Core Viewpoint - Interlink Electronics, Inc. has engaged Gateway Group to enhance its investor relations program, aiming to improve visibility and communication with the investment community [1][2][3] Company Overview - Interlink Electronics is a leading provider of sensor and printed electronic solutions, with nearly 40 years of experience in delivering technologies across various markets including industrial, medical, consumer, and automotive [5] Investor Relations Strategy - Gateway Group will collaborate with Interlink's management to implement a comprehensive outreach strategy, focusing on refining corporate messaging, providing strategic advisory services, and facilitating introductions to key stakeholders [2][3] - Interlink will participate in the 37th Annual ROTH Conference from March 16-18, 2025, which is a significant platform for small-cap investors [3] Leadership Engagement - Steven N. Bronson, Chairman, President, and CEO of Interlink, will be available for one-on-one meetings with institutional investors during the ROTH Conference on March 17-18, 2025 [4]

Group 1: Market Overview - The crypto market is experiencing a bullish sentiment, with expectations for significant growth in 2025, driven by new spot ETFs, political support, and Bitcoin reaching an all-time high above $100,000 in 2024 [1][2][14] - Solana and Chainlink are identified as two cryptocurrencies with high potential for value increase in this favorable environment [2] Group 2: Solana - Solana is positioned to become the dominant Layer-1 blockchain in the upcoming bull market, potentially surpassing Ethereum, which has historically led in this space [3][4] - The Solana ecosystem is thriving, with increased user growth, transaction activity, and a surge in decentralized exchanges and blockchain wallets [5] - The launch of a Trump meme coin on Solana indicates its rising popularity and relevance in the crypto landscape [4] Group 3: Chainlink - Chainlink is expected to benefit from the pro-crypto agenda of the Trump administration and growing institutional adoption of blockchain technology [6] - Chainlink previously experienced significant price growth during the last bull market, rising from $5 to $50 in under a year due to DeFi excitement [7] - A resurgence of DeFi is anticipated in 2025, with Chainlink already up 30% and nearing the top 10 cryptocurrencies by market cap [8] Group 4: AI Cryptos - While AI cryptos are a trending topic, most are currently underperforming, with examples like Virtuals Protocol down 32% this year [10] - There is potential for mid- or low-cap AI cryptos to gain attention, particularly those around a $1 billion market cap [11] - Ai16z is highlighted as a potential breakout AI crypto with a current market cap of $1 billion [12] Group 5: Investment Considerations - Between Solana and Chainlink, Solana is favored due to the potential for an incoming spot ETF, which could attract significant new investment [13] - The current pro-crypto optimism may fluctuate, but 2025 is anticipated to be a pivotal year for the crypto industry, suggesting a strategic time for investment [14]

Core Insights - Interlink Electronics, Inc. has been awarded a $150,000 SBIR Phase 1 grant from NASA for the development of integrated systems and predictive models aimed at early identification of air quality sources [1][3] - The importance of assessing outdoor air quality is increasing due to climate change and other factors, which is becoming a priority for governments worldwide [2] - The company aims to create low-power, low-cost, and widely deployable outdoor air quality (OAQ) nodes that will provide reliable data for NASA's Remote Sensing Network [3] Company Overview - Interlink Electronics is a leading provider of sensors and printed electronic solutions with 40 years of experience in delivering technologies across various markets [4] - The company's product portfolio includes gas sensors, HMI devices, and IoT solutions, serving industries such as industrial, medical, automotive, consumer, wearables, and IoT [4] - Interlink's expertise in materials science, manufacturing, and embedded electronics allows it to deliver high-quality, cost-effective custom solutions tailored to customer needs [4]

Core Insights - Interlink Electronics, Inc. has introduced a new electrochemical gas sensor, the 140-101 "4-series" Carbon Monoxide (CO) sensor, which enhances its existing product line and offers a competitive alternative in the market [1][3] - The new sensor is designed for various applications, including indoor CO monitoring, early wildfire detection, and health and wellness [1] - The company will showcase these sensors at the Consumer Electronics Show (CES) in Las Vegas from January 7 to 10, 2025, providing a platform for networking and showcasing advancements in the electronics industry [2] Company Overview - Interlink Electronics is a leading provider of sensors and printed electronic solutions, with 40 years of experience in delivering technologies across diverse markets [4] - The company's product portfolio includes force, piezo-electric, rugged HMI, wearable sensors, gas sensors, and systems, serving industries such as industrial, medical, automotive, consumer, wearables, and IoT [4] - Interlink's expertise in materials science, manufacturing, embedded electronics, firmware, and software enables the creation of high-quality, cost-effective custom solutions tailored to customer needs [4]

