NEON Neonode Inc

 

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): August 10, 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 August 10, 2023, Neonode Inc. (the “Company”) reported its earnings for the three months ended June 30, 2023 (the “Earnings Release”) and posted on the Neonode website the Second 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, August 10, 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 August 10, 2023
Exhibit 99.2		Second 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: August 10, 2023	NEONODE INC.
	By:	/s/ Fredrik Nihlén
	Name:	Fredrik Nihlén
	Title:	Chief Financial Officer

 

 

2

 

Exhibit 99.1

 

 

Press Release

For Release, 09:10AM EDT August 10, 2023

 

Neonode Reports Quarter Ended June 30, 2023 Financial Results

 

STOCKHOLM, SWEDEN, August 10, 2023 — Neonode Inc. (NASDAQ: NEON) today reported financial results for the three and six months ended June 30, 2023.

 

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

 

●

Revenue of $1.2 million, a decrease of 5.3% compared to the same period in the prior year.

 

●

Operating expenses of $2.8 million, a decrease of 1.9% compared to the same period in the prior year.

 

●

Net loss of $1.5 million, or $0.10 per share, compared to $1.5 million, or $0.11 per share, for the same period in the prior year.

 

●

Cash used by operations of $0.6 million compared to $2.9 million for the same period in the prior year.

 

●

Cash and accounts receivable of $21.6 million as of June 30, 2023 compared to $16.3 million as of December 31, 2022.

 

FINANCIAL SUMMARY FOR THE SIX MONTHS ENDED JUNE 30, 2023:

 

●

Revenue of $2.5 million, a decrease of 5.1% compared to the same period in the prior year.

 

●

Operating expenses of $5.6 million, an increase of 1.4% compared to the same period in the prior year.

 

●

Net loss of $2.9 million, or $0.19 per share, compared to $2.9 million, or $0.22 per share, for the same period in the prior year.

 

●

Cash used by operations of $2.3 million compared to $5.2 million for the same period in the prior year.

 

THE CEO’S COMMENTS

 

“Our licensing revenues in Q2 were at the same level as in Q1 and 15% higher than in the same period last year, showing good stability. Our product sales revenues in Q2 were low and much below expectations, which we are addressing with different kinds of activities and changes in our strategies and tactics to ensure that we come back to a growth path for this business in the coming quarters”, said Dr. Urban Forssell, Neonode’s CEO.

 

“The changes we have started to implement include an increased focus on markets and sectors where we have good traction, supported by intensified marketing – both online and through participation in tradeshows and other types of events – to create beachheads from which we may continue to grow our licensing and products businesses. To help us drive these changes and become more effective in our marketing and sales efforts we have recruited experienced core competence to strengthen our sales and engineering teams in Stockholm. We remain optimistic about our ability to grow our business and return to profitability,” concluded Dr. Forssell.

 

 

FINANCIAL OVERVIEW FOR THE QUARTER ENDED JUNE 30, 2023

 

Net revenues for the quarter ended June 30, 2023 were $1.2 million, a 5.3% decrease compared to the same period in 2022. For the 2023 period, license revenues were $1.1 million, an increase of 14.8% compared to the 2022 period. The increase is primarily volume related as the global supply chain challenges related to semiconductor supply shortages that hampered our printer and automotive customers’ production and sales for the last two years have improved and the demand for our customers’ products remains strong.

 

Revenues from product sales for the quarter ended June 30, 2023 were $0.1 million, a 60.0% decrease compared to the same period in 2022. The reason for the decrease is mainly low customer demand, which we are addressing with focused marketing and sales campaigns and updates to our partner network.

 

Gross margin related to products was 66.7% for the second quarter of 2023 compared to 55.7% in the same period in 2022. The gross margin for products is higher for lower order volumes and also varies with the product mix.

 

Our operating expenses decreased by 1.9% for the second quarter of 2023 compared to the same period in 2022, primarily due to lower payroll and related costs.

