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LiveWorld Announces First Quarter 2007 Results

Company Grows Revenue Year-Over-Year and Continues to Diversify Its Strong Customer Base

SAN JOSE, Calif.--(BUSINESS WIRE)--LiveWorld, Inc. (Pink Sheets:LVWD - News), a leading online social networking and community services marketing agency, today reported revenue of $2.6 million for the first quarter ended March 31, 2007, and this represents 5% growth over the $2.5 million in revenue for the first quarter ended March 31, 2006. This includes 112% year-over-year growth excluding revenues from the company's two largest clients, AOL US and eBay, demonstrating the Company's progress in new customer wins and diversifying its revenue mix.

"In the first quarter we continued to diversify our client and revenue base and capitalize on the growth and marketing power of online social networks," said Peter Friedman, LiveWorld's Chairman & CEO. "We have strong relationships with key clients AOL and eBay, and are leveraging our LiveWorld - WPP joint venture to generate and secure new client relationships. We expanded our product line with our new LiveWorld Video service, which enables brands to provide a fully-featured private label user video upload solution that seamlessly integrates with their sites."

"First quarter revenues were impacted by typical seasonally, but we are optimistic that our current investments will help fuel revenue growth in the second half of the year," said David Houston, Chief Financial Officer. "We are carefully managing our financials and are positioning the Company to move from the Pink Sheets to trade on the OTC market. We believe our targeted investments in product development will build a solid foundation that positions the company for revenue growth in 2007."

Revenue: Total revenues for the first quarter ended March 31, 2007 were approximately $2.6 million, representing 5% growth over the prior year period and compares to $2.9 million for the fourth quarter of fiscal year 2006. The anticipated year-over-year decline in AOL US revenues was more than fully offset by growth in revenues from other clients. These other revenues (excluding AOL US and eBay) increased to approximately $1.2 million for the first quarter of 2007, from approximately $545,000 in the first quarter 2006, or 112% year-over-year.

Net Loss Including the Impact of Non-Cash Stock Option and Warrant Expense: The net loss for the first quarter of 2007, including non-cash stock option and warrant expenses, was approximately $623,000, or a loss of $0.02 per share. First quarter net loss includes non-cash stock based compensation of approximately $67,000. This compares to net income for first quarter of 2006, including stock option expense, of approximately $82,000 and a net loss of approximately $35,000 for the fourth quarter of 2006.

Cash: The Company ended the first quarter of 2007 with approximately $3.3 million in cash and equivalents, up from $1.4 million in cash and cash equivalents for the first quarter of 2006 and an increase from the $3.2 million reported at the fiscal year ended December 31, 2006. For the first quarter of 2007, the Company was cash positive from operations, generating approximately $204,000.

Adjusted EBTIDA: Our Adjusted EBITDA for the first quarter of 2007 were approximately ($437,000), compared to $169,000, for the first quarter of 2006. This reduction of Adjusted EBITDA was a result of an increased spending for product development, sales and marketing, and general and administrative costs. LiveWorld defines Adjusted EBITDA as net income or loss with an add-back for depreciation and amortization, non-cash stock-based compensation expense, non-cash based warrant expense, interest income net, other income and income taxes. Adjusted EBITDA is not a term defined by GAAP and as a result LiveWorld's measure of Adjusted EBITDA might not be comparable to similarly titled measures used by other companies.

About LiveWorld
LiveWorld is leading the social marketing industry in creating innovative online communities, which help its clients build loyalty, brand awareness, customer engagement, customer care and business intelligence venues. The company provides Fortune 1000 clients overall social network marketing strategy, brand consulting , community management, design, development and hosting of private-label social network sites, and moderation services for these online communities as well as for any user content site. Applications and moderation services include rich profiles, friends lists, forums, blogs, photo albums, user video, customer support forums, groups and interactive webcasts.

With 20 years of experience, an extensive applications hosting platform, and a track record of delivering over 1 million hours of moderation services, LiveWorld offers its clients a team of experienced community managers and moderators who oversee activity and user content online. LiveWorld deploys its services in more than 60 country-language combinations, and is the trusted partner of leading brands worldwide, including: A&E, The Campbell Soup Company, The Coca Cola Company, eBay, HBO, HSBC, Kraft Foods, LeapFrog, Neutrogena, MINI Cooper USA, , TJX, QVC and many others.

LiveWorld is headquartered in San Jose, California with additional offices in New York City and London. For further information visit www.liveworld.com

"Safe Harbor" Statement Under The Private Securities Litigation Reform Act:

This press release may contain forward-looking information concerning LiveWorld's plans, objectives, future expectations, forecasts and prospects. These statements may include those regarding LiveWorld's current or future financial performance including but not limited to lists of clients, revenue and profit, use of cash, investments, relationships and the actual or potential impact of stock option expense, LiveWorld's efforts to list its securities on the OTCBB, and the results of its product development efforts. Actual results may differ materially from those expressed in the forward looking statements made as a result of, among other things, final accounting adjustments and results, LiveWorld's ability to attract new clients and preserve or expand its relationship with existing clients, LiveWorld's ability to retain and attract high quality employees, including its management staff, the ability to deliver new innovative products in a timely manner, changing accounting treatments, and other risks applicable to the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and the Company undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances. (See the Company's July 13, 2007 Second Amended Registration Statement on Form 10-SB for a list that includes other possible risk factors.)

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