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Segment Information and Revenue Disaggregation
 3 Months Ended
Mar. 31, 2025
Segment Reporting [Abstract]  
Segment Information and Revenue Disaggregation

Note 14 – Segment Information and Revenue Disaggregation

 

Segment Information

 

Pursuant to ASC 280, the Company’s Chief Executive Officer serves as the Company’s Chief Operating Decision Maker (“CODM”) for the purposes of ASC 280. The CODM concluded that the Company operates two reportable segments. One segment consists of its Singing Machine business and the other segment consists of its SemiCab business. The CODM manages the Company’s operations and business separately for each operating segment and uses net sales and net loss to allocate resources, making operating decisions and evaluating financial performance. The CODM also uses net sales and net loss, along with non-financial inputs and qualitative information, to evaluate the Company’s performance, establish compensation, monitor budget versus actual results, and decide the level of investment in various operating activities and other capital allocation activities.

 

The following table details the revenues, significant expenses and other segment items regularly provided to the CODM:

  

                               
   Three Months Ended March 31, 2025   Three Months Ended March 31, 2024 
   Singing Machine   SemiCab   Total   Singing Machine   SemiCab   Total 
Revenues  $1,870,000   $123,000   $1,993,000   $2,426,000   $        -   $2,426,000 
Less:                              
Adjusted cost of revenues   1,364,000    129,000    1,493,000    1,924,000    -    1,924,000 
Adjusted sales and marketing   764,000    -    764,000    630,000    -    630,000 
Adjusted general and administrative (1)   1,933,000    480,000    2,413,000    2,088,000    -    2,088,000 
Adjusted depreciation and amortization   33,000    15,000    48,000    52,000    -    52,000 
Share based compensation   85,000    -    85,000    19,000    -    19,000 
Change in fair value of warrant liability   6,468,000    -    6,468,000    -    -    - 
Gain on disposal of fixed assets   -    -         -    -    - 
Loss on issuance of warrants   -    -    -    -    -    - 
Interest expense   -    16,000    16,000    28,000    -    28,000 
Other income (expense), net   -    -    -    -    -    - 
Income tax provision   -    -    -    52,000    -    52,000 
                               
Segment net loss  $(8,777,000)  $(517,000)  $(9,294,000)  $(2,367,000)  $-   $(2,367,000)
Total segment assets  $7,515,000   $2,160,000   $9,675,000                

 

(1)Excludes depreciation and amortization, share-based compensation, impairment of goodwill and impairment of a note receivable

 

The following reconciles total segment assets to consolidated total assets as of March 31, 2025:

 

   March 31,   December 31, 
   2025   2024 
Total segment assets  $9,675,000   $17,516,000 
Goodwill   786,000    786,000 
Total Assets  $10,461,000   $18,302,000 

 

The total segment assets of $17,516,000 at December 31, 2024 were comprised of $16,301,000 for the Singing Machine segment and $1,215,000 for the SemiCab segment.

 

 

Algorhythm Holdings, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

March 31, 2025 and 2024 (Unaudited)

 

Revenue Disaggregation

 

The Company disaggregates revenues by product line and major geographic region as most of its revenue is generated by the sales of karaoke products.

 

Revenue by product line is as follows:

  

       
   Three Months Ended 
   March 31, 2025   March 31, 2024 
         
Classic karaoke machines  $742,000   $1,046,000 
Licensed products   14,000    90,000 
Kids youth electronics   67,000    65,000 
Microphones and accessories   783,000    964,000 
Music subscriptions   264,000    261,000 
Logistics   123,000    - 
Total revenue  $1,993,000   $2,426,000 

 

All of the Company’s sales during the three months ended March 31, 2025 and 2024 were in North America. The geographic area of sales is based primarily on where the product was delivered.