BELMONT, Calif., Aug. 21 /PRNewswire-FirstCall/ -- IXI Mobile, Inc. (OTC Bulletin Board: IXMO) ("IXI" or the "Company"), the maker of the Ogo(TM) family of devices and services, announced today financial results for the three and six months ended June 30, 2007.

Mr. Amit Haller, president and chief executive officer said, "This year marks a transitional period for IXI, highlighted by the completion of our merger with Israel Technology Acquisition Corp. and our resulting new status as a publicly traded company. Our evolution, while aided in part by the deal, also included a significant investment of both time and resources to further our growth plans and establish a family of Ogo products in markets around the world. As a direct result of our activity and efforts, we believe a stronger IXI has emerged - one with a solid foundation for the future: innovative technology, a sound business strategy and a strong product pipeline, which collectively position us to grow the company".

"We are pleased with our ability to grow second quarter revenue over the first quarter, despite the fact that a limited number of carriers were offering Ogo, and the rollout of Ogo2.0, our newest model, which several carriers were awaiting, occurred at the very end of the quarter. Additionally, we were able to achieve positive gross margins on a non-GAAP basis for both the second quarter and first half of 2007, compared to negative non-GAAP gross margins for both periods in 2006."

"We remain confident in our ability to penetrate new markets and expand our product offering. Beyond Ogo2.0, we will continue to invest in research and development to ensure that we remain on the cutting-edge in delivering affordable and feature rich data / messaging devices. Our commitment to Ogo's brand and to maximizing the Ogo user experience remains a priority. To that end, during the second half of 2007, IXI will roll out OgoClips(TM), add-ons for Ogo2.0, that we believe will further entrench Ogo in the youth market."

"We view the growing acceptance of Ogo devices as a reflection of the public's desire for an affordable, yet feature rich, wireless messaging device and a validation of our business plan. With the announcement of additional markets and the recent commercial launch of the new Ogo2.0, we believe we have a solid foundation in place to continue to fuel subscriber growth and penetrate new markets. Our progress to date speaks to our technology, our team and our focused growth strategy, and we are intent on further leveraging these strengths going forward."

Highlights Carrier and Subscriber:

During the first half of 2007, the Company announced its plan to launch its Ogo2.0 CT-25C in the United Stated through Ohio-based Revol Wireless. Revol will become the first to carry Ogo2.0, IXI's first CDMA product with EV- DO technology, in the United States. In addition, IXI announced that it is working with mobilelkom austria AG (Austria) and VimpelCom Communications (Russia) to expand its global presence in these two large and growing markets. IXI also expanded its offering through Swisscom Mobile AG (Switzerland), which has begun offering Ogo2.0 CT-25E, as well as the CT-12, the first Ogo model. Moreover, IMS will distribute the Ogo in Malaysia with sales expected to commence at the end of the 2007.

As of June 30, 2007, 6 customers offered Ogo, with 3 others in the process of rolling out service. Ogo subscribers totaled approximately 104,000 worldwide on June 30, 2007, representing 31,000 new subscriptions during the first half of the year, an increase of over 40%. This increase does not fully reflect sales of Ogo 2.0, which was commercially launched only 2 weeks prior to the end of the second quarter.

Products and Services:

On February 14, 2007, IXI announced the revolutionary Ogo2.0. The device maintains an optimized user experience for Instant Messaging, Email and SMS (texting), and adds enhanced communications features. The new Ogo2.0 accentuates Web2.0 with a 2.8" QVGA screen, built-in stereo speakers, a microSD memory slot, music and video players. Additionally, Ogo2.0 includes a unique feature that allows end-users to upgrade and accessorize Ogo with OgoClips, a selection of peripherals add-ons including a camera, Bluetooth handset, multimedia Bluetooth streamer and controller and a bottle opener. IXI plans to expand the family of OgoClips(TM) further as penetration of Ogo2.0 increases.

