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1. Company Snapshot

1.a. Company Description

Neonode Inc., together with its subsidiaries, develops optical sensing solutions for contactless touch, touch, and gesture sensing in the United States, Japan, South Korea, China, and internationally.It also offers software solutions for scene analysis using advanced machine learning algorithms to detect and track persons and objects in video streams for cameras and other types of imagers.In addition, the company licenses its technology to original equipment manufacturers (OEMs) and Tier 1 suppliers.


Further, it provides embedded sensors modules to OEMs, original design manufacturers, and systems integrators; and engineering consulting services.Additionally, the company sells Neonode branded sensor products, such as AirBar products through distributors.It serves office equipment, automotive, industrial automation, medical, military, and avionics markets.


Neonode Inc.was incorporated in 1997 and is headquartered in Stockholm, Sweden.

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1.b. Last Insights on NEON

Neonode Inc.'s recent performance was positively driven by its legal victories against tech giants, which have revived its IP value and triggered a dramatic rally. The company's pivot to pure licensing, with no hardware and high margins, positions it for scalable growth. With its tech embedded in over 95 million devices, Neonode sits at the intersection of rapidly growing markets. However, revenues from continuing operations decreased by 25.2% year-over-year to $0.6 million. A rating downgrade was issued, citing that legal wins are priced in.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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Neonode Reports Quarter Ended September 30, 2025 Financial Results

Nov -06

Source: prnewswire.com

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Simulations Plus (NASDAQ:SLP) and Neonode (NASDAQ:NEON) Head to Head Analysis

Nov -05

Source: defenseworld.net

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Critical Review: Neonode (NASDAQ:NEON) versus Elcom International (OTCMKTS:ELCO)

Nov -05

Source: defenseworld.net

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Neonode (NEON) Expected to Announce Earnings on Wednesday

Nov -04

Source: defenseworld.net

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Critical Comparison: Neonode (NASDAQ:NEON) & Prologic Mgmt (OTCMKTS:PRLO)

Oct -24

Source: defenseworld.net

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Neonode downgraded to Neutral from Buy at Ladenburg

Sep -04

Source: https://thefly.com

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Neonode Announces Anticipated Financial Proceeds from Patent Lawsuit Settlement

Sep -03

Source: prnewswire.com

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Neonode Reports Quarter Ended June 30, 2025 Financial Results

Aug -13

Source: prnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.16%)

6. Segments

Consumer Electronics

Expected Growth: 10.33%

Neonode Inc.'s 10.33% growth in Consumer Electronics is driven by increasing demand for touchless sensing technology, rising adoption of IoT devices, and growing popularity of gesture recognition in gaming and smart home applications. Additionally, advancements in optical sensing and AI-powered interfaces are fueling innovation and expansion in this segment.

Automotive

Expected Growth: 10.43%

Neonode Inc.'s 10.43% growth in Automotive is driven by increasing adoption of touchless sensing technology in vehicles, rising demand for advanced driver-assistance systems (ADAS), and growing popularity of electric vehicles (EVs) that require more sophisticated sensor systems.

Touch Sensor Modules

Expected Growth: 9.27%

Neonode's Touch Sensor Modules growth is driven by increasing adoption in IoT devices, smartphones, and laptops, fueled by demand for touchless interfaces, gesture recognition, and proximity sensing. Additionally, the rising need for contactless interactions in public spaces, healthcare, and retail industries contributes to the 9.27% growth.

Non-recurring Engineering Services

Expected Growth: 10.27%

Neonode Inc.'s 10.27% growth in Non-recurring Engineering Services is driven by increasing demand for touchless sensing solutions, expansion into new markets such as automotive and industrial, and strategic partnerships with leading OEMs. Additionally, the company's innovative zForce technology and strong R&D investments have enabled it to capitalize on emerging trends in human-machine interface and IoT.

7. Detailed Products

zForce AIR

A patented optical sensor technology that enables touchless sensing and gesture recognition.

zForce PLUS

A high-performance, low-power optical sensor technology for touchless sensing and gesture recognition.

zForce CORE

A low-power, low-cost optical sensor technology for touchless sensing and gesture recognition.

Neonode Licensing

A licensing program that allows companies to integrate Neonode's patented optical sensor technology into their products.

8. Neonode Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Neonode Inc. operates in the optical sensor market, which has a moderate threat of substitutes. While there are alternative technologies available, such as capacitive sensors, they have limitations and are not yet widely adopted.

Bargaining Power Of Customers

Neonode Inc.'s customers are primarily OEMs and ODMs, which have limited bargaining power due to the specialized nature of the company's products.

Bargaining Power Of Suppliers

Neonode Inc. relies on a few key suppliers for its optical sensor components, which gives them some bargaining power. However, the company's strong relationships with its suppliers mitigate this risk.

Threat Of New Entrants

The optical sensor market is highly competitive, and new entrants can easily enter the market with similar products. Neonode Inc. must continue to innovate and differentiate its products to maintain its market share.

Intensity Of Rivalry

The optical sensor market is highly competitive, with several established players competing for market share. Neonode Inc. must focus on differentiating its products and providing excellent customer service to maintain its market position.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 0.61%
Debt Cost 3.95%
Equity Weight 99.39%
Equity Cost 14.11%
WACC 14.05%
Leverage 0.62%

11. Quality Control: Neonode Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

2.34$

Current Price

2.34$

Potential

-0.00%

Expected Cash-Flows