ActivIdentity Reports Second Quarter Fiscal 2009 Financial Results

ActivIdentity Corporation (NASDAQ: ACTI), a global leader in strong authentication and credential management, reported revenue for the quarter ended March 31, 2009 of $16.1 million, compared to $13.6 million for the quarter ended March 31, 2008 and $16.3 million for the quarter ended December 31, 2008.

ActivIdentity's operating loss fell to $1.7 million for the quarter ended March 31, 2009 from $42.2 million for the quarter ended March 31, 2008, and $3.1 million for the quarter ended December 31, 2008, reflecting improvements in revenue, cost reductions, and the absence of the one time goodwill impairment charge of $35.9 million in the quarter ended March 31, 2008. Non-GAAP Adjusted EBITDA, which is defined as Operating Income adjusted for non-recurring and non-cash items such as stock-based compensation expense, depreciation, amortization of intangibles, severance and asset impairments, was $0.7 million for the quarter ended March 31, 2009, representing an improvement of $4.5 million compared to the prior-year quarter, and $0.4 million sequentially.

ActivIdentity's net loss for the quarter ended March 31, 2009, was $2.8 million or $(0.06) per basic and diluted share, compared to a net loss of $42.5 million, or $(0.93) per basic and diluted share for the three months ended March 31, 2008. The net loss for the quarter ended March 31, 2009 includes $0.6 million of severance costs and realized and unrealized losses on foreign exchange totaling $0.8 million, primarily due to the strengthening of the U.S. dollar.

"We are showing continued momentum, which in the current business climate is very encouraging," said Grant Evans, chairman and chief executive officer of ActivIdentity. "Our year-over-year growth rate is a sign that our restructuring efforts are paying off and that more and more organizations are turning their attention to identity security software to defend against security threats and identity fraud. As a result, we remain confident in reaffirming the guidance we previously communicated for fiscal 2009."

Financial Highlights:

GAAP RESULTS                                         Three Months Ended
                                                 -------------------------
(In Millions except Per Share Data)              Mar. 31  Dec. 31  Mar. 31
                                                   2009     2008     2008
                                                 -------  -------  -------
Revenues                                          $ 16.1   $ 16.3   $ 13.6
Net (Loss) Income                                ($  2.8) ($  4.5) ($ 42.5)
(Loss) Earnings Per Share                        ($ 0.06) ($ 0.10) ($ 0.93)


NON-GAAP RESULTS

Adjusted EBITDA                                  $   0.7  $   0.3  ($  3.9)

ActivIdentity is presenting non-GAAP numbers in this press release as it believes the one time charges for nonrecurring items and the non-cash charges distort the period to period results and that investors will benefit from the comparison of information from period to period without these items. Please refer to the GAAP to non-GAAP reconciliation table for further detail. Certain financial results are subject to the application of accounting estimates, especially with regards to fair value accounting. Management has used what it believes to be appropriate valuation techniques to assess the fair value of impaired investments and the fair value of undelivered elements in multi-element software arrangements.

Conference Call Details

ActivIdentity will host its Fiscal Second Quarter conference call on Thursday, May 7, at 5:00 PM Eastern Daylight Time / 2:00 PM Pacific Daylight Time.

To access the conference call within the U.S. or Canada, please dial (877) 292-2820 and enter conference ID 97771536. To access the conference call outside the U.S. or Canada, please dial (706) 679-4390 and enter conference ID 97771536.

A replay of the conference call will be available approximately two hours after the conclusion of the call at www.actividentity.com .

About ActivIdentity

ActivIdentity Corporation is a global leader in strong authentication and credential management, providing solutions to confidently establish a person's identity when interacting digitally. For more than two decades the company's experience has been leveraged by security-minded organizations in large scale deployments such as the U.S. Department of Defense, Nissan, and Saudi Aramco. The company's customers have issued over 100 million credentials, securing the holder's digital identity. ActivIdentity is headquartered in Silicon Valley, California. For more information, visit www.actividentity.com .

ActivIdentity is a registered trademark in the United States and/or other countries. All other trademarks are the property of their respective owners in the United States and/or other countries.

Safe Harbor Statement

The statements in this press release that are not historical facts are forward-looking statements that involve risks and uncertainties including, but not limited to, statements regarding ActivIdentity's ability to achieve its fiscal year guidance and continued customer acceptance of its products. These risks and uncertainties include risks relating to uncertainty in the economy and its impact on customer deployments of our products, customer adoption of ActivIdentity's new products, continued expense reductions from ActivIdentity's various restructuring and cost control measures, changes to our management team, the use of estimates and assumptions in our financial reporting, and other risks identified under the caption "Risk Factors" in our most recent Annual Report on Form 10-K, and as may be amended in subsequent Quarterly Reports on Form 10-Q, which are filed with the United States Securities and Exchange Commission (SEC). Copies of these filings are available from us and on the SEC website at www.sec.gov . Actual results, events and performance may differ materially from our forward-looking statements and final results may vary from our preliminary reports. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. ActivIdentity disclaims any intention to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.