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OPERATING SEGMENTS
 9 Months Ended
Sep. 30, 2025
Segment Reporting [Abstract]  
OPERATING SEGMENTS

NOTE 17. OPERATING SEGMENTS

 

The Company adopted ASU 2023-07 in 2024 and applied the amendment retrospectively to all periods presented in the Company’s condensed consolidated financial statements. Segment financial information is prepared in accordance with GAAP and our significant accounting policies described in Note 1. Resources are allocated and performance is assessed using segment operating income by our Chief Executive Officer, whom we have determined to be our Chief Operating Decision Maker (“CODM”). Our CODM utilizes segment operating income when making decisions about allocating capital and personnel to the segments, predominantly in the annual budget and quarterly forecasting processes. In addition, our CODM uses operating income, including comparison of actual results to budget and forecast, in assessing the performance of each segment and in evaluating product pricing, distribution strategies and marketing investments. Our CODM reviews balance sheet information at a consolidated level. We compute segment operating income based on net sales revenue, less cost of goods sold, SG&A, asset impairment charges and restructuring charges. The SG&A used to compute each segment’s operating income is directly associated with the segment. We do not allocate non-operating income and expense, including interest or income taxes, to operating segments.

 

We operate in three strategic business segments. The Video Solutions Segment encompasses our law, commercial, and shield divisions. This segment includes both service and product revenues through our subscription models offering cloud and warranty solutions, and hardware sales for video and health safety solutions. The Revenue Cycle Management Segment provides working capital and back-office services to a variety of healthcare organizations throughout the country, as a monthly service fee. The Entertainment Segment acts as an intermediary between ticket buyers and sellers within our secondary ticketing platform, ticketsmarter.com, and we also acquire tickets from primary sellers to then sell through various platforms.

 

The Company’s corporate administration activities are reported in the corporate line item. These activities primarily include expense related to certain corporate officers and support staff, certain accounting staff, expense related to the Company’s Board of Directors, stock option expense for options granted to corporate administration employees, certain consulting expenses, investor relations activities, and a portion of the Company’s legal, auditing and professional fee expenses. Corporate identifiable assets primarily consist of cash, invested cash (if any), refundable income taxes (if any), and deferred income taxes.

 

Summarized financial information for the Company’s reportable business segments is provided for the three months ended September 30, 2025, and 2024:

 

   Video Solutions   Entertainment  

Revenue

cycle Management

   Corporate and other   Total 
Three months ended September 30, 2025
                 
   Video Solutions   Entertainment  

Revenue

cycle Management

   Corporate and other   Total 
Net revenues:                         
Product  $229,629   $434,793   $—   $—   $664,422 
Service   1,216,592    1,294,980    1,361,163    —    3,872,735 
Total segment net revenues   1,446,221    1,729,773    1,361,163    —    4,537,157 
Less significant segment expense                         
Cost of Revenue - Product   476,667    428,523    —    —    905,190 
Cost of Revenue – Service and other   298,605    1,111,577    850,210    —    2,260,392 
Research and development expense   137,755    —    —    —    137,755 
Selling, advertising and promotional expense   72,392    34,557    3,057    —    110,006 
General and administrative expense   280,744    781,366    388,460    795,026    2,245,596 
                          
Total segment operating income (loss)  $180,058   $(626,250)  $119,436   $(795,026)   (1,121,782)
                          
Non-operating (expenses) income:                         
Interest income                       17,887 
Interest expense                       (90,697)
Change in fair value of derivative liabilities                       839 
Gain on the extinguishment of liabilities                       13,275 
Gain on extinguishment of debt – related party                       — 
Other non-operating income (loss)                       217,136 
Total non-operating income (loss)                       158,440 
                          
Income before income tax benefit (provision)                      $(963,342)
                          
Depreciation and amortization expense  $36,334   $336,549   $26,756   $—   $399,639 
                          
Total identifiable assets, net of
eliminations		  $11,113,519   $4,538,676   $4,712,364   $4,711,482   $25,076,041 

 

 

   Video Solutions   Entertainment  

Revenue

cycle Management

   Corporate and other   Total 
Three months ended September 30, 2024
                 
   Video Solutions   Entertainment  

Revenue

cycle Management

   Corporate and other   Total 
Net revenues:                         
Product  $306,245   $497,700   $—   $—   $803,945 
Service   890,117    755,857    1,601,792    —    3,247,766 
Total segment net revenues   1,196,362    1,253,557    1,601,792    —   $4,051,711 
Less significant segment expenses:                         
Cost of Revenue - Product   157,336    390,226    —    —    547,562 
Cost of Revenue – Service and other   269,962    935,070    559,143    —    1,764,175 
Research and development expense   210,818    —    —    —    210,818 
Selling, advertising and promotional expense   220,342    187,231    7,154    —    414,727 
Goodwill and intangible asset impairment charge   —    —    4,830,000    —    4,830,000 
General and administrative expense   248,849    1,257,964    290,719    1,691,086    3,666,728 
Total segment operating income (loss)  $(89,055)  $(1,516,934)  $(4,085,224)  $(1,691,086)  $(7,382,299)
                          
