NPLA Inplay Technologies (MM)

InPlay Technologies (NASDAQ: NPLA) today announced financial results for the three months ended June 30, 2008. Revenue for the second quarter 2008 was $299,000, down from $645,000 in the comparable period during 2007. For the three month period in 2008, revenue included $63,000 from the FinePoint segment and $235,000 from the Duraswitch segment. InPlay reported a net loss for the quarter of $1.4 million, or $0.12 per share, compared to a net loss of $1.6 million or $0.16 per share for the second quarter of 2007. �Consistent with the first quarter, year over year revenue is lower as we rebuild the sales pipeline for our digital pen technology. We are encouraged by the market feedback on our transformation of the company over the last year. We have strengthened and expanded our technology platform, engaged top-tier manufacturing and engineering resources and enhanced our customer support system,� said InPlay chairman and CEO Steve Hanson. �We continue to focus on our top priorities: solid execution on near-term customer opportunities, pursuit of new prospects to fuel future growth, and management of cash resources,� Hanson added. Conference Call InPlay Technologies will host a conference call today at 5:00 p.m. Eastern Time. To participate on the live call, analysts and investors should dial 800-257-1836 at least ten minutes prior to the call. To participate on the live call from outside the U.S., dial 303-262-2194. InPlay Technologies will also offer a live and archived webcast of the conference call, accessible from the "Investor" section of the company�s Web site (http://www.inplaytechnologies.com). A telephonic replay of the conference call will also be available for 48 hours by dialing 800-405-2236 and entering passcode 11118070#. About InPlay Technologies InPlay Technologies is a developer of innovative human interface devices for electronic products. The company's FinePoint division offers the only digital-based pen-input solution for the rapidly growing mobile computing market.�With InPlay�s digital technology, OEMs have�an almost limitless roadmap for development of new�features and functions for their product designs. The Company�s Duraswitch� brand of electronic switch technologies couples the friendly tactile feedback of mechanical pushbuttons and rotary dials with the highly reliable, thin profile of membrane switches, enabling OEMs to create ergonomic, space saving input panels for�a wide range of�applications. Visit www.inplaytechnologies.com for more information. This news release contains certain �forward-looking statements� within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements include statements regarding our progress with potential customers and ability to win new projects using our technologies, our estimation of the benefits derived from our investment in technology development and customer support, our ability to successfully manage our cash and attain profitability. Risks and uncertainties that could cause results to differ materially from those projected include our ability to raise and maintain sufficient cash resources to fund our business plan, changes in orders or timing from our licensees and customers, lack of market acceptance of our products, general changes in demand in the personal computing industry, pricing pressures, component shortages, unanticipated expenses or other unforeseen difficulties related to manufacturing our technologies and other uncertainties described from time to time in our documents filed with the Securities and Exchange Commission, including our Annual Report on Form 10-KSB for the year ended December 31, 2007 as filed with the Securities and Exchange Commission on March 24, 2008. These forward-looking statements represent our beliefs as of the date of this press release and we disclaim any intent or obligation to update these forward-looking statements. INPLAY TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) � � Three Months EndedJune 30, � Six Months EndedJune 30, 2008 � 2007 2008 � 2007 � NET REVENUE: FinePoint $ 63,176 $ 403,982 $ 72,128 $ 1,572,017 Duraswitch: Related party - Delphi - - - 7,631,250 Non-related parties � 235,329 � � 240,983 � � 614,454 � � 507,953 Total net revenue 298,505 644,965 686,582 9,711,220 � COST OF GOODS SOLD: FinePoint 4,178 276,596 13,796 1,133,970 Duraswitch � 83,929 � � 155,837 � � 204,858 � � 222,161 Total cost of goods sold � 88,107 � � 432,433 � � 218,654 � � 1,356,131 � Gross profit � 210,398 � � 212,532 � � 467,928 � � 8,355,089 � OPERATING EXPENSES: Selling, general and administrative 781,241 1,579,945 1,642,247 3,063,931 Research, development and commercial application engineering 819,066 404,565 1,845,953 742,723 � Total operating expenses � 1,600,307 � � 1,984,510 � � 3,488,200 � � 3,806,654 � INCOME (LOSS) FROM OPERATIONS (1,389,909 ) (1,771,978 ) (3,020,272 ) 4,548,435 � OTHER INCOME - Net � 10,028 � � 88,385 � � 43,910 � � 126,967 � INCOME (LOSS) BEFORE INCOME TAXES $ (1,379,881 ) $ (1,683,593 ) $ (2,976,362 ) $ 4,675,402 � PROVISION FOR INCOME TAXES - (33,672 ) - 93,508 � � � � � � � � � � � NET INCOME (LOSS) $ (1,379,881 ) $ (1,649,921 ) $ (2,976,362 ) $ 4,581,894 � EARNINGS (LOSS) PER SHARE - BASIC $ (0.12 ) $ (0.14 ) $ (0.26 ) $ 0.40 � EARNINGS (LOSS) PER SHARE - DILUTED $ (0.12 ) $ (0.14 ) $ (0.26 ) $ 0.40 � WEIGHTED AVERAGE SHARES OUTSTANDING: BASIC � 11,609,793 � � 11,505,382 � � 11,603,417 � � 11,503,886 DILUTED � 11,609,793 � � 11,505,382 � � 11,603,417 � � 11,551,333 INPLAY TECHNOLOGIES, INC. CONSOLIDATED BALANCE SHEETS (Unaudited) � � June 30,2008 � December 31,2007 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 1,740,899 $ 5,592,412 Restricted short term investment 20,000 - Accounts receivable 156,879 228,610 Inventory 194,470 108,562 Prepaid expenses and other current assets � 108,124 � � 128,932 � Total current assets 2,220,372 6,058,516 � PROPERTY AND EQUIPMENT - Net 489,094 437,248 GOODWILL 1,321,240 1,321,240 PATENTS - Net 1,152,059 1,205,977 OTHER ASSETS � 17,731 � � 17,731 � TOTAL ASSETS $ 5,200,496 � $ 9,040,712 � � LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 481,150 $ 642,781 Accrued salaries and benefits 457,695 777,987 Accrued purchase commitments 288,562 558,000 Other accrued expenses and other current liabilities 343,734 453,108 Deferred revenue � 15,000 � � 15,695 � Total current liabilities � 1,586,141 � � 2,447,571 � � LONG-TERM LIABILITIES: Other non-current liabilities � 21,225 � � 173,228 � Total liabilities � 1,607,366 � � 2,620,799 � � COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' EQUITY: Preferred stock, no par value, 10,000,000 shares authorized, no shares issued and outstanding in 2008 and 2007 - - Common stock, $.001 par value, 40,000,000 shares authorized in 2008 and 2007, 11,622,568 and 11,595,138 shares issued and outstanding in 2008 and 2007, respectively 11,623 11,595 Additional paid-in capital 31,856,009 31,706,458 Accumulated deficit � (28,274,502 ) � (25,298,140 ) Total stockholders' equity � 3,593,130 � � 6,419,913 � TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 5,200,496 � $ 9,040,712 