Revenue Performance - Total net revenues decreased by 18.8% to $3.1 million in 2024 from $3.8 million in 2023, primarily due to lower license revenues offset by higher non-recurring engineering revenues [113]. - License fees revenue fell by 29.3% to $2.7 million in 2024, driven by reduced demand from legacy customers in printer and passenger car touch applications [115]. - Non-recurring engineering revenues surged by 1,519.2% to $0.4 million in 2024, attributed to a new project with a commercial vehicle OEM and an agreement with NEXTY Electronics [115]. Financial Performance - Gross margin decreased to 96.3% in 2024 from 99.7% in 2023, reflecting an increase in non-recurring engineering projects [116]. - The net loss for 2024 was $5.9 million, compared to a net loss of $5.1 million in 2023, reflecting ongoing operational challenges [123]. - The accumulated deficit increased to approximately $224.1 million as of December 31, 2024, from $217.6 million in 2023, highlighting ongoing financial strain [132]. Expenses - Research and development expenses decreased by 10.1% to $3.4 million in 2024, mainly due to lower payroll and related costs [117]. - General and administrative expenses increased by 15.3% to $3.8 million in 2024, primarily due to higher payroll and professional fees [120]. - The company recorded rent expenses of approximately $449,000 and $428,000 for the years ended December 31, 2024 and 2023, respectively [141]. Liquidity and Capital Resources - Cash and cash equivalents as of December 31, 2024, were $16.4 million, slightly up from $16.2 million in 2023, indicating stable liquidity [124]. - Working capital remained unchanged at $16.1 million as of December 31, 2024, compared to the previous year [125]. - The company sold an aggregate of 1,423,441 shares of common stock under the Ladenburg ATM Facility, generating net proceeds of $5.8 million after expenses [149]. - For the year ended December 31, 2023, the company sold 903,716 shares under the previous ATM Facility, resulting in net proceeds of $7.9 million [150]. - The company may require additional capital sources beyond cash on hand and the ATM Facility to continue operations and implement its strategy [151]. - There are no assurances that the company will successfully obtain additional financing on reasonable terms, which could negatively impact its business and financial condition [152]. - The company has no off-balance sheet financing arrangements that could affect its liquidity or capital resources [139]. Operational Commitments - The company has a lease for 6,684 square feet of office space in Stockholm, Sweden, valid through November 2026 [140]. - The company has a commission obligation of 3.0% on gross sales price per share sold under the Ladenburg Sales Agreement [147]. Foreign Exchange Risk - The company is subject to foreign currency exchange rate risk due to its foreign subsidiaries operating in local currencies such as the Swedish Krona, Japanese Yen, and South Korean Won [153]. Engineering Agreements - The company has entered into a non-recurring engineering development agreement with Texas Instruments, agreeing to pay $500,000 for engineering costs based on ASIC sales [143].

Revenue Performance - Revenues from continuing operations for fiscal 2024 were $3.1 million, an 18.8% decrease compared to 2023[5] - License revenues were $2.7 million, a decrease of 29.3% compared to 2023, primarily due to lower demand from legacy customers[5] - Revenues from non-recurring engineering for fiscal 2024 were $0.4 million, a 1,519.2% increase compared to 2023, driven by the DMS project with a commercial vehicle OEM[6] Operating Expenses and Losses - Operating expenses from continuing operations for fiscal 2024 were $9.5 million, a slight decrease of 0.2% compared to 2023[7] - Loss from continuing operations for fiscal 2024 was $5.9 million, or $0.37 per share, compared to a loss of $5.1 million, or $0.33 per share in 2023[9] - Cash used by operations was $5.6 million in fiscal 2024, down from $6.3 million in 2023[9] Cash and Liquidity - Cash and accounts receivable totaled $17.2 million as of December 31, 2024, compared to $16.8 million at the end of 2023[10] - Cash flows from operating activities showed a net cash used of $5,592 million, a slight improvement from $6,308 million in the previous year[23] - Cash and cash equivalents at the end of the year increased to $16,427 million from $16,155 million, reflecting a net increase of $272 million[23] Inventory and Asset Management - Inventory impairment loss significantly decreased to $357 million from $3,572 million, indicating improved inventory management[23] - Right-of-use asset obtained in exchange for operating lease obligations was valued at $668 million, indicating ongoing investment in operational capacity[23] Financing Activities - Proceeds from the issuance of common stock, net of offering costs, amounted to $5,796 million, down from $7,866 million in the previous year[23] - The company experienced a net cash provided by financing activities of $5,779 million, compared to $7,777 million in the previous year, showing a decrease in financing inflows[23] Strategic Focus and Developments - The company is focusing on technology licensing, with ongoing development of MultiSensing® and zForce® platforms to enhance market position[3] - Neonode announced a contract with a leading commercial vehicle OEM for a MultiSensing driver monitoring system, indicating a shift towards automotive safety applications[4] - The company aims to secure more licensing opportunities for its innovative technologies, reflecting a strategic pivot from manufacturing to licensing[10] Tax and Interest Expenses - Cash paid for interest decreased to $1 million from $9 million, indicating reduced financing costs[23] - Cash paid for income taxes decreased to $15 million from $115 million, reflecting improved tax efficiency[23] Net Loss Improvement - Net loss for the year ended December 31, 2024, improved to $6,466 million from $10,123 million in 2023, representing a reduction of approximately 36.5%[23]

