6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

FOR THE MONTH OF August, 2011

COMMISSION FILE NUMBER: 001-35035

Velti plc

(Exact name of Registrant as specified in its charter)

Not Applicable

(Translation of Registrant's name into English)

First Floor, 28-32 Pembroke Street Upper

Dublin 2, Republic of Ireland

Attn: Alex Moukas, Chief Executive Officer

353 (0) 1234 2676

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F  R Form 40-F o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):___

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):___

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes o No R

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):

INFORMATION CONTAINED IN THIS FORM 6-K REPORT

This report contains Velti's Interim Report as of June 30, 2011 and for the three and six months ended June 30, 2011 and 2010.

EXHIBITS

Exhibit Number	Description
99.1	Velti's Interim Report as of June 30, 2011 and for the three and six months ended June 30, 2011 and 2010
99.2	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
99.3	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
99.4	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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, thereunto duly authorized.

VELTI PLC
(Registrant)
By:	/s/ Wilson W. Cheung
Name:	Wilson W. Cheung
Title:	Chief Financial Officer

Date:August 29, 2011

EX-99.1

EX 99.1

Velti plc

Interim Report

As of June 30, 2011 and for the three and

six months ended June 30, 2011 and 2010

Velti plc

Interim Report

TABLE OF CONTENTS

	Page
Condensed Consolidated Balance Sheets	1
Condensed Consolidated Statements of Operations	2
Condensed Consolidated Statements of Changes in Shareholders' Equity and Comprehensive Loss	3
Condensed Consolidated Statements of Cash Flows	4
Notes to Condensed Consolidated Financial Statements	5
Management's Discussion and Analysis of Financial Condition and Results of Operations	22
Quantitative and Qualitative Disclosures About Market and Other Financial Risks	38
Controls and Procedures	39

Velti plc

Condensed Consolidated Balance Sheets

(in thousands, except share and per share amounts)

(unaudited)

	June 30,			December 31,
	2011			2010
ASSETS
Current assets:
Cash and cash equivalents	$	159,440		$	17,354
Trade receivables (including related party receivables of $1.0 million and $3.7 million as of June 30, 2011 and December 31, 2010, respectively), net of allowance for doubtful accounts	31,886			39,114
Accrued contract receivables (including related party receivables of $1.4 million and $0 as of June 30, 2011 and December 31, 2010, respectively)	34,140			33,588
Prepayments	20,597			9,533
Other receivables and current assets (including related party receivables of $1.2 million and $731,000 as of June 30, 2011 and December 31, 2010, respectively)	62,873			28,307
Total current assets	308,936			127,896
Non-current assets:
Property and equipment, net	3,724			3,253
Intangible assets, net	53,465			45,650
Equity investments	2,538			2,328
Goodwill	18,673			18,451
Other assets	12,094			11,590
Total non-current assets	90,494			81,272
Total assets	$	399,430		$	209,168
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	18,832		$	32,514
Accrued liabilities	17,717			27,515
Deferred revenue and current portion of deferred government grant	4,134			2,849
Current portion of acquisition related liabilities	18,559			8,529
Current portion of long-term debt and short-term financings (including related party debt of $0 and $500,000 as of June 30, 2011 and December 31, 2010, respectively)	21,527			50,430
Income tax liabilities	8,824			9,875
Total current liabilities	89,593			131,712
Non-current liabilities:
Long-term debt	436			19,685
Deferred government grant - non-current	4,793			4,335
Retirement benefit obligations	553			447
Acquisition related liabilities - non-current	—			10,915
Other non-current liabilities	8,092			5,805
Total liabilities	103,467			172,899
Commitments and contingencies (See Note 12)
Shareholders' equity:
Share capital, nominal value £0.05, 100,000,000 ordinary shares authorized; 61,550,768 and 38,341,760 shares issued and outstanding as of June 30, 2011 and December 31, 2010, respectively	5,127			3,397
Additional paid-in capital	338,213			50,415
Accumulated deficit	(60,306		)	(19,358		)
Accumulated other comprehensive income	12,795			1,639
Total Velti shareholders' equity	295,829			36,093
Non-controlling interests	134			176
Total equity	295,963			36,269
Total liabilities and shareholders' equity	$	399,430		$	209,168

The accompanying notes are an integral part of these condensed consolidated financial statements.

1

Velti plc

Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

(unaudited)

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2011			2010			2011			2010
Revenue:
Software as a service (SaaS) revenue	$	27,550		$	13,788		$	50,829		$	21,361
License and software revenue	4,077			5,540			6,868			10,421
Managed services revenue	2,731			2,601			6,211			6,378
Total revenue	34,358			21,929			63,908			38,160
Cost and expenses:
Third-party costs	10,717			9,059			21,350			13,083
Datacenter and direct project costs	5,140			1,467			8,091			2,800
General and administrative expenses	14,409			3,909			23,877			9,280
Sales and marketing expenses	11,586			6,263			19,579			10,952
Research and development expenses	3,563			1,701			6,393			2,983
Acquisition related charges	6,142			—			7,603			—
Depreciation and amortization	4,108			2,684			7,862			5,253
Total cost and expenses	55,665			25,083			94,755			44,351
Loss from operations	(21,307		)	(3,154		)	(30,847		)	(6,191		)
Interest expense, net	(1,398		)	(1,305		)	(4,881		)	(2,367		)
Loss from foreign currency transactions	(2,181		)	(1,195		)	(1,803		)	(2,056		)
Other income	162			—			86			—
Loss before income taxes, equity method investments and non-controlling interest	(24,724		)	(5,654		)	(37,445		)	(10,614		)
Income tax (expense) benefit	(721		)	228			(2,958		)	440
Gain (loss) from equity method investments	320			(978		)	(645		)	(1,477		)
Net loss	(25,125		)	(6,404		)	(41,048		)	(11,651		)
Net loss attributable to non-controlling interest	(49		)	(17		)	(100		)	(41		)
Net loss attributable to Velti	$	(25,076	)	$	(6,387	)	$	(40,948	)	$	(11,610	)
Net loss attributable to Velti per share:
Basic	$	(0.47	)	$	(0.17	)	$	(0.82	)	$	(0.31	)
Diluted	$	(0.47	)	$	(0.17	)	$	(0.82	)	$	(0.31	)
Weighted average number of shares outstanding for use in computing per share amounts:
Basic	53,047			37,704			50,073			37,617
Diluted	53,047			37,704			50,073			37,617

The accompanying notes are an integral part of these condensed consolidated financial statements.

2

Velti plc

Condensed Consolidated Statements of Shareholders' Changes in Equity and Comprehensive Loss

(in thousands, except share amounts)

(unaudited)

	Velti Shareholders' Equity
	Share Capital
	Number of Shares	Amount		Additional Paid-In Capital			Accumulated Deficit			Accumulated Other Comprehensive Income		Total Velti Shareholders' Equity			Non- controlling Interests			Total
Balance as of December 31, 2010	38,341,760	$	3,397	$	50,415		$	(19,358	)	$	1,639	$	36,093		$	176		$	36,269
Components of comprehensive loss:
Net loss	—	—		—			(40,948		)	—		(40,948		)	(100		)	(41,048		)
Foreign currency translation adjustments	—	—		—			—			11,156		11,156			58			11,214
Total comprehensive loss												$	(29,792	)	$	(42	)	$	(29,834	)
Issuance of shares in January public offering, net of issuance costs	12,500,000	875		133,258			—			—		134,133			—			134,133
Issuance of shares in June public offering, net of issuance costs	9,474,275	758		135,981			—			—		136,739			—			136,739
Shares issued upon vesting of deferred share awards and option excercises	1,234,733	97		227			—			—		324			—			324
Share withholding in lieu of employee tax withholding	—	—		(1,521		)	—			—		(1,521		)	—			(1,521		)
Share-based compensation	—	—		19,853			—			—		19,853			—			19,853
Balance as of June 30, 2011	61,550,768	$	5,127	$	338,213		$	(60,306	)	$	12,795	$	295,829		$	134		$	295,963

