For Immediate Release
 Local.com Reports Fourth Quarter,
Full Year 2008 Financial Results and 2009 Outlook
   Fourth Quarter Financial Results :
 
    
    Revenue Fourth quarter of 2008 revenue of $9.6 million was slightly above the midrange of
the companys prior guidance of $9 to $10 million. This represented growth of 61% over the
fourth quarter 2007.
    
    Net Loss Net loss of $2.2 million or $0.15 per common share was at the midrange of
guidance, an increase of $0.5 million from the third quarter 2008 and included non-cash expenses
of $935,000 or $0.06 per share.
    
    Adjusted EBITDA Adjusted EBITDA was ($1.3 million), an improvement from ($1.7 million) in
the fourth quarter of 2007. Adjusted EBITDA is net loss excluding: provision for income taxes;
interest and other income (expenses), net; depreciation; amortization; and stock based
compensation charges.
  Fourth Quarter Operating and Recent Highlights :
 
    
    Redesigned Local.com Website In early February,
the company launched a redesigned interface for Local.com. The new site was designed to further improve




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the consumer search experience.
    
    Monetization of Traffic Revenue per thousand visitors (RKV) was $275, up 40% from $197 RKV
in the fourth quarter of 2007 and down 1% from $278 RKV in the third quarter of 2008.
    
    Overall Search Traffic The company reported search traffic of 51 million monthly unique
visitors (MUVs) on the Local.com site and network during the fourth quarter of 2008, up 57% from
32.5 million MUVs during the same period in 2007.
    
    Organic Search Traffic The company reported organic search traffic of 26 million monthly
unique visitors on the Local.com site and network during the fourth quarter of 2008, up over
200% from 8.5 million during the same period in 2007.
    
    Acquisition of Web Hosting Customers On February  18, the company acquired approximately 11,800 web hosting customers
for approximately $1.2 million. The transaction is expected to be
accretive immediately.
    
    Direct Advertiser Base Billable advertisers
numbered 5,100 as of January 31, 2009.
    
    Technology Licensees The number of licensees for the companys local search technologies
grew to 40 during the fourth quarter of 2008, up from 37 in the third
quarter 2008.
    
    Launched Local Mobile on Virgin Mobile USA In November, the company announced the launch
of Local Mobile on Virgin Mobile USAs nationwide network. Virgin Mobile USAs more than five
million customers can now leverage the power of Local Mobile directly from all 3G Virgin Mobile
USA handsets.
    
    Partnered with Valpak for Online Coupons In December, the company announced an agreement
with Valpak, a leading coupon and direct marketing provider, to distribute local business offers
throughout the Local.com network.
 Full Year 2008 Financial Results :
 
    
    Revenue Revenue was $38.3 million for the year ended December 31, 2008, a 78% increase over
$21.5 million in 2007.
    
    Net Loss Net loss for the full year 2008 was $8.6 million or $0.60 per common share, an
improvement over the $18.2 million or $1.58 loss per common share in 2007.
    
    Adjusted EBITDA Adjusted EBITDA was ($4.7 million), an improvement from ($7.2 million) in
2007. Adjusted EBITDA is net loss excluding: provision for income taxes; interest and other
income (expenses), net; depreciation; amortization; and stock based compensation charges.
    
    Balance Sheet On December 31, 2008, the company had $12.1 million in cash and no debt.
 First Quarter and Fiscal 2009 Financial Guidance :
  
    
    interest and other income and (expenses) of $6,000;
    
    depreciation and amortization of $425,000;
    
    and stock based compensation charges of $465,000
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Conference Call Information:
 http://ir.local.com
  About Local.com ®
 http://corporate.local.com/advertisewithus www.local.com http://corporate.local.com/
 Forward Looking Statements
  3




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Investor Relations Contact:
 dskolfield@local.com
 Media Contact:
 
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LOCAL.COM CORPORATION
CONSOLIDATED BALANCE SHEETS
 December 31,
    
    
    December 31,2008
    
    
    2007(Unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    12,142
    
    
    $
    14,258Restricted cash
    
    
    31
    
    
    
    30Marketable securities
    
    
    
    
    
    
    1,999Accounts receivable, net of allowances of $60 and $15, respectively
    
    
    5,270
    
    
    
    3,595Prepaid expenses and other current assets
    
    
    374
    
    
    
    292Total current assets
    
    
    17,817
    
    
    
    20,174Property and equipment, net
    
    
    1,073
    
    
    
    1,473Intangible assets, net
    
    
    2,158
    
    
    
    3,156Goodwill
    
    
    13,231
    
    
    
    13,233Long-term restricted cash
    
    
    35
    
    
    
    66Deposits
    
    
    12
    
    
    
    12Total assets
    
    $
    34,326
    
    
    $
    38,114LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    5,608
    
    
    $
    4,029Accrued compensation
    
    
    545
    
    
    
    456Deferred rent
    
    
    199
    
    
    
    316Other accrued liabilities
    
    
    564
    
    
    
    194Deferred revenue
    
    
    64
    
    
    
    177Total liabilities, all current
    
    
    6,980
    
    
    
    5,172Commitments and contingenciesStockholders equity:Convertible preferred stock, $0.00001 par value; 10,000,000 shares authorized;
none issued and outstanding for all periods presented
    
