ClearOne Reports Fiscal 2008 First Quarter ResultsClearOne Communications, Inc. (NASDAQ: CLRO) today reported financial

results for the first quarter of fiscal 2008 ended September 30, 2007.

Revenue for the first three months of fiscal 2008 amounted to $9.4

million, the same as in the comparable prior year period. Gross profit

was $5.1 million, or 54% of revenues, for both the fiscal 2008 and 2007

first quarters. Gross margin as a percentage of revenues in the fiscal

2008 first quarter decreased slightly compared with the two preceding

quarters, due to an increase in the company's

reserve for inventory obsolescence required to account for slow-moving

inventory and other manufacturing variances.

The company reported an operating loss for the fiscal 2008 first quarter

of $1.1 million after estimating and establishing a $1.8 million accrual

for a contingent liability. This compares to operating income of

$289,000 in the fiscal 2007 first quarter. Net loss was $924,000, or

$0.08 per share, compared to net income of $677,000, or $0.06 per

diluted share, for the same period last year.

"Excluding the fiscal 2008 first quarter

accrual for the contingent liability, the company would have reported an

operating profit and improved bottom line performance compared with the

prior year first quarter," said Zee Hakimoglu,

president, chief executive officer and chairman of ClearOne. "This

is due, in part, to our continued focus on enhancing operating

efficiencies and managing expenses."

In accordance with Statement of Financial Accounting Standards No. 5, Accounting

for Contingencies, ClearOne accrued $1.8 million in its fiscal 2008

first quarter, representing the probable amount that as of the date of

the financial statements could be reasonably estimated of its liability,

through trial, associated with the advancement of funds related to

indemnification agreements with two former officers. As disclosed in

July 2007, ClearOne was informed that two of its former officers have

been indicted by the United States Attorney's

Office for the District of Utah. The company has been advised that a

trial date has been set for January 22, 2008. ClearOne is cooperating

fully with the U.S. Attorney's office in this

matter and has been advised that it is neither a target nor a subject of

the investigation or indictment.

At September 30, 2007, the company had cash, cash equivalents, and

marketable securities of $23.6 million and no long-term debt.

About ClearOne

ClearOne is a communications solutions company that develops and sells

audio conferencing systems and other related products for audio, video,

and web conferencing applications. The reliability, flexibility, and

performance of ClearOne's comprehensive

solutions create a natural communications environment, which saves

organizations time and money by enabling more effective and efficient

communication. For more information, visit ClearOne's

website at www.clearone.com.

This release contains "forward-looking"

statements that are based on present circumstances and on ClearOne's

predictions with respect to events that have not occurred, that may not

occur, or that may occur with different consequences and timing than

those now assumed or anticipated.Such forward-looking

statements, including statements regarding the company's

ability to successfully commercialize newer products and enter new

markets, are not guarantees of future performance or results and involve

risks and uncertainties that could cause actual events or results to

differ materially from the events or results described in the

forward-looking statements.Such forward-looking statements are

made only as of the date of this release and ClearOne assumes no

obligation to update forward-looking statements to reflect subsequent

events or circumstances.Readers should not place undue reliance

on these forward-looking statements.

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CLEARONE COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands of dollars)
	(unaudited)		(audited)
	September 30,		June 30,
	2007		2007
ASSETS
Current assets:
Cash and cash equivalents	$2,506		$2,782
Marketable securities	21,102		19,871
Accounts receivable, net of allowance for doubtful accounts of $56 and $54, respectively	8,053		8,025
Note Receivable	166		163
Inventories, net	7,490		7,263
Income tax receivable	326		0
Deferred income taxes	122		0
Prepaid expenses	336		213
Total current assets	40,101		38,317
Property and equipment, net	2,619		2,694
Note Receiveable - long-term	0		43
Other assets	9		9
Total assets	$42,729		$41,063
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$2,198		$1,745
Accrued taxes	0		660
Accrued liabilities	3,411		1,874
Deferred product revenue	5,875		4,872
Total current liabilities	11,484		9,151
Deferred rent	816		855
Deferred income taxes, net	122		0
Other long-term liabilities	958		619
Total liabilities	13,380		10,625
Total shareholders' equity	29,349		30,438
Total liabilities and shareholders' equity	$42,729		$41,063

CLEARONE COMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands of dollars, except per share amounts)
(unaudited)
	Three Months Ended September 30,
	2007		2006
Revenue	$9,442		$9,411
Cost of goods sold	4,299		4,316
Gross profit	5,143		5,095
Operating expenses:
Marketing and selling	1,601		1,918
Research and product development	1,756		2,079
General and administrative	2,895		809
Total operating expenses	6,252		4,806
Operating income (loss)	(1,109)		289
Total other income, net	341		332
Income (loss) from continuing operations before income taxes	(768)		621
(Provision) benefit for income taxes	(171)		19
Income (loss) from continuing operations	(939)		640
Income from discontinued operations	15		37
Net income (loss)	($924)		$677
Basic earnings (loss) per common share	($0.08)		$0.06
Diluted earnings (loss) per common share	($0.08)		$0.06
Basic weighted average shares outstanding	10,961,256		12,184,849
Diluted weighted average shares outstanding	11,072,565		12,231,744