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): May 8, 2024

NEONODE INC.

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

Commission File Number 001-35526

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) 702958519

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 May 8, 2024, Neonode Inc. (the “Company”) reported its earnings for the three months ended March 31, 2024 (the “Earnings Release”). A copy of the Earnings Release is attached hereto as Exhibits 99.1 is incorporated herein by reference.

The information furnished pursuant to this Item 2.02, including Exhibit 99.1, 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 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.		Description
99.1		Earnings Release of the Company dated May 8, 2024
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: May 8, 2024	NEONODE INC.

	By:	/s/ Fredrik Nihlén
	Name:	Fredrik Nihlén
	Title:	Interim President and Chief Executive Office and Chief Financial Officer

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.

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

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

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	)

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

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

Cover	May 08, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	May 08, 2024
Entity File Number	001-35526
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	702958519
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