STOCKHOLM, SWEDEN – March 8, 2018 – Neonode Inc. (NASDAQ: NEON), the Optical Interactive Sensing Technology Company, today reported financial results for the fourth quarter and year ended December 31, 2017.
– Sales in the fourth quarter of $3.3 million increased by 14% over the same quarter in 2016
– Launch and first shipments of commercial zForce AIR sensor modules in the fourth quarter
– zForce AIR sensors modules available for shipment worldwide through Digi-Key Electronics
– On February 12, 2018, Håkan Persson was announced as new CEO, starting April 1, 2018
“Our first priority has been to secure a balanced cash flow by implementing tighter cash management and cost controls and focusing the company on closing near term licensing agreements and sales of sensor modules. To facilitate our refocused sales efforts, we have reassigned valuable engineering and development resources from non-core development projects to customer driven sales support and development activities,” stated Andreas Bunge, Interim CEO of Neonode
“We continue to have stable revenue from our licensing business and remain very optimistic about developing our zForce AIR technology and sensor modules and will continue to work together with key customers in strategic segments to increase our revenue. Our new CEO, Håkan Persson, brings solid expertise in driving sales and growing technology companies and we believe that Neonode has the technology, resources and capacity to secure execution of our strategy,” concluded Mr. Bunge.
Financial Results for the Fourth Quarter and Year Ended December 31, 2017
Net revenue for fiscal 2017 was $10.2 million which is basically flat compared to fiscal 2016. Licensing revenues were up by 4% year over year, primarily due to a 23.2% increase from the printer segment which was partially offset by a 29.8% decrease from our e-Reader segment. Non-recurring engineering (“NRE”) fees decreased 56.6% year over year, due to fewer customer custom design projects. License and non-recurring engineering (“NRE”) fees represented 85% and 7% of total revenue in 2017 compared to 82% and 17% in 2016, respectively. In the fourth quarter of 2017 total net revenues were $3.3 million, a 14% increase, compared to $2.9 million for the same period in 2016. License and NRE fees represented approximately 77% and 17% of total revenue, respectively, in both the comparative periods.
Our combined total gross margin was 77% in 2017 compared to 87% in 2016. The decrease in 2017 is primarily due to a high negative gross margin related to AirBar sales. AirBar sales have not met expectations and consequently, we evaluated the net realizable value of our AirBar inventory and recorded a $1.7 million inventory reserve, of which $1.4 million was recorded in the fourth quarter and $0.3 million in the third quarter of 2017. Through-out 2017 we continued to reduce our total cost structure and total operating expenses decreased by 4.6% to $13.4 million for fiscal 2017 compared to $14.0 million for fiscal 2016.
Net loss for fiscal 2017 was $4.7 million, or $0.09 per share, compared to a net loss of $5.3 million, or $0.12 per share, in fiscal 2016.
Cash and accounts receivable totaled $6.8 million at December 31, 2017 compared to $5.0 million at December 31, 2016. Common shares on a fully diluted basis including common stock, stock options and warrant outstanding totaled approximately 71.5 million shares on December 31, 2017 compared to approximately 58.6 million shares at December 31, 2016.
Conference Call Information
Neonode will host a conference call Thursday March 8, 2018 at 10AM Eastern Standard Time (EST)/4PM Central European Time (CET) featuring remarks by, and Q&A with, Andreas Bunge, Interim CEO, Lars Lindqvist, CFO and David Brunton, Head of Investor Relations.
The dial-in number for the conference call is toll-free: (877) 539-0733 (U.S. domestic) or +1 (678) 607-2005 (international). To access the call all participants must use the following Conference ID: #3083056. Please make sure to call at least five minutes before the scheduled start time.
To register for the call, and listen online, please click:
For interested individuals unable to join the live event, a digital recording for replay will be available for 30 days after the call’s completion – 3/8/2018 (13:00PM EDT) to 4/8/2018 (23:59PM EDT). To access the recording, please use one of these Dial-In Numbers (800) 585-8367 or (404) 537-3406, and the Conference ID #3083056.
Neonode Inc. (NASDAQ:NEON) develops user interface, optical interactive touch and gesture solutions. We license our technology and sell sensor components that incorporate our technology to Original Equipment Manufacturers (“OEMs”) and Tier 1 suppliers who in-turn embed our technology/sensors into products they develop, manufacture and sell. Our patented technology is developed for a wide range of devices like automotive systems, printers, medical devices, PC devices, monitors, mobile phones, tablets and e-readers. NEONODE and the NEONODE Logo are trademarks of Neonode Inc. registered in the United States and other countries. AIRBAR is a trademark of Neonode Inc. All other trademarks are the property of their respective owners.
For more information please visit www.neonode.com
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 expectations, future performance or future events, and product cost, performance, and functionality matters. 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 are discussed under “Risk Factors” and elsewhere in Neonode’s public filings with the U.S. Securities and Exchange Commission from time to time, including Neonode’s annual report 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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