Company: DGLY
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001493152-25-021680
Chunk: 252

Company: DIGITAL ALLY, INC.
Filing Date: 2025-11-12
Form: 10-Q
Item: Part I, Item 8
Chunk 252
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 require an allocation of the transaction price to each performance obligation
based on the relative standalone selling price (“SSP”).

Revenue
for our video solutions segment is recognized at the time the related performance obligation is satisfied by transferring the control
of the promised service to a customer. Revenue is recognized when control of the service is transferred to the customer, in an amount
that reflects the consideration that we expect to receive in exchange for our services. We generate all our revenue from contracts with
customers.

Revenue
for our revenue cycle management segment is recorded on a net basis, as its primary source of revenue is its end-to-end service fees.
These service fees are reported as revenue monthly, upon completion of our performance obligation to provide the agreed upon services.

Revenue
for our entertainment segment is recorded on a gross or net basis based on management’s assessment of whether we are acting as
a principal or agent in the transaction. The determination is based upon the evaluation of control over the event ticket, including the
right to sell the ticket, prior to its transfer to the ticket buyer.

We
sell our tickets held in inventory, which consists of one performance obligation, being to transfer control of an event ticket to the
buyer upon confirmation of the order. We act as the principal in these transactions as we own the ticket at the time of sale, therefore
we control the ticket prior to transferring to the customer. In these transactions, revenue is recorded on a gross basis based on the
value of the ticket and is recognized when an order is confirmed. Payment is typically due upon delivery of the ticket.

We
also act as an intermediary between buyers and sellers through the online secondary marketplace. Revenues derived from this marketplace
primarily consist of service fees from entertainment operations, and consist of one primary performance obligation, which is facilitating
the transaction between the buyer and seller, being satisfied at the time the order has been confirmed. As we do not control the ticket
prior to the transfer, we act as an agent in these transactions. Revenue is recognized on a net basis, net of the amount due to the seller
when an order is confirmed, the seller is then obligated to deliver the tickets to the buyer per the seller’s listing. Payment
is due at the time of sale.

We
review all significant, unusual, or non-standard shipments of product or delivery of services as a routine part of our accounting and
financial reporting process to determine compliance with these requirements. Extended warranties are offered on selected products, and
when a customer purchases an extended warranty