Ogo2.0, which was first commercially available at the end of June 2007 in Austria and Switzerland, improves upon the traditional telephone functionality, enabling consumers to use it as their primary mobile communication device. IXI continues to enhance the core value proposition of the Ogo family of devices, having recently added ICQ instant messaging services to its current mobile messaging platform.

GAAP Financials

IXI reported revenues of $3.2 million for the quarter ended June 30, 2007 compared to $3.1 million in the previous quarter and $3.7 million in the same period last year. Operating loss during the period was $10.2 million compared to $5.8 million in the previous quarter and $6.3 million in the same period last year.

Net loss for the three months ended June 30, 2007 was $21.5 million, as compared to net loss of $6.7 million for the three months ended March 31, 2007 and $6.3 million for the three months ended June 30, 2006. IXI's operating loss for the three months ended June 30, 2007 includes $2.9 million of stock based compensation expenses for employees and consultants and expenses recorded in connection with the issuance of stock and incentive plans to IXI's co-Chairman, Mr. Gideon Barak, and IXI's Chief Executive Officer, Mr. Haller. In addition, as of June 30, 2007, IXI incurred $837,000 of inventory write- downs and write offs of vendor advance payments, charged to cost of revenues, as a result of IXI's belief that it will ship less of the older Ogo models than it had previously anticipated due to the commercial launch of Ogo2.0 during the quarter. IXI's net loss includes, in addition to the abovementioned charges, $10.3 million of one-time financial expenses recorded in connection with the merger.

Revenues for the six months ended June 30, 2007 were $6.3 million compared to $5.5 million for the six months ended June 30, 2006. Operating loss during the six months ended June 30, 2007 was $16.0 million compared to $10.6 during the six months ended June 30, 2006. IXI had a net loss for the six months ended June 30, 2007 of $28.2 million, compared to a net loss of $10.8 million, for the six months ended June 30, 2006.

IXI's operating loss for the six months ended June 30, 2007 includes $3.0 million of stock based compensation expenses for employees and consultants and expenses recorded in connection with the issuance of stock and incentive plans to IXI's co-Chairman, Mr. Barak, and IXI's Chief Executive Officer, Mr. Haller. In addition, IXI has incurred $958,000 of inventory write down and vendor advance payments write-offs, charged to cost of revenues. IXI's net loss includes, in addition to the abovementioned charges, $10.3 million of one time financial expenses recorded in connection with the merger.

Cash and cash equivalents totaled $31.6 million at June 30, 2007, compared to $14.6 million of cash and cash equivalents at June 30, 2006.

Non-GAAP Financials

The non-GAAP consolidated results of operations for the three and six months ended June 30, 2007 exclude stock based compensation expenses and expenses related to management incentive plans in the amount of $2.9 and $3 million, and inventory write-offs in the amount of $837,000 and $958,000, respectively. The non-GAAP results for the three and six months also exclude the abovementioned one-time financial expenses recorded in connection with the merger in the amount of $10.3 million. A reconciliation of specific adjustments to GAAP results is included in the schedule titled "Reconciliation of GAAP to Non-GAAP."

Non-GAAP operating loss for the three months ended June 30, 2007 was $6.4 million, compared to $5.6 million in the previous quarter and an operating loss of $6.1 million for the three months ended June 30, 2006. Non-GAAP operating loss for the six months ended June 30, 2007 was $12.1 million, compared to an operating loss of $10.1 million for the six months ended June 30, 2006.

The non-GAAP net loss for the three months ended June 30, 2007 was $7.5 million compared to $6.5 million in the previous quarter and a net loss of $6.1 million in the second quarter of 2006. Non-GAAP net loss for the six months ended June 30, 2007 was $14.1 million, compared to a net loss of $10.4 million, for the same period last year.

About IXI Mobile

Headquartered in Belmont, CA, IXI Mobile, Inc. offers solutions that bring innovative, data-centric mobile devices and services to the mass market. IXI Mobile's Ogo devices are designed to improve the mobile user experience and increase mobile voice and data usage. The company provides a turn-key solution to mobile operators and Internet service providers around the world to launch and support Ogo products. For more information on IXI Mobile, please visit http://www.ixi.com/.

