Company: DGLY
Filing Date: 2025-05-02
Form Type: 424B3
Source: 0001641172-25-008437
Chunk: 40

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-02
Form: 424B3
Chunk 40
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 $20,690,872 and $28,003,037 for the year ended December 31, 2024 and 2023, respectively, a decrease of $7,312,165 (26%). The decrease was primarily attributable to the reduction in new advertising sponsorships being entered into by the Company offset by the goodwill and intangible asset impairment charge. Our selling, general and administrative expenses as a percentage of sales increased to 105% for the year ended December 31, 2024 compared to 99% in the same period in 2023. The significant components of selling, general and administrative expenses are as follows:

|                                                 |     | Year ended December 31, |       2024 |     |   |       2023 |
|:------------------------------------------------|:----|:------------------------|-----------:|:----|:--|-----------:|
| Research and development expense                |     | $                       |  1,339,673 |     | $ |  2,618,746 |
| Selling, advertising and promotional expense    |     |                         |  2,144,494 |     |   |  7,137,529 |
| General and administrative expense              |     |                         | 12,376,705 |     |   | 18,246,762 |
| Goodwill and intangible asset impairment charge |     |                         |  4,830,000 |     |   |          — |
| Total                                           |     | $                       | 20,690,872 |     | $ | 28,003,037 |

| 23 |

Research and development expense.Our research and development expenses totaled $1,339,673 and $2,618,746 for the year ended December 31, 2024 and 2023, respectively which represents a decrease of $1,279,073 (49%). We have focused on controlling our expenditures on bringing new products to market, including updates and improvements to current products in response to our decline in revenues. The decrease in research and development expense reflects the large cut-back in our engineering staff and research activities in order to right-size our expenses in this area with our revenues.

Selling, advertising and promotional expenses.Selling, advertising and promotional expense totaled $2,144,494 and $7,137,529 for the years ended December 31, 2024 and 2023, respectively, a decrease of $4,993,035 (70%). The decrease in selling, advertising