e.Digital Corporation Reports Q2 Fiscal 2007 Results Company Announces Over $1 Million in New eVU™ Orders, Delivers Delayed 1250 Unit Order SAN DIEGO--(BUSINESS WIRE)--e.Digital Corporation (OTC:EDIG), a leading innovator of proprietary secure digital video technology and products, and patented technology in the utilization of flash memory in portable devices, today reported results for the second quarter of its fiscal year 2007 ended September 30, 2006. During the first six months of fiscal 2007, the Company was in transition to its new eVU™ mobile entertainment system and revenues for the first six months of fiscal 2007 totaled $34,000, and for the second quarter totaled $13,000. Revenues for the comparable prior six months of fiscal 2006 were $2.99 million, and for the comparable second quarter were $1.99 million, primarily representing revenues from a previous generation product. e.Digital announced that it received a delayed 1250 unit order from its Asian contract manufacturer and has delivered the units to its customer digEcor. The Company expects to recognize $713,000 of revenue associated with this delivery in the quarter ending December 31, 2006. e.Digital also announced it has received over $1 million in new orders for eVU and eVU accessories. The majority of the new orders, being built by e.Digital’s U.S.-based contract manufacturer, are expected to ship to eVU customers in this quarter ending December 31, 2006. The company reported an operating loss of $879,000 for its second fiscal quarter 2007 as compared to an operating loss of $273,000 for the same period last year. For the six months ended September 30, 2006, the company reported an operating loss of $1,562,000 as compared to an operating loss of $803,000 for the same period last year. Net loss available to common stockholders for the second fiscal quarter of 2007 was $(0.01) per basic diluted share as compared to $(0.00) per basic diluted share for the same period last year. For the six months ended September 30, 2006, net loss available to common stockholders was $(0.01) per basic diluted share as compared to $(0.01) per basic diluted share for the same period last year. “We made substantial business progress last quarter which we believe will be reflected in this quarter ending December 31, 2006,” said Will Blakeley, e.Digital’s president and chief technical officer. “Maycom’s delivery of the delayed 1250 unit order and our subsequent delivery of the units to digEcor allows us to turn our attention to fulfilling volume eVU orders, growing our eVU backlog, diversifying our customer base, and aggressively pursuing the monetization of our flash memory patent portfolio.” Blakeley continued, “eVU is being increasingly accepted as the next generation secure portable entertainment solution for companies serving patients/customers in the healthcare and travel and entertainment industries. We expect to announce additional eVU business this quarter and in calendar Q1 2007.” Regarding the company’s efforts to monetize its flash memory-based patent portfolio, Blakeley said, “IP veteran Pat Nunally, management, and outside law firms have intensified patent due diligence and the evaluation of the licensing potential of e.Digital’s patent portfolio to companies in the cell phone, PDA/Pocket PC, portable A/V recorder, digital camera, camcorder, and other portable device industries. With the rapid proliferation of flash memory in portable devices we see significant licensing opportunities to monetize our important patent portfolio. We look forward to providing more information about this and other business developments this quarter.”