About Ogo

The Ogo family of devices delivers popular applications, including email, instant messaging, SMS, RSS, voice and Web browsing on optimized, easy-to-use handheld devices for a true on-the-go mobile messaging experience. Ogo was launched by mobile operators and Interned service providers around the world. More information on Ogo is available at: http://www.ogo.com/.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to IXI's future financial or business performance, strategies and expectations. Forward- looking statements are typically identified by words or phrases such as "trend," "potential," "opportunity," "pipeline," "believe," "comfortable," "expect," "anticipate," "current," "intention," "estimate," "position," "assume," "outlook," "continue," "remain," "maintain," "sustain," " seek, " "achieve," and similar expressions, or future or conditional verbs such as "will," " would," "should," "could," "may" and similar expressions.

For additional information, please contact: KCSA Worldwide (Investor Relations) Lee Roth / Marybeth Csaby 212-896-1209 / 1236 lroth@kcsa.com / mcsaby@kcsa.com IXI MOBILE, INC. (FORMERLY ISRAEL TECHNOLOGY ACQUISITION COMPANY) AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS U.S. dollars in thousands, except share and per share data Six months ended Three months ended June 30, June 30, 2007 2006 2007 2006 Unaudited Revenues $6,294 $5,468 $3,171 $3,729 Operating expenses: Cost of revenues 7,173 6,356 4,062 4,096 Research and development, net 7,137 2,787 4,133 1,357 Selling and marketing 3,346 5,319 1,388 3,775 General and 4,603 1,562 3,756 767 administrative Total operating expenses 22,259 16,024 13,339 9,995 Operating loss (15,965) (10,556) (10,168) (6,266) Financial expenses, net (12,210) (708) (11,313) (525) Other Income - 13 - - Loss from continuing operations (28,175) (11,251) (21,481) (6,791) Income (loss) from (55) 488 (27) 514 discontinued operations Net Loss $(28,230) $(10,763) $(21,508) $(6,277) Basic and diluted net earnings (loss) per share of Common stock: From discontinuing $(10.77) $(18.56) $(4.64) $(11.03) operations From Discontinued (0.02) 0.71 (0.01) 0.75 operations Basic net loss $(10.79) $(17.85) $(4.65) $(10.28) per share Weighted average number of shares of Common stock used in computing basic and diluted net earnings(loss) per share of Common stock 2,694,311 682,652 4,705,970 682,652

The accompanying notes are an integral part of the condensed consolidated financial statements.

IXI MOBILE, INC. (FORMERLY ISRAEL TECHNOLOGY ACQUISITION COMPANY) AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS U.S. dollars in thousands June 30, June 31 2007 2006 Unaudited ASSETS: CURRENT ASSETS Cash and cash equivalents $31,602 $2,729 Restricted cash 168 269 Trade receivables 2,669 3,286 Other receivables and prepaid expenses 1,187 682 Vendor advance payments 5,986 3,947 Inventories, net 13,201 13,473 Total current assets 54,813 24,386 LONG-TERM ASSETS: Severance pay fund 726 596 Long-term prepaid expenses 39 93 Property and equipment, net 513 429 Deferred debt and Merger costs 2,434 2,287 Other assets, net - 62 Total long-term assets 3,712 3,467 Total assets $58,525 $27,853

The accompanying notes are an integral part of the condensed consolidated financial statements.

