Radware LTD. Announces Results for the First Quarter of 2006

Radware (NASDAQ: RDWR), the leading provider of intelligent integrated solutions for ensuring the fast, reliable and secure delivery of networked and Web-enabled applications over IP, today reported its results for the first quarter of 2006. Revenues totaled $20.0 million, the same as in the first quarter of 2005. Revenues for the fourth quarter of 2005 totaled $21.0 million.

With the adoption of Statement of Financial Accounting Standards No. 123R (FAS 123R) as of January 1, 2006, the company began expensing stock-based compensation according to generally accepted accounting principles (GAAP), for the first time, in the first quarter of 2006. To facilitate a comparison of this quarter's results with the results of prior quarters, the company is providing also pro forma Non-GAAP Condensed Consolidated Statements of Operations and a reconciliation of reported net income to pro forma net income. Net income on a GAAP basis for the first quarter of 2006 was $0.3 million or $0.02 per diluted share. For comparative purposes, net income excluding the effects of stock-based compensation expense for the first quarter of 2006 was $1.4 million or $0.07 per diluted share, compared with net income of $4.4 million or $0.22 per diluted share in the first quarter of 2005 and net income of $2.4 million or $0.12 per diluted share in the fourth quarter of 2005.

The Company continued to maintain positive operational cash flow. In the first quarter of 2006 the Company generated cash in the amount of $5.6 million. This led to a balance of $170.0 million in cash, short-term and long-term bank deposits and marketable securities.

"Although Q1 sales were below expectations, we remain enthusiastic about the business prospects and growth potential for Radware," said Roy Zisapel President and CEO at Radware. "We are confident about the success of our business plan and continue to devote resources to improving our sales performance."

During the quarter ended March 31, 2006, Radware released the following significant announcements:

  • New Certifications Advance Radware's Leadership Position in Application Delivery Market
  • Radware provides MAN/WAN high availability solution for BEA WebLogic 9.0
  • Radware Joins the Microsoft SecureIT Alliance
  • Radware Introduces Next Generation IPS Solution
  • Radware Presents Security as a Core Business Enabler at RSA 2006
  • BetandWin Chooses Radware's Application Delivery Solution to Ensure 24/7 Availability and High Performance of the Company's Popular International On-line Gaming Service
  • VitalStream Selects Radware's Application Delivery Solution for High Quality Streaming Media and Content Delivery Service
  • Radware Appoints New President of Radware Americas
  • Radware's 2005 Year End Survey of InfoSecurity and Interop Attendees Reveals Need for Faster, More Secure Business Applications

Company management will host a quarterly investor conference call at 8:45 AM EDT on April 26, 2006. The call will focus on financial results for the quarter ended March 31, 2006, and certain other matters related to the Company's business.

The conference call will be webcast on April 26, 2006 at 8:45 AM EDT in the "listen only" mode via the Internet at:


About Radware

Radware (NASDAQ:RDWR) is the global leader in integrated application delivery solutions, assuring the full availability, maximum performance and complete security of all business critical networked applications while dramatically cutting operating and scaling costs. Over 3,000 enterprises and carriers worldwide use Radware application-smart switches to drive business productivity and improve profitability by adding critical application intelligence to their IP infrastructure, making networks more responsive to specific business processes. Radware's APSolute product family provides the most complete set of application front-end, remote access and security capabilities for application-smart networking to ensure faster, more reliable and secure business transactions. Learn more on how Radware application delivery solutions can enable you to get the most of your investments in IT infrastructure and people. www.radware.com.

This press release contains forward-looking statements. Such statements involve various risks that may cause actual results to differ materially. These risks and uncertainties include, but are not limited to: market demand for the Company's products, successful implementation of the Company's products, economic and competitive factors, international market conditions, technological developments, the ability to finance operations and other factors which are detailed in the Company's SEC filings.