Financial Performance - Total revenues for Q3 2024 were $838,000, a slight decrease from $840,000 in Q3 2023[8] - License fees contributed $731,000 to revenues in Q3 2024, down from $836,000 in Q3 2023, representing a decrease of approximately 12.6%[8] - The net loss for Q3 2024 was $1,087,000, compared to a net loss of $1,266,000 in Q3 2023, indicating an improvement of about 14.1%[9] - The company reported a gross margin of $815,000 for Q3 2024, compared to $840,000 in Q3 2023, showing a decline of about 3%[8] - Total revenues for the three months ended September 30, 2024, were $0.8 million, a decrease of 0.2% compared to $0.8 million for the same period in 2023[72] - License fees for the three months ended September 30, 2024, were $0.7 million, down 12.6% from $0.8 million in the same period of 2023[74] - Total revenues for the nine months ended September 30, 2024, were $2.5 million, a decrease of 21.0% compared to $3.1 million for the same period in 2023[72] - License fees for the nine months ended September 30, 2024, were $2.1 million, down 31.2% from $3.1 million in the same period in 2023[74] Operating Expenses - Operating expenses for Q3 2024 totaled $2,040,000, a decrease from $2,097,000 in Q3 2023, reflecting a reduction of approximately 2.7%[8] - Total operating expenses for the three months ended September 30, 2024, were $2.04 million, a decrease of 2.7% compared to $2.1 million in the same period of 2023[72] - The company reported an operating loss of $4.84 million for the nine months ended September 30, 2024, compared to an operating loss of $3.93 million in the same period of 2023, representing an increase of 23.1%[72] - General and administrative expenses for Q3 2024 were $0.7 million, a decrease of 12.5% from $0.8 million in Q3 2023, while expenses for the nine months ended September 30, 2024, increased by 8.0% to $2.7 million compared to $2.5 million in the same period in 2023[81] Cash and Liquidity - Cash and cash equivalents increased to $17,599,000 as of September 30, 2024, up from $16,155,000 at the end of 2023, representing an increase of approximately 8.9%[7] - Cash and cash equivalents at the end of the period were $17.6 million as of September 30, 2024, compared to $18.5 million at the end of the previous quarter[13] - As of September 30, 2024, cash and cash equivalents were $17.6 million, an increase from $16.2 million as of December 31, 2023, indicating improved liquidity[87] - Net cash used in operating activities for the nine months ended September 30, 2024, was $4.4 million, primarily due to a net loss of $4.9 million[88] Accumulated Deficit - The accumulated deficit as of September 30, 2024, was $222,480,000, compared to $217,614,000 at the end of 2023, indicating an increase in the deficit of approximately 2.6%[7] - The company incurred an accumulated deficit of approximately $222.5 million as of September 30, 2024, compared to $217.6 million as of December 31, 2023[92] Discontinued Operations - The company decided to phase out the TSM product business, terminating production at Pronode Technologies AB facilities in Sweden, with the facility lease ending on September 30, 2024[23] - As of September 30, 2024, total current assets of discontinued operations amounted to $364,000, including accounts receivable of $178,000 and inventory of $172,000[27] - Total current liabilities of discontinued operations were $142,000, with accounts payable and accrued payroll each at $50,000[27] - For the three months ended September 30, 2024, the net loss from discontinued operations was $44,000, compared to a net loss of $204,000 for the same period in 2023[29] Legal and Compliance - A material weakness in internal controls over financial reporting was identified, related to insufficient segregation of duties and lack of IT general controls[126] - The company is committed to remediating the identified material weakness through training, policy enhancements, and improved documentation[127] - The management is actively developing a remediation plan to address the material weakness, which could impact the accuracy of financial statements if not resolved[135] - The company is not currently involved in any pending legal proceedings, but may face claims in the ordinary course of business[131] Strategic Initiatives - The company has shifted its strategy to focus solely on the licensing business, allowing customers to license its technology for bespoke products[17] - The company anticipates that current customers will continue to ship products incorporating its technology in 2024 and expects to expand its customer base with new clients[64] - The company entered into an At The Market Offering Agreement with Ladenburg Thalmann & Co. Inc. to issue and sell up to approximately $10 million of shares of common stock[50] - The company raised approximately $5.8 million in net proceeds from the issuance of 1,423,441 shares of common stock during the three months ending September 30, 2024[19] Foreign Currency Impact - The company experienced a foreign currency translation adjustment loss of $61, impacting cash and cash equivalents[13] - The company reported foreign currency translation losses of $(30,000) for the three months ended September 30, 2024, compared to $(96,000) for the same period in 2023[33] Research and Development - Research and development expenses remained stable at $0.8 million for the three months ended September 30, 2024, consistent with the same period in 2023[78] Customer Concentration - As of September 30, 2024, five customers represented approximately 94.8% of consolidated accounts receivable, up from three customers representing 77.8% as of December 31, 2023[34]

