Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 9, 2023

NEONODE INC.

(Exact name of issuer of securities held pursuant to the plan)

Commission File Number 1-35526

Delaware		94-1517641
(State or other jurisdiction of incorporation)		(I.R.S. Employer Identification No.)

Karlavägen 100, 115 26 Stockholm, Sweden

(Address of Principal Executive Office, including Zip Code)

+46 (0) 86671717

Registrant’s telephone number, including area code:

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.001 per share		NEON		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02. Results of Operations and Financial Condition.

On November 9, 2023, Neonode Inc. (the “Company”) reported its earnings for the three and nine months ended September 30, 2023 (the “Earnings Release”) and posted on the Neonode website the Third Quarter 2023 Presentation (the “Presentation”). A copy of the Earnings Release and the Presentation are attached hereto as Exhibits 99.1 and 99.2, respectively, and are incorporated herein by reference.

The information furnished pursuant to this Item 2.02, including Exhibits 99.1 and 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section, or incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 7.01 Regulation FD Disclosure

As previously announced, the Company will conduct a conference call today, Thursday, November 9, 2023 at 10:00 a.m. ET. The presentation slides to be used during the call, attached hereto as Exhibit 99.2, will be available on the “Investor Relations” section of the Company’s website at www.neonode.com immediately prior to the call. The information contained in, or that can be accessed through the Company’s website is not a part of this filing.

The information furnished pursuant to this Item 7.01, including Exhibit 99.2, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, or incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.		Description
Exhibit 99.1		Earnings Release of the Company dated November 9, 2023
Exhibit 99.2		Third Quarter 2023 Presentation of Neonode Inc.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: November 9, 2023	NEONODE INC.

	By:	/s/ Fredrik Nihlén
	Name:	Fredrik Nihlén
	Title:	Chief Financial Officer

Exhibit 99.1

Press Release

For Release, 09:10AM ET November 9, 2023

Neonode Reports Quarter Ended September 30, 2023 Financial Results

STOCKHOLM, SWEDEN, November 9, 2023 — Neonode Inc. (NASDAQ: NEON) today reported financial results for the three and nine months ended September 30, 2023.

FINANCIAL SUMMARY FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2023:

	●	Revenue of $1.0 million, a decrease of 17.5% compared to the same period in the prior year.

	●	Operating expenses of $2.2 million, an increase of 6.3% compared to the same period in the prior year.

	●	Net loss of $1.3 million, or $0.08 per share, compared to $0.8 million, or $0.06 per share, for the same period in the prior year.

	●	Cash used by operations of $1.8 million compared to $0.5 million for the same period in the prior year.

	●	Cash and accounts receivable of $19.4 million as of September 30, 2023 compared to $16.3 million as of December 31, 2022.

FINANCIAL SUMMARY FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2023:

	●	Revenue of $3.5 million, a decrease of 9.1% compared to the same period in the prior year.

	●	Operating expenses of $7.8 million, an increase of 2.8% compared to the same period in the prior year.

	●	Net loss of $4.2 million, or $0.27 per share, compared to $3.7 million, or $0.27 per share, for the same period in the prior year.

	●	Cash used by operations of $4.1 million compared to $5.7 million for the same period in the prior year.

THE CEO’S COMMENTS

“Our licensing revenues in Q3 were slightly lower than in Q2 and the same period last year, but our licensing business shows good long-term stability and licensing revenues year-to-date are on a similar level as last year. Our product sales revenues in Q3 were higher than in Q2 but, because of the slow sales in the first half of the year, products sales revenues during the first nine months are significantly lower than in the same period last year,” said Dr. Urban Forssell, Neonode’s CEO.

“We are addressing the lack of growth in our business in different ways. Strategically we continue to evaluate the different market segments in which we are active and prioritize the ones where our products have the greatest potential. Tactically we also constantly monitor our sales performance and adjust resource allocation to maximize our chances of winning new businesses and creating beachheads from which we can expand further. We feel that we are on the right track in the challenge to grow our business and return to profitability and are encouraged by the interest for our different products and offerings that we receive from customers, especially in the Automotive, Medtech, and Interactive Kiosk sectors. We are therefore optimistic about the future growth potential for our business,” concluded Dr. Forssell.