 

Net loss attributable to Neonode for the three months ended June 30, 2023 was $1.5 million, or $0.10 per share, compared to a net loss of $1.5 million, or $0.11 per share, for the same period in 2022. Cash used by operations was $0.6 million in the second quarter of 2023 compared to $2.9 million for the same period in 2022. The decrease is primarily the result of less component purchases.

 

Cash and accounts receivable totaled $21.6 million and working capital was $24.0 million as of June 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

 

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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)

 

		June 30,				December 31,
		2023				2022
		(Unaudited)				(Audited)
ASSETS
Current assets:
Cash and cash equivalents		$	20,291			$	14,816
Accounts receivable and unbilled revenues, net			1,301				1,448
Inventory			3,671				3,827
Prepaid expenses and other current assets			660				707
Total current assets			25,923				20,798
Property and equipment, net			289				282
Operating lease right-of-use assets, net			83				118
Total assets		$	26,295			$	21,198
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	508			$	334
Accrued payroll and employee benefits			848				951
Accrued expenses			468				200
Contract liabilities			22				36
Current portion of finance lease obligations			54				95
Current portion of operating lease obligations			66				83
Total current liabilities			1,966				1,699
Finance lease obligations, net of current portion			31				46
Operating lease obligations, net of current portion			17				35
Total liabilities			2,014				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 June 30, 2023 and December 31, 2022, respectively			15				14
Additional paid-in capital			235,135				227,235
Accumulated other comprehensive loss			(446	)			(340	)
Accumulated deficit			(210,423	)			(207,491	)
Total stockholders’ equity			24,281				19,418
Total liabilities and stockholders’ equity		$	26,295			$	21,198

 

 

NEONODE INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

 

		Three months ended June 30,								Six months ended June 30,
		2023				2022				2023				2022
Revenues:
License fees		$	1,094			$	953			$	2,242			$	2,057
Products			84				210				186				357
Non-recurring engineering			22				104				25				171
Total revenues			1,200				1,267				2,453				2,585
Cost of revenues:
Products			28				93				75				144
Non-recurring engineering			9				17				9				26
Total cost of revenues			37				110				84				170
Total gross margin			1,163				1,157				2,369				2,415
Operating expenses:
Research and development			1,063				1,146				1,865				2,169
Sales and marketing			689				644				1,281				1,260
General and administrative			1,038				1,053				2,422				2,063
Total operating expenses			2,790				2,843				5,568				5,492
Operating loss			(1,627	)			(1,686	)			(3,199	)			(3,077	)
Other income (expense):
Interest income (expense), net			169				(4	)			327				(6	)
Other income			-				21				-				21
Total other income, net			169				17				327				15
Loss before provision for income taxes			(1,458	)			(1,669	)			(2,872	)			(3,062	)
Provision for income taxes			49				28				60				72
Net loss including noncontrolling interests			(1,507	)			(1,697	)			(2,932	)			(3,134	)
Less: net loss attributable to noncontrolling interests			-				149				-				206
Net loss attributable to Neonode Inc.		$	(1,507	)		$	(1,548	)		$	(2,932	)		$	(2,928	)
Loss per common share:
Basic and diluted loss per share		$	(0.10	)		$	(0.11	)		$	(0.19	)		$	(0.22	)
Basic and diluted – weighted average number of common shares outstanding			15,359				13,578				15,285				13,577

 

 

 

NEONODE INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands)

 

		Three months ended June 30,								Six months ended June 30,
		2023				2022				2023				2022
Net loss		$	(1,507	)		$	(1,697	)		$	(2,932	)		$	(3,134	)
Other comprehensive income (loss):
Foreign currency translation adjustments			(141	)			41				(106	)			74
Other comprehensive loss			(1,648	)			(1,656	)			(3,038	)			(3,060	)
Less: comprehensive loss attributable to noncontrolling interests			-				149				-				206
Other comprehensive loss attributable to Neonode Inc.		$	(1,648	)		$	(1,507	)		$	(3,038	)		$	(2,854	)

