Exhibit 99.1

United Online Reports Fourth-Quarter and Fiscal 2006 Results

·Content & Media Revenues Grow to 33% of Quarterly Consolidated Revenues in the Fourth Quarter

·Content & Media Fourth-Quarter Pay Accounts Rise to 46% of All Pay Accounts

·Fourth-Quarter Advertising Revenues Increase 101% Year-Over-Year

WOODLAND HILLS, Calif., Feb. 8, 2007 — United Online, Inc. (Nasdaq: UNTD), a leading provider of consumer Internet and media services, today reported financial results for its fourth quarter and fiscal year ended December 31, 2006.

“Organic revenue growth in our Content & Media segment drove United Online’s sequential revenue growth this quarter,” said Mark R. Goldston, chairman and chief executive officer of United Online.  “This achievement highlights the significant progress we made diversifying our business in 2006, with Content & Media comprising 33% of fourth-quarter revenues and 46% of total pay accounts.”

Fourth-Quarter 2006 Consolidated Results:

·Total revenues were $130.8 million, versus $130.2 million in the year-ago quarter.

·Including the impact of $13.3 million of non-cash asset impairment charges (see below), operating income was $9.3 million, or 7.1% of revenues, versus $22.1 million, or 17.0% of revenues, in the year-ago quarter.

·Excluding the impact of impairment charges, adjusted operating income before depreciation and amortization (OIBDA)(1) increased 6% to $36.6 million, or 28.0% of revenues, versus $34.6 million, or 26.6% of revenues, in the year-ago quarter.

·Pay accounts(2) decreased by 58,000 during the quarter to 4.9 million, and active accounts(2) totaled 20.1 million at December 31, 2006.

·Net income was $4.6 million, after the impact of $8.0 million, net of tax, of impairment charges, versus net income of $12.4 million in the year-ago quarter.  On a diluted per share basis, net income was $0.07, after the impact of $0.12 of asset impairment charges in the fourth quarter of 2006, versus $0.19 in the year-ago quarter.

·Excluding the impact of impairment charges, adjusted net income(3) was $19.5 million, an increase of 5%, versus $18.6 million for the year-ago quarter.  On a diluted per share basis, adjusted net income for the quarter was $0.29 per share, an increase of 4% versus $0.28 per share for the year-ago quarter.

·The $13.3 million pre-tax, non-cash asset impairment charges are comprised of (i) Communications segment charges of $4.5 million related to the write-down of certain assets associated with the company’s voice over Internet protocol (VoIP) business; and (ii) Content & Media segment charges of $8.8 million related to the write-down of goodwill and intangible assets associated with the March 2005 acquisition of PhotoSite.  Certain non-GAAP metrics contained herein, including adjusted OIBDA, adjusted OIBDA for a segment, and adjusted net income have been adjusted to exclude impairment charges.  See footnotes below.

Full-Year 2006 Consolidated Results:

·Total revenues were $522.7 million, versus $525.1 million in 2005.

·Operating income was $74.0 million, after the impact of $13.3 million of impairment charges, or 14.2% of revenues, versus $86.6 million, or 16.5% of revenues, in 2005.

·Adjusted operating income before depreciation and amortization (OIBDA)(1) increased 9% to $146.0 million, or 27.9% of revenues, versus $133.8 million, or 25.5% of revenues, in 2005.

·Net income was $42.3 million, after the impact of $8.0 million, net of tax, of impairment charges, versus net income of $47.1 million in 2005.  On a diluted per share basis, net income was $0.64 in 2006, after the impact of $0.12 of asset impairment charges in 2006, versus $0.74 in 2005.

·Adjusted net income(3) was $77.7 million, an increase of 9%, versus $71.1 million in 2005.  On a diluted per share basis, adjusted net income for 2006 was $1.16 per share, an increase of 6%, versus $1.09 per share in 2005.

“2006 marked the fifth year in a row that United Online has reported record consolidated adjusted OIBDA,” said Charles S. Hilliard, president and chief financial officer of United Online.  “2006 was also the third year in a row that we have reported record Content & Media revenues.  We believe our profitability, strong balance sheet and free cash flow give us the flexibility needed to continue to execute our diversification strategy.”

Fourth-Quarter 2006 Segment Results:

Communications:

·Communications revenues were $87.2 million, or 66.7% of consolidated revenues, versus $104.1 million, or 79.9% of consolidated revenues, in the year-ago quarter.