	Velti Shareholders' Equity
	Share Capital
	Number of Shares	Amount		Additional Paid-In Capital		Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Total Velti Shareholders' Equity			Non- controlling Interests			Total
Balance as of December 31, 2009	37,530,261	$	3,339	$	42,885	$	(3,689	)	$	4,315		$	46,850		$	86		$	46,936
Components of comprehensive loss:
Net loss	—	—		—		(11,610		)	—			(11,610		)	(41		)	(11,651		)
Foreign currency translation adjustments	—	—		—		—			(6,471		)	(6,471		)	159			(6,312		)
Total comprehensive loss												$	(18,081	)	$	118		$	(17,963	)
Shares issued upon vesting of deferred share awards	565,584	41		—		—			—			41			—			41
Share-based compensation	—	—		2,407		—			—			2,407			—			2,407
Balance as of June 30, 2010	38,095,845	$	3,380	$	45,292	$	(15,299	)	$	(2,156	)	$	31,217		$	204		$	31,421

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

Velti plc

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

	For the Six Months Ended June 30,
	2011			2010
Cash flows from operating activities:
Net loss	$	(41,048	)	$	(11,651	)
Adjustments to reconcile net loss to net cash generated from (used in) operating activities:
Depreciation and amortization	7,862			5,253
Change in fair value of contingent consideration	7,316			—
Non-cash interest expense	1,664			500
Share-based compensation	19,853			2,407
Retirement benefit obligations	63			28
Deferred income taxes	1,850			(155		)
Undistributed loss of equity method investments	645			1,477
Foreign currency transactions loss	1,803			2,056
Provision for doubtful accounts	444			—
Change in operating assets and liabilities:
Trade receivables and accrued contract receivables	11,618			(1,624		)
Prepayments and other current assets	(25,219		)	(12,979		)
Other assets	5,301			(2,633		)
Accounts payable and other accrued liabilities	(25,109		)	17,496
Deferred revenue and government grant income	2,219			185
Net cash generated from (used in) operating activities	(30,738		)	360
Cash flow from investing activities:
Purchase of property and equipment	(783		)	(418		)
Investments in software development and purchased software	(15,520		)	(11,377		)
Investment in subsidiaries and equity method investments, net of cash acquired	(9,268		)	(651		)
Net cash used in investing activities	(25,571		)	(12,446		)
Cash flow from financing activities:
Net proceeds from issuance of ordinary shares	248,316			41
Proceeds from borrowings and debt financing	917			14,984
Repayment of borrowings	(53,160		)	(4,453		)
Net cash generated from financing activities	196,073			10,572
Effect of changes in foreign exchange rates	2,322			(2,075		)
Net increase (decrease) in cash and cash equivalents	142,086			(3,589		)
Cash and cash equivalents at beginning of period	17,354			19,655
Cash and cash equivalents at end of period	$	159,440		$	16,066
Supplemental cash flow information:
Interest paid	$	5,985		$	1,376
Income taxes paid	$	378		$	636
Non-cash financing activity:
Proceeds receivable from public offering	$	21,359		$	—

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

Velti plc

Notes to Condensed Consolidated Financial Statements (unaudited)

1. Description of Business and Basis of Presentation

Velti plc (Velti or the Company), is a leading global provider of mobile marketing and advertising technology that enable brands, advertising agencies, mobile operators and media companies to implement highly targeted, interactive and measurable campaigns by communicating with and engaging consumers via their mobile devices. Our platform allows our customers to use mobile media, together with traditional media, such as television, print, radio and outdoor advertising, to reach targeted consumers, engage consumers through the mobile Internet and applications, convert consumers into their customers and continue to actively manage the relationship through the mobile channel.

Basis of Presentation

The following (a) Condensed Consolidated Balance Sheet as of December 31, 2010, which has been derived from audited financial statements, and (b) the unaudited interim Condensed Consolidated Financial Statements of Velti as of June 30, 2011, and for the three and six months ended June 30, 2011 and 2010, have been prepared in accordance with accounting principles generally accepted in the U.S. for interim financial information along with Article 10 of Securities and Exchange Commission (SEC) Regulation S-X. Accordingly, they do not include all of the information and notes required by generally accepted accounting principles (GAAP) for complete financial statements. In management’s opinion, the financial statements include all adjustments (consisting of normal, recurring and non-recurring adjustments) necessary for the fair presentation of the financial position and operating results of the Company. The results of operations for the three and six months ended June 30, 2011 are not necessarily indicative of the results for the entire fiscal year ending December 31, 2011 or for any other period. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with Velti's Annual Report on Form 20-F for the fiscal year ended December 31, 2010 (2010 Form 20-F) filed on April 12, 2011 with the SEC.

Group Structure

Velti plc is a company incorporated under the laws of the Bailiwick of Jersey, the Channel Islands. On May 3, 2006, Velti plc was first admitted and trading commenced in our ordinary shares on the Alternative Investment Market of the London Stock Exchange (AIM) and subsequently on the NASDAQ Global Select Market on January 28, 2011. Effective May 3, 2011 our ordinary shares no longer trade on AIM. In June 2011, we completed a second US public offering, resulting in the issuance of 8,000,000 additional ordinary shares and net proceeds of $115.3 million.

2. Summary of Significant Accounting Policies

Changes in Significant Accounting Policies During the Period

In October 2009, the FASB issued Accounting Standards Update (ASU) No. 2009-13, Multiple Deliverable Arrangements, related to revenue recognition for multiple-deliverable revenue arrangements. ASU 2009-13 allows, for new or materially modified arrangements, the use of the best estimate of selling price in addition to vendor-specific objective evidence (VSOE) and third-party evidence (TPE) for determining the selling price of a deliverable. A vendor must use its best estimate of the selling price when VSOE or TPE of the selling price cannot be determined. In addition, the residual method of allocating consideration is no longer permitted. This update requires expanded qualitative and quantitative disclosures. We have adopted the new guidance on a prospective basis for new or materially modified arrangements beginning January 1, 2011. There was no material impact to our financial statements upon adoption and we do not anticipate any ongoing impact in future periods from existing arrangements.

Revenue Recognition

We derive our revenue from three sources:

▪ software as a service (SaaS) revenue, which consists of fees from customers who subscribe to our hosted mobile marketing and advertising platform, generally referred to as “usage‑based” services, and fees from customers who utilize our software solutions to measure the progress of their transaction‑ based mobile marketing and advertising campaigns, generally referred to as “performance‑based” services;

▪ license and software revenue, which consists of revenue from customers who license our mobile marketing and advertising platform and fees for customized software solutions delivered to and installed on the customers' server; and

▪ managed services revenue, which consists of fees charged to customers for professional services related to the implementation, execution, and monitoring of customized mobile marketing and advertising solutions.

5

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

We account for our revenue for these services and licenses in accordance with Accounting Standards Codification (ASC) Topic 605 - Revenue Recognition and ASC Topic 985-605 - Certain Revenue Arrangements that Include Software Elements. We recognize revenue when all of the following conditions are satisfied: (i) there is persuasive evidence of an arrangement; (ii) the service has been rendered or delivery has occurred; (iii) the fee to be paid by the customer is fixed or determinable; and (iv) collectibility of the fee is reasonably assured.

SaaS revenue generated from our “usage‑based” services, including subscription fees for use of individual software modules and our automated mobile marketing campaign creation templates, and fees charged for access to our technology platform, are recognized ratably over the period of the agreement as the fees are earned.

SaaS revenue generated from our “performance‑based” services is generally based on specified metrics, typically relating to the number of transactions performed or number of text messages generated during the campaign multiplied by the cost per action or response in accordance with the terms of the related contracts. Some of our performance‑based contracts include performance incentive provisions that link a portion of revenue that we may earn under the contract to the performance of the customer's campaign relative to quantitative or other milestones, such as the growth in the consumer base, reduced consumer churn, or the effectiveness of the end-user response. We consider the performance‑based fees to be contingent fees and recognize revenue monthly as the contingency is resolved, the fees are earned and the amount of the fee can be reliably measured. Our performance‑based arrangements are typically invoiced upon completion of the campaign, which can occur in a period subsequent to revenue being recognized.

License and software revenue consists of fees charged for our mobile marketing and advertising technology provided on a perpetual license. These types or arrangements do not typically include any ongoing support arrangements or rights to upgrades or enhancements and therefore revenue related to perpetual licensing arrangements is recognized upon the delivery of the license. Fees charged to customize our software solution are recognized using the completed contract or percentage-of-completion method according to ASC 605-35, Revenue Recognition - Construction-Type and Production-Type Contracts, based on the ratio of costs incurred to the estimated total costs at completion.

Managed services revenue, when sold with software and support offerings, are accounted for separately when these services (i) have value to the customer on a standalone basis, (ii) are not essential to the functionality of the software and (iii) there is objective and reliable evidence of the selling price of each deliverable. When accounted for separately, revenue is recognized as the services are rendered for time and material contracts, and ratably over the term of the contract when accepted by the customer for fixed price contracts. For revenue arrangements with multiple deliverables, such as an arrangement that includes license, support and professional services, we allocate the total amount the customer will pay to the separate units of accounting based on their relative selling prices, as determined by the price of the undelivered items when sold separately.

