Exhibit 99.1
Press Release
For Release, 09:10AM EDT May 8, 2024
Neonode Reports Quarter Ended March 31, 2024 Financial Results
STOCKHOLM, SWEDEN, May 8, 2024 — Neonode Inc. (NASDAQ: NEON) (“Neonode” or the “Company”) today reported financial results for the three months ended March 31, 2024.
FINANCIAL SUMMARY FOR THE QUARTER ENDED MARCH 31, 2024:
| ● | Revenue of $1.0 million, a decrease of 19.1% compared to the same period in the prior year. |
| ● | Operating expenses of $2.9 million, an increase of 3.3% compared to the same period in the prior year. |
| ● | Net loss of $2.1 million, or $0.14 per share, compared to $1.4 million, or $0.09 per share, for the same period in the prior year. |
| ● | Cash used by operations of $1.9 million compared to $1.7 million for the same period in the prior year. |
| ● | Cash and accounts receivable of $15.3 million as of March 31, 2024 compared to $17.1 million as of December 31, 2023. |
THE PRESIDENT & CEO’S COMMENTS
“Our revenues decreased in the first quarter of 2024 compared to the same quarter last year. Following the announcement of our change in strategy, with full focus on our licensing business and a phase-out of our products business, product sales have increased as a result of last time buy orders. Non-recurring engineering revenues also increased in the first quarter compared to the same quarter last year, mainly due to a new potential Touch Sensor Module license project. At the same time, licensing revenues decreased compared to the same quarter last year. This is mainly due to the demand for our legacy customers’ products being lower, resulting in high inventory levels at some customers and thus lower revenues for Neonode,” said Fredrik Nihlén, Neonode’s interim President and CEO and CFO.
“The award by a leading commercial vehicle Original Equipment Manufacturer to supply Driver Monitoring System software to their global range of commercial vehicles continues to generate increased interest in our driver and in-cabin monitoring solutions. This is encouraging, and we are confident that we have a competitive, scalable and flexible solution that is attractive to both commercial vehicle and passenger car manufacturers. We also see interesting licensing opportunities for our touch and touchless human-machine interaction offerings,” concluded Mr. Nihlén.
FINANCIAL OVERVIEW FOR THE QUARTER ENDED MARCH 31, 2024
Net revenues for the quarter ended March 31, 2024 were $1.0 million, a 19.1% decrease compared to the same period in 2023. License revenues were $0.8 million, a decrease of 32.7% compared to the same period in 2023. The decrease is caused by lower sales volumes for our customers during the first quarter of 2024.
Revenues from product sales for the quarter ended March 31, 2024 were $0.2 million, a 96.1% increase compared to the same period in 2023, mainly due to last time buy orders from customers.
Revenues from non-recurring engineering for the first quarter of 2024 were $41,000, a 1,266.7% increase compared to the same period in 2023, mainly due to a new potential Touch Sensor Module license project in Q1 2024.
Gross margin related to products was negative 90.0% for the first quarter of 2024 compared to 53.9% in the same period in 2023. The gross margin for products for the first quarter in 2024 is impacted by a one-time cost related to an impairment loss on inventory due to the phasing out of the manufacturing of touch sensor modules.
Our operating expenses increased by 3.3% for the first quarter of 2024 compared to the same period in 2023, primarily due to higher marketing costs.
Net loss for the first quarter of 2024 was $2.1 million, or $0.14 per share, compared to a net loss of $1.4 million, or $0.09 per share for the same period in 2023. Cash used by operations was $1.9 million in the first quarter of 2024 compared to $1.7 million for the same period in 2023. The increase is primarily the result of component purchases in the first quarter of 2024.
Cash and accounts receivable totaled $15.3 million and working capital was $14.7 million as of March 31, 2024, compared to $17.1 million and $16.8 million as of December 31, 2023, respectively.
For more information, please contact:
Interim President and Chief Executive Officer and Chief Financial Officer
Fredrik Nihlén
E-mail: fredrik.nihlen@neonode.com
Phone: +46 703 97 21 09
About Neonode
Neonode Inc. (NASDAQ:NEON) is a publicly traded company, headquartered in Stockholm, Sweden and established in 2001. The Company provides advanced optical sensing solutions for contactless touch, touch, gesture control, and in-cabin monitoring. Building on experience acquired during years of advanced research and development and technology licensing, Neonode’s technology is currently deployed in more than 90 million products, and the Company holds more than 100 patents worldwide. Neonode’s customer base includes some of the world’s best-known Fortune 500 companies in the consumer electronics, office equipment, automotive, elevator, and self-service kiosk markets.