·Communications operating income was $24.9 million, after the impact of $4.5 million of impairment charges, or 28.5% of Communications revenues, versus $26.8 million, or 25.7% of Communications revenues, in the year-ago quarter.

·Communications adjusted OIBDA(1) was $32.9 million, or 37.7% of Communications revenues, an increase of 8%, versus $30.3 million, or 29.1% of Communications revenues, in the year-ago quarter.

·Communications pay accounts decreased by 149,000 during the quarter to 2.6 million, or 53.5% of consolidated pay accounts.

Content & Media:

·Content & Media revenues grew 67% to $43.6 million, or 33.3% of consolidated revenues, versus $26.2 million, or 20.1% of consolidated revenues, in the year-ago quarter.

·Content & Media operating loss was ($7.2) million, after the impact of $8.8 million of impairment charges, versus an operating profit of $3.1 million, or 11.8% of Content & Media revenues, in the year-ago quarter.

·Content & Media adjusted OIBDA(1) was $8.1 million, or 18.5% of Content & Media revenues, versus $9.0 million, or 34.3% of Content & Media revenues, in the year-ago quarter.

·Content & Media pay accounts increased by 91,000 during the quarter to 2.3 million, or 46.5% of consolidated pay accounts.

Other:

·Other reconciling items (unallocated corporate expenses) to arrive at consolidated adjusted OIBDA(1)  were ($4.3) million, versus ($4.6) million in the year-ago quarter.

Additional Highlights:

·Cash balances at December 31, 2006 were $162.4 million, including cash, cash equivalents and short-term investments.

·Cash flows from operations were $22.9 million in the fourth quarter of 2006, versus $22.8 million in the year-ago quarter.  Cash flows from operations were $101.5 million in 2006, versus $137.0 million in 2005.  In connection with the adoption of FAS 123R, certain tax benefits from exercised stock options that were previously reflected in the operating section of the company’s statement of cash flows are now presented in the financing section.

· Free cash flow(4) was $16.0 million in the fourth quarter of 2006, versus $17.6 million in the year-ago quarter.  Free cash flow(4) was $82.1 million in 2006, versus $115.4 million in 2005.

·The company’s previously-authorized stock repurchase program has been extended through December 31, 2007.  At December 31, 2006, the company had repurchased $139.2 million of its common stock under the program, leaving $60.8 million remaining under the program.

Full-Year 2006 Segment Results:

Communications:

·Communications revenues were $375.9 million, or 71.9% of consolidated revenues, versus $431.9 million, or 82.3% of consolidated revenues, in 2005.

·Communications operating income was $118.4 million, after the impact of $4.5 million of impairment charges, or 31.5% of Communications revenues, versus $122.9 million, or 28.4% of Communications revenues, in 2005.

·Communications adjusted OIBDA(1) was $138.0 million, or 36.7% of Communications revenues, an increase of 2%, versus $135.3 million, or 31.3% of Communications revenues, in 2005.

Content & Media:

·Content & Media revenues grew 58% to $146.7 million, or 28.1% of consolidated revenues, versus $93.1 million, or 17.7% of consolidated revenues, in 2005.

·Content & Media operating loss was ($6.5) million, after the impact of $8.8 million of impairment charges, versus an operating loss of ($8.3) million in 2005.

·Content & Media adjusted OIBDA(1) was $26.7 million, or 18.2% of Content & Media revenues, an increase of 61%, versus $16.5 million, or 17.8% of Content & Media revenues, in 2005.

Other:

·Other reconciling items (unallocated corporate expenses) to arrive at consolidated adjusted OIBDA(1)  were ($18.6) million, versus ($18.0) million in 2005.

Business Outlook:

The following forward-looking information includes certain projections made by management as of the date of this press release.  United Online does not intend to revise or update this information and may not provide this type of information in the future.  Due to a variety of factors, actual results may differ significantly from those projected.  Factors include, without limitation, the factors referenced later in this announcement under the caption “Cautionary Information Regarding Forward-Looking Statements.”  These and other factors are discussed in more detail in the company’s filings with the Securities and Exchange Commission. In addition, the stock-based compensation and weighted average diluted shares projections are based on estimated equity grants for 2007, including a company-wide grant which has not yet been determined, and actual grants could vary significantly from those currently estimated.