The timing of revenue recognition in each case depends upon a variety of factors, including the specific terms of each arrangement and the nature of our deliverables and obligations, and the existence of evidence to support recognition of our revenue as of the reporting date. For contracts with extended payment terms for which we have not established a successful pattern of collection history, we recognize revenue when all other criteria are met and when the fees under the contract are due and payable.

For the majority of our contracts, we act as the principal and contract directly with suppliers for purchase of media and other third-party production costs, and are responsible for payment of such costs as the primary obligor. We recognize the revenue generated on fees charged for such third-party costs using the gross method. We recognize revenue at the gross amount billed when revenue is earned for services rendered and record the associated fees we pay as third-party costs in the period such costs are incurred.

In the event that we have incurred costs associated with a specific revenue arrangement prior to the execution of the related contract, those costs are expensed as incurred.

Fees that have been invoiced are recorded in trade receivables and in revenue when all revenue recognition criteria have been met. Fees that have not been invoiced as of the reporting date but for which all revenue recognition criteria are met are reported as accrued contract receivables on the balance sheets.

We present revenue net of value‑added tax, sales tax, excise tax and other similar assessments. Our revenue arrangements do not contain general rights of return.

6

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

Concentration of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash and cash equivalents, to the extent that balances exceed insured limits, and accounts receivable. Our concentration of credit risk with respect to accounts receivable is limited as we have policies in place to ensure that sales are made to customers with a high credit standing, and we enter into factoring arrangements with local banks for a material portion of our accounts receivable.

There were no customers that accounted for 10% or more of our revenues for the three and six months ended June 30, 2011. Three customers accounted for 39% of our revenue in the aggregate for the three months ended June 30, 2010 with each customer individually accounting for more than 10%. There were no customers that accounted for 10% or more of our revenues for the six months ended June 30, 2010.

Use of Estimates

The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates.     

Reclassifications

Certain prior-period amounts have been reclassified to conform to current period presentation.

Recent Accounting Pronouncements

In December 2010, the FASB issued ASU No. 2010-28,When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts (Topic 350) Intangibles—Goodwill and Other. ASU 2010-28 amends the criteria for performing Step 2 of the goodwill impairment test for reporting units with zero or negative carrying amounts and requires performing Step 2 if qualitative factors indicate that it is more likely than not that a goodwill impairment exists. We will adopt ASU 2010-28 on January 1, 2012 and do not believe it will have a material impact on our consolidated financial statements.

In May 2011, the FASB issued ASU No. 2011-04, Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and International Financial Reporting Standards (Topic 820) Fair Value Measurement, to provide a consistent definition of fair value and ensure that the fair value measurement and disclosure requirements are similar between U.S. GAAP and International Financial Reporting Standards. ASU 2011-04 changes certain fair value measurement principles and enhances the disclosure requirements. We will adopt ASU 2011-04 on January 1, 2012 and do not believe it will have a material impact on our consolidated financial statements.

In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income (Topic 220) Presentation of Comprehensive Income, to require an entity to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of equity. ASU 2011-05 is effective for us on January 1, 2012, with retrospective application required. The adoption of ASU 2011-05 will require us to change our presentation of comprehensive income.

3. Segment and Geographic Information

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (CODM), or decision making group, in deciding how to allocate resources and in assessing performance. Velti's CODM is our chief executive officer. Our business is conducted in a single operating segment. Our CODM reviews a single set of financial data that encompasses our entire operations for purposes of making operating decisions and assessing financial performance. Our CODM manages our business based primarily on broad functional categories of sales, marketing, software and technology platform development and strategy. While we obtain financial statements from all of our subsidiaries and joint ventures in order to prepare our consolidated financial statements, we do not review them either individually or in the aggregate when making operating decisions for our business. We discuss revenue and capital expenditures on a worldwide basis in determining the need to expand our global presence. While we consolidate our subsidiaries, we do not allocate resources, other than financing, to any of them, nor do we allocate any portion of personnel costs, administrative costs, interest expense or taxes to them. We therefore have determined that our subsidiaries and joint venture operations do not constitute separate operating segments individually or in aggregate.

7

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

We conduct our business in three geographical areas: Europe, Americas, and Asia/Africa. The following table provides revenue by geographical area. Revenue from customers for whom we provide services in multiple locations is reported in the location of the respective customer's domicile; revenue from customers for whom we provide services in a single or very few related locations is reported in the location of the respective customer's place of operations.

	For the Three Months Ended June 30,								For the Six Months Ended June 30,
Revenue:	2011				2010				2011				2010
	(in thousands, except percentages)
Europe:
United Kingdom	$	4,707	13.7	%	$	6,444	29.4	%	$	11,681	18.3	%	$	12,152	31.8	%
Russia	940		2.7	%	6,231		28.4	%	1,876		2.9	%	8,314		21.8	%
Greece	3,209		9.3	%	2,947		13.4	%	5,489		8.6	%	3,953		10.4	%
All other European countries	11,419		33.2	%	2,829		12.9	%	20,000		31.3	%	6,040		15.8	%
Total Europe	20,275		59.0	%	18,451		84.1	%	39,046		61.1	%	30,459		79.8	%
Americas	7,361		21.4	%	297		1.4	%	15,513		24.3	%	657		1.7	%
Asia/Africa	6,722		19.6	%	3,181		14.5	%	9,349		14.6	%	7,044		18.5	%
Total revenue	$	34,358	100.0	%	$	21,929	100.0	%	$	63,908	100.0	%	$	38,160	100.0	%

The majority of our long-lived assets are located in Greece. Long-lived assets consist of property and equipment, net of related accumulated depreciation.

4. Contract Revenue and Grant Income

A significant portion of our revenue is accrued as of each reporting date. As of June 30, 2011 and 2010, we had earned but un-invoiced contract revenue of $34.1 million and $33.6 million, respectively, from rendering services relating to projects that are completed or delivered but for which we had not yet invoiced the customer. We recognize un-invoiced contract revenue when all revenue recognition criteria are met. However, accrued contract receivables are not included in trade receivables until the customer is invoiced.

In 2006, we received a grant of approximately $4.5 million from the EU administered by the Ministry of Development of Greece for the development and roll-out of mobile value-added services and various e-commerce related services. In 2007, we received a grant of approximately $8.5 million from the EU administered by the Ministry of Finance for Greece for the development and roll-out of broadband value added services. In 2009, we applied for a grant from the Ministry of Development and received official acceptance of eligibility for a grant under the program. Under this grant, we are eligible to receive funds ranging from $6.0 million to $12.0 million over four years. We recognize income under these grants as it is earned as an offset to the costs and expenses reimbursed by the grants.

The amounts earned under the three grants are as follows, by grant year:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2011		2010		2011		2010
By grant year	(in thousands)
2006	$	54	$	109	$	105	$	227
2007	428		347		732		725
2009	700		339		1,329		636
	$	1,182	$	795	$	2,166	$	1,588

8

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

These amounts are offset to expense as follows:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2011		2010		2011		2010
	(in thousands)
General and administrative	$	—	$	28	$	—	$	59
Depreciation and amortization	1,182		767		2,166		1,529
	$	1,182	$	795	$	2,166	$	1,588

5. Balance Sheet Items

Details of our significant balance sheet line items consisted of the following:

Other receivables and current assets	June 30,		December 31,
	2011		2010
	(in thousands)
Notes receivable (1)	$	16,992	$	15,540
Government grant receivables	5,083		10,784
Offering proceeds receivable	21,359		—
Other receivables	19,439		1,983
Total other receivables and current assets	$	62,873	$	28,307

⁽¹⁾ Notes receivable consists of post dated checks that due to local laws are legally enforceable short-term promissory notes and have therefore been reclassified from trade receivables.

Property and Equipment	June 30,			December 31,
	2011			2010
	(in thousands)
Buildings and fixtures	$	1,046		$	861
Computer and telecommunication hardware	6,227			5,330
Office equipment	1,686			1,511
Total cost	8,959			7,702
Less: accumulated depreciation	(5,235		)	(4,449		)
Property and equipment, net	$	3,724		$	3,253

Depreciation expense was $268,000 and $325,000during the three months endedJune 30, 2011 and 2010, respectively. Depreciation expense was $551,000 and $650,000during the six months endedJune 30, 2011 and 2010, respectively.