IXI MOBILE, INC. (FORMERLY ISRAEL TECHNOLOGY ACQUISITION COMPANY) AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS U.S. dollars in thousands, except share and per share data June 30, June 30, 2007 2006 Unaudited LIABILITIES AND STOCKHOLDERS' DEFICIENCY CURRENT LIABILITIES: Current maturities of long-term loans $3,000 $- Short-term bank credit 7,706 6,767 Short-term loan 5,000 - Trade payables 2,466 3,159 Employees and payroll accruals 1,269 1,016 Deferred revenues 12,285 13,035 Other payables and accrued expenses 4,519 3,446 Liabilities of discontinued operations 2,470 2,431 Total current liabilities 38,715 29,854 LONG-TERM LIABILITIES: Long-term loans, net of current maturities 3,000 - Long-term convertible loan 23,441 20,000 Other long-term liabilities 20 - Accrued severance pay 868 721 Total long-term liabilities 27,329 20,721 STOCKHOLDERS' DEFICIENCY: Stock capital - Common stock at June 30, 2007 and December 31, 2006 of $0.0001 par value - Authorized: 60,000,000; Issued and outstanding: 15,937,732 and 6,387,467 shares as of June 30, 2007 and December 31, 2006, respectively: 2** 1 Additional paid-in capital* 112,036 68,714 Notes receivable - (110) Accumulated deficit (119,557) (91,327) Total Stockholders' deficiency (7,519) (22,722) Total liabilities and stockholders' $58,525 $27,853 deficiency * Net of deferred stock compensation. ** Upon the Merger, the shares of IXI stock were canceled and converted into the Company's shares in a ratio of 1:0.15. All share information included in this report has been retroactively adjusted to reflect this conversion. All series of IXI shares, including IXI common stock, IXI series A, B, C, D and D-1 convertible preferred stock have been retroactively presented on as if converted basis into equivalent ITAC common shares. The accompanying notes are an integral part of the condensed consolidated financial statements. Non-GAAP Financial Measures We present the following non-GAAP financial measures: non-GAAP Cost of Revenues; non-GAAP operating income and non-GAAP net income; Non GAAP Cost of Revenues reconciliation for the three months ended June 30, 2007: IXI Mobile, Inc. Reconciliation of Non-GAAP Financial Measure Three Three months months ended ended June 30 June 30 2007 2006 ($K) ($K) TOTAL REVENUES 3,171 3,729 GAAP Cost of Revenues: 4,062 4,096 GAAP Gross margin -28.14 % -9.84 % Stock based option expense in GAAP Cost of Revenues 145 1 Inventory write-down (including vendor advance payments write off) 837 83 Non GAAP Cost of Revenues (excluding the above) 3,080 4,012 Non GAAP gross margin 2.82 % -7.57 % Non GAAP Operating Loss reconciliation for the three months ended June 30, 2007: IXI Mobile, Inc. Reconciliation of Non-GAAP Financial Measure Three Three months months ended ended June 30 June 30 2007 2006 ($K) ($K) GAAP Operating loss (10,168) (6,266) Stock based option and share expense in GAAP Operation expenses, including merger related expenses 2,881 95 Inventory write-down (including vendor advance payments write off) 837 83 Non GAAP Operating loss (excluding the above) (6,450) (6,088) Non GAAP Net Loss reconciliation for the three months ended June 30, 2007: IXI Mobile, Inc. Reconciliation of Non-GAAP Financial Measure Three Three months months ended ended June 30 June 30 2007 2006 ($K) ($K) GAAP Net loss (21,508) (6,277) Stock based option and share expense in GAAP Operation expenses, including merger related expenses 2,881 95 Inventory write-down (including vendor advance payments write off) 837 83 Financial expenses relating to merger 10,258 0 Non GAAP Net loss (excluding the above) (7,532) (6,099) Non GAAP Cost of Revenues reconciliation for the six months ended June 30, 2007: IXI Mobile, Inc. Reconciliation of Non-GAAP Financial Measure Six Six months months ended ended June 30 June 30 2007 2006 ($K) ($K) TOTAL REVENUES 6,294 5,468 GAAP Cost of Revenues: 7,173 6,356 GAAP Gross margin -13.97 % -16.24 % Stock based option expense in GAAP Cost of Revenues 146 2 Inventory write-down (including vendor advance payments write off) 958 215 Non GAAP Cost of Revenues (excluding stock-based compensation expense and Inventory write-downs) 6,069 6,139 Non GAAP gross margin 3.57 % -12.27 % Non GAAP Operating Loss reconciliation for the six months ended June 30, 2007: IXI Mobile, Inc. Reconciliation of Non-GAAP Financial Measure Six Six months months ended ended June 30 June 30 2007 2006 ($K) ($K) GAAP Operating loss (15,965) (10,556) Stock based option and share expense in GAAP Operation expenses, including merger related expenses 2,953 193 Inventory write-down (including vendor advance payments write off) 958 215 Non GAAP Operating loss (excluding the above) (12,054) (10,148) Non GAAP Net Loss reconciliation for the six months ended June 30, 2007: IXI Mobile, Inc. Reconciliation of Non-GAAP Financial Measure Six Six months months ended ended June 30 June 30 2007 2006 ($K) ($K) GAAP Net loss (28,230) (10,763) Stock based option and share expense in GAAP Operation expenses, including merger related expenses 2,953 193 Inventory write-down (including vendor advance payments write off) 958 215 Financial expenses relating to merger 10,258 0 Non GAAP Net loss (excluding the above) (14,061) (10,355)