 

 

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

 

		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

 

 

 

NEONODE INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

 

		Six months ended June 30,
		2023				2022
Cash flows from operating activities:
Net loss (including noncontrolling interests)		$	(2,932	)		$	(3,134	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation expense			35				84
Depreciation and amortization			37				87
Amortization of operating lease right-of-use assets			33				224
Recoveries of bad debt			-				(79	)
Changes in operating assets and liabilities:
Accounts receivable and unbilled revenue, net			140				253
Inventory			17				(2,312	)
Prepaid expenses and other current assets			27				232
Accounts payable, accrued payroll and employee benefits, and accrued expenses			374				(287	)
Contract liabilities			(13	)			12
Operating lease obligations			(33	)			(294	)
Net cash used in operating activities			(2,315	)			(5,214	)
Cash flows from investing activities:
Purchase of property and equipment			(36	)			(47	)
Net cash used in investing activities			(36	)			(47	)
Cash flows from financing activities:
Proceeds from issuance of common stock, net of offering costs			7,866				-
Principal payments on finance lease obligations			(52	)			(99	)
Net cash provided by (used in) financing activities			7,814				(99	)
Effect of exchange rate changes on cash and cash equivalents			12				403
Net decrease in cash and cash equivalents			5,475				(4,957	)
Cash and cash equivalents at beginning of period			14,816				17,383
Cash and cash equivalents at end of period		$	20,291			$	12,426
Supplemental disclosure of cash flow information:
Cash paid for income taxes		$	60			$	2
Cash paid for interest		$	6			$	6
Supplemental disclosure of non-cash investing and financial activities:
Property and equipment obtained in exchange for lease obligations		$	-			$	24

 

 

8

 

Exhibit 99.2

 

Q2 2023 Earnings Call | August 10, 2023 2023 - 08 - 09 1 © Neonode 2001 - 2021 · www.neonode.com · Nasdaq (NEON) 2023 - 08 - 09 1 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Today’s Presenters 2023 - 08 - 09 2 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) • Urban For s se ll, CEO • Fr e drik Nihl é n, CFO

Legal Disclaimer 2023 - 08 - 09 3 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) 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. They also may include statements about market opportunity and sales growth, financial results, use of cash, product development and 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 different 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 our intellectual property, our ability to compete, general economic conditions including as a result of the ongoing COVID - 19 pandemic or geopolitical conflicts such as the war in Ukraine, as well as other risks outlined in filings of the Company with the U.S. Securities 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 are 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 believes 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.

A g enda 2023 - 08 - 09 4 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) 1. Summary 2. Q2 2 0 23 Financial Re s u lts 3. Business Update 4. Q&A N e onod e I n c . Q2 20 2 3 | A u g u st 1 0 , 20 2 3

Summary of Key Points Q2 2023 - 08 - 09 5 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) • Lice n sing r ev e nu e s sta b le • Wor l dwide se m ic o nductor s u p p ly s h ortag e si t u a t ion h a s im p rov e d • Demand for our printer and automotive customers’ products remains strong • Product s a les re v e n ues below ta rgets • Weake r cust o m er d e mand th an ex p e c ted • D e layed pr o duct lau n c hes in sev e ral pr o je c ts • We are adjusting our strategies and tactics to improve sales in the coming quarters • Increased focus on markets and segments where traction is good • I ntensified mark e ting efforts • Development of tailored solutions to sharpen our customer offer

A g enda 2023 - 08 - 09 6 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) 1. Summary 2. Q2 2 0 23 Fin a n c i a l R e s u lts 3. Business Update 4. Q&A N e onod e I n c . Q2 20 2 3 | A u g u st 1 0 , 20 2 3