Accrued Liabilities	June 30,		December 31,
	2011		2010
	(in thousands)
Accrued interest	$	67	$	2,053
Professional fees	1,317		2,953
Employee related accruals	2,740		6,759
Accrued third-party costs	10,934		9,373
Other	2,659		6,377
Total accrued liabilities	$	17,717	$	27,515

9

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

6. Business Combinations

Mobclix, Inc. Acquisition

On September 30, 2010, we acquired Mobclix, Inc. ("Mobclix") based in Palo Alto, CA. At closing we paid $1.1 million in cash and issued 150,220 ordinary shares, to former Mobclix stockholders and creditors, with a fair value of $1.5 million. The fair value per share of £6.12 ($9.68) was based on the closing price of our ordinary shares on AIM on the date of acquisition. We paid an additional $8.5 million in March 2011, and an additional $0.7 million in employee bonuses. In addition, we agreed to pay, on March 1, 2012, an amount contingent upon the financial performance of Mobclix between January 1 and December 31, 2011. The contingent payment, which was initially based upon Mobclix achieving certain gross profit and EBITDA targets during the period, was set at a minimum of $2.0 million and a maximum of $43.0 million, after deducting the upfront payments, and the payments made during 2011.

On May 1, 2011 we amended our agreement with Mobclix to change the terms of the contingent payment in order to facilitate our integration efforts. The terms of the amendment set the fixed portion of the contingent payment at $18.1 million. In addition, we agreed the contingent amount is now based solely upon EBITDA performance between January 1 and December 31, 2011, and has a minimum of zero and a maximum additional payment of $5.0 million. Both amounts are payable in either cash or shares at our discretion with no change in the original payment dates. On May 1, 2011, we estimated the fair value of the amended minimum deferred consideration utilizing a present value factor based on the cost of capital and the timing of the payments, which resulted in recording an additional $6.1 million of acquisition related charges. In addition, we estimated the fair value of the contingent payout utilizing an internal cash flow model based on the revised terms in the amendment and determined the fair value was zero on the amendment date.

The fair value of the amended contingent payment will continue to be remeasured on each reporting date. See disclosure of fair value measurements disclosure in Note 7.

7. Fair Value Measurements

The Company considers fair value as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market in which we would transact business in an orderly transaction on the measurement date. We consider assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

We use observable inputs whenever possible and minimize the use of unobservable inputs when measuring fair value. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect the Company’s market assumptions. The inputs are then classified into the following hierarchy: (1) Level 1 Inputs—quoted prices in active markets for identical assets and liabilities; (2) Level 2 Inputs—observable market-based inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities in active markets, quoted prices for similar or identical assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data; (3) Level 3 Inputs—unobservable inputs that are supported by little or no market activity such as certain pricing and discounted cash flow models.

Our financial assets and liabilities consist principally of cash and cash equivalents, accounts payable, accrued liabilities, current and non-current notes payable. Cash and cash equivalents are stated at cost, which approximates fair value. As of June 30, 2011 and December 31, 2010, we do not have readily marketable securities that are classified as cash equivalents. Accounts payable and accrued liabilities are carried at cost that approximates fair value due to their expected short maturities. Our long-term debt bears interest at variable rates which approximate the interest rates at which we believe we could refinance the debt. Accordingly, the carrying amount of long-term debt as of June 30, 2011 and December 31, 2010 approximates its fair value. As of June 30, 2011, we did not have any financial assets or liabilities for which Level 1 or Level 2 inputs were required to be disclosed.

The fair value of our contingent payments associated with our recent acquisitions is determined based on an internal cash flow model using inputs based on estimates and assumptions developed by us and is remeasured on each reporting date. The rates used to discount net cash flows to their present value were based on our weighted average cost of capital for similar transactions and an assessment of the relative risk inherent in the associated cash flows. The inputs were current as of the measurement date. These inputs tend to be unobservable and, as such, are considered Level 3 in the fair value hierarchy. This liability is our only Level 3 fair value measurement.

As discussed in Note 6, we determined that the fair value of the amended contingent payout to Mobclix was zero on the

10

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

amendment date.

The following table provides a summary of changes in fair value of the contingent payments measured using significant unobservable inputs (Level 3):

	Fair Value
	(in thousands)
Balance as of December 31, 2010	$	9,116
Change in fair value of contingent payment liabilities	1,174
Reclassified to deferred consideration not measured at fair value	(10,290		)
Balance as of June 30, 2011	$	—

8. Intangible Assets

Information regarding our definite-lived intangible assets is a follows:

Intangible Assets	Average Useful life	Gross Carrying Value		Accumulated Amortization		Net Carrying Amount
	(in years)	(in thousands)
June 30, 2011
Internal software development costs	3.0	$	23,621	$	14,856	$	8,765
Computer software	5.0	30,340		11,383		18,957
Licenses and intellectual property	5.0	32,210		15,955		16,255
Trademark and trade name	1.3	637		382		255
Customer relationships	4.8	5,889		1,530		4,359
Developed technology	4.6	7,134		2,260		4,874
Intangible assets	4.5	$	99,831	$	46,366	$	53,465
December 31, 2010
Internal software development costs	3.0	$	19,522	$	11,116	$	8,406
Computer software	5.0	17,821		8,331		9,490
Licenses and intellectual property	5.0	28,593		11,908		16,685
Trademark and trade name	1.3	637		127		510
Customer relationships	4.8	5,838		945		4,893
Developed technology	4.6	7,134		1,468		5,666
Intangible assets	4.4	$	79,545	$	33,895	$	45,650

Gross amortization expense was $4.9 million and $3.6 millionduring the three months endedJune 30, 2011 and 2010, respectively. Gross amortization expense was $9.4 million and $7.2 millionduring the six months endedJune 30, 2011 and 2010, respectively.

The annual estimated amortization expense for the above intangible assets as of December 31, 2010 is as follows:

	Amount
	(in thousands)
2011	$	15,437
2012	12,081
2013	8,629
2014	5,322
2015	2,564
2016 and beyond	1,617
Total	$	45,650

11

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

9. Equity Method Investments

CASEE — China — Equity Investment

We own 33% of the parent company of a Chinese mobile marketing firm called Cellphone Ads Serving E-Exchange, or CASEE. One of China's largest mobile advertising exchanges, CASEE creates an online marketplace for content publishers by serving highly targeted and personalized advertisements via the mobile internet to consumers across China for major multi-national companies. Our investment in CASEE does not restrict us from conducting business in China separate from CASEE, and there is no other relationship between us or any rights to our technology provided by us to CASEE. On May 12, 2011 we entered into a non-binding letter of intent to acquire the remaining 67% of the outstanding equity of the parent company of CASEE that we do not own and expect to complete this acquisition prior to the end of 2011.

The following table provides a summary of changes in our equity method investments:

	Carrying Value
	(in thousands)
Balance as of December 31, 2010	$	2,328
Additional equity method investments	110
Share of income from equity method investments	33
Foreign exchange differences	67
Balance as of June 30, 2011	$	2,538

10. Short-term financings and long-term debt

Our short-term financings and long-term debt outstanding as of June 30, 2011 and December 31, 2010 is classified as follows:

	June 30,			December 31,
	2011			2010
	(in thousands)
Long-term debt, net of current portion	$	436		$	19,904
Current portion of long-term debt	21,785			12,940
Short-term financings	—			38,729
Short-term debt	21,785			51,669
Total debt	22,221			71,573
Less: Carrying value of debt placement fee(1)	(258		)	(1,458		)
Total debt, net of debt placement fee	$	21,963		$	70,115

⁽¹⁾  Represents the carrying value of the 875,000 new shares issued to various parties in lieu of an arrangement fee and certain other arrangement fees incurred in connection with our term loans and revolving facility with Thor Luxembourg S.à.r.l. described below under "Debt Discounts" and arrangement fees incurred in connection with our term loan with Black Sea Trade and Development Bank.

