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JUPITERMEDIA CORPORATION REPORTS RECORD RESULTS FOR ITS THIRD QUARTER ENDED SEPTEMBER 30, 2004

(New York, NY - November 4, 2004) - Jupitermedia Corporation (Nasdaq: JUPM) today reported record results for the quarter ended September 30, 2004. Revenues for the third quarter of 2004 were $18.8 million compared to revenues of $13.3 million for the same period last year, an increase of 41%. Net income for the third quarter was $5.1 million, or $0.15 per diluted share, compared to net income of $653,000 or $0.02 per diluted share, for the same period last year.

"Our financial results this quarter provided both record quarterly revenues and net income," stated Jupitermedia's Chairman and CEO Alan M. Meckler. "Significant highlights for the third quarter included continued growth of our JupiterImages division both organically and with the acquisition of the assets of the Thinkstock Images and Thinkstock Footage businesses on July 28, 2004, as well as growth in our Events business lead by a very successful Search Engine Strategies Summer trade show," added Meckler.

Jupitermedia Corporation 3rd Quarter 2004 Financial Results Conference Call Alert
Jupitermedia Corporation invites you to participate in its conference call reviewing 2004 third quarter results, scheduled for Thursday, November 4, 2004 at 11:00 am EST.

The conference call number is (800) 967-7187 for domestic participants and (719) 457-2635 for international participants; pass code "972 900." Please call five minutes in advance to ensure that you are connected prior to the presentation. The conference call replay will be available until Thursday, November 18, 2004. Replay call numbers are (888) 203-1112 for domestic participants and (719) 457-0820 for international participants: pass code: "972 900."

Acquisitions
  • In July, Jupitermedia announced that it acquired over 30,000 high-resolution image assets from a variety of leading content providers in several transactions for its JupiterImages division (www.jupiterimages.com). Terms of these acquisitions were not disclosed.

  • In July, Jupitermedia also announced that it acquired the assets of the Thinkstock Images and Thinkstock Footage businesses (www.thinkstock.com, www.thinkstockfootage.com) for $4.0 million in cash, the assumption of certain limited liabilities and 50,000 restricted shares of Jupitermedia common stock. Thinkstock has been in the stock imagery and stock footage business since 1999 and is based in Charlotte, NC. The acquisition adds over 25,000 wholly-owned digitized stock images and over 4,000 wholly-owned stock video clips to JupiterImages' image library. Ron Chapple, renowned photographer and founder of Thinkstock, will continue to provide world-class imagery for Thinkstock and JupiterImages.

  • In October, Jupitermedia announced that it acquired the assets of Megapixel.net (www.megapixel.net), a leading resource for digital camera owners and those interested in digital images. The site reviews new cameras, provides tips for photographers, hosts an active discussion community forum and features active buying exchanges for new and used equipment. Terms of this acquisition were not disclosed

New Online Media Offerings
In September, Jupitermedia launched TheCreativeForum.com (www.thecreativeforum.com), a Web-based community for the creative professional that will allow graphic designers, art directors, commercial photographers and other commercial artists to exchange creative ideas via posting of images and work samples for discussion and critique. Creative professionals need the opportunity to share creative thoughts, to get input on projects and ideas and to discuss their work. TheCreativeForum.com is an online environment established to support the creative needs of commercial artists and to give them the chance to help each other.

New Research Services
Jupitermedia continued to expand and strengthen its proprietary research offerings. In August, JupiterResearch launched a new research service covering home theater and digital home entertainment, marking the eighth new practice started by JupiterResearch since it was acquired in July 2002. The Home Theater research service helps vendors prepare for market opportunities created by the explosion of new home entertainment technologies. It delivers insights on consumer needs and expectations, enables better decisions about such topics as convergence and optimal form factors and helps vendors develop strategies to maintain margins in the face of rapid commoditization.

Conferences and Trade Shows

JupiterEvents, a division of Jupitermedia, produces paid conferences and trade shows on IT and business-specific topics worldwide that are aligned with the content on our Web sites and our research offerings. JupiterEvents held four paid conferences and trade shows in the third quarter, each focusing on a different issue pertaining to information technology and the Internet industry. Events included Jupiter Plug.IN Conference & Expo 2004; Jupiter/ClickZ Advertising Forum Conference & Expo 2004; Search Engine Strategies Summer Conference & Expo 2004; and itSMF USA Conference & Expo 2004.

