Company: EVLVW
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001805385-25-000017
Chunk: 307

Company: Evolv Technologies Holdings, Inc.
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 8
Chunk 307
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 a higher initial cost to produce that we expect to gradually decline in the future. 

Subscription Revenue

Nine Months EndedSeptember 30,20252024$ Change% ChangeSubscription revenue$62,122 $47,783 $14,339 30 %Cost of subscription revenue$27,713 $19,242 $8,471 44 %Gross profit - Subscription revenue$34,409 $28,541 $5,868 21 %Gross profit margin - Subscription revenue55 %60 %N/A(5)%

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 September 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 nine months ended September 30, 2025. Gross profit margin decreased primarily due to a $3.1 million loss on disposals of certain first generation Evolv Express systems and a $0.6 million estimated field services costs related to the replacement of certain Express system parts during the nine months ended September 30, 2025.

14

Service Revenue

Nine Months EndedSeptember 30,20252024$ Change% ChangeService revenue$21,224 $16,903 $4,321 26 %Cost of service revenue$5,753 $3,749 $2,004 53 %Gross profit - Service revenue$15,471 $13,154 $2,317 18 %Gross profit margin - Service revenue73 %78 %N/A(5)%

The increases in service revenue, cost of service revenue, and gross profit are primarily due to increased maintenance revenue associated with growth in number of active revenue-generating purchase subscription units, as well as active revenue-generating units purchased by customers, for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decrease in gross profit margin is primarily due to an accrual of $0.5 million estimated field services costs related to the replacement of certain Express system parts and increased amortization of capitalized software costs during the nine months ended September 30, 2025 by $0.7 million due to the release of Evolv eXpedite and our second generation of Evolv Express systems.

License