Financial Performance - Revenues from continuing operations for Q3 2024 were $0.8 million, a decrease of 0.2% compared to Q3 2023[2] - Operating expenses from continuing operations for Q3 2024 were $2.0 million, a decrease of 2.7% compared to Q3 2023[2] - Net loss from continuing operations for Q3 2024 was $1.0 million, or $0.07 per share, compared to a net loss of $1.1 million, or $0.07 per share for Q3 2023[2][10] - Total revenues for the three months ended September 30, 2024, were $838,000, a slight decrease from $840,000 in the same period of 2023[17] - License fees contributed $731,000 to total revenues for the three months ended September 30, 2024, compared to $836,000 in the prior year, representing a decline of 12.5%[17] - Operating loss for the three months ended September 30, 2024, was $(1,225,000), slightly improved from $(1,257,000) in the same period of 2023[17] - Net loss for the three months ended September 30, 2024, was $(1,087,000), compared to $(1,266,000) for the same period in 2023, indicating a reduction in losses[19] - Basic and diluted loss per share from continuing operations for the three months ended September 30, 2024, was $(0.07), consistent with the prior year[17] Cash Flow and Liquidity - Cash used by operations in Q3 2024 was $1.3 million, down from $1.8 million in Q3 2023[3][10] - Cash and accounts receivable totaled $18.6 million as of September 30, 2024, compared to $17.1 million as of December 31, 2023[3][11] - Cash provided by investing activities was $153,000, a significant improvement from a cash outflow of $58,000 in the previous year[21] - Net cash provided by financing activities was $5,781,000, compared to $7,789,000 in the same period last year[21] - Cash and cash equivalents at the end of the period were $17,599,000, a decrease from $18,471,000 at the end of the previous year[21] - Cash paid for income taxes was $10,000, significantly lower than $95,000 in the previous year[21] - Cash paid for interest decreased to $1,000 from $8,000 year-over-year[21] Operating Expenses - Operating expenses from continuing operations for the nine months ended September 30, 2024 were $7.2 million, an increase of 2.9% compared to the same period in 2023[4] - Total operating expenses for the three months ended September 30, 2024, were $2,040,000, down from $2,097,000 in the same period of 2023, reflecting a decrease of 2.7%[17] - Research and development expenses for the three months ended September 30, 2024, were $822,000, nearly unchanged from $827,000 in the prior year[17] Equity and Deficit - The company reported total stockholders' equity of $18,000,000 as of September 30, 2024, an increase from $17,163,000 at the end of 2023[20] - The accumulated deficit as of September 30, 2024, was $(222,480,000), compared to $(217,614,000) at the end of 2023[20] Other Financial Metrics - Non-recurring engineering revenues for Q3 2024 were $0.1 million, a 2,575.0% increase compared to Q3 2023, mainly due to the DMS project[9] - Inventory impairment loss was recorded at $287,000, with no such loss reported in the previous year[21] - Changes in accounts receivable and unbilled revenues resulted in a net decrease of $105,000, compared to an increase of $512,000 in the prior year[21] Business Developments - The company has ongoing discussions with potential customers regarding Touch Sensor Module technology and MultiSensing® platform[4][5] - The company signed a TSM technology agreement with NEXTY Electronics for sensor development in Japan's amusement market[5]

