Artificial Life Reports Strong Third Quarter Earnings

Record Revenues and Profits


LOS ANGELES and HONG KONG, Oct. 31, 2008 (GLOBE NEWSWIRE) -- Artificial Life, Inc. (OTCBB:ALIF) (www.artificial-life.com), a leading full service provider of award-winning mobile technology, games and applications, today reported strong results for its third quarter 2008.

REVENUES: Revenues for the quarter ending September 30, 2008 were $6,628,597 as compared to $1,611,704 for the same quarter in 2007. The increase in revenues of $5,016,893 or 311% was mainly due to increased product license income; one time downloads and monthly subscription revenues for 3G games derived from mobile carriers, resellers and hand set distributors; and license sales for the new technology platform MobileBooster(tm).

Revenues for the first nine months of 2008 were $16,235,071 as compared to $2,684,458 for the same period in 2007, an increase of 505%.

INCOME: Income from operations for the quarter ending September 30, 2008 was $3,584,546 as compared to $466,059 for the same quarter in 2007, an increase of 669%. The increase of income from operations is mainly due to increased revenues from the sale of 3G games and technology licenses offset by operating costs of $3,044,051.

Net income for the quarter ending September 30, 2008 was $3,485,050 as compared to a net income of $28,478 for the same quarter in 2007.

The basic and diluted net income per share for the third quarter of 2008 was $0.07, as compared to $0.00 for the quarter ending September 30, 2007.

"Despite the current global market turmoil we have been able to perform well and deliver the best quarter results in our history. The strategy of becoming a full service mobile application provider and expanding carefully is working out well and has again generated positive results. We expect further growth for the remainder of the year," said Eberhard Schoneburg, CEO of Artificial Life, Inc.



                         ARTIFICIAL LIFE, INC.
            CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                    AND COMPREHENSIVE INCOME (LOSS)
                              (UNAUDITED)


                     Three-month Period Ended  Nine-month Period Ended
                            September 30,           September 30,
                       ----------- ----------- ----------- -----------
                          2008        2007        2008         2007
 Revenues:
  Software license
   agreements          $ 5,835,733 $ 1,611,704 $15,430,034 $ 2,667,458
  Reseller license
   agreement               769,800          --     769,800          --
  Application services
   and other                23,064          --      35,237      17,000
                       ----------- ----------- ----------- -----------
                         6,628,597   1,611,704  16,235,071   2,684,458
                       ----------- ----------- ----------- -----------
 Operating expenses:
  General and
   administrative          451,518     390,730   1,480,310   1,086,751
  Engineering and cost
   of sales              1,746,142     360,510   3,798,962   1,114,504
  Research and
   development             105,695      53,799     273,394     181,372
  Sales and marketing      740,696     340,606   1,676,952   1,073,903
                       ----------- ----------- ----------- -----------
  Total operating
   expenses              3,044,051   1,145,645   7,229,618   3,456,530
                       ----------- ----------- ----------- -----------

 Income (loss) from
  operations             3,584,546     466,059   9,005,453    (772,072)
                       ----------- ----------- ----------- -----------

 Other income
  (expenses):
   Interest expense,
    net                    (64,169)   (482,694)   (159,315)   (475,238)
   Foreign currency
    transaction gains
    and other              (35,327)     45,113     324,122      59,131
                       ----------- ----------- ----------- -----------
                           (99,496)   (437,581)    164,807    (416,107)
                       ----------- ----------- ----------- -----------

 Income (loss) before
  income taxes           3,485,050      28,478   9,170,260  (1,188,179)
 Income tax expense             --          --     501,310          --
                       ----------- ----------- ----------- -----------

 Net income (loss)       3,485,050      28,478   8,668,950  (1,188,179)
 Foreign currency
  translation
  adjustment              (126,116)    (23,670)    (72,818)    (16,785)
                       ----------- ----------- ----------- -----------

 Comprehensive income
  (loss)               $ 3,358,934 $     4,808 $ 8,596,132 $(1,204,964)
                       =========== =========== =========== ===========
 Net income (loss) per
  share
   Basic               $      0.07 $     (0.00)$      0.19 $     (0.03)
                       =========== =========== =========== ===========
   Diluted             $      0.07 $     (0.00)$      0.18 $     (0.03)
                       =========== =========== =========== ===========

 Weighted average
  shares outstanding
   Basic                47,615,002  36,370,877  45,983,219  35,113,239
                       =========== =========== =========== ===========
   Diluted              49,454,371  42,923,343  48,254,905  35,113,239
                       =========== =========== =========== ===========

About Artificial Life

Artificial Life, Inc. (OTCBB:ALIF) is a public U.S. corporation headquartered in Los Angeles, with its production center in Hong Kong and additional offices in Berlin (EMEA headquarters) and Tokyo. As a leading, full-service provider of mobile broadband 3G technology, mobile participation TV, mobile gaming, content and business applications, Artificial Life provides 2D and 3D multi- and single player rich-media applications for 3G, 3.5G and 4G network-enabled mobile phones. Recognized internationally for outstanding content quality and technology, Artificial Life transcends traditional modes of mobile communications and interactive gaming. For more information, please visit www.artificial-life.com or the company's m-commerce portal at www.botme.com.

Forward-Looking Statements:

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, without limitation, statements regarding our future results of operations, financial condition and business prospects. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "intend," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue," or the negative of these terms or other comparable terminology. Although such statements are based on our own information and information from other sources we believe to be reliable, you should not place undue reliance on them. These statements involve risks and uncertainties, and actual market trends or our actual results of operations, financial condition or business prospects may differ materially from those expressed or implied in these forward-looking statements for a variety of reasons. Potential risks and uncertainties include, but are not limited to, our ability to obtain additional funding to operate and grow our business; the unproven potential of our mobile gaming business model; changing consumer preferences and uncertainty of market acceptance of our products; timely adoption and availability of 3G mobile technology; market acceptance for use of mobile handheld devices to play the interactive games; unpredictable mobile game development schedules; our reliance on a relatively small number of brands; our ability to license brands from others; our dependence upon resellers and telecommunication carriers and operators to distribute our products; our ability to successfully develop, introduce, and sell new or enhanced products in a timely manner; and the timing of new product announcements or introductions by us or by our competitors. For additional discussion of these risks and uncertainties and other factors, please see the documents we file from time to time with the Securities and Exchange Commission, including our Annual Report on Form 10-K filed on March 13, 2008. We assume no obligation to update any forward-looking statements, which apply only as of the date of this press release.



            

Coordonnées