Details of our long-term debt by facility as of June 30, 2011 are as follows:

Lender	Description / Term	Total Facility		Outstanding Amount		Interest Rate	Security/Covenant
		(in thousands)
EFG — Eurobank Ergasias	Bond loan/Due April 1, 2013	436		436		6 month Euribor + 2%	Personal guarantee
Black Sea Trade and Development Bank	Term facility due September 2015 and October 2015	21,785		21,785		3 month Euribor + 5.5%	Secured by assets of Velti SA
Total debt:		$	22,221	$	22,221

12

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

Future principal repayments under all debt arrangements as of June 30, 2010 are as follows:

	Amount
	(in thousands)
2011	$	10,893
2012	10,892
2013	436
2014	—
2015 and beyond	—
Total	$	22,221

Debt Financing

On August 31, 2010, we entered into a term loan facility with Black Sea Trade and Development Bank in the principal amount of €15.0 million (approximately $21.5 million) at an interest rate of 3 months Euribor + 6% per annum. The Black Sea facility is a senior five year term loan provided to Velti S.A., guaranteed by Velti plc and Velti Limited, and secured by a pledge on the shares of Velti S.A. and Velti Limited, and over a deposit account in which 15% of the outstanding loan balance must be maintained at all times. The loan is prepayable at our option on 30 days' prior notice, upon payment of a fee during the first two years of 2% of the principal amount being repaid, decreasing thereafter. We must maintain a net debt to operating EBITDA ratio on an annual basis of not more than 3.00 to 1; an EBIT to Net Interest Expense ratio on an annual and semi-annual basis of not less than 1.60 to 1, and a ratio of total liabilities to shareholders' equity on an annual and semi-annual basis of not more than 2.00 to 1. Included in the current portion of our long-term debt is $21.8 million due to Black Sea Trade and Development Bank. We are in discussions with this lender to repay a portion of the outstanding principle leaving a portion outstanding at modified terms.

On June 26, 2009, we entered into a facilities agreement (Facilities Agreement), as amended, with Thor Luxembourg S.à.r.L., or Thor, pursuant to which Thor advanced certain loans under three facilities, all of which were repaid in full in February 2011.

Debt Discount

We issued 875,000 new shares to various parties directed by Thor in lieu of an arrangement fee. The price per share was set at £1.605, the price of our ordinary shares on AIM at the date of the loan agreements. We recorded the value of the shares ($2.3 million) as a debt discount and are amortizing the debt discount over the 27 month term of the loan as interest expense. The remaining debt discount was charged to interest expense upon the repayment of the related Thor loans in February 2011.

Secured Borrowings and Collateralized Receivables

We have transferred certain trade receivables to financial institutions that are accounted for as secured borrowings. The transferred receivables serve as collateral under the receivable sales facilities. The carrying value of the collateralized receivables approximates the carrying value of the equivalent secured borrowings.

As of June 30, 2011, none of our accounts receivable were pledged as security against borrowings. There is a group guarantee for the term facility outstanding as of June 30, 2011 of $21.8 million. As of December 31, 2010, we had pledged $10.7 million of our accounts receivable as security against short-term loans and issued a group guarantee for the long and short-term loan of $27.5 million. The collateralized receivables are presented at their net present value. The interest rate implicit in the collateralized receivables was 6.0% as of December 31, 2010. Proceeds from and payments on the secured borrowings are presented as components of cash flows from financing activities in the consolidated statements of cash flows. Reductions of secured borrowings are recognized as financing cash flows upon payment to the financial institution and operating cash flows from collateralized receivables are recognized upon customer payment of amounts due.

The average effective interest rates to finance our borrowing facilities as of June 30, 2011 ranged from 3.5% to 7%. The average effective interest rates to finance our borrowing facilities as of December 31, 2010 ranged from 2.3% to 20%.

13

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

Interest expense related to servicing of our borrowing facilities is summarized below:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2011			2010			2011			2010
	(in thousands)
Interest expense:
Long-term bond loans	$	459		$	350		$	1,256		$	727
Short-term loans	162			543			446			749
Finance costs on factoring of receivables	429			193			821			377
Other interest costs	74			81			682			131
Accretion of debt discount and deferred purchase consideration	318			232			1,739			486
Total interest expense	1,442			1,399			4,944			2,470
Less: Interest income	(44		)	(94		)	(63		)	(103		)
Net interest expense	$	1,398		$	1,305		$	4,881		$	2,367

Debt Covenants

On December 31, 2010, we were not in compliance with a financial measurement covenant under our Facilities Agreement, as amended, with Thor. Thor, however, waived this covenant requirement through July 1, 2011. The outstanding balance was repaid in full in February 2011.

On December 31, 2010, we were also not in compliance with the ratio of total liabilities to shareholders' equity covenant under our facility with Black Sea, however with the proceeds raised from our January 2011 U.S. public offering and the subsequent repayment of short-term financing and long-term debt as noted above, the non-compliance was cured. In addition, Black Sea waived the covenant requirement through June 30, 2011. On June 30, 2011 we were in compliance with all of the covenants under this facility.

11. Income Taxes

A reconciliation between the statutory income tax rates of our country of domicile and our effective tax rates as a percentage of income (loss) before income taxes is as follows:

	For the Six Months Ended June 30,
	2011			%
	(in thousands, except percentages)
Tax at country of domicile statutory rate	$	(4,681	)	(12.5	)%
Foreign earnings at other than country of domicile statutory rates	120			0.3
Unrecognized tax benefits	2,444			6.5
Rate changes	(250		)	(0.7	)
Permanent items	3,489			9.3
Other	1,930			5.2
Valuation allowance	(94		)	(0.2	)
	$	2,958		7.9	%

The foreign differential presented in the above rate reconciliation schedule is comprised of the difference between the statutory rate of our country of domicile and the local foreign tax rate for each tax jurisdiction where we conduct business, multiplied by the adjusted taxable earnings or losses of our foreign operations.

The increase in valuation allowance was $94,000 during the six months endedJune 30, 2011. We had total net operating losses of $80.3 million and $71.8 million as of June 30, 2011 and December 31, 2010, respectively. These net operating losses carryforward are available to offset taxable income in the future and will expire in years 2012 through 2030.

We periodically evaluate the realizability of the deferred tax assets and recognize the tax benefit only as reassessment demonstrates that they are realizable. At such time, if it is determined that it is more likely than not that the deferred tax assets are realizable, the valuation allowance will be adjusted. As of June 30, 2011, management has determined that $6.4 million of

14

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

deferred tax assets should be realizable in the future. A valuation allowance of $7.1 million was recorded in Ireland and other significant foreign subsidiaries.

We have not provided for Ireland income taxes on the $60.5 million foreign unremitted earnings which are expected to be

invested outside Ireland indefinitely. In the unlikely event of a distribution of those earnings at some point in the future, we would be subject to Ireland income taxes and withholding taxes payable to the foreign countries where the foreign operations are located. The amount of unrecognized deferred income tax liability on those earnings would not be material to the financial

statements due to anticipated use of a participation exemption in the Ireland in the amount of remitted earnings, as well as the

ability to utilize Ireland tax net operating losses and foreign tax credits to offset income taxes.

A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows:

	(in thousands)
Balance as of December 31, 2010	$	9,545
Gross increases — current period tax positions	3,073
Gross decreases — current period tax positions	(628		)
Balance as of June 30, 2011	$	11,990

Our policy for deducting interest and penalties is to treat interest as interest expense and penalties as taxes. As of June 30, 2011, we had $1 million accrued for the payment of interest and penalties related to unrecognized tax benefits we do not believe that the total amount of unrecognized tax benefits will significantly change within the next 12 months.

12. Commitments and Contingencies

Operating Lease Commitments

The future aggregate minimum lease payments under non-cancellable operating leases as of December 31, 2010 are as follows:

	Amount
	(in thousands)
2011	$	2,756
2012	2,602
2013	2,324
2014	1,568
2015	901
Thereafter	2,767

Rent expense was $749,000 and $641,000 during during the three months endedJune 30, 2011 and 2010, respectively. Rent expense was $1.5 million and $1.3 millionduring the six months endedJune 30, 2011 and 2010, respectively.

Guarantees and Indemnifications

We periodically establish irrevocable bank guarantees in favor of a customer in connection with a campaign guaranteeing minimum net revenue or covering costs of a campaign. As of June 30, 2011 and December 31, 2010, the aggregate amount of our outstanding commitments under such letters of guarantee was $1.5 million and $1.1 million, respectively. We accrue for known obligations when a loss is probable and can be reasonably estimated. There were no accruals for expenses related to our performance guarantees for any period presented.

As permitted under the laws of the Bailiwick of Jersey and the Republic of Ireland, and in accordance with our bylaws, we indemnify our officers and directors for certain events or occurrences, subject to certain limits, while the officer or director is or was serving at our request in such capacity. The maximum amount of potential future indemnification is unlimited; however, we maintain director and officer liability insurance that limits our exposure and may enable us to recover a portion of any future amounts paid. We believe the fair value for these indemnification obligations is immaterial. Accordingly, we have not recognized any liabilities relating to these obligations as of June 30, 2011 and December 31, 2010.

