GEOWORKS REPORTS THIRD QUARTER RESULTS
(ALAMEDA, CA), January 26, 1999 - Geoworks Corporation (NASDAQ National Market System Symbol: GWRX), a leading provider of wireless software and service solutions, today announced results for the third quarter and first nine months of fiscal 1999.
For the quarter ended December 31, 1998, Geoworks reported revenues of $1,954,000, compared with revenues of $4,023,000 in the same period a year ago. The company reported a net loss of $3,488,000, or $0.22 per share, compared with a net loss of $2,583,000, or $0.16 per share, for the third quarter of fiscal 1998.
For the nine months ended December 31, 1998, Geoworks reported revenues of $4,740,000 compared with revenues of $9,286,000 in the same period a year ago. The company reported a loss of $13,261,000, or $0.83 per share, versus a loss of $11,082,000, or $0.71 per share, in the first nine months of fiscal 1998.
"While we are disappointed in our revenue results, we continue to work on cost reductions," noted Dave Grannan, president and chief executive officer. "We lowered our net loss relative to the second quarter of fiscal 1999 by narrowing our focus and thereby reducing our personnel and related costs," he continued.
"Revenue is our number one goal," said Grannan. "To that end we've just launched the Professional Services consulting group to generate short term income. Longer term, we launched several key products in the third quarter that we anticipate will generate revenue," Grannan added.
"At the same time, we realized several important milestones in our strategy to address the mid-range enhanced phone market, including the introduction of a device utilizing our technology in Japan, a leading smart phone market," he added.
Geoworks has provided Mitsubishi Electric Corporation engineering and software expertise to produce a new enhanced phone, the Moem-D, which debuted in Japan in early November. The Moem-D is Geoworks first product in the enhanced phone category and offers e-mail capabilities, along with PC connectivity and a phone book application for the storage of names and phone numbers.
Also in Japan, Geoworks' operating system is serving as the foundation for NTT DoCoMo's new Dialo smart phone manufactured by Toshiba. This is the first device with Geoworks' technology to be offered by NTT DoCoMo, Japan's leading service provider. Dialo provides consumers with Internet access, e-mail, web browsing, a Personal Information Manager and PC link capabilities.
"These products symbolize the market potential for devices offering both voice and data communications capabilities that are lightweight, easy-to-use and are priced attractively," Grannan noted.
The company also introduced the Premion Interface+ graphical application environment to enhance ease-of-use and functionality of wireless devices. With its flexible user interface, Premion Interface+ allows manufacturers to create enhanced phones by integrating handset features with both existing operator value-added services and future Wireless Application Protocol (WAP) applications.
Geoworks further enhanced its presence in Japan with the announcement that Toshiba will use Geoworks Premion Server+ technology as a content server to deliver news and information services to users of portable devices. Toshiba is the first company to offer services via Geoworks' Premion Server+ and plans to provide over-the-air Japanese news and information via the server.
"These developments position Geoworks squarely in the enhanced phone market and enable us to pursue our strategy of developing and marketing content for these devices," Grannan noted. "This includes our strategy to help carriers integrate advertising and sponsorship into our Premion Information Services utilizing a web-based advertising model that will enable carriers to add services and content at minimal or no cost to their customers."
Grannan said that to complement the company's focus on the enhanced phone market, Geoworks has created a Professional Services consulting group which will target device manufacturers and service providers with software development, strategic solutions, product management and quality assurance services.
"The Professional Services group will enable us to capitalize on our leadership position in the development of operating systems and software applications for this market," Grannan said. "We have already enlisted Nokia, the world's leading supplier of mobile phones, as a client for this group."
Grannan said that the company continued to strengthen its management team during the quarter. "In addition to Stephen Baker joining the company as chief financial officer in October, Jack Balousek has joined our board of directors. Jack is former president and chief operating officer of Foote, Cone & Belding Communications and has developed strong branding for many of the world's leading companies," he added.
Based in Alameda, Calif., with international operations in the United Kingdom and Japan, Geoworks Corporation is a leading provider of end-to-end software solutions for the wireless communications industry. The company creates operating system software, applications and actionable services for a variety of wireless devices, ranging from enhanced phones to high-end, all-in-one smart communications. For additional information on Geoworks, contact the company on the World Wide Web at http://www.geoworks.com.
In keeping with U.S. law, Geoworks notes that this press release includes forward-looking statements, including the projected emergence and growth of the smart and enhanced phone markets, achievements of revenue goals and the success of the company's future products, services and standards, and the company's revised strategic and management plans. Actual results may vary significantly due to various risks and uncertainties. These include, but are not limited to, the following: To date, the company has incurred significant losses, has had substantial negative cash flow and has realized limited revenues. The company expects to continue to incur substantial annual operating losses at least through the fiscal year ending March 31, 1999. Future results depend upon the emergence of the smart communicator market, establishment of licensing relationships with leading market participants, introduction of successful products and services and achievement and maintenance of a competitive advantage. Additional information is available in the Risk Factors and Business discussions in the company's Form 10-K, 10-Q and other filings available from the company or from the Securities and Exchange Commission.