehold improvements are limited by the expected lease term. The elements of lease expense were as follows (in thousands): Three Months Ended Nine Months Ended April 30, 2020 April 30, 2020 Operating lease cost $ 53 $ 170 Other lease cost, net (1) 39 108 Total lease cost $ 92 $ 278 (1) Other lease cost, net includes short-term lease costs and variable lease costs, which are immaterial. The following table presents the lease-related assets and liabilities recorded on the Consolidated Balance Sheet (in thousands): As of April 30, Operating leases: 2020 Other assets $ 327 Other current liabilities $ 198 Other liabilities 145 Total operating lease liabilities $ 343 The following table summarizes the weighted average remaining lease term and weighted average discount rate as of April 30, 2020: As of April 30, 2020 Weighted average remaining lease term: Operating leases 1.67 years Weighted average discount rate: Operating leases 5.00 % Supplemental cash flow information related to leases was as follows (in thousands): Nine Months Ended April 30, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ 188 Future minimum lease payments under non-cancelable leases for the years ending July 31, 2020, 2021, 2022, and thereafter are as follows (in thousands): Operating Leases 2020 $ 51 2021 215 2022 92 Total future minimum lease payments 358 Less imputed interest 15 Total $ 343 As of April 30, 2020, the Company did not have any leases that have not yet commenced that create significant rights and obligations.

Provision for Income Taxes

Provision for Income Taxes	9 Months Ended
	Apr. 30, 2020
Income Tax Disclosure [Abstract]
Provision for income taxes	Note 13—Provision for Income taxes The provision for income consists of minimum state taxes based on allocated net worth. As part of the Tax Cuts and Jobs Act of 2017, Global Intangible Low-Taxed Income inclusion (GILTI) and Foreign Derived Intangible Income (FDII) deduction became effective on January 1, 2018. There was no impact to income tax expense resulting from the GILTI and FDII in light of the Company's available NOL carry forward and its full valuation allowance. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. The CARES Act contains several new or changed income tax provisions, including but not limited to the following: increased limitation threshold for determining deductible interest expense, class life changes to qualified improvements (in general, from 39 years to 15 years), and the ability to carry back net operating losses incurred from tax years 2018 through 2020 up to the five preceding years. The Company has evaluated the tax provisions related to the CARES Act and determined them as being immaterial.

Recently Issued Accounting Stan

Recently Issued Accounting Standards Not Yet Adopted	9 Months Ended
	Apr. 30, 2020
Accounting Changes and Error Corrections [Abstract]
Recently Issued Accounting Standards Not Yet Adopted	Note 14—Recently Issued Accounting Standards Not Yet Adopted Recently Issued Accounting Standards Not Yet Adopted In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In August 2018, the FASB issued Accounting Standard Update No. 2018-13, Changes to Disclosure Requirements for Fair Value Measurements (Topic 820) In August 2018, the FASB issued Accounting Standard Update No. 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, In December 2019, the FASB issued Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes With the exception of the accounting standards discussed above, there have been no other recent accounting pronouncements or changes in accounting pronouncements during the three months ended April 30, 2020 that are of significance or potential significance to the Company.

Loans Payable

Loans Payable	9 Months Ended
	Apr. 30, 2020
Payables and Accruals [Abstract]
Loans Payable	Note 15—Loans Payable On July 16, 2019, the Company obtained a loan of $140,000 to pay for its insurance coverages, repayable in nine equal installments of $15,976 starting from September 1, 2020 which represented a 4.79% annual percentage interest rate. On March 27, 2020, Congress passed CARES Act to provide an estimated $2.2 trillion to fight the COVID-19 pandemic and stimulate the U.S. economy, including $349 billion that was earmarked for the Paycheck Protection Program (PPP) to provide certain small businesses with liquidity to support their operations, to be administered by the Small Business Administration (SBA). An additional $310 billion was later authorized for the PPP. Under the PPP, eligible small businesses can apply to an SBA-approved lender for a loan that doesn't require collateral or personal guarantees. The loans have a 1% fixed interest rate and are due in two years. However, they are eligible for forgiveness (in full or in part, including any accrued interest) under certain conditions. For loans (or parts of loans) that are forgiven, the lender will collect the forgiven amount from the U.S. government. The Company believes it qualified for a PPP loan and applied for and received a $218,000 loan from Western Alliance Bank, a loan servicer and the Company's lender (see Note 9), on April 22, 2020. The Company is using these proceeds primarily for payroll purposes for U.S. employees during the covered period provided under the PPP (which was recently extended to 24 weeks) and therefore expects that most of this loan will be forgiven. Any portion of the loan that is not forgiven will due five years after inception of the loan.