Core Insights - Interlink Electronics, Inc. has introduced a new family of electrochemical gas sensors capable of detecting TBM (Tert-Butyl Mercaptan) and THT (Tetra-Hydrothiophene), which are added to natural gas to provide a detectable odor for safety purposes [1][3] - The sensors will be showcased at the Consumer Electronics Show (CES) in Las Vegas from January 7 to 10, 2025, highlighting the company's commitment to innovation in the electronics domain [2] - The new sensors maintain high performance, small size, and cost competitiveness, making them attractive to commercial and domestic users, as well as gas utilities and producers [3] Company Overview - Interlink Electronics is a leading provider of sensors and printed electronic solutions with 40 years of experience in delivering technologies across various markets, including industrial, medical, automotive, consumer, wearables, and IoT [4] - The company's product portfolio includes force, piezo-electric, rugged HMI, wearable sensors, gas sensors, instruments, and systems, showcasing its technical expertise in materials science and manufacturing [4]

Core Insights - Interlink Electronics, Inc. has announced the acquisition of UK-based Conductive Transfers Limited (CT) and its affiliate Global Print Solutions Limited (GPS), enhancing its capabilities in sensor and printed electronics solutions [1][2] Company Overview - Interlink Electronics is a leading provider of sensor and printed electronic solutions with nearly 40 years of experience, serving diverse markets including industrial, medical, consumer, and automotive [4] - The company specializes in materials science, manufacturing, embedded electronics, firmware, and software, allowing for the creation of custom solutions tailored to customer needs [4] Acquisition Details - The acquisition includes valuable printing equipment and patented processes for integrating electronics with textiles, leading to functional e-textiles and wearable technology [2] - CT and GPS have a successful track record with award-winning technologies, providing products such as heaters for clothing and personal protective equipment, as well as electrodes for stroke rehabilitation [2] - Current product development includes sensors for pressure, temperature, humidity, and moisture, applicable in various sectors like healthcare and automotive [2] Strategic Fit - The acquisition aligns with Interlink's strategy to enhance its offerings in the high-growth market of wearables and smart textiles [4] - Paul Brook, co-founder of CT and GPS, expressed excitement about joining Interlink, highlighting the potential for expanding their customer base globally [3]

Company Overview - Interlink Electronics, Inc. is a leading provider of sensor and printed electronics solutions, focusing on applications such as Human-Machine Interface (HMI) devices and Internet-of-Things (IoT) solutions [5] - The company has a strong track record in various markets, including medical devices, automotive, gas detection, environmental quality monitoring, oil and gas, and consumer electronics [5] - Interlink's product offerings include patented Force Sensing Resistor® technology, piezoelectric film sensors, and advanced matrix sensor solutions [5] Recent Developments - Declan Flannery, Vice President of Strategic Alliances at Interlink, will present at the Printed Electronics Forum during the electronica 2024 event in Munich, Germany [1][2] - The presentation will focus on Printed piezoelectric sensing solutions for automotive applications, scheduled for November 14, 2024 [3] - The forum aims to provide technical background and updates on flexible and printed electronics, particularly for automotive applications [2] Technology and Applications - Interlink's piezoelectric film sensors are thin, lightweight, and flexible, suitable for dynamic strain gauges, vibration sensors, and solid-state switches [3] - These sensors generate information-rich signals that can be integrated with advanced machine learning and AI, enhancing their application in the automotive industry [3] - The company emphasizes the unique characteristics of its sensors, which can address demanding sensing challenges in various applications [3]

Core Insights - Interlink Electronics, Inc. is participating in Electronica 2024, a major trade fair for the electronics industry, taking place in Munich, Germany from November 12-15, 2024, expecting around 70,000 visitors [1][2] Company Overview - Interlink Electronics is a leading provider of sensors and printed electronic solutions, focusing on Human-Machine Interface (HMI) devices and Internet-of-Things (IoT) solutions, leveraging expertise in materials science, manufacturing, firmware, and software [2][3] - The company has a strong track record in various markets, including medical devices, automotive, gas detection, environmental quality monitoring, oil and gas, and consumer electronics, offering both standard and custom-designed sensors [2] Product Focus - The company specializes in three main fields: - Patented Force Sensing Resistor® technology for pressure and position sensing, piezoelectric film sensors for strain and vibration sensing, and advanced matrix sensor solutions for multiple touch capabilities [3] - Gas and Environmental Sensors division, which has over 25 years of experience in electrochemical gas-sensing technology, providing solutions for detecting gases like carbon monoxide and ozone, and air quality monitoring [4] - Calman Technology subsidiary, which has over 30 years of experience in membrane keypads and printed electronics, serving customers in medical devices and defense technologies [5] Global Presence - The company operates from its headquarters in Irvine, California, with additional facilities in Camarillo, California, Shenzhen, China, and Irvine, Scotland, as well as a gas sensor production facility in Silicon Valley [6]

Exhibit 99.1 Interlink Electronics Reports Third Quarter 2024 Results IRVINE, Calif., Nov. 7, 2024 /PRNewswire/ – Interlink Electronics, Inc. (Nasdaq: LINK), a world-leading provider of sensors and printed electronic solutions that support a wide range of applications including Human-Machine Interface devices and Internet-ofThings solutions, today announced its financial results for the three- and nine-month periods ended September 30, 2024. Revenue for the quarter was approximately $2.7 million, down 13% f ...

