February 29, 2008

Audible Announced Fourth Quarter 2007 Financial Results

NEWARK, N.J.–(BUSINESS WIRE)–Feb. 29, 2008–Audible, Inc. (NASDAQ: ADBL; http://www.audible.com), the leader in spoken audio entertainment, information, and educational programming on the Internet, today announced unaudited financial results for the fourth quarter and year ended December 31, 2007.Audible reported consolidated fourth quarter net revenue of $31.1 million, up 35% over the $23.2 million reported in the fourth quarter of 2006 and 13% over the $27.6 million reported in the third quarter of 2007. Revenue for the year ended December 31, 2007, was $110.0 million, up 34% from the $82.0 million in revenue for 2006.

Adjusted EBITDA for the fourth quarter of 2007 was $3.2 million, an increase of $2.6 million from adjusted EBITDA in the fourth quarter of 2006, and an increase of $1.3 million from $1.9 million in the third quarter of 2007. The company finished 2007 with $8.0 million of adjusted EBITDA, compared to a loss of $(1.0 million) in 2006.

Net income for the fourth quarter of 2007 was $4.0 million, or $0.16 per share, an improvement from the net loss of $(0.9 million), or $(0.04) per share, reported in the fourth quarter of 2006. Net income included a non-operating benefit of $3.1 million from the sale of net operating loss tax credits in the state of New Jersey. The company finished 2007 with net income of $2.4 million or $0.10 per share compared to a net loss of $(8.7 million) or $(0.36) per share in 2006.

During the quarter, 71,000 new AudibleListener(R) members were acquired, an increase from the 70,000 new AudibleListener members reported in the fourth quarter of 2006, and a 13% increase quarter over quarter, from the 63,000 new members reported in the third quarter of 2007.

There were 457,000 total AudibleListener members at the end of 2007, compared to 381,000 total members reported at the end of 2006. This included 324,000 Gold/Platinum members which represented a gain of 85,000 members in one of the minimum monthly delivery subscription plans since last year.

Amazon Acquisition

On January 31, 2008, Audible and Amazon.com, Inc. (NASDAQ:AMZN) announced that they had reached an agreement for Amazon to acquire Audible. Amazon commenced a tender offer on February 11, 2008, to purchase for cash all of the outstanding shares of Audible for $11.50 per share. The transaction is subject to certain regulatory reviews and other conditions and is expected to close by the second quarter of 2008.

Use of Non-GAAP Measures

In addition to the results presented in accordance with generally accepted accounting principles, or GAAP, Audible presents financial measures that are non-GAAP measures, specifically adjusted EBITDA. Adjusted EBITDA is net (loss) income excluding interest, taxes, depreciation, amortization, asset impairment, loss on equity investment, and stock based compensation. Audible believes that this non-GAAP measure, viewed in addition to and not in lieu of Audible’s reported GAAP results, provides useful information to investors regarding its performance and overall results of operations. These metrics are an integral part of Audible’s internal reporting to measure the performance of the company and the overall effectiveness of senior management. Reconciliations to comparable GAAP measures are available in the accompanying schedules to this press release and on Audible’s Web site. The GAAP financial measures presented are consistent with Audible’s historical financial reporting practices. The non-GAAP measures presented herein may not be comparable to similarly titled measures presented by other companies, and are not identical to corresponding measures used in our various agreements or other public filings. Management also presents total cash sales. The measurement of total cash sales is defined as the change in deferred revenue plus consolidated net sales. Management believes that total cash sales is a useful measurement when understanding the increase in deferred revenue.