Sales of Class B Common Stock

Sales of Class B Common Stock	9 Months Ended
	Apr. 30, 2020
Equity [Abstract]
Sales of Class B Common Stock	Note 16—Sales of Class B Common Stock On February 5, 2020, the Company closed on its registered direct offering of 1,734,459 shares of its Class B common stock for gross proceeds of $2.25 million. The Company sold 1,657,813 shares at a purchase price of $1.28 per share which represented a 20% discount from the 10 Day Volume Weighted Average Price (VWAP) through January 31, 2020, and certain Company insiders purchased an additional 76,646 shares at a purchase price of $1.67 per share, the closing price on February 3, 2020. In connection with this offering, the Company incurred a total issuance costs of $141,000. The Company intends to use the net proceeds from the offering for working capital and other general corporate purposes.

Basis of Presentation and Rec_2

Basis of Presentation and Recently Adopted Accounting Pronouncements (Policies)	9 Months Ended
	Apr. 30, 2020
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited consolidated financial statements of Zedge, Inc. and its subsidiaries, Zedge Europe AS and Zedge Canada, Inc. (dissolved as of May 2, 2019) (the "Company") have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months and nine months ended April 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending July 31, 2020 or any other period. The balance sheet at July 31, 2019 has been derived from the Company's audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. For further information, please refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the year ended July 31, 2019, as filed with the U.S. Securities and Exchange Commission (the "SEC"). The Company's fiscal year ends on July 31 of each calendar year. Each reference below to a fiscal year refers to the fiscal year ending in the calendar year indicated (e.g., fiscal 2020 refers to the fiscal year ending July 31, 2020). COVID-19 Impacts on Financial and Operational Results The COVID-19 pandemic has caused widespread economic disruption impacting the Company in a number of ways, most notably, with a significant decrease in global advertising spend. As such, the Company lacks clarity about how the pandemic will influence its future financial and operational results. In light of the current operating and economic environment, the Company has shifted resources and priorities to increase focus on generating incremental revenue at the expense of delivering new product. The Company imposed a temporary hiring freeze and lowered its discretionary spend to preserve cash for mission critical projects. The Company has responded quickly and decisively to the challenges presented by the pandemic in order to ensure the continuity of its service. As of April 30, 2020, the Company had $4.6 million of cash and cash equivalents. The Company has developed certain contingency plans to preserve liquidity if such actions may be determined to be necessary due to worsening conditions, including related to an increase in impacts from the COVID-19 pandemic or if the effects of the pandemic last longer than currently anticipated. At the current time, the Company does not believe taking such actions is prudent nor, does it expect to need to take such action based on its current forecasts. The Company believes that its existing cash and cash equivalents, together with cash generated by operations will be sufficient to meet its working capital and capital expenditure requirements for the foreseeable future when accounting for the ill effects of the COVID-19 pandemic. The Company considered the impacts of the COVID-19 pandemic on its significant estimates and judgments used in applying its accounting policies in the three months ended April 30, 2020. In light of the pandemic, there is a greater degree of uncertainty in applying these judgments and depending on the duration and severity of the pandemic, changes to its estimates and judgments could result in a meaningful impact to its financial statements in future periods. Of the more significant items subject to a greater degree of uncertainty during this time include estimates of revenue collectability and credit losses related to accounts receivable.
Recently Adopted Accounting Pronouncements	Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-02 —Leases The Company adopted this standard in the first quarter of fiscal 2020, effective as of August 1, 2019, using the modified retrospective approach. The adoption of Topic 842 had a material impact on the Company's consolidated balance sheets, but did not impact its consolidated statements of comprehensive loss, consolidated statements of stockholders' equity, or consolidated statements of cash flows. There was no adjustment to beginning retained earnings on August 1, 2019. The Company elected the short-term lease recognition exemption for all leases that qualify. Accordingly, the Company did not recognize ROU assets or lease liabilities for leases that qualify, including leases for existing short-term leases in effect at transition and continue to recognize those lease payments as expenses on the Company's consolidated statements of comprehensive loss on a straight-line basis over the lease term. The Company elected the practical expedient to not separate lease and non-lease components for all its leases. Upon adoption, the Company recognized new ROU assets and lease obligations on the Consolidated Balance Sheet for its operating leases of $538,000 and $512,000, respectively. See Note 12 – Lease for further details. In August 2017, the FASB issued ASU 2017-12 – Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting Hedging Activities

