For the fiscal 2007 third quarter, revenue increased to $9.4 million from $8.3 million in the same quarter of last year. Gross profit grew to $5.2 million from $4.0 million for the prior year period. Operating income was $550,000 compared with an operating loss of $1.2 million in the same quarter last year. Net income was $1.2 million, or $0.11 per diluted share, which included income from discontinued operations of $263,000. This compares with net income for the prior year period of $540,000, or $0.04 per diluted share, which included income from discontinued operations of $677,000.

"The company's improved financial performance reflected increased sales of our higher margin, market-leading professional audio conferencing products," said Zee Hakimoglu, president and chief executive officer of ClearOne. "We have stepped-up our efforts on communicating the unique attributes and differentiated value of our entire product line to industry professionals and end-users."

For the first nine months of fiscal 2007, revenue increased to $28.9 million from $26.2 million in the same period of fiscal 2006. Gross profit grew to $15.5 million from $13.4 million for the prior year period. Operating income was $1.8 million compared with an operating loss of $1.0 million in the same period last year. Net income rose to $3.0 million, or $0.25 per diluted share, which included income from discontinued operations of $304,000. This compares with net income for the prior year period of $2.6 million, or $0.21 per diluted share, which included income from discontinued operations of $1.8 million.

At March 31, 2007, the company had cash, cash equivalents, and marketable securities of $22.0 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 newerproducts 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.

http://www.b2i.us/irpass.asp?BzID=509&to=ea&s=0

FINANCIAL TABLES FOLLOW

CLEARONE COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands of dollars, except per share amounts)
		Unaudited
		March 31,			June 30,
		2007			2006
ASSETS
Current assets:
Cash and cash equivalents		$	1,312		$	1,240
Marketable securities			20,650			20,550
Accounts receivable			6,847			7,784
Note receivable			160			-
Inventories, net			6,953			6,614
Income tax receivable			-			3,240
Deferred income taxes, net			132			128
Prepaid expenses			299			255
Net assets of discontinued operations			-			565
Total current assets			36,353			40,376
Property and equipment, net			2,689			1,647
Note receivable - long-term			85			-
Other assets			13			15
Total assets		$	39,140		$	42,038
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	1,946		$	2,597
Accrued taxes			456			-
Accrued liabilities			1,814			2,397
Deferred product revenue			5,111			5,871
Total current liabilities			9,327			10,865
Deferred rent			894			-
Deferred income taxes, net			132			128
Other long-term liabilities			578			633
Total liabilities			10,931			11,626
Shareholders' equity:
Common stock, par value $0.001, 50,000,000 shares authorized, 10,881,262 and 12,184,727 shares issued and outstanding, respectively			11			12
Additional paid-in capital			47,578			52,764
Accumulated deficit			(19,380)			(22,364)
Total shareholders' equity			28,209			30,412
Total liabilities and shareholders' equity		$	39,140		$	42,038

CLEARONE COMMUNICATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands of dollars, except per share amounts)
		Three Months Ended						Nine Months Ended
		March 31,			March 31,			March 31,			March 31,
		2007			2006			2007			2006
Product Revenue:		$	9,355		$	8,278		$	28,873		$	26,158
Cost of goods sold:			4,190			4,253			13,366			12,737
Gross profit			5,165			4,025			15,507			13,421
Operating expenses:
Marketing and selling			2,004			1,920			5,711			5,542
General and administrative			763			1,060			2,260			4,288
Settlement in shareholders' class action			-			-			-			(1,205)
Research and product development			1,848			2,201			5,782			5,778
Total operating expenses			4,615			5,181			13,753			14,403
Operating income (loss)			550			(1,156)			1,754			(982)
Other income (expense), net:			577			237			1,229			594
Income (loss) from continuing operations before income taxes			1,127			(919)			2,983			(388)
(Provision) benefit from income taxes			(167)			782			(303)			1,150
Income (loss) from continuing operations			960			(137)			2,680			762
Discontinued operations:
Income from discontinued operations			-			50			495			268
Gain (loss) on disposal of discontinued operations			420			1,030			(10)			2,676
Income tax provision			(157)			(403)			(181)			(1,098)
Income from discontinued operations:			263			677			304			1,846
Net income		$	1,223		$	540		$	2,984		$	2,608
		Three Months Ended						Nine Months Ended
		March 31,			March 31,			March 31,			March 31,
			2007			2006			2007			2006
Basic earnings per common share from continuing operations		$	0.09		$	(0.01)		$	0.23		$	0.06
Diluted earnings per common share from continuing operations		$	0.09		$	(0.01)		$	0.23		$	0.06
Basic earnings per common share from discontinued operations		$	0.02		$	0.06		$	0.03		$	0.16
Diluted earnings per common share from discontinued operations		$	0.02		$	0.06		$	0.03		$	0.15
Basic earnings per common share		$	0.11		$	0.04		$	0.25		$	0.22
Diluted earnings per common share		$	0.11		$	0.04		$	0.25		$	0.21
Basic weighted average shares			10,994,607			12,184,727			11,705,853			11,882,375
Diluted weighted average shares			11,101,791			12,187,446			11,770,145			12,214,401