Neonode Reports $3.1 Million Revenue for Fiscal Year 2024, Down 18.8%

Neonode Inc. reported a total revenue of $3.1 million for the fiscal year ending December 31, 2024, a decrease of 18.8% from $3.8 million in 2023. The decline was primarily attributed to a 29.3% drop in license fee revenues, which fell to $2.7 million from $3.8 million, reflecting reduced demand from legacy customers in the printer and automotive sectors. However, the company saw a significant increase in non-recurring engineering (NRE) revenues, which surged to $421,000 from just $26,000 in the previous year, driven by new projects with commercial vehicle OEMs and NEXTY Electronics.

In terms of operational changes, Neonode announced a strategic shift in December 2023, focusing exclusively on its licensing business and phasing out its touch sensor module (TSM) product line. This transition is expected to streamline operations and enhance profitability by leveraging existing technology through licensing agreements. As of December 31, 2024, the company maintained 37 valid technology license agreements with various global OEMs, with a customer base concentrated in the automotive and printer markets.

Geographically, Neonode's revenue distribution shifted notably, with Japan accounting for 55.8% of total revenues, up from 38.5% in 2023. The United States contributed 24.5%, down from 38%, while Sweden and Germany also saw changes in their revenue contributions. The company’s customer concentration remains high, with four customers representing approximately 80.9% of consolidated accounts receivable and unbilled revenues, highlighting the risks associated with dependency on a limited number of clients.

Despite the revenue decline, Neonode's gross margin remained high at 96.3%, although it decreased from 99.7% in 2023 due to the increased proportion of NRE projects. Operating expenses were relatively stable, totaling $9.5 million, with research and development costs slightly reduced to $3.4 million. The company reported a net loss of $5.9 million for 2024, compared to a loss of $5.1 million in 2023, reflecting ongoing challenges in achieving profitability.

Looking ahead, Neonode's management expressed optimism about future growth driven by its renewed focus on licensing and the potential for new customer acquisitions. However, the company acknowledged the need for additional capital to support operations and strategic initiatives, emphasizing the importance of maintaining liquidity in a competitive market environment. As of December 31, 2024, Neonode had cash and cash equivalents of $16.4 million, providing a buffer for its operational needs in the coming year.