Below is the company’s guidance for the March 2007 quarter and the year ending December 31, 2007:

(in millions)

	Q1 ending 3/31/07	Full Year ending 12/31/07
Operating income	$15.0 — $17.0	$78.5 — $83.5
Depreciation	5.0	21.0
Amortization	4.7	19.0
Stock-based compensation	3.8	21.0
Restructuring charges	1.5	1.5
Adjusted operating income before depreciation and amortization (1)	$30.0 — $32.0	$141.0 — $146.0
Weighted average diluted shares	68.5 — 69.5	70.0 — 71.0

Total revenues for the March 2007 quarter are estimated to be between approximately $124.0 million and approximately $126.0 million.

We currently anticipate a slight to modest decline in total revenues for fiscal year 2007 when compared to total revenues for fiscal year 2006.

(1)Adjusted operating income before depreciation and amortization (adjusted OIBDA) is defined by the company as operating income before depreciation; amortization; stock-based compensation; restructuring charges; and impairment of goodwill, intangible assets and long-lived assets.  Management believes that because adjusted OIBDA excludes (1) certain non-cash expenses (such as depreciation, amortization, stock-based compensation and impairment of goodwill, intangible assets and long-lived assets); and (2) expenses that are not reflective of the company’s core operating results over time, this measure provides investors with additional useful information to measure the company’s performance, particularly with respect to changes in performance from period to period.   Management uses adjusted OIBDA to measure the company’s performance.  The company’s Board of Directors uses this measure in determining certain compensation incentives for certain members of the company’s management.  Adjusted OIBDA is not determined in accordance with accounting principles generally accepted in the United States of America (GAAP) and should be considered in addition to, not as a substitute for or superior to, financial measures determined in accordance with GAAP.  A limitation associated with the use of adjusted OIBDA is that it does not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in the company’s business.  Management evaluates the costs of such tangible and intangible assets through other financial measures such as capital expenditures and purchase accounting.  An additional limitation associated with this measure is that it does not include stock-based compensation expenses related to the company’s workforce.  Management compensates for this limitation by providing supplemental information about stock compensation expense on the face of the consolidated statements of operations.  A further limitation associated with the use of this measure is that it does not reflect the costs of restructuring charges and impairment charges.  Management compensates for this limitation by providing information about

restructuring charges and impairment charges.  Management does not believe any of these limitations are material, particularly when such measure is disclosed with its most comparable GAAP financial measure, operating income.  A reconciliation to operating income is provided in the accompanying tables.

Adjusted OIBDA for each of the company’s segments is defined by the company as segment income from operations as set forth in the company’s Form 10-Ks and Form 10-Qs before restructuring charges and impairment of goodwill, intangible assets and long-lived assets. Management believes that because adjusted OIBDA for a segment excludes certain non-cash expenses and expenses that are not reflective of the segment’s core operating results over time, this measure provides investors with additional useful information to measure the company’s segment performance, particularly with respect to changes in performance from period to period.  Adjusted OIBDA for the company’s segments is not determined in accordance with GAAP and should be considered in addition to, not as a substitute for or superior to, financial measures determined in accordance with GAAP.  A limitation associated with the use of adjusted OIBDA for a segment is that it does not reflect the costs of restructuring charges and impairment charges related to an operating segment.  Management compensates for this limitation by providing information about restructuring charges and impairment charges by segment.  Management does not believe this limitation is material, particularly when such measure is disclosed with its most comparable GAAP financial measure, segment income from operations.  A reconciliation to segment income from operations is provided in the accompanying tables.

(2)A pay account represents a unique billing relationship with a customer who subscribes to one or more of the company’s services.  A pay account does not equate to a unique subscriber since one subscriber could have several pay accounts.  Active accounts are defined as all free access, VoIP, social-networking and email users that logged on to our services at least once during the preceding 31 days, together with all pay accounts.  Additionally, active accounts include the number of free Web sites that received at least one unique visitor within the preceding 90 days; the number of free photo-sharing users that logged on to the service at least once within the preceding 90 days; and the number of MyPoints members who earned points or spent points within the preceding 90 days.

