Invest in the Future.

As an investor, you have a unique opportunity to get behind a technology that is just beginning to reach its full potential. Just as touch input changed the way that billions of devices receive input from humans, touch feedback will change the way devices convey information back to us.  From mobile phones to wearables, game consoles to automobiles, haptic feedback is enriching the way that people interact with digital technology.  And the best is yet to come as content on mobile, video, games and social networks, become richer, more realistic and more personal with haptics.  At Immersion, we’re changing the digital world.

Feb 07, 2000

Immersion Corporation Reports Record Net Revenues of $2.5 Million for Fourth Quarter

Immersion Corporation Reports Record Net Revenues of $2.5 Million for Fourth Quarter SAN JOSE, Calif. Feb. 7, 2000--Immersion Corporation, (NASDAQ: IMMR), the pioneering developer of sensory interaction technology, announced today that fourth quarter 1999 total revenues were $2.5 million, as compared with $1.6 million in the fourth quarter of 1998, an increase of 52%. The fourth quarter 1999 revenue was comprised of $1.0 million in royalty revenue, which was $639,000 or 204% higher than the fourth quarter of 1998; product sales of $1.3 million, which was $185,000 or 16% higher than the fourth quarter of 1998 and development contract revenue of $175,000, which was $16,000 or 10% higher than the fourth quarter of 1998. The net loss for the quarter was $632,000 compared to a net loss of $255,000 recorded in the same period in the prior year. Basic and diluted net loss per share for the quarter was $0.06, which remained unchanged as compared with the fourth quarter of 1998.

Total revenues for the year ended December 31, 1999 increased to $8.0 million from $5.0 million for 1998, an increase of 60%. The 1999 revenue was comprised of $2.2 million in royalty revenue, which was $1.9 million or 595% higher than 1998 royalty revenue; 1999 product sales of $4.6 million, which was $858,000 or 23% higher than 1998 product sales and 1999 development contract revenue of $1.2 million, which was $248,000 or 25% higher than the 1998 development contract revenue. Net loss, for the full year 1999 was $4.4 million compared to a net loss of $1.7 million in 1998. Basic and diluted net loss per share, for 1999 was $0.66, compared to basic and diluted net loss per share of $0.43 in 1998.

"We're very pleased with our fourth quarter results," said Victor Viegas, CFO at Immersion. "All three revenue groups showed solid growth, in particular, the royalty revenue increased significantly. In addition, we have made great progress in our new marketing initiatives, development projects and in developing improved corporate processes. Our fourth quarter was important to us for a number of reasons including, the completion of the Company's Initial Public Offering and the launch of the first TouchSense enabled mouse - the Wingman Force Feedback Mouse from Logitech (NASDAQ: LOGIY)."

About Immersion Corporation (www.immersion.com)

Founded in 1993, Immersion Corporation develops advanced hardware and software technologies that enable users to interact with computers using their sense of touch. Immersion's patented TouchSenseTM technologies, enable computer peripheral devices to deliver tactile sensations that correspond to on-screen events. Immersion licenses its hardware and software technology, on which it holds 42 issued patents worldwide, to industry-leaders in order to integrate and implement its sensory feedback into professional simulation and modeling, consumer devices, and enabling technologies.

All statements contained herein, as well as oral statements that may be made by Immersion or by officers, directors or employees of Immersion acting on Immersion's behalf, that are not statements of historical fact, constitute "forward-looking statements" and are made pursuant to the Safe-Harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause the actual results of Immersion to be materially different from the historical results or from any future results expressed or implied by such forward-looking statements. Such risks and uncertainties are outlined in Immersion's Prospectus dated November 12, 1999 included in its Registration Statement on Form S-1 filed with the Securities and Exchange Commission. These factors may not constitute all factors that could cause actual results to differ materially from those discussed in any forward-looking statement. The Company is not obligated to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.

Note to Editors: Additional background information on Immersion Corporation is available through our Web Site at www.immersion.com.


                         Immersion Corporation
            Condensed Consolidated Statements of Operations
               (In thousands, except per share amounts)
                              (Unaudited)

                              Three Months          Twelve Months
                            Ended December 31,    Ended December 31,
                             1999      1998        1999      1998

Revenues:
     Royalty Revenue       $  952    $  313      $  2,232    $  321
     Product sales          1,326     1,141         4,583     3,725
     Development contracts
       and other              175       159         1,223       975
                              ---       ---          -       ---
      Total revenues        2,453     1,613         8,038     5,021
                            --      -        ---    

Costs and expenses:
    Cost of product sales     653       435         2,106     1,507
    Sales and marketing       761       120         1,801       656
    Research and
      development             681       539         2,273     1,817
    General and
      administrative          917       652         4,171     2,677
    Amortization of
      intangibles and
      deferred stock
      compensation            469       161         1,339       211
    In-process research
      and development          --        --         1,190        --
                               --        --          -        --

      Total costs and
      expenses              3,481     1,907        12,880     6,868
                            --      -            

Loss from operations       (1,028)     (294)       (4,842)   (1,847)
Other income                  396        39           488       174
                           ---        --              -

Net loss                $    (632)$    (255)    $  (4,354)$  (1,673)
                        =========      ====     ========= =========

Basic and diluted
   net loss per share  $    (0.06)$   (0.06)    $   (0.66)$   (0.43)
                            --     --         --     --

Shares used in calculating basic
   and diluted
   Net loss per share      10,636     4,006         6,599     3,909
                            --      -          -      -

                         Immersion Corporation
                 Condensed Consolidated Balance Sheets
          (In thousands, except share and per share amounts)

                             December 31,     December 31,
                                1999             1998
                             (Unaudited)       (Audited)

Assets
  Cash and cash equivalents  $   46,527        $   2,592
  Short-term investments          4,781              402
  Accounts receivable, net        1,064            1,111
  Inventories                       660              481
  Prepaid expenses and
    other assets                  1,057               99
                                 ---             -

         Total current assets    54,089            4,685

  Property and equipment, net       591              329
  Patents and technology, net     4,687              945
  Other assets                       71               --

         Total Assets         $  59,438          $ 5,959
                                 ======            =====

Liabilities
  Accounts payable          $       750       $      410
  Accrued compensation              180              171
  Other accrued liabilities         503               82
  Deferred revenue                1,316               --
  Customer advances                  39               46
  Income taxes payable                2                1
                                  --             -

         Total current
          liabilities             2,790              710

  Redeemable convertible
    preferred stock                  --            1,476

Stockholders' Equity             56,648            3,773

Total Liabilities &
Stockholders' Equity          $  59,438          $ 5,959
                                 ======            =====