EXHIBIT 99.1

COSINE COMMUNICATIONS ANNOUNCES FINANCIAL RESULTS

FOR THE QUARTER ENDED MARCH 31, 2008

LOS GATOS, CALIFORNIA, May 14, 2008 -- CoSine Communications, Inc. (COSN.PK), today announced net income of $52,000 or $0.01 per share for the three months ended March 31, 2008 as compared to net income of $94,000 or $0.01 per share for the three months ended March 31, 2007.

About Cosine Communications

CoSine Communications was founded in 1998 as a global telecommunications equipment supplier to empower service providers to deliver a compelling portfolio of managed, network-based IP and broadband services to consumers and business customers. CoSine ceased its customer service operations effective December 31, 2006. CoSine’s strategic plan is to redeploy its existing resources to identify and acquire new business operations. CoSine’s redeployment strategy will involve the acquisition of one or more operating businesses with existing or prospective taxable earnings. This strategy may allow CoSine to realize future cash flow benefits from its net operating loss carry-forwards (“NOLs”). As of this date, no candidates have been identified, and no assurance can be given that CoSine will find suitable candidates, and if it does, that it will be able to utilize its existing NOLs.

Safe Harbor Warning

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This release contains forward-looking statements, which include, among others, statements concerning CoSine's expected financial performance, exploration of strategic alternatives, and business outlook, expected performance and developments. The company uses words such as "anticipate," "believe," "plan," "expect," "future," "intend" and similar expressions to identify forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements.

Factors that might cause such a difference include, but are not limited to, Cosine’s ability to identify and effectuate desirable strategic acquisitions, the time and costs required to explore and investigate possible transactions and other corporate actions, management and board interest in and distraction due to exploring and investigating strategic alternatives, the reactions, either positive or negative, of investors, competitors, customers, employees and others to CoSine exploring and executing possible strategic acquisitions. A detailed discussion of these factors and other risks that affect CoSine's business is contained in its SEC filings, including its most recent reports on Form 10-K and Form 10-Q, particularly under the heading "Risk Factors." Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date hereof. CoSine undertakes no obligation to revise or publicly release the results of any revision to these forward-looking statements.

For additional information contact:

Terry Gibson

(408) 399-6494

E-mail: Terry.Gibson@Cosinecom.com

CoSine Communications, Inc.

STATEMENT OF OPERATIONS

(in thousands, except per share data)

	Three months ended
	March 31,
	2008			2007
Revenue:
Product	$	-		$	-
Service		-			-
Total revenue		-			-
Cost of revenue		-			-
Gross profit		-			-
Operating expenses:
Research and development		-			-
Sales and marketing		-			-
General and administrative		178			197
Restructuring and impairment charges		-			-
Total operating expenses		178			197
Loss from operations		(178	)		(197	)
Interest income and expense and other, net		230			291
Loss before income tax (benefits) provision		52			94
Income tax (benefits) provision		-			-
Net income	$	52		$	94
Basic net income per share	$	0.01		$	0.01
Diluted net income per share	$	0.01		$	0.01
Shares used in computing basic and
diluted net income per share
Basic		10,091			10,091
Diluted		10,091			10,120

CoSine Communications, Inc.

CONDENSED BALANCE SHEETS

(in thousands)

	March 31, 2008			December 31,
	(Unaudited)			2007 (1)
ASSETS
Current assets:
Cash and cash equivalents	$	8,400		$	12,709
Short-term investments		14,684			10,410
Other receivables		116			-
Prepaid expenses and other current assets		23			109
Total Current Assets		23,223			23,228
Long-Term Deposits		3			3
Total Assets	$	23,226		$	23,231
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	226		$	204
Other accrued liabilities		10			97
Total liabilities		236			301
Stockholders' equity:
Common stock		1			1
Additional paid-in capital		539,034			539,026
Accumulated other comprehensive income		15			15
Accumulated deficit		(516,060	)		(516,112	)
Total stockholders' equity		22,990			22,930
	$	23,226		$	23,231

(1) Amounts are derived from the December 31, 2007 audited financial statements.