FINANCIAL OVERVIEW FOR THE QUARTER ENDED SEPTEMBER 30, 2023

Net revenues for the quarter ended September 30, 2023 were $1.0 million, a 17.5% decrease compared to the same period in 2022. For the 2023 period, license revenues were $0.8 million. This is a decrease of 20.0% compared to the 2022 period and is caused by lower sales volumes for our customers during the third quarter of 2023.

Revenues from product sales for the quarter ended September 30, 2023 were $0.2 million, a 5.2% increase compared to the same period in 2022. We continue with the focused marketing and sales campaigns and updates to our partner network.

Gross margin related to products was negative 39.3% for the third quarter of 2023 compared to 48.4% in the same period in 2022. The gross margin for products varies with the product mix. The gross margin for products for the three months ended September 30, 2023 is impacted by a one-time cost related to a customer claim.

Our operating expenses increased by 6.3% for the third quarter of 2023 compared to the same period in 2022, primarily due to higher professional fees.

Net loss attributable to Neonode for the three months ended September 30, 2023 was $1.3 million, or $0.08 per share, compared to a net loss of $0.8 million, or $0.06 per share, for the same period in 2022. Cash used by operations was $1.8 million in the third quarter of 2023 compared to $0.5 million for the same period in 2022. The increase is primarily the result of component purchases in the third quarter of 2023.

Cash and accounts receivable totaled $19.4 million and working capital was $22.7 million as of September 30, 2023 compared to $16.3 million and $19.1 million as of December 31, 2022, respectively.

For more information, please contact:

Chief Financial Officer

Fredrik Nihlén

E-mail: fredrik.nihlen@neonode.com

Phone: +46 703 97 21 09

Chief Executive Officer

Urban Forssell

E-mail: urban.forssell@neonode.com

Phone: +46 734 10 03 59

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 R&D and technology licensing, Neonode’s technology is currently deployed in more than 80 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

Cision

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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 COVID-19 pandemic, 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.

NEONODE INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

	September 30,			December 31,
	2023			2022
	(Unaudited)			(Audited)
ASSETS
Current assets:
Cash and cash equivalents	$	18,471		$	14,816
Accounts receivable and unbilled revenues, net		928			1,448
Inventory		4,309			3,827
Prepaid expenses and other current assets		755			707
Total current assets		24,463			20,798

Property and equipment, net		288			282
Operating lease right-of-use assets, net		66			118
Total assets	$	24,817		$	21,198

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	510		$	334
Accrued payroll and employee benefits		743			951
Accrued expenses		431			200
Contract liabilities		28			36
Current portion of finance lease obligations		35			95
Current portion of operating lease obligations		66			83
Total current liabilities		1,813			1,699

Finance lease obligations, net of current portion		24			46
Operating lease obligations, net of current portion		-			35
Total liabilities		1,837			1,780

Commitments and contingencies

Stockholders’ equity:
Common stock, 25,000,000 shares authorized, with par value of $0.001; 15,359,481 and 14,455,765 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively		15			14
Additional paid-in capital		235,148			227,235
Accumulated other comprehensive loss		(494	)		(340	)
Accumulated deficit		(211,689	)		(207,491	)
Total stockholders’ equity		22,980			19,418
Total liabilities and stockholders’ equity	$	24,817		$	21,198

NEONODE INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

	Three months ended September 30,						Nine months ended September 30,
	2023			2022			2023			2022
Revenues:
License fees	$	836		$	1,045		$	3,078		$	3,102
Products		163			155			349			512
Non-recurring engineering		4			16			29			187
Total revenues		1,003			1,216			3,456			3,801

Cost of revenues:
Products		227			80			302			224
Non-recurring engineering		-			(2	)		9			24
Total cost of revenues		227			78			311			248

Total gross margin		776			1,138			3,145			3,553

Operating expenses:
Research and development		827			792			2,692			2,961
Sales and marketing		516			348			1,797			1,608
General and administrative		890			960			3,312			3,023

Total operating expenses		2,233			2,100			7,801			7,592
Operating loss		(1,457	)		(962	)		(4,656	)		(4,039	)