Pension and Other Post-Retirement Obligations

We are required under Greek law to make a payment to employees on unfair dismissal or on attaining normal retirement age.

15

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

The amount of the payment depends on the employees' monthly earnings (capped at €6,000 per month, or approximately $8,200) and a multiple which depends on length of service. The most recent independent actuarial valuation was carried out as of December 31, 2010. As of June 30, 2011, our retirement benefits obligations were wholly unfunded.

The benefits expected to be paid under the plan in the next ten years, as of December 31, 2010 are as follow:

	Amount
	(in thousands)
2011	$	80
2012	96
2013	115
2014	138
2015	166
2016 to 2020	1,114

Legal Proceedings

We are involved in various claims and litigation arising in the normal course of business. While the outcome of these matters is uncertain and there can be no assurance that such matters will be resolved in our favor, we do not currently believe that the outcome of any pending or threatened proceedings related to these or other matters, or the amounts which we may be required to pay by reason thereof, would have a material adverse impact on our financial position, results of operations or liquidity.

13. Share-Based Compensation

We have historically granted deferred share awards to our employees as part of our compensation package. In 2009, we began granting share options to our employees and consultants in addition to deferred share awards. We also award ordinary shares as compensation to our non-executive directors in lieu of cash payments for their service as members of the board. Beginning in 2010 these awards vest over a one year period.

Under our share incentive plans, shares are issued to a participant when the deferred share award vests in accordance with any vesting schedule specified in the award agreement following receipt of payment of the aggregate nominal (par) value of £0.05 per ordinary share. The deferred share award recipient is responsible for all applicable taxes payable on the award. Historically, our deferred share awards have vested on the second anniversary of the date of grant, based upon achievement of performance metrics as well as a minimum service period. Beginning in 2010, our deferred share awards typically vest over four years, contingent on continued service to the company at each vesting date. A portion of the deferred share awards granted to our executive officers, representing shares paid in lieu of cash compensation, vest over one year. All of our share options have an exercise price equal to the market price of our ordinary shares on the date of grant. Our share options typically vest over a four-year period at the rate of 25% per year on the anniversary of the date of grant, although during 2010 we awarded a number of share options that vest on the one year anniversary of the date of grant, subject to the completion of our public offering in the U.S. prior to the vesting date. We also periodically award share options or deferred share awards to consultants that vest over a two year period.

Deferred Share Awards

Details of our deferred share awards are as follows:

	Number of Shares		Weighted Average Exercise Price Per Share		Weighted Average Grant Date Fair Value Per Share		Weighted Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value (in thousands)
Outstanding as of December 31, 2010	2,055,984		$	0.08
Share awards granted	1,119,686		$	0.08	$	12.76		$	14,282
Forfeited	(182,474	)	$	0.08
Vested deferred share awards	(1,250,356	)	$	0.08				$	22,569
Outstanding as of June 30, 2011	1,742,840		$	0.08			1.89	$	28,850

For deferred share awards, the fair value on the date of grant approximates market value as the exercise price equals the nominal (par) value of £0.05 (remeasured into US Dollars on grant date) per ordinary share. The aggregate estimated grant date fair value

16

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

therefore approximates the intrinsic value disclosed in the table above.

Stock Options

Details of stock option activity are as follows:

	Number of options		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value Per Share		Weighted Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value (in thousands)
Outstanding as of December 31, 2010	3,492,820		$	5.01
Share options granted	1,123,505		$	12.82	$	7.40
Forfeited share options	(214,366	)	$	5.45
Exercised options	(63,357	)	$	3.58				$	260
Outstanding as of June 30, 2011	4,338,602		$	7.03			8.98	$	42,940

There were 39,250 share options granted to non-employees of Velti, which are included in the table above. The fair value of these options is remeasured at each reporting date utilizing the share price at that time.

The aggregate estimated grant date fair value for options granted to employees was $1.6 million and $8.3 millionduring the three months endedJune 30, 2011 and 2010, respectively. The aggregate estimated grant date fair value for options granted to employees was $8.3 million and $8.7 millionduring the six months endedJune 30, 2011 and 2010, respectively.

The following table summarizes information regarding our outstanding and exercisable options as of June 30, 2011:

	Outstanding				Exercisable
Range of Exercise Prices	Number of Option Shares	Weighted-Average Exercise Price per Share		Remaining Weighted-Average Contractual Term (Years)	Number of Option Shares	Weighted-Average Exercise Price Per Share		Aggregate Intrinsic Value
$2.57 - $4.69	573,656	$	2.68	8.09	124,172	$	2.68
$4.95 - $4.95	2,241,334	$	4.95	8.84	757,155	$	4.95
$6.26 - $9.64	417,036	$	8.81	9.00	22,510	$	6.61
$12.10 - $12.10	868,673	$	12.10	9.69	—	$	—
$12.59 - $18.47	237,903	$	15.51	9.82	—	$	—
	4,338,602	$	7.03	8.98	903,837	$	4.68	$	11,054

The fair value of our share options was estimated at the date of grant using the Black-Scholes model with the following assumptions:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2011		2010		2011		2010
Share Options Valuation Assumptions
Expected volatility	60	%	60	%	60	%	60	%
Expected life in years	6.25		6.25		6.25		6.25
Risk free rate	2.5	%	2.5	%	2.5	%	2.5	%
Expected dividends	—	%	—	%	—	%	—	%

For share options, as we do not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment behavior, we estimate the expected term of options granted by taking the average of the vesting term and the contractual term of the options, referred to as the simplified method. We estimate the expected term of our share options using a blended volatility factor, which consists of our own share volatility from our trading history on AIM and expected future volatility. The risk-free interest rate assumption is based upon observed interest rates appropriate for the expected term of the deferred share award or share option. Expected dividends during the term of the options are based on our dividend policy. To date, no dividends have been declared or paid and none are expected to be declared or paid during the

17

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

expected term. We estimated the forfeiture rate based on historical and anticipated levels of personnel turnover.

During the three and six months ended June 30, 2011 and 2010 we recognized total share-based payment expense under equity incentive plans for our employees as follows:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2011		2010		2011		2010
	(in thousands)
Datacenter and direct project	$	1,751	$	106	$	2,379	$	173
General and administrative	5,367		498		8,611		722
Sales and marketing	4,019		679		5,895		1,164
Research and development	1,889		199		2,703		348
	$	13,026	$	1,482	$	19,588	$	2,407

Share-based compensation expense for consultants and advisors was $265,000 and $91,000during the three months endedJune 30, 2011 and 2010, respectively. Share-based compensation expense for consultants and advisors was $473,000 and $105,000during the six months endedJune 30, 2011 and 2010, respectively. These amounts are included in general and administrative expenses on the accompanying consolidated statements of operations.

There was no recognized tax benefit recorded during the three and six months ended June 30, 2011 and 2010 related to share-based compensation expense. As of June 30, 2011, there was $10.9 million of total unrecognized compensation expense related to deferred share awards awarded under our share incentive plans expected to be recognized over a weighted-average recognition period of 1.9 years. As of June 30, 2011, there was $9.0 million of total unrecognized compensation expense related to share options expected to be recognized over a weighted-average recognition period of 1.8 years.

In March 2011, certain performance based deferred share awards granted to employees in 2009 were approved for vesting. The performance metrics of these awards were set at the time of grant based on then current projections of company performance under IFRS for 2009 and 2010. These metrics did not contemplate our conversion to US GAAP, the impact of acquisitions completed during 2009 and 2010, or the impact on our results of preparing for and completing our US public offering. Due to the judgment required to reconcile actual company performance with the original metrics, it was determined that any vesting would be required to be treated as a modification under the guidance in ASC 718. This required the fair value of the awards to be remeasured on the vesting approval date, with the incremental fair value charged to expense over the remaining vesting period. As a result, we recognized additional compensation expense of approximately $7.2 million and $10.5 million during the three and six months ended June 30, 2011, respectively.

In May 2010, we allowed for the vesting of certain deferred share awards granted to employees in 2008 that would not have vested under the original terms. As a result of this modification, we recognized additional compensation expense of approximately $1.1 million during the three and six months ended June 30, 2010.