Revenue (Tables)

Revenue (Tables)	9 Months Ended
	Apr. 30, 2020
Revenue from Contract with Customer [Abstract]
Schedule of revenue by type of service	Three Months Ended Nine Months Ended April 30, April 30, 2020 2019 2020 2019 (in thousands) (in thousands) Advertising revenue $ 1,501 $ 1,670 $ 5,428 $ 6,243 Subscription and Zedge Premium revenue 578 63 1,328 95 Service revenue - 179 - 528 Total Revenue $ 2,079 $ 1,912 $ 6,756 $ 6,866

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	9 Months Ended
	Apr. 30, 2020
Fair Value Disclosures [Abstract]
Schedule of balance of assets and liabilities measured at fair value on a recurring basis	Level 1 (1) Level 2 (2) Level 3 (3) Total 30-Apr-20 (in thousands) Assets: Foreign exchange forward contracts $ - $ - $ - $ - Liabilities: Foreign exchange forward contracts $ - $ 145 $ - $ 145 31-Jul-19 Assets: Foreign exchange forward contracts $ - $ - $ - $ - Liabilities: Foreign exchange forward contracts $ - $ 38 $ - $ 38 (1) – quoted prices in active markets for identical assets or liabilities (2) – observable inputs other than quoted prices in active markets for identical assets and liabilities (3) – no observable pricing inputs in the market

Derivative Instruments (Tables)

Derivative Instruments (Tables)	9 Months Ended
	Apr. 30, 2020
Schedule of fair value of derivative assets and liabilities	Derivatives Instruments Balance Sheet Location April 30, July 31, (in thousands) Derivatives not designated or not qualifying as hedging instruments: Foreign exchange forward contracts Accrued expenses and other current liabilities $ 145 $ 38
Schedule of derivative instruments on consolidated statements of comprehensive loss	Amount of Loss Recognized on Derivatives Three Months Ended Nine Months Ended April 30, April 30, Derivatives not designated or not qualifying as hedging instruments Statement of Comprehensive Loss Location 2020 2019 2020 2019 (in thousands) (in thousands) Foreign exchange forward contracts Net loss resulting from foreign exchange transactions $ 273 $ 80 $ 327 $ 254
Western Alliance Bank [Member]
Schedule of outstanding foreign exchange contracts	Settlement Date U.S. Dollar Amount NOK Amount May-20 350,000 3,216,464 Jun-20 350,000 3,216,359 Jul-20 350,000 3,216,114 Aug-20 350,000 3,216,324 Total $ 1,400,000 12,865,261

Accrued Expenses and Other Cu_2

Accrued Expenses and Other Current Liabilities (Tables)	9 Months Ended
	Apr. 30, 2020
Payables and Accruals [Abstract]
Schedule of accrued expenses and other liabilities	April 30, 2020 July 31, 2019 (in thousands) Accrued vacation $ 459 $ 503 Accrued payroll taxes 198 183 Accrued payroll and bonuses 135 235 Operating lease liability 198 - Derivative liability 145 38 Accrued professional fees - 57 Due to artists 44 56 Other 64 100 Total accrued expenses and other current liabilities $ 1,243 $ 1,172