Other income (expense):
Interest income (expense), net		220			-			547			(6	)
Other income		6			-			6			21
Total other income, net		226			-			553			15

Loss before provision for income taxes		(1,231	)		(962	)		(4,103	)		(4,024	)

Provision for income taxes		35			32			95			104
Net loss including noncontrolling interests		(1,266	)		(994	)		(4,198	)		(4,128	)
Less: net loss attributable to noncontrolling interests		-			194			-			400
Net loss attributable to Neonode Inc.	$	(1,266	)	$	(800	)	$	(4,198	)	$	(3,728	)

Loss per common share:
Basic and diluted loss per share	$	(0.08	)	$	(0.06	)	$	(0.27	)	$	(0.27	)
Basic and diluted – weighted average number of common shares outstanding		15,359			13,580			15,310			13,577

NEONODE INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands)

	Three months ended September 30,						Nine months ended September 30,
	2023			2022			2023			2022
Net loss	$	(1,266	)	$	(994	)	$	(4,198	)	$	(4,128	)

Other comprehensive income (loss):
Foreign currency translation adjustments		(48	)		30			(154	)		104
Other comprehensive loss		(1,314	)		(964	)		(4,352	)		(4,024	)
Less: comprehensive loss attributable to noncontrolling interests		-			194			-			400
Other comprehensive loss attributable to Neonode Inc.	$	(1,314	)	$	(770	)	$	(4,352	)	$	(3,624	)

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 Neonode Inc. Stockholders’ Equity			Noncontrolling Interests		Total Stockholders’ Equity
Balances, December 31, 2022		14,456	$	14	$	227,235	$	(340	)	$	(207,491	)	$	19,418		$	-	$	19,418
Stock-based compensation		-		-		18		-			-			18			-		18
Issuance of shares for cash, net of offering costs		903		1		7,865		-			-			7,866			-		7,866
Foreign currency translation adjustment		-		-		-		35			-			35			-		35
Net loss		-		-		-		-			(1,425	)		(1,425	)		-		(1,425	)
Balances, March 31, 2023		15,359	$	15	$	235,118	$	(305	)	$	(208,916	)	$	25,912		$	-	$	25,912
Stock-based compensation		-		-		17		-			-			17			-		17
Foreign currency translation adjustment		-		-		-		(141	)		-			(141	)		-		(141	)
Net loss		-		-		-		-			(1,507	)		(1,507	)		-		(1,507	)
Balances, June 30, 2023		15,359	$	15	$	235,135	$	(446	)	$	(210,423	)	$	24,281		$	-	$	24,281
Stock-based compensation		-		-		13		-			-			13			-		13
Foreign currency translation adjustment		-		-		-		(48	)		-			(48	)		-		(48	)
Net loss		-		-		-		-			(1,266	)		(1,266	)		-		(1,266	)
Balances, September 30, 2023		15,359	$	15	$	235,148	$	(494	)	$	(211,689	)	$	22,980		$	-	$	22,980

	Common Stock Shares Issued			Common Stock Amount		Additional Paid-in Capital			Accumulated Other Comprehensive Income (Loss)			Accumulated Deficit			Total Neonode Inc. Stockholders’ Equity			Noncontrolling Interests			Total Stockholders’ Equity
Balances, December 31, 2021		13,576		$	14	$	226,880		$	(408	)	$	(202,608	)	$	23,878		$	(4,041	)	$	19,837
Stock-based compensation		-			-		39			-			-			39			-			39
Foreign currency translation adjustment		-			-		-			33			-			33			-			33
Net loss		-			-		-			-			(1,380	)		(1,380	)		(57	)		(1,437	)
Balances, March 31, 2022		13,576		$	14	$	226,919		$	(375	)	$	(203,988	)	$	22,570		$	(4,098	)	$	18,472
Stock-based compensation		4			-		45			-			-			45			-			45
Foreign currency translation adjustment		-			-		-			41			-			41			-			41
Net loss		-			-		-			-			(1,548	)		(1,548	)		(149	)		(1,697	)
Balances, June 30, 2022		13,580		$	14	$	226,964		$	(334	)	$	(205,536	)	$	21,108		$	(4,247	)	$	16,861
Stock-based compensation		-			-		5			-			-			5			-			5
Repurchase and retirement of stock		(10	)		-		(12	)		-			-			(12	)		-			(12	)
Foreign currency translation adjustment		-			-		-			30			-			30			-			30
Net loss		-			-		-			-			(800	)		(800	)		(194	)		(994	)
Balances, September 30, 2022		13,570		$	14	$	226,957		$	(304	)	$	(206,336	)	$	20,331		$	(4,441	)	$	15,890