About Audible, Inc.:

Audible (www.audible.com) is the leader in spoken audio information and entertainment on the Internet. Content from Audible is downloaded and played back on personal computers, CDs, or AudibleReady computer-based and wireless mobile devices. Audible has 180,000 hours of audio programs from more than 470 content partners that include leading audiobook publishers, broadcasters, entertainers, magazine and newspaper publishers, and business information providers. Audible is the preeminent provider of spoken-word audio products for Apple’s iTunes Store. Among Audible’s key business relationships are Apple, Inc., Amazon.com, Palm, Inc., Creative Labs Inc., SanDisk Corporation, and XM Satellite Radio, Inc. Audible has its headquarters in Newark, NJ, and an office in London, England. Audible, audible.com, AudibleListener, and AudibleReady are registered trademarks of Audible, Inc. and all are part of the family of Audible, Inc. trademarks. Other product or service names mentioned herein are the trademarks of their respective owners.

Forward-Looking Statements

The statements in this press release which are not historical facts may be deemed to contain forward-looking statements about Audible. Actual results may differ materially from those anticipated in any forward-looking statements as a result of certain risks and uncertainties, including, without limitation, Audible’s limited operating history, history of losses, uncertain market for its services, and its inability to license or produce compelling audio content and other risks and uncertainties detailed in Audible’s Securities and Exchange Commission filings. No forward-looking statement can be guaranteed. Forward-looking statements speak only as of the date on which they are made and Audible, Inc. undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

                     AUDIBLE INC. AND SUBSIDIARY
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
           (in thousands, except share and per share data)
                             (Unaudited)

                   Three months ended                Year ended
           ----------------------------------- -----------------------
            December   September    December    December    December
               31,         30,         31,         31,         31,
              2007        2007        2006        2007        2006
           ----------- ----------- ----------- ----------- -----------

Revenue,
 net:
 Content
  and
services:
 Consumer
content    $    30,479 $    26,973 $    22,536 $   108,158 $    80,217
 Point of
sale
 rebates           (4)         (4)        (25)        (37)       (318)
 Services           19          28          26         109         111
           ----------- ----------- ----------- ----------- -----------
 Total
content and
services        30,494      26,997      22,537     108,230      80,010
 Hardware          118          28         148         310         431
 Related
party
revenue            106         431         395         648       1,247
 Other             421         162          70         780         344
           ----------- ----------- ----------- ----------- -----------
 Total
revenue,
net             31,139      27,618      23,150     109,968      82,032

Operating
expenses:
 Cost of
content
and
services
revenue:
 Royalties
and other
content
charges         13,492      11,989       9,734      47,947      33,677
 Discount
certificate
rebates            181          74         418         588       1,328
           ----------- ----------- ----------- ----------- -----------
 Total cost
of content
and
services
revenue         13,673      12,063      10,152      48,535      35,005
 Cost of
hardware
revenue            221          95         246         616       1,953
 Cost of
related
party
revenue            106         133         139         476         637
 Operations      3,894       3,761       3,225      14,887      12,168
 Technology
and
development      4,504       4,680       4,303      18,324      16,984
 Marketing       4,692       4,300       4,108      16,945      15,322
 General
  and
 adminis-
  trative        3,831       3,609       3,402      13,903      12,009
           ----------- ----------- ----------- ----------- -----------
Total
operating
expenses        30,921      28,641      25,575     113,686      94,078
           ----------- ----------- ----------- ----------- -----------

Income
(loss) from
operations         218     (1,023)     (2,425)     (3,718)    (12,046)

Loss on
equity
investment       (303)        (17)        (94)       (380)       (364)

Other
income
(expense):
 Interest
income             930         904         822       3,536       2,975
 Other
expense             12         (4)           -         (1)           -
           ----------- ----------- ----------- ----------- -----------
 Other
income,
net                942         900         822       3,535       2,975

           ----------- ----------- ----------- ----------- -----------
Income
(loss)
before
income
 taxes             857       (140)     (1,697)       (563)     (9,435)

 Income
tax
expense           (53)        (52)         (5)       (160)        (14)

 State
income
tax
benefit          3,148           -         769       3,148         769

           ----------- ----------- ----------- ----------- -----------
Net income
(loss)     $     3,952 $     (192) $     (933) $     2,425 $   (8,680)
           =========== =========== =========== =========== ===========