Earnings per Share (Tables)

Earnings per Share (Tables)	9 Months Ended
	Apr. 30, 2020
Earnings Per Share [Abstract]
Schedule of weighted-average number of shares calculation of basic and diluted earnings per share	Three Months Ended Nine Months Ended April 30, April 30, 2020 2019 2020 2019 (in thousands) Basic weighted-average number of shares 11,979 10,116 10,793 10,063 Effect of dilutive securities: Stock options - - - - Non-vested restricted Class B common stock - - - - Deferred stock units - - - - Diluted weighted-average number of shares 11,979 10,116 10,793 10,063
Schedule of shares excluded from the dilutive earnings per share computations	Three Months Ended Nine Months Ended April 30, April 30, 2020 2019 2020 2019 (in thousands) Stock options 1,326 1,277 1,326 1,277 Non-vested restricted Class B common stock 120 217 120 217 Deferred stock units 69 - 69 - Shares excluded from the calculation of diluted earnings per share 1,515 1,494 1,515 1,494

Business Segment and Geograph_2

Business Segment and Geographic Information (Tables)	9 Months Ended
	Apr. 30, 2020
Segment Reporting [Abstract]
Schedule of net long-lived assets and total assets held outside of the United States	United States Foreign Total Long-lived assets, net: (in thousands) 30-Apr-20 $ 2,720 $ 516 $ 3,236 31-Jul-19 $ 3,304 $ 212 $ 3,516 Total assets: 30-Apr-20 $ 7,303 $ 3,660 $ 10,963 31-Jul-19 $ 5,508 3,499 $ 9,007

Leases (Tables)

Leases (Tables)	9 Months Ended
	Apr. 30, 2020
Leases [Abstract]
Schedule of lease expense	Three Months Ended Nine Months Ended April 30, April 30, Operating lease cost $ 53 $ 170 Other lease cost, net (1) 39 108 Total lease cost $ 92 $ 278 (1) Other lease cost, net includes short-term lease costs and variable lease costs, which are immaterial.
Schedule of lease-related assets and liabilities	As of April 30, Operating leases: 2020 Other assets $ 327 Other current liabilities $ 198 Other liabilities 145 Total operating lease liabilities $ 343
Schedule of weighted average remaining lease term and weighted average discount rate	As of April 30, 2020 Weighted average remaining lease term: Operating leases 1.67 years Weighted average discount rate: Operating leases 5.00 %
Schedule of cash flow information related to leases	Nine Months Ended April 30, 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ 188
Schedule of Future minimum lease payments under non-cancelable leases	Operating Leases 2020 $ 51 2021 215 2022 92 Total future minimum lease payments 358 Less imputed interest 15 Total $ 343

Basis of Presentation and Rec_3

Basis of Presentation and Recently Adopted Accounting Pronouncements (Details) - USD ($) $ in Thousands	Apr. 30, 2020	Jul. 31, 2019	Apr. 30, 2019	Jul. 31, 2018
Basis of Presentation and Recently Adopted Accounting Pronouncements (Textual)
Cash and cash equivalents	$ 4,630	$ 1,609	$ 2,248	$ 3,408
Operating leases right of use asset	$ 538	$ 512

Revenue (Details)

Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2020	Apr. 30, 2019	Apr. 30, 2020	Apr. 30, 2019
Disaggregation of Revenue [Line Items]
Total Revenue	$ 2,079	$ 1,912	$ 6,756	$ 6,866
Advertising revenue [Member]
Disaggregation of Revenue [Line Items]
Total Revenue	1,501	1,670	5,428	6,243
Subscription and Zedge Premium revenue [Member]
Disaggregation of Revenue [Line Items]
Total Revenue	578	63	1,328	95
Service revenue [Member]
Disaggregation of Revenue [Line Items]
Total Revenue		$ 179		$ 528

Revenue (Details Textual)

