NEWS + PRESS

eDIGITAL REPORTS FIRST QUARTER RESULTS

http://edigital.com/edigital-reports-first-quarter-results/

(SAN DIEGO, CA, – August 11, 2016) – e.Digital Corporation (OTCQB: EDIG), a long standing source of innovation and future-defining patented technologies, today announced results for the first quarter of fiscal year 2017, ended June 30, 2016.

Patent monetization update – The Company began enforcing its Nunchi® patents against companies in the connected home security market in fiscal 2015. One royalty-bearing license agreement was executed in the fourth quarter of fiscal 2016 and two new license agreements covering three companies were executed during the first quarter of fiscal 2017. In December 2015, the United States Patent Trial and Appeal Board (PTAB) granted a defendant’s petition for Inter Partes Review (IPR) of the asserted patents. In July 2016, the USPTO granted a joint motion to dismiss the IPR, allowing the remaining cases to move forward. eDigital continues to identify companies that it believes infringe this technology and will continue to vigorously protect its intellectual property.

“The Internet of Things (IoT) is being called the next industrial revolution,” said Fred Falk, president & CEO of eDigital. “Analysts predict that by 2020, there will be 24 billion IoT devices connected to the internet. The connected home market, one segment of the IoT industry, is the space where eDigital and its supporting patents expects to participate. Utilizing our patented intellectual property, we are developing a smart home product that will monitor a household’s water usage, help prevent water damage and reduce homeowner insurance claims by detecting leaks and monitoring water pressure in real-time, assess water quality, and assist homeowners with water conservation efforts. Water damage claims cost homeowners thousands of dollars, and insurance companies billions of dollars every year. Water conservation is a critical issue impacting the environment as nationwide water supplies become increasingly stressed. Water conservation not only saves the consumer money, it benefits the greater community.

“In addition to our smart home product development, we will continue to enforce our patents and we expect to continue to be successful in doing so,” Falk concluded.

First Quarter Fiscal 2017 Financial Summary:
The Company reported net loss of $45,221 or $(0.00) per share, for the first quarter of fiscal 2017 compared to a net loss of $120,275 or $(0.00) per share for the prior year’s first quarter. Revenues were $593,366 for the first quarter of fiscal 2017 compared to revenues of $545,126 for the same period of the prior year. The current period includes patent license revenues of $593,366 as compared to $540,000 for the same period of the prior year. Operating expenses decreased to $638,587 from $665,401 for the prior year’s comparable quarter primarily due to decreased professional fees and decreased noncash stock-based compensation expense.

About e.Digital Corporation: For more than 27 years, e.Digital’s ideas and inventions have impacted the evolution of consumer products. Today, e.Digital innovations, including its Flash-R™ portfolio of flash memory-related patents, and Nunchi® portfolio, are essential to many portable consumer electronic products. For more information about e.Digital, please visit:www.edigital.com.

Safe Harbor statement under the Private Securities Litigation Reform of 1995: This press release includes forward-looking information and statements. Except for historical information contained in this release, statements in this release may constitute forward-looking statements regarding assumptions, projections, expectations, targets, intentions or beliefs about future events that are based on management’s belief, as well as assumptions made by, and information currently available to, management. While the Company believes that expectations are based upon reasonable assumptions, there can be no assurances that goals and strategy will be realized. Numerous factors, including risks and uncertainties, may affect actual results and may cause results to differ materially from those expressed in forward-looking statements made by the Company or on its behalf. Some of these factors include the substantial uncertainties inherent in pursuing patent enforcement activities including, but not limited to the risks and costs of litigation and support activities, the timing and amount of settlements/licenses if any, the acceptance of existing and future products and technologies, the difficulty of commercializing and protecting new technology such as the Company’s Nunchi, microSignet, Synap and other technologies, the impact of competitive products, technologies and pricing, general business and economic conditions, and other factors detailed in the Company’s Annual Report on Form 10-K and other periodic reports filed with the SEC. Except as required by law, the Company specifically disclaims any obligation to update or revise any forward-looking statement whether as a result of new information, future developments or otherwise.

CONTACT: e.Digital Corporation: Investor Relations, (858) 304-3016 ext. 205, ir@edigital.com