(3)Adjusted net income is defined by the company as net income before the after-tax effect of amortization of intangible assets; stock-based compensation; restructuring charges; impairment of goodwill, intangible assets and long-lived assets; and the cumulative effect of a change in accounting principle as a result of the adoption of FAS 123R, and the re-measurement of certain deferred tax assets.  Management believes that adjusted net income and adjusted net income per share provide investors with additional useful information to measure the company’s financial performance, particularly from period to period, because these measures are exclusive of (1) certain non-cash expenses (such as amortization, stock-based compensation and impairment of goodwill, intangible assets and long-lived assets) and (2) expenses that are not reflective of the company’s core results over time.  Management also uses adjusted net income and adjusted net income per share for this purpose.  Adjusted net income and adjusted net income per share are not determined in accordance with accounting principles generally accepted in the United States of America (GAAP) and should be considered in addition to, not as a substitute for or superior to, financial measures determined in accordance with GAAP.  The limitations of adjusted net income and adjusted net income per share are that, similar to adjusted OIBDA, they do not include certain costs, and the terms adjusted net income and adjusted net income per share do not have standardized meanings.  Therefore, other companies may use the same or similarly named measures but exclude different items or use different computations, which may not provide investors a comparable view of the company’s performance in relation to other companies in the same industry.  Management compensates for this limitation by presenting the most comparable GAAP measure, net income, directly ahead of adjusted net income in this earnings release and by providing a reconciliation that shows and describes the adjustments made.  Management does not believe these limitations are material, particularly when such measure is disclosed with its most comparable GAAP financial measure, net income.  A reconciliation to net income is provided in the accompanying tables.

(4)Free cash flow is defined by the company as net cash provided by operating activities, less capital expenditures and including the excess tax benefits from stock-based compensation and cash paid for restructuring charges.  Management believes that this measure of free cash flow provides investors with additional useful information to measure operating liquidity because it reflects the company’s operating cash flows after investing in capital assets.  This measure is used by management, and may also be useful for investors, to assess the company’s ability to pay its quarterly dividend, repay debt obligations, generate cash flow for a variety of strategic opportunities, including reinvestment in the business, and effect potential acquisitions and share repurchases.  Free cash flow is not determined in accordance with accounting principles generally accepted in the United States of America (GAAP) and should be considered in addition to, not as a substitute for or superior to, financial measures determined in accordance with GAAP.  The limitation of free cash flow is that it does not represent the total increase or decrease in cash during the period.  Management does not believe that this is a material limitation, particularly when such measure is disclosed with its most comparable GAAP financial measure, net

cash provided by operating activities.  A reconciliation to net cash provided by operating activities is provided in the accompanying tables.

Conference Call

United Online will host a conference call today at 2:00 p.m. PST (5:00 p.m. EST) to discuss its quarterly results. A live Web cast of the call can be accessed through the Investors section of the company’s Web site at www.untd.com. A recording of the call will be available on the site for seven days.

About United Online

United Online, Inc. (Nasdaq: UNTD) is a leading provider of consumer Internet and media services.  The company’s Content & Media services include social networking (Classmates) and online loyalty marketing (MyPoints).  Its Communications services include Internet access (NetZero, Juno) and email.  United Online is headquartered in Woodland Hills, CA, with offices in New York, NY; Fort Lee, NJ; Renton, WA; San Francisco, CA; Schaumburg, IL; Orem, UT; Erlangen, Germany; and Hyderabad, India.  For more information about United Online, please visit www.untd.com.

Cautionary Information Regarding Forward-Looking Statements

This release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, as amended.  Statements containing words such as “guidance,” “may,” “believe,” “will,” “expect,” “project,” “projections,” “business outlook” and “estimate” or similar expressions constitute forward-looking statements.  These statements include, without limitation, expectations regarding future financial performance; weighted average diluted shares; depreciation and amortization; stock-based compensation and restructuring charges.   Any such forward-looking statements are not guarantees of future performance or results, and involve risks and uncertainties that may cause actual performance and results to differ materially from those predicted and reported results should not be considered an indication of future performance.  Potential risks and uncertainties include, among others: the effect of competition, including adoption of broadband services and changes in the company’s pricing or competitors’ pricing, and the use of promotional offers to acquire or retain subscribers; the company’s inability to retain its existing subscribers and the rate at which new subscribers sign up for the company’s services; changes in pay accounts and the mix of pay accounts; the effects of changes in marketing expenditures or shifts in marketing expenditures to support existing and new products and services; the effects of seasonality; changes in Internet usage; changes in the projected number of weighted average diluted shares due to the issuance of stock, restricted stock units and stock options, stock repurchases, fluctuations in the company’s stock price or other factors; changes in stock-based compensation; changes in the projected amortization and depreciation figures due to capital spending or other factors; potential impairment of goodwill and intangibles; that the company will incur additional restructuring charges or currently anticipated restructuring charges will be greater than anticipated;  risks associated with the commercialization of new services; changes in tax laws, the company’s business or other factors that would impact anticipated tax benefits; changes in usage by subscribers, additional telecommunications costs or other factors negatively impacting the company’s cost of revenue; changes in active accounts; the company’s inability to maintain, renew, or enter into new, agreements with telecommunications providers on attractive terms; the company’s ability to successfully integrate acquisitions; problems associated with the company’s billing systems; the company’s inability to retain key customers and key personnel; technological problems or developments; risks associated with litigation; and governmental regulation.  From time to time, the company considers acquisitions or divestitures that, if consummated, could be material.  Forward-looking statements regarding financial metrics are based upon the assumption that no such acquisition or divestiture is consummated during the relevant periods.  If an acquisition or divestiture were consummated, actual results could differ materially from any forward-looking statements.  More information about potential factors that could affect the company’s business and financial results is included in the company’s annual and quarterly reports filed with the Securities and Exchange Commission (http://www.sec.gov), including, without limitation, information under the captions “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors.”

