Company: DGLY
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001493152-25-021680
Chunk: 103

Company: DIGITAL ALLY, INC.
Filing Date: 2025-11-12
Form: 10-Q
Item: Part I, Item 1
Chunk 103
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273 for the three months ended September 30, 2025 and 2024, respectively,
a decrease of $6,628,916 (72.7%). The decrease was primarily driven by fewer new advertising sponsorships and reductions in headcount
within selling, general and administrative functions as the Company right-sized operations across all segments. Additionally, the prior-year
period included a goodwill and intangible asset impairment charge that did not recur, further contributing to the year-over-year decrease.
Our selling, general and administrative expenses as a percentage of sales decreased to 55% for the three months ended September 30, 2025
compared to 225% in the same period in 2024. The significant components of selling, general and administrative expenses are as follows:

    For the three months ended 

    September 30, 

    2025  
    2024 
  
    Research and development expense 
    $137,755  
    $210,818 
  
    Selling, advertising and promotional expense 
     110,006  
     414,727 
  
    General and administrative expense 
     2,245,596  
     3,666,728 
  
    Goodwill and intangible asset impairment charge 
     —  
     4,830,000 

    Total 
    $2,493,357  
    $9,122,273 

Research
and development expense. Our research and development expenses totaled $137,755 and $210,818 for the three months ended September
30, 2025 and 2024, respectively which represents a decrease of $73,063 (34.7%). The decrease in research and development expense reflects
a narrower project portfolio and a reallocation of resources toward sustaining engineering and targeted enhancements, including reductions
in engineering headcount and third-party development spend.

Selling,
advertising and promotional expenses. Selling, advertising and promotional expense totaled $110,006 and $414,727 for the three
months ended September 30, 2025 and 2024, respectively, a decrease of $304,721 (73.5%). Selling, advertising, and promotional expenses
decreased due to significant reductions in sales staffing and in promotional and advertising activities, undertaken to right-size these
expenses to current revenue levels. Additionally, the decline reflects fewer new sponsorship agreements at the Company and its subsidiary,
TicketSmarter.

General
and administrative expense. General and administrative expenses totaled