Company: DGLY
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001641172-25-011765
Chunk: 180

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 8
Chunk 180
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 to right-size our expenses in this area
with our revenues.

Selling, advertising and
promotional expenses. Selling, advertising and promotional expense totaled $108,041 and $761,118 for the three months ended March
31, 2025 and 2024, respectively, a decrease of $653,077 (86%). The decrease in selling, advertising and promotional expenses reflects
the large cut-back in selling staff and promotional and advertising activities in order to right-size our expenses in this area with our
revenues. In addition, the decrease is attributable to the reduction in new sponsorships being entered into by the Company and its subsidiary
TicketSmarter.

General and administrative
expense. General and administrative expenses totaled $2,383,721 and $3,914,149 for the three months ended March 31, 2025 and 2024,
respectively which represents a decrease of $1,530,428 (39%). The decrease in general and administrative expenses in the three months
ended March 31, 2025 compared to the same period in 2024 is primarily attributable to a decrease in administrative salaries and reductions
in headcount in order to right-size our expenses in this area with our revenues. The decrease in general and administrative expenses was
offset by a substantial increase legal and professional expenses for the three months ended March 31, 2025 compared to the same period
in 2024 due to the failed merger with CloverLeaf and various capital raises we have undertaken.

Operating Loss

For the reasons previously stated,
our operating loss was $974,680 and $3,639,034 for the three months ended March 31, 2025 and 2024, respectively, an improvement of $2,664,354
(73%). Operating loss as a percentage of revenues improved to 22% in 2025 as compared to 66% in 2024.

Interest Income

Interest income increased to $31,975
for the three months ended March 31, 2025, from $19,356 in 2024, which reflects our overall increase in our cash and cash equivalent levels
in 2025 compared to 2024 due to funds generated in the February 2025 public equity offering.

Interest Expense

We incurred interest expenses
of $792,273 and $648,567 during the three months ended March 31, 2025 and 2024, respectively. The increase is attributable to the amortization
of debt discounts associated with the