CONTACT:	Press:
	Scott Matulis — United Online, Inc.
	818-287-3388
	Liz Gengl — United Online, Inc.
	818-287-3076
	pr@untd.com
	Investors and Press:
	Evan Pondel - PondelWilkinson Inc.
	310-279-5980
	investor@pondel.com

UNITED ONLINE, INC.

Unaudited Condensed Consolidated Balance Sheets

 (in thousands)

	December 31, 2006		December 31, 2005
ASSETS
Cash, cash equivalents and short-term investments	$	162,362	$	244,362
Accounts receivable, net	32,226		19,201
Deferred tax assets, net	71,360		68,355
Property and equipment, net	34,296		33,093
Goodwill and intangible assets, net	186,671		139,837
Other assets	16,104		16,340
Total assets	$	503,019	$	521,188
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable	$	36,550	$	46,955
Accrued liabilities	39,547		36,249
Member redemption liability	19,989		—
Deferred revenue	56,348		56,284
Capital leases	30		698
Term loan	—		54,208
Other liabilities	3,589		4,379
Total liabilities	156,053		198,773
Stockholders’ equity	346,966		322,415
Total liabilities and stockholders’ equity	$	503,019	$	521,188

UNITED ONLINE, INC.
Unaudited Consolidated Statements of Operations
(in thousands, except per share amounts)

	Three Months Ended December 31,						Year Ended December 31,
	2006			2005			2006			2005
Revenues	$	130,786		$	130,232		$	522,654		$	525,061
Operating expenses:
Cost of revenues(a)	29,967			28,241			120,049			110,672
Sales and marketing(a)	43,976			48,639			177,019			209,292
Product development(a)	13,231			11,229			52,933			40,009
General and administrative(a)	16,537			15,126			67,709			56,729
Amortization of intangible assets	4,486			4,915			17,640			21,799
Impairment of goodwill, intangible assets and long-lived assets	13,285			—			13,285			—
Total operating expenses	121,482			108,150			448,635			438,501
Operating income	9,304			22,082			74,019			86,560
Interest and other income, net	1,549			2,201			6,076			6,885
Interest expense	(245		)	(1,328		)	(2,571		)	(6,073		)
Income before income taxes	10,608			22,955			77,524			87,372
Provision for income taxes	6,049			10,581			36,293			40,245
Income before cumulative effect of change in accounting principle	4,559			12,374			41,231			47,127
Cumulative effect of change in accounting principle, net of tax	—			—			1,041			—
Net income	$	4,559		$	12,374		$	42,272		$	47,127
Basic net income per share
Income before cumulative effect of change in accounting principle	$	0.07		$	0.20		$	0.64		$	0.77
Cumulative effect of change in accounting principle, net of tax	—			—			0.02			—
Basic net income per share	$	0.07		$	0.20		$	0.66		$	0.77
Diluted net income per share
Income before cumulative effect of change in accounting principle	$	0.07		$	0.19		$	0.62		$	0.74
Cumulative effect of change in accounting principle, net of tax	—			—			0.02			—
Diluted net income per share	$	0.07		$	0.19		$	0.64		$	0.74
Shares used to calculate basic net income per share	65,102			61,899			64,001			61,135
Shares used to calculate diluted net income per share	67,616			64,996			66,269			63,815
Shares outstanding at end of period	65,805			62,606			65,805			62,606
(a) Stock-based compensation was allocated as follows:
Cost of revenues	$	148		$	52		$	817		$	183
Sales and marketing	714			333			3,457			954
Product development	1,119			327			5,367			1,069
General and administrative	2,050			2,408			9,527			7,746
Total stock-based compensation	$	4,031		$	3,120		$	19,168		$	9,952