Revenue (Details Textual) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended	9 Months Ended
	Jul. 31, 2019	Apr. 30, 2020	Apr. 30, 2020
Revenue (Textual)
Credits, description			The Company records deferred revenues when users purchase or earn Zedge Credits. Unused Zedge Credits represent the value of the Company’s unsatisfied performance obligation to its users. Revenue is recognized when Zedge App users use Zedge Credits to acquire Zedge Premium content or upon expiration of the Zedge Credits upon 180 days of account inactivity.
Deferred revenue	$ 362
Process subscription payments fee percent			30.00%
Unsatisfied performance obligations, description			The Company also records deferred revenues related to the unsatisfied performance obligations with respect to subscription revenue. As of April 30, 2020, the Company’s deferred revenue balance related to subscriptions was approximately $899,000, representing approximately 394,000 active subscribers.
Revenue from breakage		$ 62	$ 124
Revenue recognized	329		329
Subscription Revenue [Member]
Revenue (Textual)
Deferred revenue	129
Zedge Premium [Member]
Revenue (Textual)
Deferred revenue	$ 155	$ 170	$ 170

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($) $ in Thousands		Apr. 30, 2020	Jul. 31, 2019
Assets:
Foreign exchange forward contracts
Liabilities:
Foreign exchange forward contracts		145	38
Fair Value on a Recurring Basis [Member] | Level 1 [Member]
Assets:
Foreign exchange forward contracts	[1]
Liabilities:
Foreign exchange forward contracts	[1]
Fair Value on a Recurring Basis [Member] | Level 2 [Member]
Assets:
Foreign exchange forward contracts	[2]
Liabilities:
Foreign exchange forward contracts	[2]	145	38
Fair Value on a Recurring Basis [Member] | Level 3 [Member]
Assets:
Foreign exchange forward contracts	[3]
Liabilities:
Foreign exchange forward contracts	[3]
[1]	quoted prices in active markets for identical assets or liabilities
[2]	observable inputs other than quoted prices in active markets for identical assets and liabilities
[3]	no observable pricing inputs in the market

Derivative Instruments (Details

Derivative Instruments (Details) - Western Alliance Bank [Member]	9 Months Ended
	Apr. 30, 2020USD ($)	Apr. 30, 2020NOK (kr)
Amount | $	$ 1,400,000
NOK [Member]
Amount | kr		kr 12,865,261
May-20 [Member]
Settlement Date	May 31, 2020	May 31, 2020
Amount | $	$ 350,000
May-20 [Member] | NOK [Member]
Amount | kr		kr 3,216,464
Jun-20 [Member]
Settlement Date	Jun. 30, 2020	Jun. 30, 2020
Amount | $	$ 350,000
Jun-20 [Member] | NOK [Member]
Amount | kr		kr 3,216,359
Jul-20 [Member]
Settlement Date	Jul. 31, 2020	Jul. 31, 2020
Amount | $	$ 350,000
Jul-20 [Member] | NOK [Member]
Amount | kr		kr 3,216,114
Aug-20 [Member]
Settlement Date	Aug. 31, 2020	Aug. 31, 2020
Amount | $	$ 350,000
Aug-20 [Member] | NOK [Member]
Amount | kr		kr 3,216,324

Derivative Instruments (Detai_2

Derivative Instruments (Details 1) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Apr. 30, 2020	Jul. 31, 2019
Derivatives not designated or not qualifying as hedging instruments:
Foreign exchange forward contracts	$ 145	$ 38
Balance Sheet Location	Accrued expenses and other current liabilities	Accrued expenses and other current liabilities

Derivative Instruments (Detai_3

Derivative Instruments (Details 2) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2020	Apr. 30, 2019	Apr. 30, 2020	Apr. 30, 2019
Derivatives not designated or not qualifying as hedging instruments
Foreign exchange forward contracts	$ 273	$ 80	$ 327	$ 254
Statement of Comprehensive Loss Location	Net loss resulting from foreign exchange transactions	Net loss resulting from foreign exchange transactions	Net loss resulting from foreign exchange transactions	Net loss resulting from foreign exchange transactions