PART I -- FINANCIAL INFORMATION This section presents the unaudited condensed consolidated financial statements and management's discussion and analysis of financial condition and results of operations [Item 1. Financial Statements (unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, comprehensive income (loss), stockholders' equity, and cash flows, along with detailed notes explaining significant accounting policies, financial statement components, acquisitions, earnings per share, stockholders' equity changes, customer and geographic concentrations, related party transactions, income taxes, and commitments and contingencies [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This statement provides a snapshot of the company's financial position, detailing assets, liabilities, and stockholders' equity at specific points in time Balance Sheets (in thousands) | ASSETS (in thousands) | September 30, 2024 | December 31, 2023 | | :-------------------- | :----------------- | :---------------- | | Cash and cash equivalents | $3,810 | $4,304 | | Accounts receivable, net | $1,174 | $2,167 | | Inventories | $2,494 | $2,476 | | Total current assets | $7,721 | $9,328 | | Total assets | $14,121 | $15,062 | | LIABILITIES AND STOCKHOLDERS' EQUITY (in thousands) | September 30, 2024 | December 31, 2023 | | :------------------------------------------------ | :----------------- | :---------------- | | Total current liabilities | $1,254 | $1,375 | | Total long-term liabilities | $1,401 | $659 | | Total liabilities | $2,655 | $2,034 | | Total stockholders' equity | $11,466 | $13,028 | | Total liabilities and stockholders' equity | $14,121 | $15,062 | - **Total assets decreased from** **$15,062 thousand** at December 31, 2023, to **$14,121 thousand** at September 30, 2024. **Total stockholders' equity also decreased from** **$13,028 thousand** to **$11,466 thousand** during the same period[5](index=5&type=chunk) [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This statement reports the company's revenues, expenses, and net income or loss over specific periods Statements of Operations (in thousands, except per share data) | (in thousands, except per share data) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------------------------------ | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Revenue, net | $2,671 | $3,075 | $8,693 | $10,402 |\n| Gross profit | $1,105 | $1,459 | $3,663 | $5,107 |\n| Income (loss) from operations | $(476) | $(92) | $(1,540) | $141 |\n| Net income (loss) | $(523) | $(125) | $(1,571) | $65 |\n| Earnings (loss) per common share – basic and diluted | $(0.06) | $(0.02) | $(0.19) | $(0.02) | - For the three months ended September 30, 2024, **net revenue decreased by** **13.1%** to **$2,671 thousand** from **$3,075 thousand** in the prior year. **Net loss increased significantly to** **$(523) thousand** from **$(125) thousand** YoY. For the nine months ended September 30, 2024, **net revenue decreased by** **16.4%** to **$8,693 thousand** from **$10,402 thousand** in the prior year, **resulting in a net loss of** **$(1,571) thousand** **compared to a net income of** **$65 thousand** in the prior year[6](index=6&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This statement presents net income or loss alongside other comprehensive income or loss items, such as foreign currency translation adjustments Comprehensive Income (Loss) (in thousands) | (in thousands) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Net income (loss) | $(523) | $(125) | $(1,571) | $65 |\n| Foreign currency translation adjustments | $398 | $(194) | $282 | $1 |\n| Comprehensive income (loss) | $(125) | $(319) | $(1,289) | $66 | - **Comprehensive loss for the three months ended September 30, 2024, was** **$(125) thousand**, **an improvement from** **$(319) thousand** in the prior year, **primarily due to positive foreign currency translation adjustments**. **For the nine months, comprehensive loss was** **$(1,289) thousand**, **compared to comprehensive income of** **$66 thousand** in the prior year[7](index=7&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) This statement details changes in the equity section of the balance sheet, including net income, dividends, and stock-based compensation Stockholders' Equity (in thousands) | (in thousands) | Balance at Dec 31, 2023 | Net (loss) | Stock-based compensation expense | Preferred stock dividends | Foreign currency translation adjustment | Balance at Sep 30, 2024 | | :------------- | :---------------------- | :--------- | :------------------------------- | :------------------------ | :-------------------------------------- | :---------------------- | | Total Stockholders' Equity | $13,028 | $(1,571) | $27 | $(300) | $282 | $11,466 | - **Total stockholders' equity decreased from** **$13,028 thousand** at December 31, 2023, to **$11,466 thousand** at September 30, 2024, **primarily due to a net loss of** **$(1,571) thousand** **and preferred stock dividends of** **$(300) thousand**, **partially offset by positive foreign currency translation adjustments of** **$282 thousand**[9](index=9&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This statement categorizes cash inflows and outflows into operating, investing, and financing activities over specific periods Cash Flows (in thousands) | (in