UNITED ONLINE, INC.
Unaudited Condensed Consolidated Statements of Cash Flows
(in thousands)

	Three Months Ended December 31,						Year Ended December 31,
	2006			2005			2006			2005
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	4,559		$	12,374		$	42,272		$	47,127
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and stock-based compensation	14,018			12,538			58,098			47,232
Impairment of goodwill, intangible assets and long-lived assets	13,285			—			13,285			—
Deferred taxes and other	(6,046		)	170			(586		)	2,325
Tax benefits from stock-based compensation	1,093			3,995			5,781			15,170
Excess tax benefits from stock-based compensation	(441		)	—			(3,863		)	—
Cumulative effect of change in accounting principle, net of tax	—			—			(1,041		)	—
Change in operating assets and liabilities (excluding the effects of acquisitions):
Accounts receivable	(5,962		)	1,678			(3,296		)	(1,669		)
Other assets	(1,553		)	(1,764		)	844			1,806
Accounts payable and accrued liabilities	3,895			(5,231		)	(11,211		)	17,677
Member redemption liability	1,198			—			2,315			—
Deferred revenue	(1,180		)	(1,034		)	(999		)	5,181
Other liabilities	(6		)	45			(129		)	2,198
Net cash provided by operating activities	22,860			22,771			101,470			137,047
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(7,437		)	(5,199		)	(24,329		)	(21,653		)
Purchases of rights, patents and trademarks	—			(8		)	(509		)	(5,562		)
Purchases of short-term investments	(67,733		)	(38,151		)	(324,328		)	(320,869		)
Proceeds from maturities and sales of short-term investments	57,614			101,755			325,180			353,333
Cash paid for acquisitions, net of cash acquired	(41		)	—			(61,155		)	(8,638		)
Decrease in restricted cash	1,450			—			—			—
Payment related to settlement of pre-acquisition liability	—			—			(4,800		)	—
Proceeds from sales of assets, net	17			—			104			—
Net cash provided by (used for) investing activities	(16,130		)	58,397			(89,837		)	(3,389		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on term loan	—			(4,125		)	(54,209		)	(45,792		)
Payments on capital leases	(424		)	(91		)	(668		)	(621		)
Proceeds from exercises of stock options	2,883			1,142			9,452			5,874
Proceeds from employee stock purchase plan	2,039			1,491			5,004			3,169
Repurchases of common stock	(310		)	—			(2,684		)	(14,206		)
Payments for dividends	(13,695		)	(12,808		)	(53,483		)	(38,067		)
Excess tax benefits from stock-based compensation	441			—			3,863			—
Net cash used for financing activities	(9,066		)	(14,391		)	(92,725		)	(89,643		)
Effect of exchange rate changes on cash and cash equivalents	(71		)	(39		)	(53		)	(130		)
Change in cash and cash equivalents	(2,407		)	66,738			(81,145		)	43,885
Cash and cash equivalents, beginning of period	21,659			33,659			100,397			56,512
Cash and cash equivalents, end of period	$	19,252		$	100,397		$	19,252		$	100,397

UNITED ONLINE, INC.
Reconciliation of Net Income to Adjusted Net Income(3)
(in thousands, except per-share data)

	Three Months Ended December 31,						Year Ended December 31,
	2006			2005			2006			2005
Net income	$	4,559		$	12,374		$	42,272		$	47,127
Add (deduct):
Stock-based compensation	4,031			3,120			19,168			9,952
Amortization of intangible assets	4,486			4,915			17,640			21,799
Restructuring charges	—			—			627			—
Impairment of goodwill, intangible assets and long-lived assets	13,285			—			13,285			—
Cumulative effect of change in accounting principle	—			—			(1,041		)	—
	26,361			20,409			91,951			78,878
Income tax effect of adjusting entries	(7,682		)	(1,819		)	(16,416		)	(8,777		)
Re-measurement of certain deferred tax assets	813			—			2,132			1,008
Adjusted net income	$	19,492		$	18,590		$	77,667		$	71,109
Adjusted basic net income per share	$	0.30		$	0.30		$	1.21		$	1.16
Adjusted diluted net income per share	$	0.29		$	0.28		$	1.16		$	1.09
Shares used to calculate adjusted basic net income per share	65,102			61,899			64,001			61,135
Shares used to calculate adjusted diluted net income per share(a)	68,194			66,236			67,138			65,127

(a)Includes the adjustment of shares used to calculate diluted net income per share resulting from the elimination of stock-based compensation.