$1.2 million R e v e n u e T o t a l Q2 2023 但 5 % Y oY $0.1 million Revenue Products Q2 2023 但 60 % Y oY $1.1 million R e v e n u e Lic e n s e Q2 2023 似 15 % Y oY 1,400 1,200 1,000 800 600 400 200 0 - 200 A M E R A P A C EM E A A M E R APAC EM E A A M E R APAC EM E A A M E R APAC EM E A A M E R APAC EM E A A M E R APAC EM E A A M E R APAC EM E A A M E R APAC EM E A A M E R APAC EM E A A M E R APAC EM E A A M E R APAC E M E A A M E R APAC EM E A A M E R APAC EM E A A M E R APAC EM E A Q 2 - 22 Q 3 - 22 Q 4 - 22 Q 1 - 23 Q 2 - 23 T h o us a nd s Q2/’23 Financial Results – Revenues Revenues by Revenue Stream and Region Q1 - 20 Q2 - 20 Q3 - 20 Q4 - 20 Q1 - 21 Q2 - 21 L i c e n s e fe e s Q3 - 21 Q4 - 21 Q1 - 22 Products NRE Thousands Revenues by Revenue Stream 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 - 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 License fees Products NRE 2023 - 08 - 09 7 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

67% Adjusted Gross Margin TSMs* Q2 2023 似 11pp YoY 67% G r o s s M a r g i n Products Q2 2023 似 11pp YoY * See reconciliation in Appendix ”Non - GAAP Financial Measures” - 25 0 % - 20 0 % - 15 0 % - 10 0 % - 50% 0% 50% 100 50 0 - 50 - 100 - 150 - 200 20 0 100% 150 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 T h o us a nd s Q2/’23 Financial Results – Gross Profit/Margin Gross Profit/Margin Products Gross profit Gross margin 0% 10% 20% 50% 40% 30% 60% 70% 0 50 100 150 200 250 Q4 - 22 Q1 - 23 Q2 - 23 T h o us a nd s Gross Profit/Margin TSMs Adjusted* Q1 - 20 Q2 - 20 Q3 - 20 Q4 - 20 Q1 - 21 Q2 - 21 Q3 - 21 Q4 - 21 Q1 - 22 Q2 - 22 Q3 - 22 Gross profit Gross margin 2023 - 08 - 09 8 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Q2/’23 Financial Results – Operating Expenses $2.8 million Operating Expenses Q2 2023 但 2% YoY - 3 ,000 - 3 ,500 2023 - 08 - 09 9 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) - 2 ,500 - 2 ,000 - 1,500 - 1,000 - 500 0 Q 1 - 20 Q 2 - 20 Q 3 - 20 Q 4 - 20 T h o us a nd s Operating Expenses Q1 - 21 Q2 - 21 Q3 - 21 Q4 - 21 Q1 - 22 Q2 - 22 Q3 - 22 Q4 - 22 Q1 - 23 Q2 - 23

Q2/’23 Financial Results – Cash $21.6 million Cash and Accounts Receivables Jun. 30, 2023 似 5.3 Million Dec. 31, 2022 $0.6 million Net Cash Burn O p e r a t i n g A ct i v i t i e s Q2 2023 但 79 % Y oY - 3 ,000 - 3 ,500 2023 - 08 - 09 10 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) - 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 T h o us a nd s Net cash used in operating activities

A g enda 2023 - 08 - 09 11 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) 1. Summary 2. Q2 2 0 23 Financial Re s u lts 3. Bu s i n e s s Up d ate 4. Q&A N e onod e I n c . Q2 20 2 3 | A u g u st 1 0 , 20 2 3

Touchless Solutions 2023 - 08 - 09 12 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Luxury Hotel, The Maybourne Riviera, Installs Contactless Controls 2023 - 08 - 09 13 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