thousands) | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------- | :----------------------------- | :----------------------------- | | Net cash provided by (used in) operating activities | $(144) | $155 |\n| Net cash (used in) investing activities | $(107) | $(4,322) |\n| Net cash (used in) financing activities | $(300) | $(650) |\n| Net (decrease) in cash and cash equivalents | $(494) | $(4,884) |\n| Cash and cash equivalents, end of period | $3,810 | $5,207 | - For the nine months ended September 30, 2024, **the company used** **$144 thousand** **in operating activities, a shift from** **$155 thousand** **provided in the prior year**. **Investing activities used** significantly less cash at **$(107) thousand** compared to **$(4,322) thousand** in the prior year, **mainly due to the absence of a major acquisition**. **Financing activities used** **$(300) thousand**, **primarily for preferred stock dividends**[11](index=11&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide essential details and explanations for the figures presented in the primary financial statements [Note 1 – The Company and its Significant Accounting Policies](index=9&type=section&id=Note%201%20%E2%80%93%20The%20Company%20and%20its%20Significant%20Accounting%20Policies) This note describes the company's business operations and outlines the key accounting policies used in preparing the financial statements - **Interlink Electronics, Inc. operates in two principal sensor technology divisions**: force/touch sensors and gas and environmental sensors. **The company designs, develops, manufactures, and sells proprietary force-sensing and gas-sensing technologies**, including HMI platforms for consumer electronics, automotive, industrial, and medical markets, and electrochemical gas-sensing technology for industry, community, health, and home settings[13](index=13&type=chunk) - **On March 1, 2024, the Board of Directors declared a** **50%** **common stock dividend, increasing outstanding shares from** **6,573,570** **to** **9,860,368**. **All common stock and per share information in the report has been retroactively adjusted to reflect this stock split**[15](index=15&type=chunk) - **The company recognizes revenue when customers obtain control of promised goods or services**, **typically upon shipment when title and risk of loss transfer**. **Reserves are established for potential customer returns or warranty repairs based on historical experience**[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - **Engineering, research and development (R&D) costs are expensed as incurred**, **primarily consisting of compensation for R&D employees, depreciation, amortization, and overhead**[24](index=24&type=chunk) - **The company operates in one reportable segment**: the manufacture and sale of force/touch sensors and gas sensors[33](index=33&type=chunk) [Note 2 – Details of Certain Financial Statement Components](index=15&type=section&id=Note%202%20%E2%80%93%20Details%20of%20Certain%20Financial%20Statement%20Components) This note provides a breakdown of specific asset and liability accounts, offering more granular financial information Inventories (in thousands) | Inventories (in thousands) | September 30, 2024 | December 31, 2023 | | :------------------------- | :----------------- | :---------------- |\n| Raw materials | $1,923 | $1,986 |\n| Work-in-process | $262 | $232 |\n| Finished goods | $309 | $258 |\n| Total inventories | $2,494 | $2,476 | Property, Plant and Equipment, Net (in thousands) | Property, plant and equipment, net (in thousands) | September 30, 2024 | December 31, 2023 | | :------------------------------------------------ | :----------------- | :---------------- |\n| Furniture, machinery and equipment | $2,694 | $2,009 |\n| Leasehold improvements | $451 | $412 |\n| Less: accumulated depreciation | $(2,831) | $(2,108) |\n| Total property, plant and equipment, net | $314 | $313 | Intangible Assets, Net (in thousands) | Intangible assets, net (in thousands) | September 30, 2024 | December 31, 2023 | | :------------------------------------ | :----------------- | :---------------- |\n| Patents, tradenames, and trademarks | $945 | $935 |\n| Developed technology | $562 | $543 |\n| Customer relationships | $1,512 | $1,449 |\n| Non-compete agreements | $973 | $930 |\n| Order backlog | $22 | $22 |\n| In-process research and development | $29 | $29 |\n| Less: accumulated amortization | $(1,868) | $(1,254) |\n| Total intangible assets, net | $2,175 | $2,654 | - **Goodwill increased from** **$2,461 thousand** at January 1, 2024, to **$2,565 thousand** at September 30, 2024, **primarily due to foreign currency exchange rate changes**[48](index=48&type=chunk) [Note 3 – Acquisition of Calman Technology Limited](index=17&type=section&id=Note%203%20%E2%80%93%20Acquisition%20of%20Calman%20Technology%20Limited) This note details the acquisition of Calman Technology Limited, including the purchase price and the fair value of assets acquired - **On March 17, 2023, Interlink acquired Calman Technology Limited for approximately** GB£4,127,000 (approximately **$4,912,000**), a Scotland-based designer and manufacturer of membrane keypads, graphic overlays, and printed electronics[50](index=50&type=chunk) Net Assets Acquired (in thousands) | Net assets acquired (in thousands) | Amount | | :--------------------------------- | :----- |\n| Cash | $1,577 |\n| Accounts receivable | $656 |\n| Inventories | $622 |\n| Property, plant, and equipment | $146 |\n| Developed technology | $381 |\n| Tradenames and trademarks | $214 |\n| Customer relationships | $1,260 |\n| Non-compete agreements | $843 |\n| Goodwill | $2,064 |\n| Net assets acquired | $6,450 | - **The acquisition resulted in** **$2,064 thousand** **in goodwill, primarily attributed to expected synergies and Calman's assembled workforce, which is not expected to be tax-deductible**[52](index=52&type=chunk) [Note 4 – Earnings Per Share](index=18&type=section&id=Note%204%20%E2%80%93%20Earnings%20Per%20Share) This note explains the calculation of basic and diluted earnings per share, including adjustments for stock dividends and anti-dilutive securities - **Basic and diluted earnings per share calculations retroactively reflect the** **50%** **common stock dividend declared on March 1, 2024, as if it occurred at the beginning of the earliest period presented**[56](index=56&type=chunk) - **200,000** **shares of Series A Convertible Preferred Stock (convertible into** **600,000** **common shares) and** **31,250** **restricted stock units were excluded from diluted EPS calculations for 2024 periods because their conversion or effect would be anti-dilutive due to net losses or a higher conversion price than the market price**[57](index=57&type=chunk) [Note 5 – Stockholders' Equity](index=19&type=section&id=Note%205%20%E2%80%93%20Stockholders'%20Equity) This note provides further details on changes in stockholders' equity, including stock-based compensation and share repurchase programs - **In May 2024, the company granted** **31,250** **restricted stock units to certain employees with a weighted-average grant-date fair value of** **$4.35** per share. **As of September 30, 2024, there was approximately** **$124,000** **of unrecognized compensation cost related to these units, expected to be recognized over** **4.3** years[59](index=59&type=chunk) - **The company did not repurchase any shares during the three and nine months ended September 30, 2024**. **A stock repurchase program approved in May 2023 to repurchase up to** **100,000** **shares expired in May 2024**[61](index=61&type=chunk) [Note 6 – Significant Customers, Concentrations of Credit Risk, and Geographic Information](index=19&type=section&id=Note%206%20%E2%80%93%20Significant%20Customers,%20Concentrations%20of%20Credit%20Risk,%20and%20Geographic%20Information) This note identifies major customers, assesses credit risk concentrations, and breaks down revenues by geographic region Net Revenues from Significant Customers | Net revenues from customers ≥ 10% of total net revenues | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------------------------------------------------ | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- |\n| Customer A | * % (<10%) | 11 % | 14 % | 22 % |\n| Customer B | 10 % | 19 % | 13 % | 11 % |\n| Customer C | * % (<10%) | 11 % | * % (<10%) | * % (<10%) | Net Revenues by Geographic Area (in thousands) | Net revenues by geographic area (in thousands) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :--------------------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- |\n| United States | $1,056 | $1,257 | $3,904 | $5,357 |\n| Asia and Middle East | $775 | $816 | $1,982 | $2,770 |\n| Europe and other | $840 | $1,002 | $2,807 | $2,275 |\n| Revenue, net | $2,671 | $3,075 | $8,693 | $10,402 | - **At September 30, 2024, two customers accounted for** **17%** and **13%** of total accounts receivable, while at December 31, 2023, two customers **accounted for** **35%** and **16%**. **The allowance for credit losses remained** **$0** **at both dates**[64](index=64&type=chunk) [Note 7 – Related Party Transactions](index=21&type=section&id=Note%207%20%E2%80%93%20Related%20Party%20Transactions) This note discloses transactions and balances with entities controlled by key management personnel, ensuring transparency - **The company has facilities and consulting agreements with Qualstar Corporation and BKF Capital Group, Inc., both related parties controlled by Steven N. Bronson (Chairman, President, and CEO of Interlink)**. **These agreements involve sharing office facilities and providing operational, sales, marketing, and administrative services**[67](index=67&type=chunk)[71](index=71&type=chunk) Transactions with Qualstar (in thousands) | Transactions with Qualstar (in thousands) | Due from Qualstar (Sep 30, 2024) | Due to Qualstar (Sep 30, 2024) | | :---------------------------------------- | :------------------------------- | :----------------------------- |\n| Balance at September 30, | $26 | $29 | Transactions with BKF Capital (in thousands) | Transactions with BKF Capital (in thousands) | Due from BKF Capital (Sep 30, 2024) | Due to BKF Capital (Sep 30, 2024) | | :------------------------------------------- | :---------------------------------- | :-------------------------------- |\n| Balance at September 30, | $0 | $0 | [Note 8 – Income Taxes](index=22&type=section&id=Note%208%20%E2%80%93%20Income%20Taxes) This note details the company's income tax expense, effective tax rate, deferred tax assets and liabilities, and valuation allowances - **Income tax expense as a percentage of pre-tax income/loss