Core Viewpoint - Neonode Inc. reported its financial results for the three and nine months ended September 30, 2024, focusing solely on its licensing business after reclassifying its products business to discontinued operations [1]. Financial Summary for the Three Months Ended September 30, 2024 - Revenues from continuing operations were $0.8 million, a decrease of 0.2% compared to the same period in the prior year [2]. - Operating expenses from continuing operations were $2.0 million, a decrease of 2.7% compared to the same period in the prior year [2]. - Net loss from continuing operations was $1.0 million, or $0.07 per share, compared to a net loss of $1.1 million, or $0.07 per share, for the same period in the prior year [2]. - Cash used by operations was $1.3 million compared to $1.8 million for the same period in the prior year [2]. Financial Summary for the Nine Months Ended September 30, 2024 - Revenue from continuing operations was $2.5 million, a decrease of 21.0% compared to the same period in the prior year [4]. - Operating expenses from continuing operations were $7.2 million, an increase of 2.9% compared to the same period in the prior year [4]. - Net loss from continuing operations was $4.4 million, or $0.28 per share, compared to a net loss of $3.5 million, or $0.22 per share, for the same period in the prior year [4]. - Cash used by operations was $4.4 million compared to $4.1 million for the same period in the prior year [4]. Business Highlights for the Nine Months Ended September 30, 2024 - Ongoing discussions with potential customers regarding Touch Sensor Module (TSM) technology and the MultiSensing® platform [5]. - TSM technology agreement with NEXTY Electronics for sensor development and manufacturing of next-generation amusement machines for a leading manufacturer in Japan's amusement market [5]. - TSM technology agreement with YesAR to develop and build holographic infotainment solutions for customers in the automotive and elevator segments [5]. Financial Overview for the Quarter Ended September 30, 2024 - Revenues from continuing operations were $0.8 million, a 0.2% decrease compared to the same period in 2023 [8]. - License revenues were $0.7 million, a decrease of 12.6% compared to the same period in 2023, mainly due to lower demand from legacy customers [8]. - Revenues from non-recurring engineering for the third quarter were $0.1 million, a 2,575.0% increase compared to the same period in 2023, mainly due to the DMS project with a commercial vehicle OEM [9]. Cash and Accounts Receivable - Cash and accounts receivable totaled $18.6 million as of September 30, 2024, compared to $17.1 million as of December 31, 2023 [3]. - Working capital for continuing operations was $17.7 million as of September 30, 2024, compared to $16.1 million as of December 31, 2023 [11].

Core Insights - Neonode Inc. (NASDAQ: NEON) is characterized as a "different" kind of company compared to more traditional, conservative stocks [1] Group 1 - The mission of Grassroots Trading emphasizes providing objective, unbiased, and balanced research, focusing on small- to mid-cap companies [1] - Grassroots Trading aims to identify compelling investment opportunities in often overlooked small- to mid-cap companies while also expanding coverage to large- and mega-cap companies [1]

Core Points - Neonode Inc. has appointed Peter Kruk as a Class II director on its Board of Directors [1] - Peter Kruk is currently the CEO and a board member of NCAB Group AB, with extensive experience in global industrial companies [2] - Kruk expressed excitement about joining Neonode and contributing to its innovative technology [3] - Ulf Rosberg, Chairman of the Board, highlighted Kruk's management experience and knowledge of the automotive industry as valuable assets [3]

Core Viewpoint - Neonode Inc. has terminated its corporate broking services agreement with Redeye AB, which provided financial advisory and investor relations services to the company [1]. Group 1 - The company is committed to enhancing shareholder value and will explore alternative options for effective communication with stakeholders and the broader investment community [2].

Core Insights - Neonode Inc. has entered into a new license agreement with NEXTY Electronics Corporation for its Touch Sensor Module (TSM) technology, which is expected to generate an estimated value of US$2–3 million over the next four to five years [1][4]. Group 1: License Agreement Details - NEXTY Electronics has selected Neonode's TSM technology for the development and manufacturing of next-generation amusement machines in Japan, indicating a strategic partnership in the amusement market [1][2]. - The agreement includes an upfront technology access fee along with future royalties, highlighting the financial structure of the partnership [1]. Group 2: Technology and Market Fit - The TSM technology is based on surface-mount technology (SMT), which allows for touch interactivity on larger displays at a lower cost compared to alternative solutions, making it suitable for various applications [2][3]. - NEXTY Electronics will manufacture the TSMs in Japan, targeting both the Japanese amusement market and other markets that require high-quality, cost-effective touch functionality [2]. Group 3: Strategic Importance - The partnership is seen as a vote of confidence in Neonode's licensing-focused business strategy, as NEXTY Electronics has a history of working closely with Neonode and is familiar with its products [3][4]. - The agreement signifies a deepening relationship between the two companies, with expectations of enhanced operational performance in the amusement sector without compromising display quality [3][4].

STOCKHOLM, Aug. 8, 2024 /PRNewswire/ -- Neonode Inc. (NASDAQ: NEON) ("Neonode" or the "Company") today reported financial results for the three and six months ended June 30, 2024. FINANCIAL SUMMARY FOR THE THREE MONTHS ENDED JUNE 30, 2024: Revenues of $1.4 million, an increase of 18.7% compared to the same period in the prior year. Operating expenses of $2.7 million, a decrease of 1.6% compared to the same period in the prior year. Net loss of $1.7 million, or $0.11 per share, compared to $1.5 million, or $ ...