Company: EVLVW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001805385-25-000009
Chunk: 389

Company: Evolv Technologies Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 2
Chunk 389
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 geographies or vertical markets. 

Product Revenue

Three Months EndedJune 30,20252024$ Change% Change(Restated)Product revenue$2,528 $1,954 $574 29 %Cost of product revenue$5,351 $2,839 $2,512 88 %Gross loss - Product revenue$(2,823)$(885)$(1,938)(219)%Gross profit margin - Product revenue(112)%(45)%N/A(66)%

The increases in product revenue and cost of product revenue are primarily due to an increased utilization of our purchase subscription model, in which the customers purchase Evolv Express and Evolv eXpedite systems directly from us, for the three months ended June 30, 2025 compared to the prior year period. The decrease in product gross profit margin was due to a $1.4 million increase in inventory reserves on first generation Evolv Express parts during the three months ended June 30, 2025, as well as the initial deployments of our Evolv eXpedite systems, which as a new product offering reflect a higher initial cost to produce that we expect to gradually decline in the future. 

Subscription Revenue

Three Months EndedJune 30,20252024$ Change% Change(Restated)Subscription revenue$20,200 $15,655 $4,545 29 %Cost of subscription revenue$8,894 $6,309 $2,585 41 %Gross profit - Subscription revenue$11,306 $9,346 $1,960 21 %Gross profit margin - Subscription revenue56 %60 %N/A(4)%

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 June 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 three months ended June 30, 2025. Gross profit margin decreased primarily due to an increase of $1.3 million of expense related to disposals of certain first generation Evolv Express systems, partially offset by our ability to leverage our fixed costs over a higher revenue base and lower costs related to our second generation of Evolv Express systems.

9

Service Revenue

Three Months EndedJune 30,20252024$ Change% Change