JupiterEvents has announced the following conferences and trade shows for the fourth quarter of 2004:

  • Digital Rights Management Strategies (October 25 - 27, Los Angeles, CA)
  • Search Engine Strategies Conference & Expo 2004 (October 27 - 28, Stockholm)
  • ISPCON Fall 2004 (November 3 - 5, Santa Clara, CA)
  • Inside ID Conference & Expo (November 15 - 17, Washington, D.C.)
  • Wi-Fi Planet Conference & Expo Fall 2004 (November 30 - December 2, San Jose, CA)
  • Search Engine Strategies Conference & Expo 2004 (December 13 - 16, Chicago, IL)

Jupitermedia Corporation

Consolidated Statements of Operations

For the Three and Nine Months Ended September 30, 2003 and 2004

(unaudited)

(in thousands, except per share amounts)

 
 

Three Months Ended

September 30

Nine Months Ended

September 30
 

2003

  

2004

2003

  

2004

Revenues

$13,328

  

$18,774

$31,793

  

$50,973

Cost of revenues

$6,122

  

$6,478

$15,302

  

$19,045
             

Gross profit

$7,206

  

$12,296

$16,491

  

$31,928
             

Operating expenses:

            

          Advertising, promotion and selling

$4,046

  

$3,932

$10,307

  

$12,057

          General and administrative

$1,495

  

$2,704

$4,873

  

$7,381

          Depreciation

$407

  

$129

$1,108

  

$594

          Amortization

$517

  

$360

$1,013

  

$1,477

Total operating expenses

$6,465

  

$7,125

$17,301

  

$21,509
             

Operating income (loss)

$741

  

$5,171

$(810)

  

$10,419
             

Income on investments and other, net

$30

  

$5

$29

  

$124

Interest income

$23

  

$55

$174

  

$82

Interest expense

$(10)

  

$(39)

$(10)

  

$(101)
             

Income (loss) before income taxes, minority interests and equity loss
from venture fund investments and other, net

$784

  

$5,192

$(617)

  

$10,524

Provision for income taxes

$-

  

$5

$-

  

$145

Minority Interests

$12

  

$(20)

$22

  

$(57)

Equity Loss from venture fund
investments and other, net

$(143)

  

$(108)

$(193)

  

$(117)

Net income (loss)

$653

  

$5,059

$(788)

  

$10,205
             

Basic net income (loss) per share

 

($0.03)

  

 

$0.16

 

($0.03)

  

 

$0.36
             

Basic weighted average number of
common shares outstanding

 

 

25,800

  

 

 

31,382

 

 

25,463

  

 

 

28,448
             

Diluted net income (loss) per share

 

 

$(0.02)

  

 

 

$0.15

 

 

$(0.03)

  

 

 

$0.33
             

Diluted weighted average number of
common shares outstanding

$27,496

  

$34,141

$25,463

  

$30,815
             

Segment Information

The following tables summarize the results of the segments of Jupitermedia for the three and nine months ended September 30, 2003 and 2004. Online media consists of the JupiterWeb business that includes the internet.com, EarthWeb.com, DevX.com and ClickZ.com Networks. Online images consist of the JupiterImages business that includes Comstock Images, Photos.com, Thinkstock Images and ClipArt.com. Research represents the JupiterResearch business. Events represents the JupiterEvents business. Other includes corporate overhead, depreciation, amortization and venture fund related activities.

(unaudited)
(In thousands)
 

Three Months Ended
September 30

Nine Months Ended
September 30
 

2003

2004

2003

2004
Revenues:
Online Media

$7,070

$6,692

$17,749

$21,913
Online Images

$1,837

$6,797

$1,837

$15,045
Research

$2,134

$2,279

$6,567

$6,822
Events

$2,134

$2,995

$5,187

$7,158
Other

$153

$11

$453

$35
 

$13,328

$18,774

$31,793

$50,973
Cost of revenues:
Online Media

$2,654

$2,781

$7,649

$8,551
Online Images

$719

$1,250

$719

$3,028
Research

$1,196

$1,346

$3,918

$3,900
Events

$1,553

$1,101

$3,016

$3,566
 

$6,122

$6,478

$15,302

$19,045
Gross Profit:
Online Media

$4,416

$3,911

$10,100

$13,362
Online Images

$1,118

$5,547

$1,118

$12,017
Research

$938

$933

$2,649

$2,922
Events

$581

$1,894

$2,171

$3,592
Other

$153

$11

$453

$35
 

$7,206

$12,296

$16,491

$31,928
Advertising, promotion and selling:
Online Media

$1,757

$1,602

$4,504

$5,046
Online Images

$237

$694

$237

$2,250
Research

$668

$735

$2,198

$2,233
Events

$1,384

$901

$3,368

$2,528
 

$4,046

$3,932

$10,307

$12,057
General and administrative:
Online Media

$41

$(12)