MyScript Collaboration Provides Handwriting Recognition Solutions to Integrators 2023 - 08 - 09 14 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Neonode and NXO Sign Value - added Reseller Agreement 2023 - 08 - 09 15 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Rugged Touch Solutions 2023 - 08 - 09 16 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Me d t ech 2023 - 08 - 09 17 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Automotive Commercial Vehicle and Off Highway 2023 - 08 - 09 18 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

HUD Obstruction Detection 2023 - 08 - 09 19 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Driver and In - cabin Monitoring 2023 - 08 - 09 20 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Events Q2 2023 2023 - 08 - 09 21 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) • • • IM S & H UD Ex p o , C h ina • M e d - T e c h I n nov a t io n E xpo, UK • Car. HM I Europ e , G e rm a ny • InCa b in . S e nsing Europ e , G e rm a ny • A u t o S e ns InC a b i n , B e lgium IVT Ex p o , G ermany W o rld El e v ato r Esc alato r Ex p o , C h ina Upcoming Major Events: • • CES 202 4, L as Ve gas, N V NRF 202 4, Ne w Yo rk, N Y

A g enda 2023 - 08 - 09 22 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) 1. Summary 2. Q2 2 0 23 Financial Re s u lts 3. Business Update 4. Q&A N e onod e I n c . Q2 20 2 3 | A u g u st 1 0 , 20 2 3

inf o @ n e o nod e . c o m neonode.com Subsc r ibe to N e o node n e w s let t e r Thank you. 2023 - 08 - 09 23 © Neonode 2001 - 2021 · www.neonode.com · Nasdaq (NEON) 2023 - 08 - 09 23 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Appendix 2023 - 08 - 09 24 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON)

Non - GAAP Financial Measures In addition to presenting our financial results in accordance with accounting principles generally accepted in the United States (“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 adjusted gross margin is a meaningful measure because it reflects the performance of our TSM business, which is our current focus. Non - GAAP financial measures should not be considered as alternatives to the most directly comparable GAAP financial measures. Our use of adjusted gross 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 analysis of our results as reported under GAAP. Our definition of non - GAAP adjusted gross margin may not be comparable to similarly titled measures of other companies, thereby diminishing its utility. 2023 - 08 - 09 25 © Neonode 2001 - 2023 · www.neonode.com · Nasdaq (NEON) The following tables presents a reconciliation of adjusted gross margin to gross margin, the most directly comparable GAAP financial measure. Q2 - 23 Q1 - 23 Q4 - 22 Q3 - 22 Q2 - 22 Q1 - 22 Q4 - 21 Q3 - 21 Q2 - 21 Q1 - 21 Q4 - 20 Q3 - 20 Q2 - 20 Q1 - 20 kUSD 84 102 483 155 210 147 118 136 346 355 502 284 66 98 Revenue Products - 28 - 47 - 552 - 80 - 93 - 51 - 342 - 98 - 212 - 270 - 496 - 198 - 72 - 36 Cost of Sales Products 56 55 - 69 75 117 96 - 224 38 134 85 6 86 - 6 62 Gross Profit Products - - - - - - 92 12 - 14 - - - - - Lost revenues TSM quality issue - - - - - - - 61 27 4 - - - - - Cost of sales TSM quality issue - - 294 - - - 154 - - - - - - - Inventory write - down TSM quality issue - - 4 - - - - 13 - - - - 43 - 21 - 60 - 0 1 Revenue AirBar - - - - - - 149 - 7 - 4 39 123 86 27 - 23 Cost of Sales AirBar 56 51 225 75 117 83 110 70 120 81 109 112 21 40 Adjusted Gross Profit Products 67% 54% - 14% 48% 56% 65% - 190% 28% 39% 24% 1% 30% - 9% 63% Gross Margin Products 67% 52% 47% 48% 56% 62% 52% 47% 36% 26% 23% 50% 32% 40% Adjusted Gross Margin Products

v3.23.2

Cover	Aug. 10, 2023
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Aug. 10, 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

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