NEONODE and the NEONODE logo are trademarks of Neonode Inc. registered in the United States and other countries.
For further information please visit www.neonode.com
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Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include, but are not limited to, statements relating to our expectations for growth and the growing demand for our products, future performance or future events. These statements are based on current assumptions, expectations and information available to Neonode management and involve a number of known and unknown risks, uncertainties and other factors that may cause Neonode’s actual results, levels of activity, performance or achievements to be materially different from any expressed or implied by these forward-looking statements.
These risks, uncertainties, and factors include risks related to our reliance on the ability of our customers to design, manufacture and sell their products with our touch technology, the length of a customer’s product development cycle, our dependence and our customers’ dependence on suppliers, the global economy generally and other risks discussed under “Risk Factors” and elsewhere in Neonode’s public filings with the SEC from time to time, including Neonode’s annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. You are advised to carefully consider these various risks, uncertainties and other factors. Although Neonode management believes that the forward-looking statements contained in this press release are reasonable, it can give no assurance that its expectations will be fulfilled. Forward-looking statements are made as of today’s date, and Neonode undertakes no duty to update or revise them.
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NEONODE INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
| March 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| (Unaudited) | (Audited) | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 14,274 | $ | 16,155 | ||||
| Accounts receivable and unbilled revenues, net | 1,072 | 917 | ||||||
| Inventory | 487 | 610 | ||||||
| Prepaid expenses and other current assets | 760 | 938 | ||||||
| Total current assets | 16,593 | 18,620 | ||||||
| Property and equipment, net | 294 | 340 | ||||||
| Operating lease right-of-use assets, net | 34 | 54 | ||||||
| Total assets | $ | 16,921 | $ | 19,014 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 491 | $ | 440 | ||||
| Accrued payroll and employee benefits | 1,021 | 941 | ||||||
| Accrued expenses | 205 | 354 | ||||||
| Contract liabilities | 82 | 10 | ||||||
| Current portion of finance lease obligations | 29 | 33 | ||||||
| Current portion of operating lease obligations | 34 | 54 | ||||||
| Total current liabilities | 1,862 | 1,832 | ||||||
| Finance lease obligations, net of current portion | 12 | 19 | ||||||
| Total liabilities | 1,874 | 1,851 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Common stock, 25,000,000 shares authorized, with par value of $0.001; 15,359,481 shares issued and outstanding at March 31, 2024 and December 31, 2023 | 15 | 15 | ||||||
| Additional paid-in capital | 235,160 | 235,158 | ||||||
| Accumulated other comprehensive loss | (430 | ) | (396 | ) | ||||
| Accumulated deficit | (219,698 | ) | (217,614 | ) | ||||
| Total stockholders’ equity | 15,047 | 17,163 | ||||||
| Total liabilities and stockholders’ equity | $ | 16,921 | $ | 19,014 | ||||
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NEONODE INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
| Three months ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| Revenues: | ||||||||
| License fees | $ | 773 | $ | 1,148 | ||||
| Products | 200 | 102 | ||||||
| Non-recurring engineering | 41 | 3 | ||||||
| Total revenues | 1,014 | 1,253 | ||||||
| Cost of revenues: | ||||||||
| Products | 380 | 47 | ||||||
| Non-recurring engineering | 17 | - | ||||||
| Total cost of revenues | 397 | 47 | ||||||
| Total gross margin | 617 | 1,206 | ||||||
| Operating expenses: | ||||||||
| Research and development | 895 | 802 | ||||||
| Sales and marketing | 816 | 592 | ||||||
| General and administrative | 1,160 | 1,384 | ||||||
| Total operating expenses | 2,871 | 2,778 | ||||||