Basic net
income
(loss)
per
common
 share     $      0.16 $    (0.01) $    (0.04) $      0.10 $    (0.36)

Diluted net
income
(loss)
per
common
 share     $      0.16 $    (0.01) $    (0.04) $      0.10 $    (0.36)

Basic
weighted
average
common
shares
outstanding 24,406,910  24,349,644  24,158,857  24,311,667  24,371,844

Diluted
weighted
average
common
shares
outstanding 25,171,943  24,349,644  24,158,857  24,958,120  24,371,844
                     AUDIBLE INC. AND SUBSIDIARY
                         NON-GAAP INFORMATION
                             (Unaudited)
                            (in thousands)

                            Three months ended          Year ended
                        --------------------------- ------------------
                        December September December December  December
                           31,      30,       31,      31,       31,
                          2007     2007      2006     2007      2006
                        -------- --------- -------- --------- --------

Stock-based
 compensation included
 in expense line items:
   Operations           $   286  $    243  $   344  $  1,095  $ 1,111
   Technology and
    development             295       240      294     1,098      993
   Marketing                326       292      327     1,224    1,123
   General and
    administrative          710       694      787     2,777    2,687
                        -------- --------- -------- --------- --------
                        $ 1,617  $  1,469  $ 1,752  $  6,194  $ 5,914
                        ======== ========= ======== ========= ========

Depreciation and
 amortization included
 in expense line items:
   Operations           $    13  $     13  $    14  $     45  $    57
   Technology and
    development           1,122     1,117    1,148     4,482    4,377
   Marketing                  -         -        -         -        -
   General and
    administrative          219       204      145       791      583
                        -------- --------- -------- --------- --------
                        $ 1,354  $  1,334  $ 1,307  $  5,318  $ 5,017
                        ======== ========= ======== ========= ========

Asset impairment
 included in expense
 line items:
   Technology and
    development               -       160        -       160      144
                        -------- --------- -------- --------- --------
                        $     -  $    160  $     -  $    160  $   144
                        ======== ========= ======== ========= ========

Reconciliation to Non-
 GAAP Financial
 Measures (unaudited)
Net income (loss)       $ 3,952  $   (192) $  (933) $  2,425  $(8,680)
Add back:
   Stock-based
    compensation          1,617     1,469    1,752     6,194    5,914
   Depreciation and
    amortization          1,354     1,334    1,307     5,318    5,017
   Loss on equity
    investment              303        17       94       380      364
   Asset impairment           -       160        -       160      144
   Income tax expense        53        52        5       160       14
Less:
   Interest income, net    (942)     (900)    (822)   (3,535)  (2,975)
   State income tax
    benefit              (3,148)        -     (769)   (3,148)    (769)

                        -------- --------- -------- --------- --------
Non-GAAP adjusted
 EBITDA                 $ 3,189  $  1,940  $   634  $  7,954  $  (971)
                        ======== ========= ======== ========= ========

Reconciliation to Non-
 GAAP Financial
 Measures (unaudited)
Total revenue, net      $31,139  $ 27,618  $23,150  $109,968  $82,032
Add:
   Change in deferred
    revenue               2,080       785    2,253     4,843    7,125
                        -------- --------- -------- --------- --------
Non-GAAP total cash
 sales                  $33,219  $ 28,403  $25,403  $114,811  $89,157
                        ======== ========= ======== ========= ========
                     AUDIBLE INC. AND SUBSIDIARY
                CONDENSED CONSOLIDATED BALANCE SHEETS
                            (in thousands)

                                             December 31, December 31,
                   Assets                        2007         2006
                                             ------------ ------------
                                             (unaudited)

Current Assets:
  Cash and cash equivalents                  $    72,384  $    14,925
  Short-term investments                           8,453       51,295
  Interest receivable on short-term
   investments                                       332          626
  Accounts receivable, net of allowance            5,007        4,181
  Accounts receivable, related parties               443          100
  Royalty advances                                   310          710
  Prepaid expenses and other current assets          740        1,797
  Inventory                                           69          212
                                             ------------ ------------
Total current assets                              87,738       73,846