    
    
    
    
    
    Common stock, $0.00001 par value; 30,000,000 shares authorized;
14,446,107 and 14,204,110 issued and outstanding, respectively
    
    
    
    
    
    
    Additional paid-in capital
    
    
    85,141
    
    
    
    82,176Accumulated comprehensive loss
    
    
    
    
    
    
    (1
    )Accumulated deficit
    
    
    (57,895
    )
    
    
    (49,233
    )Stockholders equity
    
    
    27,346
    
    
    
    32,942Total liabilities and stockholders equity
    
    $
    34,326
    
    
    $
    38,114
 5




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LOCAL.COM CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
 Three months ended
    
    
    Year endedDecember 31,
    
    
    December 31,2008
    
    
    2007
    
    
    2008
    
    
    2007(Unaudited)
    
    
    (Unaudited)
    
    
    (Unaudited)Revenue
    
    $
    9,573
    
    
    $
    5,932
    
    
    $
    38,257
    
    
    $
    21,525Operating expenses:Search serving
    
    
    1,186
    
    
    
    978
    
    
    
    5,290
    
    
    
    3,862Sales and marketing
    
    
    8,233
    
    
    
    5,570
    
    
    
    32,231
    
    
    
    20,268General and administrative
    
    
    1,427
    
    
    
    1,235
    
    
    
    5,541
    
    
    
    4,890Research and development
    
    
    713
    
    
    
    684
    
    
    
    3,071
    
    
    
    2,555Amortization and write-down of intangibles
    
    
    200
    
    
    
    325
    
    
    
    999
    
    
    
    1,121Total operating expenses
    
    
    11,759
    
    
    
    8,792
    
    
    
    47,132
    
    
    
    32,696Operating loss
    
    
    (2,186
    )
    
    
    (2,860
    )
    
    
    (8,875
    )
    
    
    (11,171
    )Interest and other income (expense)
    
    
    21
    
    
    
    194
    
    
    
    312
    
    
    
    (7,030
    )Loss before income taxes
    
    
    (2,165
    )
    
    
    (2,666
    )
    
    
    (8,563
    )
    
    
    (18,201
    )Provision (benefit) for income taxes
    
    
    
    
    
    
    
    
    
    
    1
    
    
    
    1Net loss
    
    $
    (2,165
    )
    
    $
    (2,666
    )
    
    $
    (8,562
    )
    
    $
    (18,202
    )Per share data:Basic net loss per share
    
    $
    (0.15
    )
    
    $
    (0.19
    )
    
    $
    (0.60
    )
    
    $
    (1.58
    )Diluted net loss per share
    
    $
    (0.15
    )
    
    $
    (0.19
    )
    
    $
    (0.60
    )
    
    $
    (1.58
    )Basic weighted average shares outstanding
    
    
    14,446,107
    
    
    
    14,197,811
    
    
    
    14,313,048
    
    
    
    11,499,879Diluted weighted average shares
outstanding
    
    
    14,446,107
    
    
    
    14,197,811
    
    
    
    14,313,048
    
    
    
    11,499,879
 Supplemental consolidated statements of operations information:
 Three months ended
    
    
    Year endedDecember 31,
    
    
    December 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Non-cash stock based compensation expense:Sales and marketing
    
    $
    195
    
    
    $
    180
    
    
    $
    887
    
    
    $
    544General and administrative
    
    
    329
    
    
    
    308
    
    
    
    1,248
    
    
    
    968Research and development
    
    
    77
    
    
    
    53
    
    
    
    267
    
    
    
    236Total stock-based compensation expense
    
    $
    601
    
    
    $
    541
    
    
    $
    2,402
    
    
    $
    1,748Basic and diluted net compensation expense per share
    
    $
    0.04
    
    
    $
    0.04
    
    
    $
    0.17
    
    
    $
    0.15
 6




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LOCAL.COM CORPORATION
RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA (Note 1)
 Three months ended
    
    
    Year endedDecember 31,
    
    
    December 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Net loss
    
    $
    (2,165
    )
    
    $
    (2,666
    )
    
    $
    (8,562
    )
    
    $
    (18,202
    )Less interest income and other, net
    
    $
    (21
    )
    
    $
    (194
    )
    
    $
    (312
    )
    
    $
    7,030Plus provision for income taxes
    
    $
    
    
    
    $
    
    
    
    $
    1
    
    
    $
    1Plus amortization of intangibles
    
    $
    200
    
    
    $
    325
    
    
    $
    999
    
    
    $
    1,121Plus depreciation
    
    $
    134
    
    
    $
    264
    
    
    $
    814
    
    
    $
    1,086Plus stock-based compensation
    
    $
    601
    
    
    $
    541
    
    
    $
    2,402
    
    
    $
    1,748Adjusted EBITDA
    
    $
    (1,251
    )
    
    $
    (1,730
    )
    
    $
    (4,658
    )
    
    $
    (7,216
    )Basic and diluted adjusted EBITDA
per share
    
    $
    (0.09
    )
    
    $
    (0.12
    )
    
    $
    (0.33
    )
    
    $
    (0.63
    )Basic and diluted weighted
average shares outstanding
    
    
    14,446,107
    
    
    
    14,197,811
    
    
    
    14,313,048
    
    
    
    11,499,879
    7