| Operating loss | (2,254 | ) | (1,572 | ) | ||||
| Other income: | ||||||||
| Interest income, net | 180 | 158 | ||||||
| Total other income | 180 | 158 | ||||||
| Loss before provision for income taxes | (2,074 | ) | (1,414 | ) | ||||
| Provision for income taxes | 10 | 11 | ||||||
| Net loss | $ | (2,084 | ) | $ | (1,425 | ) | ||
| Loss per common share: | ||||||||
| Basic and diluted loss per share | $ | (0.14 | ) | $ | (0.09 | ) | ||
| Basic and diluted – weighted average number of common shares outstanding | 15,359 | 15,209 | ||||||
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NEONODE INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In thousands)
| Three months ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| Net loss | $ | (2,084 | ) | $ | (1,425 | ) | ||
| Other comprehensive income: | ||||||||
| Foreign currency translation adjustments | (34 | ) | 35 | |||||
| Other comprehensive loss | $ | (2,118 | ) | $ | (1,390 | ) | ||
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NEONODE INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands)
| Common Stock Shares Issued | Common Stock Amount | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total Stockholders’ Equity | |||||||||||||||||||
| Balances, December 31, 2023 | 15,359 | $ | 15 | $ | 235,158 | $ | (396 | ) | $ | (217,614 | ) | $ | 17,163 | |||||||||||
| Stock-based compensation | - | - | 2 | - | - | 2 | ||||||||||||||||||
| Foreign currency translation adjustment | - | - | - | (34 | ) | - | (34 | ) | ||||||||||||||||
| Net loss | - | - | - | - | (2,084 | ) | (2,084 | ) | ||||||||||||||||
| Balances, March 31, 2024 | 15,359 | $ | 15 | $ | 235,160 | $ | (430 | ) | $ | (219,698 | ) | $ | 15,047 | |||||||||||
| Common Stock Shares Issued | Common Stock Amount | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total Stockholders’ Equity | |||||||||||||||||||
| Balances, December 31, 2022 | 14,456 | $ | 14 | $ | 227,235 | $ | (340 | ) | $ | (207,491 | ) | $ | 19,418 | |||||||||||
| Stock-based compensation | - | - | 18 | - | - | 18 | ||||||||||||||||||
| Issuance of shares for cash, net of offering costs | 903 | 1 | 7,865 | - | - | 7,866 | ||||||||||||||||||
| Foreign currency translation adjustment | - | - | - | 35 | - | 35 | ||||||||||||||||||
| Net loss | - | - | - | - | (1,425 | ) | (1,425 | ) | ||||||||||||||||
| Balances, March 31, 2023 | 15,359 | $ | 15 | $ | 235,118 | $ | (305 | ) | $ | (208,916 | ) | $ | 25,912 | |||||||||||
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NEONODE INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
| Three months ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (2,084 | ) | $ | (1,425 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Stock-based compensation expense | 2 | 18 | ||||||
| Depreciation and amortization | 27 | 17 | ||||||
| Amortization of operating lease right-of-use assets | 17 | 16 | ||||||
| Inventory impairment loss | 278 | - | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable and unbilled revenue, net | (170 | ) | (491 | ) | ||||
| Inventory | (253 | ) | (11 | ) | ||||
| Prepaid expenses and other current assets | 136 | 66 | ||||||
| Accounts payable, accrued payroll and employee benefits, and accrued expenses | 76 | 133 | ||||||
| Contract liabilities | 73 | (5 | ) | |||||
| Operating lease obligations | (17 | ) | (16 | ) | ||||
| Net cash used in operating activities | (1,915 | ) | (1,698 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Proceeds from issuance of common stock, net of offering costs | - | 7,866 | ||||||
| Principal payments on finance lease obligations | (9 | ) | (28 | ) | ||||
| Net cash (used in) provided by financing activities | (9 | ) | 7,838 | |||||
| Effect of exchange rate changes on cash and cash equivalents | 43 | 25 | ||||||
| Net change in cash and cash equivalents | (1,881 | ) | 6,165 | |||||
| Cash and cash equivalents at beginning of period | 16,155 | 14,816 | ||||||
| Cash and cash equivalents at end of period | $ | 14,274 | $ | 20,981 | ||||
| Supplemental disclosure of cash flow information: | ||||||||
| Cash paid for income taxes | $ | 10 | $ | 11 | ||||
| Cash paid for interest | $ | 1 | $ | 2 | ||||
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