  Property and equipment, net                      9,910        8,149
  Investment in related party, net at equity         657            -
  Other assets                                     1,695          781

                                             ------------ ------------
Total Assets                                 $   100,000  $    82,776
                                             ============ ============

    Liabilities and Stockholders' Equity

Current Liabilities:
  Accounts payable                           $     1,796  $     3,121
  Accrued expenses                                 3,804        4,678
  Accrued royalties                                9,532        9,028
  Accrued compensation                             6,241          778
  Deferred revenue, current                       18,651       13,840
                                             ------------ ------------
Total current liabilities                         40,024       31,445

  Deferred revenue, non current                      546          513
  Royalty obligations, non current                     -           90
  Other liabilities, non current                   1,734          262

  Commitments and contingencies

Stockholders' Equity:
  Common stock                                       243          241
  Additional paid-in capital                     195,617      190,799
  Accumulated other comprehensive (loss)
   income                                            (51)         (36)
  Accumulated deficit                           (138,113)    (140,538)
                                             ------------ ------------
Total Stockholders' Equity                        57,696       50,466

                                             ------------ ------------
Total Liabilities and Stockholders' Equity   $   100,000  $    82,776
                                             ============ ============
                     AUDIBLE INC. AND SUBSIDIARY
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (in thousands)
                             (unaudited)

                                Three months ended     Year ended
                                   December 31,       December 31,
                                ------------------ -------------------
                                  2007     2006      2007      2006
                                -------- --------- --------- ---------

Cash flows from operating
 activities:
  Net income (loss)             $ 3,952  $   (933) $  2,425  $ (8,680)
Adjustments to reconcile net
 income (loss) to net cash
 provided by operating
 activities:
  Loss on equity investment in
   related party                    303         -       320         -
  Depreciation and amortization   1,354     1,308     5,318     5,018
  Amortization of audio
   production costs                 186        69       553       148
  Impairment loss on purchased
   software                           -         -       160       144
  Non-cash stock-based
   compensation charge            1,617     1,752     6,194     5,914
  Income tax benefit from
   exercise of stock options         20         -        20         -
  Amortization of discounts on
   short-term investments          (114)     (280)     (881)   (1,004)
Changes in assets and
 liabilities:
  Interest receivable on short-
   term investments                  90      (121)      294      (198)
  Accounts receivable, net       (1,383)   (1,337)     (823)   (1,833)
  Accounts receivable, related
   parties                         (180)      427      (343)      494
  Royalty advances                  114      (191)      400      (239)
  Prepaid expenses and other
   current assets                   758       202     1,059      (896)
  Inventory                          10       (52)      144       293
  Other assets                     (254)      (45)   (1,467)     (812)
  Accounts payable                 (257)      762    (1,326)   (1,640)
  Accrued expenses                  176      (129)     (967)     (724)
  Accrued royalties               1,935     3,129       499     3,902
  Accrued compensation            2,249      (295)    5,460      (101)
  Deferred revenue                2,080     2,253     4,843     7,125
  Other liabilites, non-current    (109)      262     1,471       262
                                -------- --------- --------- ---------
Net cash provided by operating
 activities                      12,547     6,781    23,353     7,173
                                -------- --------- --------- ---------

Cash flows from investing
 activities:
  Purchases of property and
   equipment                       (657)     (231)   (6,051)   (4,280)
  Capitalized software
   development costs               (535)     (427)   (1,188)     (872)
  Investment in related party         -         -      (978)        -
  Purchases of short-term
   investments                        -   (25,367)  (44,313)  (85,465)
  Proceeds from maturity of
   short-term investments        19,615    21,725    88,036    90,790
                                -------- --------- --------- ---------
Net cash provided by investing
 activities                      18,423    (4,300)   35,506       173
                                -------- --------- --------- ---------

