Company: DGLY
Filing Date: 2025-02-06
Form Type: S-1/A
Source: 0001493152-25-005144
Chunk: 52

Company: DIGITAL ALLY, INC.
Filing Date: 2025-02-06
Form: S-1/A
Chunk 52
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 for the three months ended     
 September 30, 2024 and 2023, respectively, a decrease of $34,751 (2%). Our revenue cycle management operating segment provides revenue   
 cycle management solutions and back-office services to healthcare organizations throughout the country. We expect our revenue cycle      
 management segment to continue to present a strong revenue outlook moving forward.                                                       |

Total revenues for the three months ended September 30, 2024 and 2023 were $4,051,711 and $6,337,699, respectively, a decrease of $2,285,988 (36%), due to the reasons noted above.

| 29 |

Cost of Product Revenue

Overall cost of product revenue sold for the three months ended September 30, 2024, and 2023 was $547,562 and $2,587,750, respectively, a decrease of $2,040,188 (79%). Overall cost of goods sold for products as a percentage of product revenues for the three months ended September 30, 2024, and 2023 were 68% and 124%, respectively. Cost of products sold by operating segment is as follows:

| Cost of Product Revenues: |     | For                    
 the three months ended 
 September 30,          
 2024                   |         |     | 2023 |           |
|:--------------------------|:----|:-----------------------|--------:|:----|:-----|----------:|
| Video Solutions           |     | $                      | 157,336 |     | $    |   957,987 |
| Revenue Cycle Management  |     |                        |       — |     |      |         — |
| Entertainment             |     |                        | 390,226 |     |      | 1,629,763 |
| Total Cost of Product     
 Revenues                  |     | $                      | 547,562 |     | $    | 2,587,750 |

The decrease in cost of goods sold for our video solutions segment products was primarily driven by the sale of repair inventory and components as compared to the same period in the prior year. We have been unable to ship backlog due to low inventory levels of finished goods. Cost of product sold as a percentage of product revenues for the video solutions segment decreased to 51% for the three months ended September 30, 2024 as compared to 98% for the three months ended September 30, 2023.

The decrease in entertainment operating segment cost of product