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DoubleClick Reports Third Quarter 2003 Financial Results

Company has third consecutive GAAP profitable quarter

New York, NY, 10/16/2003 - DoubleClick Inc. (NASDAQ: DCLK), the leading provider of data and technology tools for direct marketers, web publishers and advertisers, today announced financial results for the third quarter ended September 30, 2003, updated its guidance for the full year 2003, and gave a preliminary business outlook for full year 2004.

DoubleClick reported revenues for the third quarter of $74.8 million versus $74.6 million in the year ago period. GAAP net income for the most recent quarter was $6.3 million, or $0.04 per share compared with $5.8 million or $0.04 in the second quarter of 2003 and a loss of $62.0 million or $0.46 per share in the third quarter of 2002. GAAP net income before interest, taxes, depreciation, and amortization, or EBITDA, was $23.8 million for the third quarter of 2003 versus $16.4 million in the second quarter of 2003.1 Total GAAP operating expenses were $45.7 million, versus $117.9 million in the third quarter of 2002. Total company headcount at the end of the most recent quarter was 1,214 versus 1,147 at the end of the third quarter of 2002.

Third quarter 2003 GAAP earnings were negatively impacted by $8.3 million in charges related to the acceleration of amortization of the leasehold improvements and furniture and fixtures at the Company’s New York and San Francisco offices due to the change in useful life of these assets. Third quarter 2003 GAAP earnings and EBITDA benefited from a net restructuring credit of $2.2 million related to the reversal of a portion of the Company’s real estate reserve for its New York and San Francisco offices and the receipt of $1.4 million by the Company in connection with an insurance claim.

Last year’s third-quarter GAAP results included $46.2 million in charges related to the impairment of goodwill for the Company’s email business and other intangible assets, a $23.8 million restructuring charge related to the Company’s real estate, a $14.1 million charge relating to the impairment of some of the Company’s minority investments, a $7.4 million gain related to the sale of the Company’s North American Media business and a $11.9 million gain on the early extinguishment of debt.

The Company used $43.4 million in cash flow from operations during the third quarter of 2003. This figure included payments by the Company of $56.5 million in connection with the termination of leases on the Company’s New York and San Francisco offices. The Company ended the quarter with $662 million in cash and marketable securities, and had a net cash position of $526 million, or $3.83 per share.2 The Company used $158.0 million in connection with the redemption of its 4.75% convertible notes during the quarter.

"DoubleClick’s business has begun to benefit from the turnaround in marketing spending, with TechSolutions transaction volumes for the third quarter reaching their highest levels since the first quarter of 2001. In addition, our Data Segment had its best quarterly revenue to date,” said Kevin Ryan, Chief Executive Officer, DoubleClick. “During the quarter, we made tremendous strides in integrating our recently acquired Data Management division. Our rich media authoring and delivery product, DART Motif, is scheduled to add multi-event ad tracking and analysis functionality in the near future. Motif is a joint development between DoubleClick and Macromedia, and market response to this product has been very favorable.”

3Q03 2Q03 3Q02
Revenue (000’s) $74,790 $63,556 $74,625
GAAP Net Income (Loss) (000’s) $6,340 $5,831 ($61,951)
GAAP EPS $0.04 $0.04 ($0.46)

1 See attached schedule for a reconciliation of EBITDA to GAAP net income. Please see the Form 8-K filed today by the Company with the SEC for a discussion of why the Company believes EBITDA is a useful financial measure to investors and how it is used by management.

2 Net cash is defined as gross cash and cash equivalents of $126.7 million, restricted cash of $27.7 million, and investments in marketable securities of $507.6 million minus zero coupon convertible subordinated notes of $135.0 million and capital lease obligations of $1.0 million. Please see the Form 8-K filed today by the Company with the SEC for a discussion of why the Company believes net cash is a useful financial measure to investors and how it is used by management.

About DoubleClick

DoubleClick (www.doubleclick.net) is the leading provider of data and technology for advertisers, direct marketers and web publishers to plan, execute and analyze their marketing programs. DoubleClick’s online advertising, email marketing and database marketing solutions help clients yield the highest return on their marketing dollar. In addition, the Company’s marketing analytics tools help clients measure performance within and across channels. DoubleClick Inc. has global headquarters in New York City and maintains 22 offices around the world.

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