8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  August 14, 2008

ICEWEB, INC.

(Exact name of registrant as specified in its charter)

Delaware	000-27865	13-2640971
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

205 Van Buren Street, Suite 150, Herndon, Virginia 20170

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code:  703-964-8000

_________________________________________________

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

 On August 14, 2008 IceWEB, Inc. issued a press release announcing financial results for the quarter ending June 30, 2008. A copy of this press release is attached hereto as Exhibit 99.1 and is hereby incorporated by reference. The information in this Current Report, including the Exhibit attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference to such filing.

Item 9.01   Financial Statements and Exhibits.

(d) Exhibits.

99.1 Press release dated August 14, 2008.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934,the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ICEWEB, INC.
Date: August 14, 2008	By: /s/ John R. Signorello
	John R. Signorello,
	Chief Executive Officer

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EX-99.1

IceWEB™ Announces Third Quarter Financial Results

HERNDON, Va. ─ (BUSINESS WIRE) ─ August 14, 2008,─IceWEB, Inc. (OTCBB:IWEB), www.IceWEB.com, today announced financial results for its fiscal third quarter which ended June 30, 2008. As projected, revenues continued to increase as the Company continues to gain traction and share in the Storage and On-Demand Software markets.

Revenues for the third quarter were up 64% at $6.0 million compared to $3.7 million for the same period in 2007. Revenues for the nine months ended June 30, 2008 were up $16.4% at $14.1 million compared to $12.1 million for same nine-month period in 2007.

Third quarter total operating expenses were $2.8 million, which included approximately $1.8 million in Non-Cash items from FAS 123R, Acquisition costs, Depreciation and Amortization expense. EBITDA loss for the quarter was $365,000 or approximately $121,000 per month.

John R. Signorello, Chairman and Chief Executive Officer of IceWEB, Inc., stated, “Our products margins remain strong, the sales for IceWEB products continue to increase, and we are rapidly closing in on positive EBITDA. Our cash overhead was approximately $1,119,000 for the quarter and we expect that to drop an additional 15% in the fourth quarter due to rent reduction and consolidation of personnel.”

Signorello Continued, “The vision and direction for IceWEB is crystal clear. We have positioned the company to become the market leader in providing GEOSPATIAL storage solutions. We will soon be filing our provisional patents to protect the company’s intellectual property, which will differentiate our technology in the marketplace and drive shareholder value.”

2008 Fiscal Highlights

For the nine months ended June 30, 2008 compared to the nine months ended June 30, 2007:

· Revenues increased 16.4% from $12.1 Million to $14.1 Million.

· Sales of storage, network and security solutions to the Company’s government and enterprise customers increased 14.8% from $12.0 Million to $13.8 million.

· On-demand software sales increased 188% to $316,665 from $109,786.

· Gross margin on sales rose 15.7%.

· Research and development expenses increased to $207,636 from $0 due to R&D activities related to the Company’s proprietary INLINE storage products.

· Marketing and selling costs were $139,000, an 18% increase from $117,000. The increase was attributable to an increase in web marketing, advertising and print advertising during the nine months period.

· For the three months ended June 30, 2008 compared to the three months ended June 30, 2007:

· Revenues increased 64% to $6.0 Million from $3.7 Million.

· Network, storage and security solution sales totaled $5.6 Million, reflecting a 55% increase from $3.6 Million.

· EBIDTA Loss for the Quarter was $365,000 or $122,000 per month.

The Company’s fourth quarter and fiscal year ends on September 30, 2008. Fourth quarter plans include increased concentration on select, niche storage markets such as the fast-growing geospatial application segment.

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ICEWEB, Inc.

Consolidated Balance Sheet

June 30, 2008

(Unaudited)

CURRENT ASSETS:
Cash	$	48,344
Accounts receivable, net of allowance of $9,000		4,100,548
Inventory, net of allowance of $73,518		694,557
Other current assets		45,504
Prepaid expenses		97,668
		4,986,621
OTHER ASSETS:
Property and equipment, net		1,141,939
Deposits		61,418
Intangible assets, net of accumulated amortization of $369,589		1,221,341
Total Assets	$	7,411,319
CURRENT LIABILITIES:
Accounts payable and accrued liabilities	$	7,522,868
Notes payable		1,931,469
Deferred revenue		15,625
		9,469,962
Long-Term Liabilities
Notes payable		1,016,558
Total Liabilities		10,486,520
Stockholders’ Deficit
Preferred stock ($.001 par value; 10,000,000 shares authorized)
Series A convertible preferred stock ($.001 par value; 0 shares issued and outstanding)		—
Series B convertible preferred stock ($.001 par value; 1,253,334 shares issued and outstanding)		1,253
Common stock ($.001 par value; 1,000,000,000 shares authorized; 22,279,088 shares issued and 22,116,588, shares outstanding)		22,118
Additional paid in capital		15,092,767
Accumulated deficit		(18,178,339	)
Treasury stock, at cost, (162,500 shares)		(13,000	)
Total stockholders’ deficit		(3,075,201	)
Total liabilities and stockholders’ deficit	$	7,411,319

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ICEWEB, Inc.

