NEON

• 2023 Overview: Operated in Licensing and Product Sales segments; Licensing had mixed performance in automotive and printers; Product Sales struggled with weak demand.
• New Strategy: Phased out Products business, focusing 100% on Technology Licensing; Targets Human Machine Interaction and Machine Perception applications using zForce and MultiSensing platforms; Focused on IT & Industrial (printers, kiosks, Medtech) and Automotive segments.
• 2024 Plans: In IT & Industrial, selling TSMs in first half and winding down production in Kungsbacka, Sweden, in second half; In Automotive, progressing with driver monitoring software project, expecting NRE revenues and royalty revenues from mass production; Participated in CES and NRF, generating leads.

No specific numerical guidance provided, but aiming to double turnover in coming years, focusing on high gross margins through simplified operations and fewer but bigger customers.

In 2023, Neonode had two main segments: Technology Licensing and Product Sales. Total revenue was $4.4 million. License revenues from Technology Licensing were $3.8 million (86.36% of total revenue), with Automotive Licensing revenues stable in 2023 and a breakthrough driver monitoring software award in Q4, but printer licensing revenues weakening in Q3 and Q4 due to underlying product sales and inventory issues. Product Sales revenue was $0.6 million (13.64% of total revenue), struggling with weak demand leading to the phase-out of the Products business in December 2023, offering key customers to license the technology instead.

• Uncertainties in automotive sales cycles and market demand.
• Risks associated with forward-looking statements, including unknown factors affecting actual results.
• Impact of inventory impairments and purchase commitments related to phase-out of Products business.

Q: Detail on automotive project process and NRE revenues A: Automotive sales cycles are long (18-36 months). During development, NRE revenues are earned. Once mass production starts, royalties per vehicle.

Q: Average selling price for royalties A: Royalties per vehicle are low, but high volumes compensate. Margins remain good due to flexible software.

Q: Market results from marketing efforts A: CES and NRF were successful, but Products business sales were weak, leading to strategy change.

Q: Revenue growth and profitability targets A: Aiming to double turnover, focus on high gross margins via simplified operations.

Q: View on ownership and share price A: Management holds significant shares, sees current share price as attractive, optimistic about future growth.