Company: DGLY
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001493152-25-021680
Chunk: 237

Company: DIGITAL ALLY, INC.
Filing Date: 2025-11-12
Form: 10-Q
Item: Part I, Item 8
Chunk 237
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 offering. We expect improved product
    availability to support higher video solutions product sales in the fourth quarter of 2025.

    ●
    Our
    video solutions operating segment management has continued to focus on migrating commercial customers, from a hardware sale to a
    service fee model. Therefore, we expect a reduction in commercial hardware sales (principally DVM-250’s, FLT-250’s, and
    a portion of our body-worn camera line) as we convert these customers to a service model under which we provide the hardware as part
    of a monthly recurring service fee. In that respect, we introduced a monthly subscription agreement plan for our body worn cameras
    and related equipment during the second quarter of 2020 that allowed law enforcement agencies to pay a monthly service fee to obtain
    body worn cameras without incurring a significant upfront capital outlay. This program has gained some traction, resulting in decreased
    product revenues and increasing our service revenues. We expect this program to continue to hold traction, resulting in recurring
    revenues over a span of three to five years.

Service
and other revenues by operating segment is as follows:

    Nine months ended September 30, 

    2025  
    2024 
  
    Service and Other Revenues: 

    Video Solutions 
    $2,987,182  
    $2,851,952 
  
    Revenue Cycle Management 
     4,144,008  
     4,600,745 
  
    Entertainment 
     3,911,068  
     3,167,208 
  
    Total Service and Other Revenues 
    $11,042,258  
    $10,619,905 

Service
and other revenues for the nine months ended September 30, 2025 and 2024 were $11,042,258 and $10,619,905, respectively, an increase
of $422,353 (3.8%), due to the following factors:

    ●
    Cloud
    revenues generated by the video solutions operating segment were $1,903,807 and $1,964,038 for the nine months ended September 30,
    2025 and 2024, respectively, a slight decrease of $60,231 (3.1%). We continue to experience increased interest in our cloud solutions
    for law enforcement primarily due to the deployment of our cloud-based EVO-HD in-car system and our next