FOR IMMEDIATE RELEASE
e.DIGITAL REPORTS FISCAL Q2 2011 FINANCIAL RESULTS
(SAN DIEGO, CA, – November 12, 2010) – e.Digital Corporation (OTC: EDIG), a leading innovator of dedicated portable entertainment systems and patented flash memory-related technology, today reported revenues for fiscal Q2 2011 ended September 30, 2010 totaled $238,000, compared to revenues of $1.5 million for the same period a year ago. Fiscal Q2 2010 revenues included $1.25 million in licensing fees from the Company’s Flash-R™ patent portfolio.
e.Digital’s Flash-R patent portfolio is comprised of fundamental technology related to the use of flash memory in the large and growing portable electronic products market. The Company introduced the first portable recorder with removable flash memory in 1993 and believes its patent portfolio to be essential to many consumer electronics products that utilize flash memory including cell phones, digital cameras, camcorders, PDAs and other popular devices.
e.Digital filed enforcement actions against 19 companies in November 2009 after settling with and licensing seven companies in its first round of cases. To date, three of the 19 companies in the second round have settled and entered into licensing agreements. A Markman hearing has been scheduled for January 28, 2011 in connection with the second round of Flash-R intellectual property (IP) cases.
Gross profit for fiscal Q2 2011 was $89,000 or 37% of revenues, compared to $937,000 or 62% of revenues for the same period a year ago that included $807,000 of margin from patent licensing.
Operating expenses for fiscal Q2 2011 were $361,000, compared to $377,000 in fiscal Q2 2010.
Loss attributable to common stockholders for fiscal Q2 2011 was $272,000 or $(0.00) per share, compared to income attributable to common stockholders of $292,000 or $0.00 per share for the same period last year.
Revenues for the first six months of fiscal 2011 were $750,000, compared to $1.7 million for the same six months in fiscal 2010. The 57% reduction in revenues was due primarily to the decrease in patent license revenue.
Gross profit for the first six months of fiscal 2011 was $264,000 or 35% of revenues, compared to $1.0 million or 69% of revenues for the same period a year ago that included $807,000 of margin from patent licensing.
Operating expenses for the first six months of fiscal 2011 were $886,000, compared to $1.0 million for the first six months of fiscal 2010. The decrease was derived primarily from reduced professional fees associated with the favorable digEcor litigation outcome reported last year.
Loss attributable to common stockholders for the first six months of fiscal 2011 was $653,000 or $(0.00) per share, compared to $320,000 or $(0.00) per share for the same period last year.
Safe Harbor statement under the Private Securities Litigation Reform of 1995: All statements made in this document, other than statements of historical fact, are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act. You should not place undue reliance on these statements. We base these statements on particular assumptions that we have made in light of our industry experience, the stage of product and market development, expected future developments and other factors that we believe are appropriate under the circumstances. These forward-looking statements are based on the then-current expectations, beliefs, assumptions, estimates and forecasts about the businesses of the Company and the industries and markets in which the Company operates. Actual outcomes and results may differ materially from what is expressed or implied by the forward-looking statements. More information about potential factors that could affect the Company can be found in its most recent Form 10-K, Form 10-Q and other reports and statements filed with the Securities and Exchange Commission (“SEC”). e.Digital Corporation disclaims any intent or obligation to update these or any forward-looking statements, except as otherwise specifically stated by it.
CONTACT: e.Digital Corporation: Robert Putnam, (858) 304-3016 ext. 205, rputnam@edigital.com