UNITED ONLINE, INC.
Reconciliation of Non-GAAP Financial Data
(in thousands)

	Three Months Ended December 31,					Year Ended December 31,
	2006			2005		2006		2005
Adjusted Operating Income Before Depreciation and Amortization(1)
Operating income	$	9,304		$	22,082	$	74,019	$	86,560
Depreciation	5,501			4,503		21,290		15,481
Amortization	4,486			4,915		17,640		21,799
Operating income before depreciation and amortization	19,291			31,500		112,949		123,840
Stock-based compensation	4,031			3,120		19,168		9,952
Restructuring charges	—			—		627		—
Impairment of goodwill, intangible assets and long-lived assets	13,285			—		13,285		—
Adjusted operating income before depreciation and amortization	$	36,607		$	34,620	$	146,029	$	133,792
Reconciliation of Segment Income from Operations to Adjusted OIBDA(1)
Communications:
Segment income from operations	$	28,360		$	30,292	$	132,839	$	135,286
Restructuring charges	—			—		619		—
Impairment of goodwill, intangible assets and long-lived assets	4,504			—		4,504		—
Adjusted operating income before depreciation and amortization	$	32,864		$	30,292	$	137,962	$	135,286
Content & Media:
Segment income from operations	$	(725	)	$	8,969	$	17,913	$	16,541
Restructuring charges	—			—		8		—
Impairment of goodwill, intangible assets and long-lived assets	8,781			—		8,781		—
Adjusted operating income before depreciation and amortization	$	8,056		$	8,969	$	26,702	$	16,541

UNITED ONLINE, INC.
Reconciliation of Non-GAAP Financial Data
(in thousands)

	Three Months Ended December 31,						Year Ended December 31,
	2006			2005			2006			2005
Free Cash Flow(4)
Net cash provided by operating activities	$	22,860		$	22,771		$	101,470		$	137,047
Add (deduct):
Capital expenditures	(7,437		)	(5,199		)	(24,329		)	(21,653		)
Excess tax benefits from stock-based compensation(a)	441			—			3,863			—
Cash paid for restructuring charges	105			—			1,100			—
Free cash flow	$	15,969		$	17,572		$	82,104		$	115,394

(a)In accordance with FAS 123R, certain tax benefits from exercised stock options that were previously reflected in the operating section of the statement of cash flows are now presented in the financing section.

UNITED ONLINE, INC.
Supplemental Schedule of Segment Information
(in thousands)

	Three Months Ended December 31, 2006
	Communications		Content & Media			Unallocated Corporate Expenses			Total
Billable services	$	77,047	$	22,305		$	—		$	99,352
Advertising	10,147		21,287			—			31,434
Total revenues	87,194		43,592			—			130,786
Operating expenses:
Cost of revenue	18,524		11,295			148			29,967
Sales and marketing	25,362		17,900			714			43,976
Product development	8,067		4,045			1,119			13,231
General and administrative	5,486		4,664			6,387			16,537
Amortization of intangible assets	372		4,114			—			4,486
Impairment of goodwill, intangible assets and long-lived assets	4,504		8,781			—			13,285
Total operating expenses	62,315		50,799			8,368			121,482
Operating income (loss)	24,879		(7,207		)	(8,368		)	9,304
Depreciation	3,109		2,368			24			5,501
Amortization	372		4,114			—			4,486
Operating income before depreciation and amortization	28,360		(725		)	(8,344		)	19,291
Stock-based compensation	—		—			4,031			4,031
Impairment of goodwill, intangible assets and long-lived assets	4,504		8,781			—			13,285
Adjusted operating income before depreciation and amortization	$	32,864	$	8,056		$	(4,313	)	$	36,607

	Three Months Ended December 31, 2005
	Communications		Content & Media		Unallocated Corporate Expenses			Total
Billable services	$	95,058	$	19,533	$	—		$	114,591
Advertising	9,018		6,623		—			15,641
Total revenues	104,076		26,156		—			130,232
Operating expenses:
Cost of revenue	24,247		3,942		52			28,241
Sales and marketing	38,669		9,637		333			48,639
Product development	8,549		2,353		327			11,229
General and administrative	5,138		2,939		7,049			15,126
Amortization of intangible assets	713		4,202		—			4,915
Total operating expenses	77,316		23,073		7,761			108,150
Operating income (loss)	26,760		3,083		(7,761		)	22,082
Depreciation	2,819		1,684		—			4,503
Amortization	713		4,202		—			4,915
Operating income before depreciation and amortization	30,292		8,969		(7,761		)	31,500
Stock-based compensation	—		—		3,120			3,120
Adjusted operating income before depreciation and amortization	$	30,292	$	8,969	$	(4,641	)	$	34,620