was** **5.7%** for the three months ended September 30, 2024 (vs. **89.4%** in 2023) and **4.0%** for the nine months ended September 30, 2024 (vs. **78.0%** in 2023). **The effective tax rate varies from the U.S. statutory rate of** **21%** **due to the mix of domestic and foreign pre-tax earnings/losses and the valuation allowance on domestic Net Operating Losses (NOLs)**[74](index=74&type=chunk) - **A valuation allowance on federal and state deferred tax assets was deemed necessary at September 30, 2024, and December 31, 2023, due to uncertainties in generating sufficient future taxable income to utilize existing deferred tax assets**. **No valuation allowance was necessary for foreign deferred tax assets**[76](index=76&type=chunk) - **Of the** **$3.8 million** **cash at September 30, 2024,** **$2.5 million** **was held by foreign subsidiaries**. **These funds can be repatriated without significant tax effects through methods like intercompany loan repayments or distributions of previously taxed income**[78](index=78&type=chunk) [Note 9 – Commitments and Contingencies](index=23&type=section&id=Note%209%20%E2%80%93%20Commitments%20and%20Contingencies) This note outlines the company's lease obligations, legal proceedings, and other potential future liabilities - **The company leases facilities under non-cancellable operating leases expiring through fiscal 2029**. **The weighted average incremental borrowing rate used for ROU assets and lease liabilities was** **9.5%** for the nine months ended September 30, 2024 (vs. **5.5%** in 2023)[79](index=79&type=chunk)[80](index=80&type=chunk) Lease Liabilities (in thousands) | Lease Liabilities (in thousands) | September 30, 2024 | December 31, 2023 | | :------------------------------- | :----------------- | :---------------- |\n| Current lease liabilities | $351 | $126 |\n| Long-term lease liabilities | $870 | $33 |\n| Right-of-use assets | $1,155 | $143 | - **Operating lease costs for the nine months ended September 30, 2024, totaled approximately** **$466,000**, with **$241,000** **in cost of revenue and** **$225,000** **in operating expenses**[90](index=90&type=chunk) - **The company is not party to any legal proceedings as of September 30, 2024**. **Warranty reserves are established for future product warranty costs, which have historically not been material**[92](index=92&type=chunk)[94](index=94&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations, highlighting key business activities, product offerings, and strategic initiatives. It includes a detailed comparison of financial performance for the three and nine months ended September 30, 2024, versus 2023, covering revenue, gross profit, operating expenses, and net income/loss. The discussion also addresses critical accounting policies, liquidity, capital resources, and cash flow analysis [Overview](index=26&type=section&id=Overview) This overview summarizes the company's business, including its sensor technology divisions, global customer base, and strategic investments in technology platforms - **Interlink Electronics, Inc. is a global sensor and printed electronics company with two main divisions**: force/touch sensors (including FSR® technology, membrane keypads, graphic overlays) and gas and environmental sensors (acquired through SPEC/KWJ)[102](index=102&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk) - **The company serves a diverse global customer base, including Fortune Global 500 companies, across consumer electronics, automotive, industrial automation, medical, defense, and environmental monitoring markets**. **Manufacturing occurs in Shenzhen, China; Silicon Valley, California; and Irvine, Scotland**[105](index=105&type=chunk)[106](index=106&type=chunk) - **Interlink has invested in expanding its technology platforms through internal development and strategic acquisitions, establishing a Global Product Development and Materials Science Center in Camarillo, California, and advanced facilities in Silicon Valley and Scotland**[107](index=107&type=chunk) [Critical Accounting Policies and Estimates](index=28&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section confirms that there have been no material changes to the critical accounting policies and estimates previously disclosed - **There have been no material changes to the critical accounting policies and estimates described in the Annual Report on Form 10-K filed on March 25, 2024**[109](index=109&type=chunk) [Recently Issued and Adopted Accounting Pronouncements](index=28&type=section&id=Recently%20Issued%20and%20Adopted%20Accounting%20Pronouncements) This section states that recently issued accounting pronouncements are not expected to materially impact the financial statements - **All recently issued accounting pronouncements were reviewed and concluded to be either not applicable or not expected to be material to the financial statements**[110](index=110&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance, comparing revenues, gross profit, and operating expenses for the reported periods [Comparison of Three Months Ended September 30, 2024 and 2023](index=29&type=section&id=Comparison%20of%20Three%20Months%20Ended%20September%2030,%202024%20and%202023) This comparison highlights the financial performance for the three months ended September 30, 2024, versus the prior year