Benzinga | May 12, 2021 11:51AM EDT

Why Did Neonode Stock Plunge After Q1 Earnings?

* Neonode Inc (NASDAQ: NEON) reported first-quarter FY21 revenue growth of 28.7% year-on-year to $1.7 million, missing the analyst consensus of $1.83 million.

* HMI Solutions revenues rose 9.9% Y/Y to $1.3 million from higher license fees from its automotive customers.

* The HMI Products revenues rose 226.8% Y/Y to $0.4 million from growing market demand for contactless touch solutions for elevators and self-service kiosks.

* Gross margin contracted 1,320 basis points to 83.4% due to the change in the mix of the components of overall revenue with an increase in the relatively lower margin sales of sensor modules.

* Net loss rose by 60% Y/Y to ($1.6 million), with an EPS loss of ($0.14), missing the analyst consensus of ($0.12) loss.

* The company generated $2 million in operating cash flow and held $9.5 million in cash and equivalents.

* Neon inked an agreement with B. Riley Securities on May 10 to sell shares worth up to $25 million.

* Price action: NEON shares traded lower by 9.44% at $7.10 on the last check Wednesday.