UNITED ONLINE, INC.
Supplemental Schedule of Segment Information
(in thousands)

	Year Ended December 31, 2006
	Communications		Content & Media			Unallocated Corporate Expenses			Total
Billable services	$	336,924	$	86,641		$	—		$	423,565
Advertising	39,013		60,076			—			99,089
Total revenues	375,937		146,717			—			522,654
Operating expenses:
Cost of revenue	86,811		32,421			817			120,049
Sales and marketing	109,484		64,078			3,457			177,019
Product development	32,931		14,635			5,367			52,933
General and administrative	21,401		18,095			28,213			67,709
Amortization of intangible assets	2,424		15,216			—			17,640
Impairment of goodwill, intangible assets and long-lived assets	4,504		8,781			—			13,285
Total operating expenses	257,555		153,226			37,854			448,635
Operating income (loss)	118,382		(6,509		)	(37,854		)	74,019
Depreciation	12,033		9,206			51			21,290
Amortization	2,424		15,216			—			17,640
Operating income before depreciation and amortization	132,839		17,913			(37,803		)	112,949
Stock-based compensation	—		—			19,168			19,168
Restructuring charges	619		8			—			627
Impairment of goodwill, intangible assets and long-lived assets	4,504		8,781			—			13,285
Adjusted operating income before depreciation and amortization	$	137,962	$	26,702		$	(18,635	)	$	146,029

	Year Ended December 31, 2005
	Communications		Content & Media			Unallocated Corporate Expenses			Total
Billable services	$	396,330	$	69,649		$	—		$	465,979
Advertising	35,614		23,468			—			59,082
Total revenues	431,944		93,117			—			525,061
Operating expenses:
Cost of revenue	94,946		15,543			183			110,672
Sales and marketing	162,242		46,096			954			209,292
Product development	30,015		8,925			1,069			40,009
General and administrative	18,815		12,133			25,781			56,729
Amortization of intangible assets	3,048		18,751			—			21,799
Total operating expenses	309,066		101,448			27,987			438,501
Operating income (loss)	122,878		(8,331		)	(27,987		)	86,560
Depreciation	9,360		6,121			—			15,481
Amortization	3,048		18,751			—			21,799
Operating income before depreciation and amortization	135,286		16,541			(27,987		)	123,840
Stock-based compensation	—		—			9,952			9,952
Adjusted operating income before depreciation and amortization	$	135,286	$	16,541		$	(18,035	)	$	133,792

UNITED ONLINE, INC.
Selected Quarterly Historical Financial Data and Key Metrics(a)

	Dec 31, 2006		Sep 30, 2006		Jun 30, 2006		Mar 31, 2006		Dec 31, 2005
Revenue (in thousands)	$	130,786	$	129,636	$	134,900	$	127,332	$	130,232
Net income (in thousands)	$	4,559	$	13,436	$	11,585	$	12,692	$	12,374
Net income per diluted share	$	0.07	$	0.20	$	0.18	$	0.20	$	0.19
Pay accounts(2) (in thousands)	4,854		4,912		4,996		5,093		5,009
Active accounts(2) (in millions)	20.1		20.8		20.7		18.7		17.6
Number of employees at end of period	1,006		1,023		1,016		912		900

(a)More information on the financial results for these quarters can be found in the company’s filings with the Securities and Exchange Commission.

UNITED ONLINE, INC.
Analysis of Pay Accounts (2)
(in thousands)

	Dec 31, 2006	Sep 30, 2006	Jun 30, 2006	Mar 31, 2006	Dec 31, 2005
Communications(a)
Access	2,282	2,425	2,556	2,751	2,855
Other	317	323	330	321	313
Total	2,599	2,748	2,886	3,072	3,168
Content & Media(b)
Social networking	2,169	2,079	2,029	1,945	1,766
Other	86	85	81	76	75
Total	2,255	2,164	2,110	2,021	1,841
Total pay accounts(2)	4,854	4,912	4,996	5,093	5,009

(a)Communications includes Internet access, VoIP, premium content, premium email and security suite.

(b)Content & Media includes social networking, Web hosting and photo sharing.