$449

$222
Online Images

$123

$288

$123

$805
Research

$132

$104

$744

$478
Events

$50

$36

$146

$118
Other

$1,149

$2,288

$3,411

$5,758
 

$1,495

$2,704

$4,873

$7,381
Depreciation

$407

$129

$1,108

$594
Amoritization

$517

$360

$1,013

$1,477
Operating income (loss):
Online Media

$2,618

$2,321

$5,147

$8,094
Online Images

$758

$4,565

$758

$8,962
Research

$138

$94

$(293)

$211
Events

$(853)

$957

$(1,343)

$946
Other

$(1,920)

$(2,766)

$(5,079)

$(7,794)
 

$741

$5,171

$(810)

$10,419

Jupitermedia Corporation

Consolidated Balance Sheets

December 31, 2003 and September 30, 2004

(in thousands, except share and per share amounts)
   

December 31, 2003

  

September 30, 2004
         

ASSETS

        
         

Current assets:

        
          Cash and cash equivalents  

$9,567

  

$32,707
          Accounts receivable, net of allowances of $948 and $533, respectively  

10,281

  

10,293
          Unbilled accounts receivable  

1,012

  

1,185
          Prepaid expenses and other  

2,124

  

2,026

          Total current assets

  

22,984

  

46,211
         
Property and equipment, net of accumulated depreciation of $8,674 and $9,046, respectively  

1,488

  

1,629
Intangible assets, net of accumulated amortization of $3,204 and $4,682, respectively  

8,130

  

17,307
Goodwill  

21,760

  

38,428
Investments and other assets  

1,676

  

1,236

          Total assets

  

$56,038

  

$104,811
         

LIABILITIES AND STOCKHOLDERS' EQUITY

        
         

Current liabilities:

        
Accounts payable  

$1,494

  

$1,551
Accrued payroll and related expenses  

2,482

  

1,973
Accrued expenses and other  

4,151

  

5,185
Deferred revenues  

9,211

  

10,781

          Total current liabilities

  

17,338

  

19,490
         

Long Term Liabilities

  

341

  

254

Deferred Revenues

  

-

  

379

Deferred income tax Liabilities

  

-

  

112

          Total liabilities

  

17,679

  

20,235
         

Stockholders' equity:

        

Preferred stock, $.01 par value, 4,000,000 shares authorized, no shares issued

 		 

-

 

-

Common stock, $.01 par value, 75,000,000 shares authorized, 25,984,130 and 32,039,316 shares issued at December 31, 2003 and September 30, 2004, respectively

 		 

260

  

320

Additional paid-in capital

 

177,629

  

213,524

Accumulated deficit

 

(139,427)

  

(129,222)

Treasury stock, 65,000 shares at cost

 

(106)

  

(106)

Accumulated other comprehensive income

 

3

  

60

          Total stockholders' equity

  

38,359

  

84,576

          Total liabilities and stockholders' equity

  

$56,038

  

$104,811

Jupitermedia Corporation

Consolidated Statements of Cash Flows

Nine Months Ended September 30,2003 and 2004

(unaudited)

(in thousands)
 

Nine Months Ended

September 30

 

2003

  

2004

Cash flows from operating activities:

      

          Net income (loss)

$(788)

  

$10,205

          Adjustments to reconcile net Income (loss) to net cash provided by
          operating activities:

     

                    Depreciation and amortization

2,121

2,071

          Barter transactions, net

(684)

-

          Provision (benefit) for losses on accounts receivable

40

(388)

          Minority interests

(22)

57

          Equity loss from venture fund investments
          and other, net

193

117

          Income on investments and other, net

(29)

  

(124)

Changes in current assets and liabilities, (net of businesses acquired):

      

          Accounts receivable

861

  

1,411

          Unbilled accounts receivable

1,169

  

(173)

          Prepaid expenses and other

(668)

  

199

          Accounts payable and accrued expenses

(1,447)

(398)

          Deferred revenues

(380)

1,917

          Net cash provided by operating activities

366

  

14,894
       

Cash flows from investing activities:

          Additions to property and equipment

(211)

(269)

          Acquisitions of businesses and other

(17,016)

  

(27,233)

          Proceeds from sales of assets and other

94

191

          Distribution from internet.com venture funds

-

148

          Net cash used in investing activities

(17,133)

(27,163)
       

Cash flows from financing activities:

      

          Proceeds from issuance of common stock, net

-

  

30,340

          Borrowings under credit facilities

-

  

13,000

          Repayment of borrowings under credit facilities

-

  

(13,000)

          Proceeds from exercise of stock options

305

  