NEONODE INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Nine months ended September 30,
	2023			2022
Cash flows from operating activities:
Net loss (including noncontrolling interests)	$	(4,198	)	$	(4,128	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense		48			89
Depreciation and amortization		55			104
Amortization of operating lease right-of-use assets		49			327
Recoveries of bad debt		-			(45	)
Changes in operating assets and liabilities:
Accounts receivable and unbilled revenue, net		512			294
Inventory		(689	)		(1,691	)
Prepaid expenses and other current assets		(76	)		45
Accounts payable, accrued payroll and employee benefits, and accrued expenses		256			(386	)
Contract liabilities		(8	)		(6	)
Operating lease obligations		(49	)		(297	)
Net cash used in operating activities		(4,100	)		(5,694	)

Cash flows from investing activities:
Purchase of property and equipment		(58	)		(54	)
Net cash used in investing activities		(58	)		(54	)

Cash flows from financing activities:
Proceeds from issuance of common stock, net of offering costs		7,866			-
Repurchase of common stock		-			(12	)
Principal payments on finance lease obligations		(77	)		(135	)
Net cash provided by (used in) financing activities		7,789			(147	)

Effect of exchange rate changes on cash and cash equivalents		24			(186	)

Net increase (decrease) in cash and cash equivalents		3,655			(6,081	)
Cash and cash equivalents at beginning of period		14,816			17,383
Cash and cash equivalents at end of period	$	18,471		$	11,302

Supplemental disclosure of cash flow information:
Cash paid for income taxes	$	95		$	2
Cash paid for interest	$	8		$	6

Supplemental disclosure of non-cash investing and financial activities:
Property and equipment obtained in exchange for lease obligations	$	-		$	24

Exhibit 99.2

2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 1 Open Open / Confidential / Secret Q3 2023 Earnings Call Nov. 9, 2023

2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 2 Open Urban Forssell Chief Executive Officer Fredrik Nihlén Chief Financial Officer Presenters

2023 - 11 - 09 3 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : Legal Disclaimer This presentation contains, and related oral and written statements of Neonode Inc. (the “Company”) and its management may contain, forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward - looking statements include information about current expectations, strategy, plans, potential financial performance or future events. Th ey also may include statements about market opportunity and sales growth, financial results, use of cash, product development an d introduction, regulatory matters and sales efforts. Forward - looking statements are based on assumptions, expectations and information available to the Company and its management and involve a number of known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, levels of activity, performance or achievements to be materially d iff erent from any expressed or implied by these forward - looking statements. These uncertainties and risks include, but are not limited to, our ability to secure financing when needed on acceptable terms, risks related to new product development, our ability to protect ou r intellectual property, our ability to compete, general economic conditions including as a result of the ongoing COVID - 19 pandemi c or geopolitical conflicts such as the war in Ukraine, as well as other risks outlined in filings of the Company with the U.S. Se cur ities and Exchange Commission (the “SEC”) under the Securities Exchange Act of 1934, as amended, including the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Prospective investors a re advised to carefully consider these various risks, uncertainties and other factors. Any forward - looking statements included in this presentation are made as of today’s date. The Company and its management undertake no duty to update or revise forward - looking statements. This presentation has been prepared by the Company based on its own information, as well as information from public sources. Certain of the information contained herein may be derived from information provided by industry sources. The Company believe s such information is accurate and that the sources from which it has been obtained are reliable. However, the Company has not independently verified such information and cannot guarantee the accuracy of such information. Open

2023 - 11 - 09 4 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : Agenda 1. Summary 2. Q3 2023 Financial Results 3. Strategy & Business Update 4. Q&A Open