Cash flows from financing
 activities:
  Proceeds from exercise of
   common stock options              47       248       516       633
  Proceeds from exercise of
   common stock warrants             76         -        76       750
  Payment of taxes due on
   vested restricted stock         (124)        -      (572)        -
  Repurchase of treasury stock
   at cost                       (1,414)   (1,363)   (1,414)   (5,351)
                                -------- --------- --------- ---------
Net cash (used in) provided by
 financing activities            (1,415)   (1,115)   (1,394)   (3,968)
                                -------- --------- --------- ---------

Effect of exchange rate changes
 on cash and cash equivalents       (17)        3        (6)       (2)
                                -------- --------- --------- ---------

    Increase in cash and cash
     equivalents                 29,538     1,369    57,459     3,376

Cash and cash equivalents at
 beginning of period             42,846    13,556    14,925    11,549
                                -------- --------- --------- ---------
Cash and cash equivalents at
 end of period                  $72,384  $ 14,925  $ 72,384  $ 14,925
                                ======== ========= ========= =========
                     AUDIBLE INC. AND SUBSIDIARY
                UNAUDITED SUPPLEMENTAL OPERATING DATA
                        (Members in thousands)

New AudibleListener     Q1    Q2    Q3    Q4    Q1    Q2    Q3    Q4
 Membership Reporting:  2005  2005  2005  2005  2006  2006  2006  2006
Total
 AudibleListener(R)
 Members(1)             186   204   223   245   277   306   343   381
   Year-over-year       77%   78%   70%   56%   49%   50%   54%   56%
   Quarter-over-
    quarter             18%   10%   9%    10%   13%   10%   12%   11%
Basic/Value
 AudibleListener(R)
 Members (2)             0     0     0     9    47    80    113   142
All Other
 (Gold/Platinmu)
 AudibleListener(R)
 Members (2)            186   204   223   236   230   226   230   239
   Year-over-year       77%   78%   70%   56%   24%   11%   3%    1%
   Quarter-over-
    quarter             18%   10%   9%    6%    -3%   -2%   2%    4%
New AudibleListener(R)
 Members(3)             54    52    60    62    79    65    71    70
   Year-over-year      143%  136%  107%   59%   46%   25%   18%   13%
   Quarter-over-
    quarter             38%   -4%   15%   3%    27%  -18%   9%    -1%
Average Monthly Churn
 in AudibleListener(R)
 Members(4)            4.78% 4.70% 5.20% 4.80% 4.80% 3.50% 3.00% 2.60%
Cost per New AL         $52   $57   $57   $94   $51   $44   $45   $49

New AudibleListener Membership         Q1 2007 Q2 2007 Q3 2007 Q4 2007
 Reporting:
Total AudibleListener(R) Members(1)      412     425     441     457
   Year-over-year                        49%     39%     29%     20%
   Quarter-over-quarter                  8%      3%      4%      4%
Basic/Value AudibleListener(R) Members
 (2)                                     150     147     143     133
All Other (Gold/Platinmu)
 AudibleListener(R) Members (2)          262     278     298     324
   Year-over-year                        14%     23%     30%     36%
   Quarter-over-quarter                  10%     6%      7%      9%
New AudibleListener(R) Members(3)        72      55      63      71
   Year-over-year                        -9%    -15%    -11%     1%
   Quarter-over-quarter                  3%     -24%     15%     13%
Average Monthly Churn in
 AudibleListener(R) Members(4)          3.00%   3.00%   3.30%   3.50%
Cost per New AL                          $41     $48     $45     $46

(1) Total number of AudibleListener(R) members at the end of the
 period.
(2) Number of Basic/Value AudibleListener(R)members at the end of the
 period.
(3) Total number of new AudibleListener(R) members added during the
 period. Members canceling and rejoining a membership within the same
 day are counted as one membership.
(4) Churn is defined as member cancellations in the period divided by
 the sum of members at the beginning of the period plus gross member
 adds, divided by three months.

CONTACT: Audible, Inc.
James Pearson, 973-820-0474
jpearson@audible.com
SOURCE: Audible, Inc.

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