Non-operating (expenses) income:                         
Interest income                       13,775 
Interest expense                       (771,846)
Change in fair value of derivative liabilities                       2,530,675 
Other Other income (expense)                       8,920 
Gain on the extinguishment of debt                       9,385 
Loss on extinguishment of debt                       (310,505)
Gain on sale of property, plant and equipment                       431,183 
Total non-operating income (loss)                       1,911,587 
                          
Loss before income tax benefit (provision)                      $(5,470,712)
                          
Depreciation and amortization expense  $133,246   $26,735   $339,265   $—   $499,246 
                          
Total identifiable assets, net of eliminations  $16,876,673   $1,969,225   $6,037,666   $7,379,605   $32,263,169 

 

 

Summarized financial information for the Company’s reportable business segments is provided for the nine months ended September 30, 2025, and 2024:

 

   Video Solutions   Entertainment  

Revenue

cycle Management

   Corporate and other   Total 
Nine months ended September 30, 2025
                 
   Video Solutions   Entertainment  

Revenue

cycle Management

   Corporate and other   Total 
Net revenues:                         
Product  $721,992   $2,880,210   $—   $—   $3,602,202 
Service   2,987,182    3,911,068    4,144,008    —    11,042,258 
Total segment net revenues   3,709,174    6,791,278    4,144,008    —    14,644,460 
Less significant segment expenses:                         
Cost of Revenue - Product   1,125,676    4,357,017    —    —    5,482,693 
Cost of Revenue – Service and other   986,011    3,218,978    2,616,329    —    6,821,318 
Research and development expense   405,983    —    —    —    405,983 
Selling, advertising and promotional expense   276,603    206,049    18,532    —    501,184 
General and administrative expense   740,211    2,507,947    1,268,059    3,108,600    7,624,817 
                          
Total segment operating income (loss)  $174,690   $(3,498,713)  $241,088   $(3,108,600)  $(6,191,535)
                          
Non-operating (expenses) income:                         
Interest income                       95,808 
Interest expense                       (960,250)
Change in fair value of derivative liabilities                       3,373,919 
Gain on the extinguishment of liabilities                       2,243,991 
Gain on extinguishment of debt – related party                       — 
Other non-operating income (loss)                       252,603 
Total non-operating income (loss)                       5,006,071 
                          
Income before income tax benefit (provision)                      $(1,185,464)
                          
Depreciation and amortization expense  $134,617   $1,064,726   $77,117   $—   $1,276,460 
                          
Total identifiable assets, net of eliminations  $11,113,519   $4,538,676   $4,712,364   $4,711,482   $25,076,041 

 

 

   Video Solutions   Entertainment  

Revenue

cycle Management

   Corporate and other   Total 
Nine months ended September 30, 2024
                 
   Video Solutions   Entertainment  

Revenue

cycle Management

   Corporate and other   Total 
Net revenues:                         
Product  $1,648,373   $2,929,019   $—   $—   $4,577,392 
Service   2,851,952    3,167,208    4,600,745    —    10,619,905 
Total segment net revenues   4,500,325    6,096,227    4,600,745    —    15,197,297 
Less significant segment expenses:                         
Cost of Revenue - Product   1,913,356    3,620,853    —    —    5,534,209 
Cost of Revenue – Service and other   964,412    2,325,987    2,868,885    —    6,159,284 
Research and development expense   1,244,060    —    —    —    1,244,060 
Selling, advertising and promotional expense   1,008,653    876,062    17,774    —    1,902,489 
Goodwill and intangible asset impairment charge             4,830,000         4,830,000 
General and administrative expense   1,279,090    (3,260,740)   (839,847)   5,083,070    10,462,747 
                          
Total segment operating income (loss)  $(1,909,246)  $(3,987,415)  $(3,955,761)  $(5,083,070)  $(14,935,492)
                          
Non-operating (expenses) income:                         
Interest income                       63,064 
Interest expense                       (2,505,536)
Change in fair value of derivative liabilities                       2,178,965 
Other Other income (expense)                       66,966 
Gain on the extinguishment of liabilities                       691,730 
Loss on extinguishment of debt                       (379,332)
Gain on sale of intangibles                       5,582 
Gain on sale of property, plant and equipment                       389,522 
Total non-operating income (loss)                       501,961 
                          
Loss before income tax benefit (provision)                      $(14,424,531)
                          
Depreciation and amortization expense  $520,970   $80,164   $977,112   $—   $1,578,246 
                          
Total identifiable assets, net of eliminations  $16,876,673   $1,969,225   $6,037,666   $7,379,605   $32,263,169 

 

The segment net revenues reported above represent sales to external customers. Segment gross profit represents net revenues less cost of revenues. Segment operating income, which is used in management’s evaluation of segment performance, represents net revenues, less cost of revenues, less all operating expenses. Identifiable assets are those assets used by each segment in its operations. Corporate assets primarily consist of cash, property, plant and equipment, accounts receivable, inventories, and other assets.