e.DIGITAL REPORTS FISCAL YEAR 2013 RESULTS

(SAN DIEGO, CA, – June 27, 2013) – e.Digital Corporation (OTCQB: EDIG), a long standing source of innovation and future-defining patented technologies, today announced results for its fiscal year ended March 31, 2013.

Highlights:
•Continued progress with patent licensing: Since the start of fiscal 2013 the Company has filed a total of twenty-two complaints, settled with seven defendants, won a stipulated judgment against one defendant, and dismissed one.

•Added new patents to portfolio of IP: The USPTO has granted the Company six new patents in the area of context and interpersonal awareness systems technologies creating the foundation of its Nunchi® patent portfolio. The Company filed two patent continuations and one continuation in part, which it expects will further strengthen the portfolio.

•Began marketing new IP: In March, the Company retained IPmetrics Intellectual Property Consulting to manage the valuation and monetization of the Nunchi patent portfolio. IPmetrics is currently marketing the portfolio of patents into various technology sectors.

Management Commentary:
“Fiscal year 2013 brought not only challenge, but also progress,” commented Fred Falk, president and CEO of e.Digital. “Although the Company reported a financial loss for the year, we were successful in getting the much-needed tools in place to allow us to renew our intellectual property monetization efforts. We successfully completed the reexamination by the United States Patent and Trademark Office (USPTO), of one of our key patents, US 5,742,737. With the reexamination completed, we restarted the process of monetizing our Flash-R™ patent portfolio, through a newly retained law firm, Handal & Associates. We have begun to realize Flash-R related licensing revenue and expect more licensing revenues in the future as we progress through the litigation process. Our future success will be determined to some degree by factors out of our control, such as Markman and other court rulings.

“We enjoyed progress in the development of new intellectual property during the year, our Nunchi portfolio,” continued Falk. “As with all emerging technologies, it takes time for industries to embrace a new technology’s role in their market. Just as in the early days of our Flash-R technology, we believe value increases as we develop the portfolio over time.

“Although new sales of our eVU® portable in-flight entertainment device have been stifled by the growing trend of passengers using their own entertainment devices, we did receive small follow on orders from an existing airline customer. Many of the players that we’ve sold over the years are still in use and we continue to provide revenue-generating services, such as repairs and content updates, for those devices.

“Looking to the future, we have begun developing new intellectual property, focusing on technologies in the areas of cloud based privacy, security, user authentication and communications,” concluded Falk.

Fiscal 2013 Financial Summary:
Revenues totaled $442,000 for the fiscal year ended March 31, 2013. Revenues for fiscal year 2013 included $11,000 in licensing fees from the Company’s Flash-R™ patent portfolio and $431,000 in eVU portable in flight entertainment (IFE) sales and services. For the prior year, licensing revenue was $4.1 million and eVU revenues were $627,000. During fiscal 2013 the Company had no new patent license agreements, and in the prior year, licensed eight companies including one outside of litigation. The Company recently announced new patent licenses secured in the first quarter of fiscal 2014 from its expanded enforcement efforts.

Operating costs and expenses for fiscal year 2013 were $1.98 million, decreased from $3.4 million in fiscal year 2012. The decrease is primarily as a result of decreased contingent legal fees due to a lack of patent license settlements in fiscal 2013.

Net loss for fiscal year 2013 was $1.48 million or $(0.01) per diluted share, compared to the net income of $1.2 million or $0.00 per diluted share for fiscal 2012.

About e.Digital Corporation: For more than 20 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, are essential to many portable consumer electronic products. The Company pioneered dedicated portable in-flight entertainment systems and more than 30 airlines have made e.Digital powered products their in-flight entertainment choice. For more information about e.Digital, please visit: www.edigital.com.