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Aware, Inc. Reports Third Quarter 2011 Financial Results
Date:10/25/2011

tandards; our ability to sell services contracts in a manner that is consistent with our business model; our ability to deliver services contract milestones; and our dependence on third party contractors and consultants to deliver certain services contract milestones. Further, there can be no assurance as to the timing of a possible transaction with respect to our patent management operations, whether it will ultimately be structured as a spin-off, sale, or license or whether such a transaction will be completed.

We refer you to the documents Aware files from time to time with the Securities and Exchange Commission, specifically the section titled Risk Factors in our annual report on Form 10-K for the fiscal year ended December 31, 2010 and other reports and filings made with the Securities and Exchange Commission.

Aware and Dr. DSL are trademarks or registered trademarks of Aware, Inc.

Any other trademarks appearing herein are the property of their respective owners.AWARE, INC.CONSOLIDATED STATEMENTS OF OPERATIONS(In thousands, except per share data) (unaudited)Three Months EndedNine Months EndedSeptember 30,September 30, 2011201020112010Revenue:Product sales$4,902$5,026$13,977$13,588Services9714883,1751,043Royalties5496371,5422,107Total revenue6,4226,15118,69416,738Costs and expenses:Cost of product sales7771,2363,0853,112Cost of services 4142061,221352Research and development1,8312,0825,6026,198Selling and marketing1,0451,0293,1553,148General and administrative1,0831,6504,0694,469Total costs and expenses5,1506,20317,13217,279Income (loss) from operations1,272(52)1,562(541)Other income-100-425Interest income12284767Income (loss)  before provision for income taxes1,284761,609(49)Provision for income taxes--21Net income (loss)$1,284$76$1,607($50)Net income (loss) per share – basic  $0.06$0.00$0.08($0.00)Net income (loss) per share – diluted$0.06$0.00$0.08($0.00)Weighted average shares – basic20,599
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