Company: DGLY
Filing Date: 2025-05-02
Form Type: 424B3
Source: 0001641172-25-008437
Chunk: 34

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-02
Form: 424B3
Chunk 34
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 and acceptance of the service or materials by the end customer.                                               |

| 19 |

Our revenue cycle management operating segment sells its services to customers in the following manner:

| ● | Our revenue cycle management                                                                                                              
 operating segment generates service revenues through relationships with medium to large healthcare organizations, in which the underlying 
 service revenue is recognized upon execution of services. Service revenues are generally determined as a percentage of the dollar         
 amount of medical billings collected by the customer.                                                                                     |

Our entertainment operating segment sells our products and services to customers in the following manner:

| ● | Our entertainment operating                                                                                                               
 segment generates product revenues from the sale of tickets directly to consumers for a particular event that the entertainment operating 
 segment has previously purchased and held in inventory for ultimate resale to the end consumer. Service sales through TicketSmarter       
 are driven largely in part to the usage of the TicketSmarter.com marketplace by buyers and sellers, in which the Company collects         
 service fees for each transaction completed through this platform.                                                                        |

We may discount our prices on specific orders based upon the size of the order, the specific customer and the competitive landscape.

Product revenues by operating segment is as follows:

| Product Revenues:        |     | Years ended December 31, 
 2024                     |           |     | 2023 |           |
|:-------------------------|:----|:-------------------------|----------:|:----|:-----|----------:|
| Video Solutions          |     | $                        | 1,997,389 |     | $    | 4,303,369 |
| Revenue Cycle Management |     |                          |         — |     |      |         — |
| Entertainment            |     |                          | 3,406,928 |     |      | 5,044,576 |
| Total Product Revenues   |     | $                        | 5,404,317 |     | $    | 9,347,945 |

Product revenues for the years ended December 31,
2024 and 2023 were $5,404,317 and $9,347,945, respectively, a decrease of $3,943,628 (42.2%), due to the following factors:

| ● | Revenues generated                                                                                                                    
 by the entertainment operating segment began with the Company’s September 2021 acquisition of TicketSmarter. The new entertainment    
 operating segment generated $3,406,928 in product revenues for the year ended December 31, 2024, compared to $5,