Accrued Expenses and Other Cu_3

Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Apr. 30, 2020	Jul. 31, 2019
Payables and Accruals [Abstract]
Accrued vacation	$ 459	$ 503
Accrued payroll taxes	198	183
Accrued payroll and bonuses	135	235
Operating lease liability	198
Derivative liability	145	38
Accrued professional fees		57
Due to artists	44	56
Other	64	100
Total accrued expenses and other current liabilities	$ 1,243	$ 1,172

Stock-Based Compensation (Detai

Stock-Based Compensation (Details) $ / shares in Units, $ in Thousands	Nov. 07, 2019USD ($)Customershares	Feb. 07, 2018USD ($)shares	Feb. 05, 2020USD ($)shares	Aug. 28, 2019USD ($)shares	Oct. 18, 2017USD ($)Customershares	Sep. 30, 2017USD ($)shares	Apr. 30, 2020USD ($)$ / sharesshares	Apr. 30, 2019USD ($)shares	May 07, 2020shares	Feb. 07, 2020shares	Jul. 31, 2019$ / shares
Stock-Based Compensation (Textual)
Unrecognized compensation expense | $				$ 139
Vested period, description				The DSUs vest over a four-year period from August 1, 2019.
Number of non-executive employees, description				11 of its non-executive employees based in Norway and Lithuania.
Shares purchased			76,646
Restricted Stock Award [Member]
Stock-Based Compensation (Textual)
Options granted		108,553
Unrecognized compensation expense | $							$ 85
Aggregate grant date fair value | $		$ 330				$ 369	60
Vested period, description		Two-third of the shares have vested and the remaining shares shall vest on February 7, 2021.
Issuance of shares										15,267
Restricted Stock Award [Member] | Employees [Member]
Stock-Based Compensation (Textual)
Amount of share purchase | $							29,072	$ 30,543
Restricted Stock Award [Member] | Subsequent Event [Member]
Stock-Based Compensation (Textual)
Issuance of shares									15,267
Unvested Stock Options [Member]
Stock-Based Compensation (Textual)
Unrecognized compensation expense | $							221
Aggregate grant date fair value | $							$ 91
Stock Options [Member]
Stock-Based Compensation (Textual)
Options to purchase shares of the Company's Class B common stock					124,435
Unrecognized compensation expense | $					$ 159
Stock, description							The Compensation Committee approved two equity grants of options to purchase an aggregate of 27,493 shares of Class B Stock to 6 non-executive employees. The options vest over a three-year period. Unrecognized compensation expense related to this grant was an aggregate of $33,000 based on the estimated fair value of the options on the grant dates.
Class B common stock [Member]
Stock-Based Compensation (Textual)
Common stock, par value | $ / shares							$ 0.01				$ 0.01
Amount of share purchase | $			$ 2,250
Class B common stock [Member] | Restricted Stock Award [Member]
Stock-Based Compensation (Textual)
Options granted						192,953
Shares purchased							18,441	14,137
Restricted shares	30,534
Deferred Stock Units [Member]
Stock-Based Compensation (Textual)
Options granted				90,000
Unrecognized compensation expense | $							$ 86
2016 Incentive Plan [Member]
Stock-Based Compensation (Textual)
Vesting period	3 years
Unrecognized compensation expense | $	$ 242
Number of employees | Customer	4
Number of consultant | Customer	1
Stock, description	Additionally, on November 7, 2019, Mr. Jonas received 1,411 restricted shares of the Company's Class B common stock to vest in substantially equal amounts on November 7, 2020, 2021 2022.
Vested period, description	The unrecognized compensation expense is being recognized on a straight-line basis over the vesting period.
2016 Incentive Plan [Member] | Class B common stock [Member]
Stock-Based Compensation (Textual)
Options granted							295,000
Options to purchase shares of the Company's Class B common stock	180,996
Number of non-executive employees | Customer					55
Incentive plan, description	The Company’s Board of Directors amended its 2016 Stock Option and Incentive Plan (as amended to date, the “2016 Incentive Plan”) to increase the number of shares of the Company’s Class B common stock available for the grant of awards thereunder by an additional 230,000 shares, to an aggregate of 1,271,000 shares. This amendment was ratified by the Company’s stockholders at the Annual Meeting of Stockholders held on January 13, 2020.