2023 - 11 - 09 5 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 5 Summary of Key Points Q3 and YTD • Licensing revenues decreased in Q3 but are stable YTD • Some customers reported lower sales volumes in Q3 compared to Q2 • YTD sales volumes on par with the sales volumes during the same period 2022 • Product sales revenues improved in Q3 but are below targets YTD • Weaker customer demand than expected • Delays in several projects • We continue to adjust and sharpen our strategies and tactics to improve sales performance • Increased focus on the segments and markets where we believe we have the best possibilities to create break throughs • Intensified marketing efforts to create demand for our products and offerings Open

2023 - 11 - 09 6 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : Agenda 1. Summary 2. Q3 2023 Financial Results 3. Strategy & Business Update 4. Q&A Open

2023 - 11 - 09 7 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : Q 3 /’23 Financial Results – Revenues Open $1. 0 million Revenue Total Q 3 2023 ▼ 18 % YoY $0. 2 million Revenue Products Q 3 2023 ▲ 5 % YoY $ 0 . 8 million Revenue License Q 3 2023 ▼ 20 % YoY -200 0 200 400 600 800 1,000 1,200 1,400 AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA AMER APAC EMEA Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Thousands Revenues by Revenue Stream and Region License fees Products NRE -200 0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Thousands Revenues by Revenue Stream License fees Products NRE

2023 - 11 - 09 8 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : Q 3 /’23 Financial Results – Gross Profit/ Margin Open 48 % Adjusted Gross Margin TSMs * Q 3 2023 0 pp YoY (39) % Gross Margin Products Q 3 2023 ▼ 88 pp YoY * See reconciliation in Appendix ”Non - GAAP Financial Measures ” -250% -200% -150% -100% -50% 0% 50% 100% -200 -150 -100 -50 0 50 100 150 200 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Thousands Gross Profit/Margin Products Gross profit Gross margin 0% 10% 20% 30% 40% 50% 60% 70% 0 50 100 150 200 250 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Thousands Gross Profit/Margin TSMs Adjusted* Gross profit Gross margin

2023 - 11 - 09 9 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : Q 3 /’23 Financial Results – Operating Expenses Open $2. 2 million Operating Expenses Q 3 2023 ▲ 6 % YoY -3,500 -3,000 -2,500 -2,000 -1,500 -1,000 -500 0 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Thousands Operating Expenses

2023 - 11 - 09 10 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : Q 3 /’23 Financial Results – Cash Open Lorem $ 19.4 million Cash and Accounts Receivables Sep . 30, 2023 ▲ 3 . 1 Million Dec. 31, 2022 $ 1 . 8 million Net Cash Burn Operating Activities Q 3 2023 ▲ 272 % YoY -3,500 -3,000 -2,500 -2,000 -1,500 -1,000 -500 0 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Thousands Net cash used in operating activities

2023 - 11 - 09 11 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : Agenda 1. Summary 2. Q3 2023 Financial Results 3. Strategy & Business Update 4. Q&A Open

2023 - 11 - 09 12 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 12 Open Lorem ipsum dolor sit Interactive Holographic Displays Shown here is a queue management kiosk used in government services building in Gangnam, Seoul, South Korea, developed by our partner Marketon using our TSM products. 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 12 Open

2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 13 Open 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 13 Rugged Touch and Touchless User Interface Features for Medtech Pictures from LabDays Oslo 2023 where we demonstrated a touchless user interface solution for analytical instruments that avoids cross contamination based on our TSM products . 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 13 Open

2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 14 Open 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 14 Touch On Any Surface Our optical touch technology zForce ® supports touch features on any surface, e.g., glass, plastic, metal, wood, or leather and allows the use of fingers, styluses, and other objects to interact with the underlying system. 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 14 Open

2023 - 11 - 09 15 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 15 Open Lorem ipsum dolor sit HUD Obstruction Detection Neonode offers custom object detection features tailored for each customer’s specific needs. Our proven zForce technology - found in millions of vehicles on the market - is ideally suited for reliably detecting different objects sitting on the HUD unit and obstructing the projected image. 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 15 Open