We excluded the following items in the development of the non-GAAP financial measures presented:

1) Stock-based compensation expenses.

We have excluded stock-based compensation expenses, which consist of expenses for stock-based compensation that we began recording under SFAS 123-R in the first quarter of fiscal 2006. We excluded these expenses primarily because they are non-cash expenses that we do not consider part of ongoing operating results when assessing the performance of our business.

2) Inventory write-down and Vendor advance payments write off.

We have excluded inventory write-down and vendor advance payments write off. Although these may be considered a recurring item under Item 10(e) of Regulation S-K, management evaluates its Cost of Revenues excluding this item in order to better understand the trends in its Cost of Revenues. Management thinks it is useful for investors in assessing the Cost of Revenues as compared to revenues, which is important for understanding the performance of our business.

3) General and administrative expenses recorded in connection with the issuance of stock, stock options and cash bonuses to our senior management.

We have excluded expenses recorded in connection with the issuance of stock, stock options and cash bonuses to Mr. Barak, co-Chairman and Mr. Haller, President and Chief Executive Officer in connection with the consummation of the Merger and their specific compensation terms following the consummation of the merger. We excluded these expenses from our non-GAAP operating loss primarily because we believe that excluding these items allows investors to better assess our operating loss and to compare it to previous periods which did not include these expenses.

4) Finance expenses recorded in connection with the consummation of the merger

In addition to the above mentioned exclusions, we have also excluded financial expenses recorded in connection with the consummation of the merger. We exclude these expenses from our non-GAAP loss primarily because we believe that excluding these items allows investors to better assess our net loss and to compare it to previous periods which did not include these expenses.

Our non-GAAP presentation and information should not be considered as a substitute for, or as superior to, our financial information prepared in accordance with GAAP. The non-GAAP presentation does not reflect a comprehensive system of accounting, and they differ from similar financial information prepared in accordance with GAAP and from financial information not prepared in accordance with GAAP with the same or similar names that are used by other companies. We strongly urge investors and potential investors in our securities to review the reconciliation of our non-GAAP financial information to the comparable GAAP financial information that are included in this filing, and our consolidated financial statements, including the notes thereto, and the other financial information contained in our periodic filings with the SEC and not to rely on any single financial measure to evaluate our business. The principal limitation of our non-GAAP presentation is that it excludes significant expenses that are required by GAAP to be recorded. In addition, the non-GAAP presentation is subject to inherent limitations because it reflects the exercise of judgments by management about which charges are excluded from the non-GAAP presentation. To mitigate this limitation, we present our non-GAAP presentation in addition to our GAAP results, and recommend that investors do not give undue weight to the non-GAAP presentation.

CONTACT: investors, Lee Roth, +1-212-896-1209, lroth@kcsa.com, or
Marybeth Csaby, +1-212-896-1236, mcsaby@kcsa.com, both of KCSA Worldwide, for
IXI Mobile

Web site: http://www.ixi.com/