Three Months Ended September 30, 2024 and 2023 (in thousands, except percentages) | (in thousands, except percentages) | Three Months Ended Sep 30, 2024 | % of Revenue | Three Months Ended Sep 30, 2023 | % of Revenue | Change | % Change | | :--------------------------------- | :------------------------------ | :----------- | :------------------------------ | :----------- | :----- | :------- |\n| Revenue, net | $2,671 | 100.0% | $3,075 | 100.0% | $(404) | (13.1)% |\n| Cost of revenue | $1,566 | 58.6% | $1,616 | 52.6% | $(50) | (3.1)% |\n| Gross profit | $1,105 | 41.4% | $1,459 | 47.4% | $(354) | (24.3)% |\n| Engineering, research and development | $486 | 18.2% | $588 | 19.1% | $(102) | (17.3)% |\n| Selling, general and administrative | $1,095 | 41.0% | $963 | 31.3% | $132 | 13.7% |\n| Income (loss) from operations | $(476) | (17.8)% | $(92) | (3.0)% | $(384) | (417.4)% |\n| Net income (loss) | $(523) | (19.6)% | $(125) | (4.1)% | $(398) | (318.4)% | - **Revenue decreased by** **13.1%** **YoY, primarily due to lower demand from larger force-sensor customers in medical and industrial markets and delays in fulfilling orders from a large membrane printed electronics customer**[114](index=114&type=chunk)[115](index=115&type=chunk) - **Gross profit and gross margin percentage declined due to lower revenues and changes in product and customer mix**. **Selling, general and administrative expenses increased by** **13.7%** **due to higher intangible asset amortization from the Calman acquisition, partially offset by lower compensation and professional services expenses**[116](index=116&type=chunk)[118](index=118&type=chunk) [Comparison of Nine Months Ended September 30, 2024 and 2023](index=31&type=section&id=Comparison%20of%20Nine%20Months%20Ended%20September%2030,%202024%20and%202023) This comparison details the financial performance for the nine months ended September 30, 2024, versus the prior year Nine Months Ended September 30, 2024 and 2023 (in thousands, except percentages) | (in thousands, except percentages) | Nine Months Ended Sep 30, 2024 | % of Revenue | Nine Months Ended Sep 30, 2023 | % of Revenue | Change | % Change | | :--------------------------------- | :----------------------------- | :----------- | :----------------------------- | :----------- | :----- | :------- |\n| Revenue, net | $8,693 | 100.0% | $10,402 | 100.0% | $(1,709) | (16.4)% |\n| Cost of revenue | $5,030 | 57.9% | $5,295 | 50.9% | $(265) | (5.0)% |\n| Gross profit | $3,663 | 42.1% | $5,107 | 49.1% | $(1,444) | (28.3)% |\n| Engineering, research and development | $1,572 | 18.1% | $1,765 | 17.0% | $(193) | (10.9)% |\n| Selling, general and administrative | $3,631 | 41.8% | $3,201 | 30.8% | $430 | 13.4% |\n| Income (loss) from operations | $(1,540) | (17.7)% | $141 | 1.4% | $(1,681) | (1192.2)%|\n| Net income (loss) | $(1,571) | (18.1)% | $65 | 0.6% | $(1,636) | (2516.9)%| - **Revenue decreased by** **16.4%** **for the nine months ended September 30, 2024, compared to the prior year, primarily due to lower demand from force-sensor customers in medical, industrial, and consumer markets, and fulfillment delays from a membrane printed electronics customer**. **Standard product sales, however, increased**[123](index=123&type=chunk) - **Gross profit and gross margin percentage decreased due to lower revenues and changes in product and customer mix**. **Selling, general and administrative costs increased by** **13.4%** **due to higher intangible asset amortization from the Calman acquisition, partially offset by lower compensation and professional services expenses**[124](index=124&type=chunk)[126](index=126&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's ability to meet its short-term and long-term financial obligations, including cash position, working capital, and financing arrangements - **As of September 30, 2024, the company had** **$3.8 million** **in cash and cash equivalents,** **$6.5 million** **in working capital, and no indebtedness**. **$2.5 million** **of the cash was held by foreign subsidiaries, which can be repatriated without significant tax effects**[129](index=129&type=chunk) - **The company has** **200,000** **shares of** **8.0%** **Series A Convertible Preferred Stock outstanding, with an aggregate liquidation preference of** **$5.0 million**. **Monthly cumulative cash dividends of** **$0.16667** **per share are paid, and the company expects to continue these payments**[130](index=130&type=chunk) - **Management believes existing cash and cash equivalents will be sufficient for current operations**. **However, if additional cash is needed, the company may seek equity, equity-linked, or debt financing, which could dilute existing stockholders or impose restrictive covenants**[131](index=131&type=chunk) [Cash Flow Analysis](index=33&type=section&id=Cash%20Flow%20Analysis) This section analyzes the company's cash inflows and outflows from operating, investing, and financing activities for the reported periods Cash Flow Activity (in thousands) | Cash Flow Activity (in thousands) | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :-------------------------------- | :----------------------------- | :----------------------------- |\n| Net cash provided by (used in) operating activities | $(144) | $155 |\n| Net cash (used in) investing activities | $(107) | $(4,322) |\n| Net