Quarterly report pursuant to Section 13 or 15(d)

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

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CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Income Statement [Abstract]        
Revenue $ 6,407,997 $ 13,455,472 $ 11,870,851 $ 20,059,972
Expenses        
Cost of revenues (cost of revenues is exclusive of patent amortization expenses) 4,002,040 5,584,542 12,190,415 8,448,954
Amortization of patents 2,884,269 1,480,311 8,511,730 2,872,638
Compensation and related taxes 903,685 824,165 3,571,817 2,266,283
Consulting fees 643,702 785,601 1,869,326 1,550,155
Professional fees 882,213 408,280 2,230,748 933,751
General and administrative 177,494 166,216 681,951 380,400
Impairment of patent     766,498  
Impairment of goodwill   2,144,488   2,144,488
Total operating expenses 9,493,403 11,393,603 29,822,485 18,596,669
Operating income (loss) (3,085,406) 2,061,869 (17,951,634) 1,463,303
Other income (expenses)        
Other income/(expense) 6,646 (21,063) 14,085 (21,833)
Foreign exchange gain/(loss) (20,090) 256 (57,593) 256
Change in fair value adjustment of Clouding IP earn out 597,047   2,901,348  
Interest income 135 138 137 632
Interest expense (1,078,615)   (3,587,238) (20)
Loss on debt extinguishment (654,000)   (654,000)  
Total other expesnes (1,148,877) (20,669) (1,383,261) (20,965)
Income (Loss) before benefit for income taxes (4,234,283) 2,041,200 (19,334,895) 1,442,338
Income tax benefit 483,815 1,481,404 6,300,159 1,481,404
Net income (loss) (3,750,468) 3,522,604 (13,034,736) 2,923,742
Deemed dividends to related beneficial conversion feature of Series A preferred stock       (1,271,492)
Net income (loss) attributable to common shareholders $ (3,750,468) $ 3,522,604 $ (13,034,736) $ 1,652,250
Earnings (Loss) Per Share, Basic $ (0.26) $ 0.31 $ (0.92) $ 0.15
Earnings (Loss) Per Share, Diluted $ (0.26) $ 0.22 $ (0.92) $ 0.11
Weighted-Average Number of Shares Outstanding - Basic 14,376,118 11,500,500 14,094,891 11,197,374
Weighted Average Number of Shares Outstanding - Diluted 14,376,118 15,966,454 14,094,891 14,926,504
Other comprehensive income (loss), net of tax:        
Foreign currency translation adjustments $ 45,628   $ (584,706)