14. Net Loss Per Share

Basic net loss per share is calculated by dividing the loss attributable to equity holders by the weighted average number of ordinary shares outstanding during the year. Diluted net loss per share is computed by including all potentially dilutive ordinary shares, deferred share awards and share options. For the three and six months ended June 30, 2011 and 2010, deferred share awards and share options were not included in the computation of diluted net loss per share because the effect would have been antidilutive. The following table presents the calculation of basic and diluted loss per share:

18

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2011			2010			2011			2010
	(in thousands, except per share data)
Net loss attributable to Velti	$	(25,076	)	$	(6,387	)	$	(40,948	)	$	(11,610	)
Weighted average number of ordinary shares outstanding	53,047			37,704			50,073			37,617
Plus: Incremental dilutive deferred share awards and share options	—			—			—			—
Weighted average number of ordinary shares including dilutive effect of outstanding share awards and options	53,047			37,704			50,073			37,617
Net loss per share attributable to Velti:
Basic	$	(0.47	)	$	(0.17	)	$	(0.82	)	$	(0.31	)
Diluted	$	(0.47	)	$	(0.17	)	$	(0.82	)	$	(0.31	)

15. Related Party Transactions

Related Party Debt

Included among the participants advancing funds pursuant to the Thor Facilities Agreement was Nicholas Negroponte, one of the members of our board of directors, in the amount of $500,000. The Thor loans were repaid in full in February 2011.

Transactions with Equity Method Investments

Velti Center for Innovation S.A. Velti Center for Innovation, a wholly‑owned subsidiary of ours, or VCI, was incorporated for the sole purpose of participating in the EU sponsored program active from 2004 to 2008, which is administered by the General Secretariat of Research and Development of Greece. Under this agreement, VCI was established to develop start up enterprises in Greece to develop innovative technologies that will be served by a common architecture. The enterprises include Amplus S.A., Evorad S.A., Tagem S.A., mPoint S.A. and N‑Squared S.A. During 2010, 2009 and 2008 we had the following transactions with these related parties.

We eliminate unrealized gains and losses on transactions between us and our equity method investments. US GAAP requires these eliminations; however where they are eliminated is based on the facts and circumstances of the transactions. We have elected to record these gains or losses as non-operating loss from equity method investments based on the nature of the transactions, which is one of the acceptable methods. This resulted in an additional gain from equity method investments of $200,000 during the three months ended June 30, 2011 and an additional loss from equity method investments of $1.3 million for the six months ended June 30, 2011. There were no such transactions during the three and six months ended June 30, 2010.

We had the following transactions with related parties during the three and six months ended June 30, 2011 and 2010.

Amplus S.A.

Chris Kaskavelis, our Chief Operating Officer, and Menelaos Scouloudis, our Chief Commercial Officer, are members of the board of Amplus S.A. VCI S.A. holds 21.7% of the share capital of Amplus S.A.

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2011		2010		2011		2010
	(in thousands)
Sales to Amplus S.A.	$	880	$	—	$	1,496	$	—
Invoiced to Amplus S.A. for services rendered	$	6	$	17	$	19	$	35
Purchases from Amplus S.A.	$	14	$	—	$	47	$	18

19

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

	June 30,		December 31,
	2011		2010
	(in thousands)
Trade receivables from Amplus S.A.	$	503	$	—
Accrued and other receivables from Amplus S.A.	$	864	$	—
Trade payables to Amplus S.A.	$	164	$	360

Tagem S.A.

VCI S.A. holds one‑half of the share capital of Tagem S.A.

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2011		2010		2011		2010
	(in thousands)
Sales to Tagem S.A.	$	—	$	598	$	—	$	702
Invoiced to Tagem S.A. for services rendered	$	—	$	—	$	16	$	15
Purchases from Tagem S.A.	$	501	$	—	$	2,152	$	—

	June 30,		December 31,
	2011		2010
	(in thousands)
Trade receivables from Tagem S.A.	$	—	$	1,383
Accrued and other receivables from Tagem S.A.	$	—	$	—
Trade payables to Tagem S.A.	$	—	$	—

Digital Rum S.A.

VCI S.A holds one-half the share capital of Digital Rum S.A.

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2011		2010		2011		2010
	(in thousands)
Sales to Digital Rum S.A.	$	511	$	834	$	951	$	1,139
Invoiced to Digital Rum S.A. for services rendered	$	10	$	9	$	10	$	9
Purchases from Digital Rum S.A.	$	141	$	655	$	3,025	$	655

	June 30,		December 31,
	2011		2010
	(in thousands)
Trade receivables from Digital Rum S.A.	$	516	$	2,300
Accrued and other receivables from Digital Rum S.A.	$	500	$	—
Trade payables to Digital Rum S.A.	$	—	$	101

N-Squared S.A.

Chris Kaskavelis, our Chief Operating Officer, is a member of the board of N‑Squared S.A. VCI holds one-half of the share capital of N-Squared S.A. We did not have any significant transactions with N-Squared during the periods presented.

Evorad S.A.

VCI S.A. holds 49% of the share capital of Evorad S.A. We did not have any significant transactions with Evorad during the periods presented. We had $726,000 and $501,000 in other receivables from Evorad as of June 30, 2011 and December 31, 2010, respectively.

20

Velti, plc

Notes to Consolidated Financial Statements (unaudited) (continued)

CASEE

In connection with signing the letter of intent to purchase the remaining outstanding equity interest of CASEE, we provided CASEE with a $500,000 loan to fund working capital needs prior to the completion of the acquisition. This is included in other receivables as of June 30, 2011.

16. Subsequent Events

On June 30, 2011 the underwriters of our June 2011 US public offering exercised their over-allotment option, resulting in the issuance of 1,474,245 additional ordinary shares and net proceeds of $21.4 million. This amount has been included in other current receivables and the issuance of the shares has been reflected as of June 30, 2011 in the accompanying condensed consolidated financial statements. The proceeds were received in July.

We have evaluated subsequent events for recognition or disclosure through the date on which the accompanying consolidated financial statements being presented were issued as part of this filing, and not beyond that date.

21

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The discussion in our MD&A contains forward‑looking statements that reflect our current expectations and views of future events. These forward‑looking statements can be identified by words or phrases such as “shall,” “may,” “will,” “expect,” “should,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to” or other similar expressions. These forward‑looking statements include, among other things, statements relating to our goals and strategies, our competitive strengths, our expectations and targets for our results of operations, our business prospects and our expansion strategy. We have based these forward‑looking statements largely on current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Although we believe that we have a reasonable basis for each forward‑looking statement, we caution shareholders that these statements are based on our projections of the future that are subject to known and unknown risks and uncertainties and other factors that may cause our actual results, level of activity or performance expressed or implied by these forward‑looking statements, to differ.

The forward‑looking statements included in our MD&A are subject to risks, uncertainties and assumptions about our company. Our actual results of operations may differ materially from the forward‑looking statements as a result of risk factors described under “Risk Factors” in our 2010 Form 20-F, including, among other things, our ability to:

• manage evolving pricing models in our business, which are primarily based on software as a service;

• keep pace with technological developments and compete against potential new entrants, who may be much larger and better funded;

• resolve the material weaknesses in our internal control over financial reporting;

• achieve the anticipated benefits of our acquisitions;

• continue our global business while expanding into new geographic regions;

• benefit from expected growth in general in the market for mobile marketing and advertising services;

• retain existing customers and attract new ones;

• protect our intellectual property rights; and

• comply with new and modified regulations in the jurisdictions in which we conduct business.

These risks are not exhaustive. We operate in an evolving environment and new risk factors emerge from time to time. It is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause our actual results to differ materially from those contained in any forward‑looking statement.

An investor in our ordinary shares should not rely upon forward‑looking statements as predictions of future events. Unless required by law, we undertake no obligation to update or revise any forward‑looking statements to reflect new information or future events or otherwise.

Market data and industry statistics used throughout this MD&A are based on independent industry publications and other publicly available information. We believe these sources of information are reliable and that the information fairly and reasonably characterizes our industry. Although we take responsibility for compiling and extracting the data, we have not independently verified this information.

Overview

We are a leading global provider of mobile marketing and advertising technology that enables brands, advertising agencies, mobile operators and media companies to implement highly targeted, interactive and measurable campaigns by communicating with and engaging consumers via their mobile devices. Our platform allows our customers to use mobile media, together with traditional media, such as television, print, radio and outdoor advertising, to reach targeted consumers, engage consumers through the mobile Internet and applications, convert consumers into their customers and continue to actively manage the relationship through the mobile channel.