Earnings Per Share (Details)

Earnings Per Share (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2020	Apr. 30, 2019	Apr. 30, 2020	Apr. 30, 2019
Earnings Per Share [Abstract]
Basic weighted-average number of shares	11,979	10,116	10,793	10,063
Effect of dilutive securities:
Stock options
Non-vested restricted Class B common stock
Deferred stock units
Diluted weighted-average number of shares	11,979	10,116	10,793	10,063

Earnings Per Share (Details 1)

Earnings Per Share (Details 1) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2020	Apr. 30, 2019	Apr. 30, 2020	Apr. 30, 2019
Shares excluded from the calculation of diluted earnings per share	1,515	1,494	1,515	1,494
Stock options [Member]
Shares excluded from the calculation of diluted earnings per share	1,326	1,277	1,326	1,277
Non-vested restricted Class B common stock [Member]
Shares excluded from the calculation of diluted earnings per share	120	217	120	217
Deferred stock units [Member]
Shares excluded from the calculation of diluted earnings per share	69		69

Contingencies (Details)

Contingencies (Details) $ in Thousands	Mar. 31, 2014USD ($)
Contingencies (Textual)
Lawsuit approximate amount	$ 1,600

Revolving Credit Facility (Deta

Revolving Credit Facility (Details) - USD ($) $ in Thousands	1 Months Ended			9 Months Ended
	Dec. 31, 2016	Nov. 16, 2016	Sep. 27, 2016	Apr. 30, 2020
Revolving Credit Facility (Textual)
Forward contracts, description				There were $1.4 million of outstanding foreign exchange contracts with less than six months tenor under the credit facility, which reduced the available borrowing under the revolving credit facility by $140,000.
Foreign Exchange Contract [Member]
Revolving Credit Facility (Textual)
Loan and security agreement with western alliance bank for revolving credit facility amount		$ 5,000
Line of credit facility, borrowing capacity, description		The Company to enter into foreign exchange contracts not to exceed $5.0 million in the aggregate at any point in time under its revolving credit facility. This limit was raised to approximately $6.5 million pursuant to the Loan and Security Modification Agreement dated May 30, 2018. The available borrowing under the revolving credit facility is reduced by an applicable foreign exchange reserve percentage as determined by Western Alliance Bank, in its reasonable discretion from time to time, which was initially set at 10% of the nominal amount of the foreign exchange contracts in effect at the relevant time.
Foreign exchange, description	The applicable foreign exchange reserve percentage was changed so that the reduction of available borrowing for major currency forward contracts of less than nine months tenor is set at 10% of the nominal amount of the foreign exchange contracts, and for contracts over six months tenor, 12.5% of the nominal amount of the foreign exchange contracts.
Revolving Credit Facility [Member]
Revolving Credit Facility (Textual)
Loan and security agreement with western alliance bank for revolving credit facility amount			$ 2,500
Line of credit facility, borrowing capacity, description			Advances under this facility may not exceed the lesser of $2.5 million or 80% of the Company's eligible accounts receivable, subject to certain concentration limits.
Interest rate, description			The outstanding principal amount bears interest per annum at the greater of 5.0% or the prime rate plus 1.25%. Interest is payable monthly and all outstanding principal and any accrued and unpaid interest is due on the maturity date of September 26, 2020.
Line of credit maturity date			Sep. 26, 2020
Line of credit facility annual fee			$ 12,500
Available borrowing reduction				$ 140

Investment in Privately-Held _2

Investment in Privately-Held Company (Details) - USD ($) $ in Thousands	3 Months Ended
	Jul. 31, 2019	Aug. 31, 2018
Investment in Privately-Held Company (Textual)
Investments		$ 250
Equity ownership interest		1.00%
Impairment charges	$ 250
Non-marketable equity securities	$ 0