Consolidated Statements of Operations

(Unaudited)

	Three Months Ended June 30						Nine Months Ended June 30
	2008			2007			2008			2007
Sales	$	5,981,083		$	3,655,019		$	14,095,946		$	12,114,253
Cost of sales		5,249,906			3,176,055			12,127,796			10,652,698
Gross profit		731,177			478,964			1,968,150			1,461,555
Operating expenses:
Marketing and selling		50,208			(53,981	)		138,927			117,248
Depreciation and amortization		259,933			58,658			412,297			189,794
Research and development		121,906			—			207,636			—
General and administrative		2,369,286			764,064			5,187,547			1,938,947
Total Operating Expenses		2,801,333			768,741			5,946,407			2,245,989
Income (loss) From Operations		(2,070,156	)		(289,777	)		(3,978,257	)		(784,434	)
Other income (expenses):
Gain/(loss) from sale of assets		—			—			—			153,319
Interest income		682			952			3,266			2,446
Interest expense		(196,450	)		(103,880	)		(481,457	)		(447,816	)
Total other (expenses):		(195,768	)		(88,195	)		(478,191	)		(292,050	)
Net income (loss)	$	(2,265,924	)	$	16,903		$	(4,456,448	)	$	(1,076,484	)
Basic and diluted loss per common share	$	(0.12	)	$	(0.05	)	$	(0.28	)	$	(0.11	)
Weighted average common shares outstanding-basic and diluted		19,172,959			10,352,305			16,162,168			9,888,434

See accompanying notes to unaudited consolidated financial statements

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ICEWEB, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

	Nine Months Ended June 30,
	2008			2007
NET CASH USED IN OPERATING ACTIVITIES	$	(385,319	)	$	87,556
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment		(65,923	)		(1,873	)
Net cash received from sale of net assets		—			138,000
Gain on conversion of note payable to equity		—			(132,875	)
Cash used in acquisitions, net		(1,311,318	)		(247,000	)
NET CASH USED IN INVESTING ACTIVITIES		(1,377,241	)		(243,749	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of equipment financing		(60,068	)		(57,006	)
Proceeds from notes payable - related party		—			30,000
Repayment of notes payable - related party		(115,767	)		(26,500	)
Net proceeds from related party advances		—			11,737
Proceeds from notes payable		7,092,685			610,037
Payments on notes payable		(6,476,876	)		(1,048,070	)
Proceeds from exercise of common stock options		198,450			185,650
Proceeds from sale of common stock		80,000			—
Proceeds from exercise of common stock warrants		—			407,000
NET CASH PROVIDED BY FINANCING ACTIVITIES		718,424			112,848
NET INCREASE (DECREASE) IN CASH		(1,044,136	)		(43,345	)
CASH - beginning of period		1,092,470			432,885
CASH - end of period	$	48,334		$	389,540
Supplemental disclosure of cash flow information:
Cash paid for :
Interest	$	463,245		$	435,316
Income taxes		—			—
Non-cash transactions affecting investing and financing activities:
Fair value of shares issued for services from a retailer and an investor relations firm	$	—			(350,000	)
Conversion of shares of preferred stock to shares of common stock		1,037,000			300
Fair value of shares issued in satisfaction of debt to related parties		—			114,000
Acquisition details:
Goodwill	$	—		$	—
Liabilities assumed	$	1,616,814		$	—
Common stock issued	$	276,845			—
Direct costs		740,000			—
Fair value of assets acquired	$	3,944,977		$	—
Cash paid	$	1,311,318		$	250,000

See accompanying notes to unaudited consolidated financial statements

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About IceWEB, Inc.

Headquartered just outside of Washington, D.C., IceWEB manufactures and markets storage solutions and on-line application services. Additionally it is a leading source for best-of-class security products, services and solutions offered in partnership with a wide range of global technology leaders. Its customer base includes U.S. government agencies, enterprise companies, and small to medium sized businesses (SMB). For more information, please visit www.IceWEB.com.

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: Except for historical information, all of the statements, expectations and assumptions contained in the foregoing are forward looking statements that involve a number of risks and uncertainties. It is possible that the assumptions made by management are not necessarily the most likely and may not materialize. In addition, other important factors that could cause actual results to differ materially include the following: business conditions and the amount of growth in the computer industry and general economy; competitive factors; ability to attract and retain personnel, including key sales and management personnel; the price of the Company's stock; and the risk factors set forth from time to time in the Company's SEC reports, including but not limited to its annual report on Form 10-K and its quarterly reports on Forms 10-Q; and any reports on Form 8K. IceWEB takes no obligation to update or correct forward-looking statements.

FOR MORE INFORMATION, PLEASE CONTACT:

703-344-0951 or email at investor@iceweb.com

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