2023 - 11 - 09 16 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 16 Open Driver and In - cabin Monitoring Custom driver and in - cabin monitoring applications for any need Unparalleled robustness, scalability, and efficiency Sophisticated software platform including development tools for efficient and controlled development of new features 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 16 Open

2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 17 Open 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 17 Events Q3 2023 • iVT Expo Off - Highway Vehicle Technology, Chicago, Illinois, Aug. 21 - 22 • Vendtra Vending Trade Festival, Munich, Germany, Sep. 24 - 25 • SID Vehicle Displays and Interfaces, Detroit, Michigan, Sep. 26 - 27 • LabDays Oslo 2023, Oslo, Norway, Oct. 11 - 12 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 17 Open

2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 18 Open 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 18 Upcoming Events 2023 • Agritechnica , Hannover, Germany, Nov. 12 - 18 • Compamed , Düsseldorf, Germany, Nov. 13 - 16 • InCabin Sensing, Dearborn, Michigan, Dec. 6 - 8 • Car. HMI, Dearborn, Michigan, Dec. 6 – 8 2024 • CES, Las Vegas, Nevada, Jan. 9 - 12 • NRF, New York, New York, Jan. 14 - 16 2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 18 Open

2023 - 11 - 09 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : 19 Open Visit www.neonode.com for more information Follow us on social media

2023 - 11 - 09 21 © Neonode 2001 - 2023 · www.neonode.com · NASDAQ : NEON · Classification : Non - GAAP Financial Measures Open In addition to presenting our financial results in accordance with accounting principles generally accepted in the United Sta tes (“GAAP”), we use adjusted gross margin to measure our financial performance. We define adjusted gross margin as gross margin excluding AirBar sales revenues and costs and adjusting for costs and lost revenues caused by a quality issue and one - time write - down of inventory. We believe a djusted gross margin is a meaningful measure because it reflects the performance of our TSM business, which is our current focus. Non - GAAP fin ancial measures should not be considered as alternatives to the most directly comparable GAAP financial measures. Our use of adjuste d g ross margin, a non - GAAP financial measure, has important limitations as an analytical tool because it excludes some, but not all, items that affect the most directly comparable GAAP financial measure. You should not consider adjusted gross margin in isolation or as substitutes for ana lysis of our results as reported under GAAP. Our definition of non - GAAP adjusted gross margin may not be comparable to similarly titled measu res of other companies, thereby diminishing its utility. The following tables presents a reconciliation of adjusted gross margin to gross margin, the most directly comparable GAAP fi nan cial measure. kUSD Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Q2-23 Q3-23 Revenue Products 98 66 284 502 355 346 136 118 147 210 155 483 102 84 163 Cost of Sales Products -36 -72 -198 -496 -270 -212 -98 -342 -51 -93 -80 -552 -47 -28 -227 Gross Profit Products 62 -6 86 6 85 134 38 -224 96 117 75 -69 55 56 -64 Lost revenues TSM quality issue - - - - - -14 12 92 - - - - - - - Cost of sales TSM quality issue - - - - - 4 27 -61 - - - - - - 143 Inventory write-down TSM quality issue - - - - - - - 154 - - - 294 - - - Revenue AirBar 1 -0 -60 -21 -43 - - - -13 - - - -4 - - Cost of Sales AirBar -23 27 86 123 39 -4 -7 149 - - - - - - - Adjusted Gross Profit Products 40 21 112 109 81 120 70 110 83 117 75 225 51 56 79 Gross Margin Products 63% -9% 30% 1% 24% 39% 28% -190% 65% 56% 48% -14% 54% 67% -39% Adjusted Gross Margin Products 40% 32% 50% 23% 26% 36% 47% 52% 62% 56% 48% 47% 52% 67% 48%

Cover	Nov. 09, 2023
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Nov. 09, 2023
Entity File Number	1-35526
Entity Registrant Name	NEONODE INC.
Entity Central Index Key	0000087050
Entity Tax Identification Number	94-1517641
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	Karlavägen 100
Entity Address, City or Town	Stockholm
Entity Address, Country	SE
Entity Address, Postal Zip Code	115 26
City Area Code	+46 (0)
Local Phone Number	86671717
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	NEON
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false