Business Segment and Geograph_3

Business Segment and Geographic Information (Details) - USD ($) $ in Thousands	Apr. 30, 2020	Jul. 31, 2019
Segment Reporting Information [Line Items]
Long-lived assets, net	$ 3,236	$ 3,516
Total assets	10,963	9,007
United States [Member]
Segment Reporting Information [Line Items]
Long-lived assets, net	2,720	3,304
Total assets	7,303	5,508
Foreign [Member]
Segment Reporting Information [Line Items]
Long-lived assets, net	516	212
Total assets	$ 3,660	$ 3,499

Business Segment and Geograph_4

Business Segment and Geographic Information (Details Textual)	9 Months Ended
	Apr. 30, 2020Segment
Business Segment and Geographic Information (Textual)
Number of opertating segment	1

Leases (Details)

Leases (Details) - USD ($) $ in Thousands		3 Months Ended	9 Months Ended
		Apr. 30, 2020	Apr. 30, 2020
Leases [Abstract]
Operating lease cost		$ 53	$ 170
Other lease cost, net	[1]	39	108
Total lease cost		$ 92	$ 278
[1]	Other lease cost, net includes short-term lease costs and variable lease costs, which are immaterial

Leases (Details 1)

Leases (Details 1) $ in Thousands	Apr. 30, 2020USD ($)
Operating leases:
Other assets	$ 327
Accrued expenses and other current liabilities	198
Other liabilities	145
Total operating lease liabilities	$ 343

Leases (Details 2)

Leases (Details 2)	Apr. 30, 2020
Weighted average remaining lease term:
Operating leases	1 year 8 months 2 days
Weighted average discount rate:
Operating leases	5.00%

Leases (Details 3)

Leases (Details 3) $ in Thousands	9 Months Ended
	Apr. 30, 2020USD ($)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used in operating leases	$ 188

Leases (Details 4)

Leases (Details 4) $ in Thousands	Apr. 30, 2020USD ($)
Leases [Abstract]
2020	$ 51
2021	215
2022	92
Total future minimum lease payments	358
Less imputed interest	15
Total	$ 343

Leases (Details Textual)

Leases (Details Textual)	9 Months Ended
	Apr. 30, 2020ft²
Leases (Textual)
Area of land	11,578
Lease expires	Jul. 31, 2021
Lease, description	1) New York to house its commercial operations including sales, accounting and finance, and business development, 2) Vilnius, Lithuania, a satellite development center and 3) Bodo, Norway that meet short-term lease criteria and are not recognized on the Consolidated Balance Sheets.

Loans Payable (Details)

Loans Payable (Details) - USD ($) $ in Thousands	Jul. 16, 2019	Mar. 27, 2020	Apr. 30, 2020	Apr. 22, 2020	Jul. 31, 2019
Loans Payable (Textual)
Loans payable, description		The Congress passed The Coronavirus Aid, Relief, and Economic Security (CARES) Act to provide an estimated $2.2 trillion to fight the COVID-19 pandemic and stimulate the U.S. economy, including $349 billion that was earmarked for the Paycheck Protection Program (PPP) to provide certain small businesses with liquidity to support their operations, to be administered by the Small Business Administration (SBA). An additional $310 billion was later authorized for the PPP.
Fixed interest rate			1.00%
Term interest			2 years
Loan payable	$ 140		$ 218
Installments payments	$ 15,976
Annual percentage interest rate	4.79%
Western Alliance Bank [Member]
Loans Payable (Textual)
Loan received				$ 218

Sales of Class B Common Stock (

Sales of Class B Common Stock (Details) $ / shares in Units, $ in Thousands	1 Months Ended
	Feb. 05, 2020USD ($)$ / sharesshares
Direct offering	1,734,459
Sales of shares	1,657,813
Purchase price per shares | $ / shares	$ 1.28
Shares discount rate	20.00%
Shares issuance cost | $	$ 141,000
Additional purchace of shares	76,646
Additional purchase price of per shares | $ / shares	$ 1.67
Class B Common Stock
Common stock net proceeds amount | $	$ 2,250