Company: EVLVW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001805385-25-000009
Chunk: 303

Company: Evolv Technologies Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 8
Chunk 303
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, as well as the initial deployments of our Evolv eXpedite systems, which as a new product offering reflect a higher initial cost to produce that we expect to gradually decline in the future. 

Subscription Revenue

Three Months EndedJune 30,20252024$ Change% Change(Restated)Subscription revenue$20,200 $15,655 $4,545 29 %Cost of subscription revenue$8,894 $6,309 $2,585 41 %Gross profit - Subscription revenue$11,306 $9,346 $1,960 21 %Gross profit margin - Subscription revenue56 %60 %N/A(4)%

The increases in subscription revenue, cost of subscription revenue, and subscription gross profit are primarily due to continued growth in our customer base as of June 30, 2025 compared to the prior year, with a higher number of active Evolv Express systems deployed under our pure subscription model and an increase in short term rental subscription revenue during the three months ended June 30, 2025. Gross profit margin decreased primarily due to an increase of $1.3 million of expense related to disposals of certain first generation Evolv Express systems, partially offset by our ability to leverage our fixed costs over a higher revenue base and lower costs related to our second generation of Evolv Express systems.

9

Service Revenue

Three Months EndedJune 30,20252024$ Change% Change(Restated)Service revenue$6,686 $5,566 $1,120 20 %Cost of service revenue$1,710 $1,147 $563 49 %Gross profit - Service revenue$4,976 $4,419 $557 13 %Gross profit margin - Service revenue74 %79 %N/A(5)%

The increases in service revenue, cost of service revenue, and service gross profit are primarily due to an increased number of active revenue-generating purchase subscription units, as well as active revenue-generating units purchased by customers directly from Columbia Tech under our distributor licensing model, for the three months ended June 30, 2025 compared to the prior year period. The decrease in gross profit margin is primarily due to a $0.2 million expense related to certain accrued service fees and a $0.2 million increase in amortization of capitalized software costs during the three months ended June 30, 2025 due to the