Hey I was just looking around on DMRC, and I wasn't sure where they make their money? I know the new barcode system when it's sold to large retail stores will be huge. But, I read the latest article where we are getting into magazines: cosmo and food recipes.....etc. I was just curious how they make money off of this? Is it from the magazine publishers.....or how does that get monetized?? Like I said I'm new and barely out of college and trying to learn. I'd appreciate any information you guys would have. Thanks
The short answer is licensing technology. The barcode and magazines are a zero and small potatoes, respectively right now.
You've got to learn how to do DD. I am a lazy somewhat recent post collegiate, but I at least know how to get the basics. Anyway here's some help. First, the annual report breaks revenue into subscription, service, and licensing defining them like so :
Service. Service revenue consists primarily of software development and consulting services. The majority of service revenue arrangements are structured as time and materials consulting agreements, or fixed price consulting agreements. Most of our service revenue is derived from contracts with the Central Banks, IV and government agency contractors. The agreements range from several months to several years in length...
I cut this in half because my post wasn't going through...
Subscription. Subscription revenue includes subscriptions for products and services, is generally recurring, paid in advance and recognized over the term of the subscription.
License. License revenue originates primarily from licensing our technology and patents where we receive fixed license fees and/or royalties as our income stream. The majority of license revenue is derived from contracts with IV, Nielsen, Verance and Civolution. Revenue from our licensed products have minimal associated direct costs, and thus are highly profitable.
There is a major fall off in licensing recently because the IV contract mentioned above went from having to make minimum payments to only having to pay once a certain profit threshold is hit. However, the company is working on a new bundle of patents to be licensed at sometime in the future.
Also, I'd try looking at the most recent investor presentation on their website. I always find those are useful.