cash (used in) financing activities | $(300) | $(650) | - **Operating activities used** **$144,000** **cash in the nine months ended September 30, 2024, primarily due to a net loss of** **$1,571,000**, **partially offset by non-cash charges and cash provided by changes in operating assets and liabilities**[132](index=132&type=chunk) - **Investing activities used** **$107,000** **for property, plant, and equipment purchases in 2024, significantly less than the** **$4.3 million** **used in 2023, which included the Calman acquisition**. **Financing activities used** **$300,000**, **primarily for preferred stock dividends**[134](index=134&type=chunk)[135](index=135&type=chunk) [Off-Balance Sheet Arrangements](index=34&type=section&id=Off-Balance%20Sheet%20Arrangements) This section confirms that the company does not have any off-balance sheet arrangements - **The company does not have any off-balance sheet arrangements**[137](index=137&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=34&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This item is marked as 'Not Applicable,' indicating that the company does not have material quantitative or qualitative disclosures regarding market risk for the reported period - **This section is marked as 'Not Applicable'**[137](index=137&type=chunk) [Item 4. Controls and Procedures](index=34&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the evaluation of the company's disclosure controls and procedures, confirming their effectiveness at a reasonable assurance level as of September 30, 2024. It also states that there were no material changes in internal controls over financial reporting during the quarter and acknowledges the inherent limitations of any control system [Evaluation of Disclosure Controls and Procedures](index=34&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section confirms that management, with CEO and CFO participation, concluded the disclosure controls and procedures were effective at a reasonable assurance level - **Management, with CEO and CFO participation, concluded that disclosure controls and procedures were designed at a reasonable assurance level and were effective as of September 30, 2024**[138](index=138&type=chunk) [Changes in Internal Controls over Financial Reporting](index=34&type=section&id=Changes%20in%20Internal%20Controls%20over%20Financial%20Reporting) This section states that no material changes occurred in internal controls over financial reporting during the quarter - **There was no change in internal control over financial reporting during the quarter ended September 30, 2024, that materially affected, or is reasonably likely to materially affect, internal control over financial reporting**[139](index=139&type=chunk) [Limitations on Effectiveness of Controls and Procedures](index=34&type=section&id=Limitations%20on%20Effectiveness%20of%20Controls%20and%20Procedures) This section acknowledges the inherent limitations of any control system, emphasizing that reasonable assurance, not absolute, is provided - **Management acknowledges that control systems, no matter how well designed, can only provide reasonable, not absolute, assurance and are subject to inherent limitations such as human diligence, judgment lapses, and breakdowns**[141](index=141&type=chunk) PART II -- OTHER INFORMATION This section provides additional information not covered in the financial statements, including risk factors, exhibits, and signatures [Item 1A. Risk Factors](index=35&type=section&id=Item%201A.%20Risk%20Factors) This section refers to the risk factors detailed in the company's Annual Report on Form 10-K filed on March 25, 2024, and states that there have been no material changes to these risk factors during the nine months ended September 30, 2024 - **No material changes to risk factors were identified during the nine months ended September 30, 2024, as compared to those in the Annual Report on Form 10-K filed on March 25, 2024**[142](index=142&type=chunk) [Item 5. Other Information](index=35&type=section&id=Item%205.%20Other%20Information) This section confirms that there are no insider trading arrangements to report - **There are no insider trading arrangements to report**[143](index=143&type=chunk) [Item 6. Exhibits](index=36&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Quarterly Report on Form 10-Q, including certifications, XBRL documents, and various corporate governance documents incorporated by reference - **The report includes certifications from the Principal Executive Officer and Principal Financial Officer (Exhibits 31.1, 31.2, 32.1) and various XBRL taxonomy extension documents (Exhibits 101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE)**[145](index=145&type=chunk) - **Other exhibits include Articles of Incorporation, Certificate of Designations of Series A Preferred Stock, Bylaws, and their amendments, along with the form of common stock**[146](index=146&type=chunk) [Signatures](index=37&type=section&id=Signatures) This section contains the required signatures, confirming the due authorization and filing of the report by Interlink Electronics, Inc - **The report was signed on November 7, 2024, by Ryan J. Hoffman, Chief Financial Officer (Principal Financial and Accounting Officer) of Interlink Electronics, Inc.**[148](index=148&type=chunk)