NeoMedia Technologies, Inc (NEOM)

[Poptech]

cloud: What has changed most significantly lately is we no longer know the primary sources of cash or the components of revenue. The last revenue-based 8K was almost a year ago and I suspect we may never see one again. NeoMedia has said their revenues have declined significantly because one customer is in arbitration. This raises real concern over weighting of line items for both cash and income.


The reduction in lending is the result of aggressively shrinking their budgets while almost maintaining revenue. I have never been entirely impressed with any argument of shrinking to success.

The EU win was a statistical long-shot to survive the rejection. Despite the impressive win, it won't do much that will add to NeoMedia's business. First of all, they had already been licensing the patent despite its void status so licensing is business-as-usual. Second, the patent expires in less than two years so it would be tough for NeoMedia to build business services dependent on that IP.

The upside right now, sadly, is the reverse split. It will have both cosmetic and significant benefits for investors. The extension of the maturity coupled with the reverse split indicates YA expects NeoMedia to be around for a while. The continuous predictions for bankruptcy now have no basis for reasonable discussion. The conversion benefit to NeoMedia increases significantly so that 70 million shares will pay off YA on conversion date. That will take the wind out of the conversion-kills angst.

Otherwise, it is business as usual. Shareholders are left to debate what it is NeoMedia does, management largely ignores shareholder's basic requirements, NeoMedia's image within their industry continues to erode, NeoMedia's technology needs serious development to maintain industry requirements, and investors will continue to hammer predictions for a positive outcome.