VIENNA, Va., June 4, 2008 /PRNewswire-FirstCall via COMTEX/ ----Convera Corporation (Nasdaq: CNVR) - www.convera.com - a leading provider of vertical search services for publishers, today announced financial results for the three-month period ended April 30, 2008.

Revenue from continuing operations for the first quarter of fiscal 2009 increased to $402,000 or 44% over the $280,000 in revenue recorded in the fourth quarter of fiscal 2008.

Backlog, grew from $4.0 million at January 31, 2008 to $4.7 million April 30, 2008. These backlog balances represent future revenues stemming from the contractual minimum revenue commitment amounts from our customers.

As of April 30, 2008, a total of 45 Excalibur supported vertical search sites from 25 different publishers that have been commercially launched. There were 39 vertical search sites from 24 publishers that had been commercially launched at January 31, 2008. Search traffic activity from the Excalibur supported vertical sites continued to grow, increasing 187% from 9.5 million searches in the fourth quarter of last year to 17.8 million in the first quarter ended April 30, 2008.

As of today, a total of 75 Excalibur supported vertical search sites are under contract with customers, 47 of these sites have been commercially launched and 28 of these sites are in development. These contracted sites represent publications in over 15 major vertical industries.

Convera is presently providing vertical search services to 30 different trade publishers. Patrick Condo, President and CEO of Convera, stated, "We are pleased with the continued progress we are making in acquiring customers, launching sites and the increased search traffic on our network. Advertising revenue and the newly instituted annual capacity based pricing model began to contribute to revenue in quarter and are expected to continue to grow in subsequent quarters. We expect to see the financial results of this effort evidenced in this fiscal year as the we continue to see the impact of our efforts to increase revenue and decrease expenses in the coming quarters of this fiscal year".

The loss from continuing operations for the three-month period ended April 30, 2008, was $5.4 million, or $0.10 per share, (which includes $1.6 million in depreciation and stock compensation expenses which are non cash expenses) compared to a loss of $7.7 million, or $0.15 per share, (which includes $0.1 million in depreciation and stock compensation which are non cash expenses) for the comparable year-ago period and a loss of $7.0 million (which includes $1.4 million in depreciation and stock compensation which are non cash expenses) for the three months ended January 31, 2008.

The decreased loss reflects the reduction in staffing levels and Convera's efforts to discontinue non-strategic activities from cost streamlining actions taken during fiscal 2008. Convera expects to continue to receive benefits from these actions in the coming quarters as a result of continued alignment of resources to pursue the on line publishing and media marketplace.

Net loss for the three months ended April 30, 2008 was $5.4 million or $0.10 per share, which compares to a net loss of $7.5 million or $0.14 per share, for the comparable period of the prior year.

Cash and investments as of April 30, 2008, totaled $31.4 million and does not include the $4 million held in escrow from the sale of the RetrievalWare enterprise search business in August 2007. We expect to receive the escrow to be released in the third quarter, in accordance with terms of the agreement.

The attached financial information compares the results of operations for the three-months April 30, 2008, to the same period in 2007, and the balance sheet as of April 30, 2008 and January 31, 2008.

 The condensed, consolidated statements of operations for the Company for the three
   months ended April 30, 2008 and 2007 appear below and are presented in accordance with accounting principles generally accepted
   in the United States. All amounts, except per share amounts, are expressed in thousands of U.S. dollars. Three Months Ended
   April 30, 2008 2007 Continuing Operations: (unaudited) (unaudited) Revenues: Hosted services $402 $324 Operating Expenses:
   Cost of revenue - hosted services 1,829 1,933 Sales and marketing 876 1,019 Research and product development 1,234 1,289 General
   and administrative 2,068 4,323 Total Expense 6,007 8,564 Operating loss (5,605) (8,240) Interest income, net 179 491 Net (loss)
   from continuing operations $(5,426) $(7,749) Discontinued Operations: Income from discontinued operations - 206 Income from
   discontinued operations - 206 Net Loss $(5,426) $(7,543) Earnings(loss) per share - basic & diluted Continuing operations
   $(0.10) $(0.15) Discontinued operations - 0.01 $(0.10) $(0.14) Weighted average number of common shares outstanding - basic
   and diluted 53,306 52,901 

The condensed, consolidated Balance Sheets for the Company as of April 30, 2008, and January 31, 2008, appear below and are presented in accordance with accounting principles generally accepted in the United States. All amounts are expressed in thousands of U.S. dollars.

 Assets April 30, 2008 January 31, 2008 (unaudited) (unaudited)
   Current Assets: Cash and cash equivalents 31,350 $36,641 Accounts receivable, net 463 182 Escrow, Prepaid expenses and other
   5,089 4,002 Total current assets 36,902 40,825 Equipment and leasehold improvements, net 4,244 4,913 Other assets 621 629
   Total assets 41,767 $46,367 Liabilities and Shareholders' Equity Current Liabilities: Accounts payable 982 $699 Accrued expenses
   1,971 2,282 Deferred revenues 634 651 Total Liabilities 3,587 3,632 Shareholders' Equity 38,180 42,735 Total liabilities and
   shareholders' equity 41,767 $46,367 

About Convera(R)

Convera is the leading provider of vertical search services for publishers. Convera enables publishers to generate additional revenue by creating customized search applications for specialist audiences under their own brand.

Convera vertical search applications can combine publisher proprietary content with an editorially vetted best of the Web for specific professional audiences, providing an authoritative and comprehensive search experience. Many of the world's largest publishers are working with Convera to accelerate their e-publishing strategies, meet growing online revenue goals and build loyal online professional communities.

This release, including any statements from Convera personnel, contains statements about Convera's future expectations, performance, plans, and prospects, as well as assumptions about future events. The reader is cautioned not to put undue reliance on these forward-looking statements, as these statements are subject to numerous factors and uncertainties, including without limitation, business and economic conditions and trends; the ability to continue funding operating losses; fluctuations in operating results including impacts from reduced corporate IT spending and lengthier sales cycles; continued success in technological advances and development; possible disruption in commercial activities caused by terrorist activity and armed conflict, such as changes in logistics and security arrangements; reduced customer demand relative to expectations; competitive factors; and other risk factors listed from time to time in the company's reports to the Securities and Exchange Commission. Actual results may differ materially from our expectations as the result of these and other important factors relating to Convera's business and product development efforts, which are further described in Convera's filings with the SEC. These filings can be obtained from the SEC's website located at www.sec.gov. Any forward-looking statements are based on information available to Convera on the date of this release, and Convera assumes no obligation to update such statements. Convera(R) and the Convera design logo are trademarks of Convera in the United States and other countries.

SOURCE Convera Corporation

http://www.convera.com 

Copyright
   (C) 2008 PR Newswire. All rights reserved ********************************************************************** As of Saturday,
   05-31-2008 23:59, the latest Comtex SmarTrend� Alert, an automated pattern recognition system, indicated a DOWNTREND on 05-05-2008
   for CNVR @ $1.29. For more information on SmarTrend, contact your market data provider or go to www.mysmartrend.com SmarTrend
   is a registered trademark of Comtex News Network, Inc. Copyright � 2004-2008 Comtex News Network, Inc. All rights reserved.