<PAGE>
Contact: Philip Ranger Howard Kalt
Inference Corporation Kalt, Rosen & Chase, Inc.
415-893-7275 415-397-2686
[email protected] [email protected]
Inference Corporation Announces First Quarter
Financial Results
NOVATO, Calif. (May 31, 2000)--Inference Corporation (NASDAQ: INFR) reported
that total revenues for the first quarter ended April 30, 2000 were $6.0
million, 8% above revenues of $5.5 million in the preceding quarter and 7% below
revenues of $6.4 million in the same quarter last year. Loss from operations for
the quarter was $3.9 million, compared to an operating loss of $4.2 million in
the preceding quarter and an operating loss of $2.3 million in the same quarter
last year. The net loss for the quarter amounted to $3.9 million, or $0.50 per
share, as compared to a net loss of $4.0 million, or $0.52 per share, in the
preceding quarter and a net loss of $2.1 million, or $0.29 per share, a year
ago.
International product revenues were $1.6 million, a 36% increase from $1.2
million a year earlier. Product revenues from Americas operations were $1.3
million, a 32% decrease from $1.9 million during the same quarter last year.
"As anticipated during the fourth quarter, we are now beginning to generate
revenue from the sales of our two new products, k-Commerce Support Enterprise
and k-Commerce Sales, as we continue to take a product leadership role," said
Charles Jepson, president and chief executive officer. "Equally exciting are a
number of deals in which we partnered with eGain Communications Corporation to
close the transaction, validating the strength of our proposed merger. These
deals include customers like Egg, one of the UK's
<PAGE>
busiest e-commerce Web sites, who will be using k-Commerce Support Enterprise
and eGain Mail to provide Web-based customer support.
-more-
Inference Reports First Quarter Financial Results / Page Two
"Additionally, we continued to see progress in our k-Commerce Sales
division, which experienced an increase in revenue from agreements with
companies such as WeddingNetwork.com, Guild.com and Consonus, which will be
using the k-Commerce Sales product to provide a personalized experience to
their Web visitors," Jepson said.
He indicated that the company's operating expenses were about equal to
those in the fourth quarter of last year, including expenses related to the
company's pending acquisition by eGain Communications Corp (NASDAQ: EGAN).
On March 16/th/, eGain and Inference announced a definitive agreement under
which eGain will acquire Inference in exchange for common stock. The acquisition
brings together eGain's strength in Web-based, multi-channel customer
communications with Inference's customer profiling and contact center support
capabilities. Inference shareholders are scheduled to vote on the matter at a
special shareholders meeting on June 26/th/. Proxy materials were mailed to
shareholders on May 22, 2000.
About Inference Corporation
Inference Corporation (NASDAQ: INFR) is a leading provider of software and
services that deliver personalized one-to-one sales, service and support over
the Web. Its k-Commerce Sales e-merchandising software helps e-tailers know
their Web visitors, anticipate their needs and target offers to turn lookers
into buyers. In addition, k-Commerce(TM) Support Enterprise, the company's e-
service and support product, guides customers to solutions through an easy
exchange of questions and answers regardless of how they contact you. Both
products ensure a highly personalized customer experience to build long-term
customer relationships.
<PAGE>
-more-
Inference Reports First Quarter Financial Results / Page Three
Headquartered in the San Francisco Bay Area, with international operations
headquartered near London, England, Inference supports its customers from
offices throughout North America and Europe through a global professional
services organization. For further information, contact Inference at 415-893-
7200, send an e-mail to [email protected] or visit our website.
The Inference logo, k-Commerce and the k-Commerce logo are trademarks of
Inference Corporation in the United States and other countries. eGain, and eGain
Mail are trademarks of eGain Communications Corporation. All other company names
and products are trademarks or registered trademarks of their respective
companies.
# # #
<PAGE>
INFERENCE CORPORATION
CONSOLIDATED BALANCE SHEETS
[ Amounts in thousands ]
[ unaudited ]
<TABLE>
<CAPTION>
April 30, January 31,
2000 2000
------------- -------------
ASSETS
------
<S> <C> <C>
Current assets:
Cash and cash equivalents....................................... $ 11,985 $ 17,244
Accounts receivable............................................. 5,592 4,299
Other current assets............................................ 1,283 1,061
------------- -------------
Total current assets........................ 18,860 22,604
Property and equipment, net ....................................... 1,752 1,858
Intangible assets, net ............................................ 823 884
Other assets ...................................................... 464 470
------------- -------------
$ 21,899 $ 25,816
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Current liabilities:
Accounts payable ............................................... $ 826 $ 1,134
Accrued salaries and related items ............................. 2,103 2,289
Other accrued liabilities ...................................... 2,533 2,384
Deferred revenue ............................................... 5,115 5,019
------------- -------------
Total current liabilities................... 10,577 10,826
Shareholders' equity:
Common stock ................................................... 79 78
Additional paid-in capital ..................................... 49,525 49,308
Cumulative foreign currency translation ........................ (329) (371)
Accumulated deficit ............................................ (37,953) (34,025)
------------- -------------
Total shareholders' equity ................. 11,322 14,990
------------- -------------
$ 21,899 $ 25,816
============= =============
</TABLE>
<PAGE>
INFERENCE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
[Amounts in thousands, except net loss per share ]
[unaudited ]
Three Months ended
April 30,
---------------------
2000 1999
--------- ---------
Revenues:
Products ................................... $ 2,920 $ 3,077
Services ................................... 3,037 3,317
--------- ---------
Total revenues ............................... 5,957 6,394
Operating costs and expenses:
Cost of revenues - products ................ 420 158
Cost of revenues - services ................ 1,656 1,684
Product development ........................ 1,521 1,447
Sales and marketing ........................ 4,522 3,922
General and administrative ................. 1,399 829
Acquistion related ......................... 325 677
Amortization of intangible assets .......... 61 -
--------- ---------
Total operating costs and expenses ........... 9,904 8,717
--------- ---------
Loss from operations ......................... (3,947) (2,323)
Interest income and other, net ............... 19 269
--------- ---------
Loss before income taxes ..................... (3,928) (2,054)
Provision for income taxes ................... - -
========= =========
Net loss...................................... $ (3,928) $ (2,054)
========= =========
Net loss per share:
Basic and diluted........................ $ (0.50) $ (0.29)
========= =========
Shares used in computing net
loss per share:
Basic and diluted........................ 7,858 7,053
========= =========