5,069

          Net cash provided by financing activities

305

  

35,409
       

Net increase (decrease) in cash and cash equivalents

(16,462)

  

23,140
       

Cash and cash equivalents, beginning of period

25,451

  

9,567
       

Cash and cash equivalents, end of period

$8,989

  

$32,707
       

Supplemental disclosures of cash flow:

      

          Cash paid for income taxes

$-

  

-

          Cash paid for interest

$10

  

$13

Non-cash investing activities:

      

          Common stock issued for acquisitions

$1,771

  

$541

Business Outlook

Jupitermedia's financial guidance is prepared in accordance with accounting principles generally accepted in the United States of America. Historical results below have been adjusted to conform to this presentation. The amounts below reflect the preliminary allocation of the purchase prices paid by Jupitermedia in connection with its recent acquisitions of Comstock Images, Thinkstock Images and Megapixel.net and are subject to change pending a final allocation of these amounts. The following forward-looking statements reflect Jupitermedia's expectations as of November 3, 2004. Due to potential changes in general economic conditions and the various other risk factors discussed below and in Jupitermedia's reports filed with the Securities and Exchange Commission from time to time, actual results may differ materially. Jupitermedia intends to continue its practice of not updating forward-looking statements until its next quarterly results announcement, other than in publicly available statements.

Future Expectations

 

Actual Total 2003

Q1 2004

Q2 2004

Q3 2004

Q4 2004

Total 2004
(in millions, except per share amounts)

Revenues ($M)

$47.0

$14.4

$17.8

$18.8

$19.4-20.4

$70.4-71.4

Cost of revenues, advertising, promotion & selling, and G & A expenses

$42.8

$12.2

$13.3

$13.1

$13.2-14.2

$51.8-52.8

Depreciation and amortization

$2.8

$0.6

$1.0

$0.5

$1.0

$3.1

Interest Income, net

$0.2

$0.0

$0.0

$0.0

$0.1

$0.1

Other income (loss)

$(0.2)

$0.0

$0.1

$(0.1)

$0.0

$0.0

Income Taxes

$0.0

$0.0

$0.1

$0.0

$0.1

$0.2

Net income

$1.4

$1.6

$3.5

$5.1

$5.2

$15.4

Diluted Share Count

26.9

29.5

31.0

34.1

35.8

32.6

Earnings per diluted share

$0.05

$0.06

$0.11

$0.15

$0.15

$0.47

About Jupitermedia Corporation
Jupitermedia Corporation (Nasdaq: JUPM), (www.jupitermedia.com) headquartered in Darien, CT, is a leading global provider of original information, images, research and events for information technology, business and creative professionals. JupiterWeb, the online division of Jupitermedia, operates four distinct online networks: internet.com and EarthWeb.com for IT and business professionals; DevX.com for developers; and ClickZ.com for interactive marketers. JupiterWeb properties include more than 150 Web sites and over 150 e-mail newsletters that are viewed by approximately 20 million users and generate approximately 300 million page views monthly. Jupitermedia also includes: JupiterImages, one of the leading images companies in the world with over 3.5 million images online serving creative professionals with products like Comstock Images, Thinkstock Images, Thinkstock Footage, Photos.com and Clipart.com; JupiterResearch, a leading international research advisory organization specializing in business and technology market research in 18 business areas and 14 vertical markets; and JupiterEvents, which produces offline conferences and trade shows focused on IT and business-specific topics, including Search Engine Strategies and Wi-Fi Planet.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release which are not historical facts are "forward-looking statements" that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The potential risks and uncertainties address a variety of subjects including, for example, the competitive environment in which Jupitermedia competes; the unpredictability of Jupitermedia's future revenues, expenses, cash flows and stock price; Jupitermedia's ability to integrate acquired businesses, products and personnel into its existing businesses; Jupitermedia's dependence on a limited number of advertisers; and Jupitermedia's ability to protect its intellectual property. For a more detailed discussion of such risks and uncertainties, refer to Jupitermedia's reports filed with the Securities and Exchange Commission pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934. The forward-looking statements included herein are made as of the date of this press release, and Jupitermedia assumes no obligation to update the forward-looking statements after the date hereof.

All current Jupitermedia Corporation press releases can be found on the World Wide Web at www.jupitermedia.com/corporate/press.html

CONTACT:
Lisa DiGiacomo
Marketing & Public Relations Associate
Jupitermedia Corporation
212-547-7938
[email protected]

All current Jupiter Research press releases can be found online at www.jupitermedia.com/corporate/press.html.

All current Jupitermedia Corporation press releases can be found on the World Wide Web at http://www.internet.com/corporate/press.html.