We believe our integrated, easy-to-use, end-to-end software platform is the most extensive mobile marketing and advertising campaign management platform in the industry. Our platform further enables brands, advertising agencies, mobile operators and media companies to plan, execute, monitor and measure mobile marketing and advertising campaigns in real time throughout the campaign lifecycle. We generate revenue from our software as a service (SaaS) model, from licensing our software to customers and from providing managed services to customers.

Velti mGage provides a one-stop-shop where our customers may plan marketing and advertising campaigns. They also can select advertising inventory, manage media buys, create mobile applications, design websites, build mobile CRM campaigns and track performance across their entire campaign in real-time. In addition, our proprietary databases and analytics platforms, including those we have acquired recently, are able to process, analyze and optimize more than 2.5 billion new data facts daily.

22

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

On a trailing twelve month basis, total revenues have grown from $129.6 million for the twelve months ended March 31, 2011 to $142.0 million for the twelve months ended June 30, 2011. Our revenue for the three months and six months ended June 30, 2011 was $34.4 million and $63.9 million, respectively. For the three and six months ended June 30, 2010, our revenue was $21.9 million and $38.2 million, respectively. This represents an increase of 57% and 67% from the three and six months ended June 30, 2010, respectively.

We have been able to grow our business by expanding our sales and marketing activities in order to respond to the opportunities presented by the emergence of the mobile device as a principal interactive channel for brands, advertising agencies, mobile operators and media companies to reach consumers. In addition, the growth in mobile marketing and advertising is further driven by the continued growth of wireless data subscribers, the proliferation of mobile devices, smartphones and advanced wireless networks, and the increased usage of mobile content, applications and services. Smartphones offer access to features previously available only on PCs, such as Internet browsing, email and social networking, and accordingly are gaining importance as a separate platform. Increasingly, brands and advertising agencies are recognizing the unique benefits of the mobile channel and they are seeking to maximize its potential by integrating mobile media within their overall advertising and marketing campaigns. Our platform allows our customers to focus on campaign strategy, creativity and media efficiency without having to worry about the complexity of implementing mobile marketing and advertising campaigns globally.

We believe that our continued growth depends upon our ability to maintain our technology leadership as well as our ability to maintain existing, and develop new relationships with brands, advertising agencies, mobile operators and media companies in both developed and emerging markets. In addition, we expect our growth to be dependent upon the increased adoption of our Velti mGage platform. We continue to invest in infrastructure required to manage our growth, expand our customer base globally and increase our presence in new markets, resulting in capital expenditures of $16.3 million for the six months ended June 30, 2011.

Although our growth historically has been driven by revenue from our mobile operator customers, it is increasingly being driven by our advertising agency and brand customers. We expect that this trend will continue as we focus our marketing efforts on greater penetration of advertising agencies and directly with brand customers and as our customers increase their reliance on mobile marketing and advertising as part of their overall marketing and advertising strategy. We have also grown our business through geographic expansion and by acquisition, and expect to continue to enter into new markets in order to both support our current and prospective customers and to expand our business.

As part of our growth by acquisition, in 2010 we acquired Mobclix, Inc., a California‑based targeted mobile exchange and open marketplace for advertising agencies, ad networks and brands to manage ad inventory and increase campaign performance. Following this acquisition, we launched the Velti mGage Exchange, which we believe is the first global mobile media exchange. The Velti mGage Exchange provides advertising agencies, ad networks and brands with greater flexibility, transparency and optimization of their mobile ad campaigns. mGage Exchange consists of white label exchanges, which are private marketplaces where agencies can work directly and discreetly with tier one publishers and ad networks, as well as the Mobclix and CASEE public exchanges. mGage Exchange enables targeted ad delivery based on content relevancy as well as streamlined campaign planning, allowing media buyers to organize ad buys based on price and specific target audiences.

Our business, as is typical of companies in our industry, is seasonal. This is primarily due to relatively heavy traditional marketing and advertising spending occurring during the holiday season and in part because brands, advertising agencies, mobile operators and media companies often close out annual budgets towards the end of a given year. Seasonal trends have historically contributed to, and we anticipate will continue to contribute to, fluctuations in our quarterly results, including fluctuations in sequential revenue growth rates.

Some of our business is in emerging markets where payment terms on amounts due to us may be longer than on our contracts with customers in other markets. Our days sales outstanding (DSOs) is calculated based on trade receivables, which includes only amounts invoiced as of the balance sheet date. Our DSOs have historically decreased during the first and second quarters, and increased during the third and fourth quarters, due to the seasonal nature of our business. DSOs based on trailing 12 months' revenue were 79 as of June 30, 2011 compared to 113, 121 and 131 as of March 31, 2011, December 31, 2010 and 2009, respectively. We have historically collected substantially all amounts due from our customers, even from those customers with balances with longer aging, as evidenced by our insignificant bad debt expense for 2010, 2009 and 2008.

As our revenue mix changes in the future to a greater percentage of revenue from North America and Asia, where there is generally a shorter payment cycle, we expect our DSOs to continue to improve. In addition, we continue to increase collection efforts worldwide, which we expect will enhance our ability to decrease DSOs in future periods.

23

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

We raised $134.1 million from the sale of 12,500,000 ordinary shares in connection with our January 2011 U.S. public offering and $136.7 million from the sale of an additional 9,474,275 ordinary shares in connection with our June 2011 follow on offering in the U.S. We used $48.2 million to repay outstanding debt as of June 30, 2011 and plan to repay an additional $10.0 million during the quarter ended September 30, 2011. We also used $8.5 million to fund a portion of the deferred consideration related to the Mobclix acquisition.

The trend of increasing SaaS revenue both in terms of absolute dollars and as a percentage of total revenue has continued in 2011, as we have increasingly focused our efforts on selling our flexible pricing SaaS solution. For the three and six months ended June 30, 2011, our SaaS revenue represented $27.6 million or 80% and $50.8 million or 79%, respectively of our total revenue of $34.4 million and $63.9 million, respectively. This is compared to $13.8 million or 63% and $21.4 million or 56% for the three and six months ended June 30, 2010, respectively. We expect that our SaaS revenue will continue to increase both in absolute dollars and as a percentage of total revenue as our customers continue to seek more flexible pricing models that better address their marketing and advertising needs, and we are therefore able to derive increased transaction‑based and performance‑based SaaS revenue.

Components of Results of Operations

Revenue

We derive our revenue from customers who use our platform to create, execute and measure mobile marketing and advertising campaigns. Our contracts predominantly range from one to three months, or for the duration of a mobile marketing or advertising campaign. Our platform is based upon a modular, distributed architecture, allowing our customers to use the whole or any part of the functionality of the platform, depending upon the needs of each campaign. Our fees vary by contract, depending upon a number of factors, including the scope of the services that we provide to the campaign, and the range of Velti mGage functionality deployed by the customer. For our engagements with brands, our contracts may be directly with the brand, or with an advertising agency who manages the mobile marketing or advertising campaign on a brand's behalf.

We generate revenue as follows:

▪ Software as a Service (SaaS) Revenue: Fees from customers who subscribe to our hosted mobile marketing and advertising platform, generally referred to as “usage‑based” services, and fees from customers who utilize our software solutions to measure the progress of their transaction‑based mobile marketing and advertising campaigns, generally referred to as “performance‑based” services.

Our SaaS revenue includes both usage‑based fees and performance‑based fees. Usage‑based fees include subscription fees for use of individual software modules and our automated mobile marketing campaign creation templates, and fees charged for access to our software platform. Performance‑based fees are variable fees based on specified metrics, typically relating to the number of transactions performed or number of text messages generated during the campaign multiplied by the cost per transaction or response in accordance with the terms of the related contract. Representative metrics our customers can use to measure the success of their campaigns include, but are not limited to: growth in their customer base; increased revenue in the aggregate or per-consumer; number of transactions, such as the number of messages carried, the number of coupons redeemed, or the total number of ad impressions delivered; reduced consumer churn; or consumer response, such as joining a community site or reward program.

▪ License and Software Revenue: Fees from customers who license our mobile marketing and advertising platform provided on a perpetual license and fees for customized software solutions delivered to and installed on the customers' server, including fees to customize the platform for use with different media used by the customer in a campaign.

▪ Managed Services Revenue: Fees charged to customers for professional services related to the implementation, execution and monitoring of customized mobile marketing and advertising solutions.

The fees associated with our managed services revenue are typically paid over a fixed period corresponding with the duration of the campaign or the consumer acquisition and retention program. An initial, one-time setup fee may also be charged for the development of mobile marketing and advertising campaigns, applications or CRM programs and services.

In addition to the fees described above, we may also charge fees to procure third‑party mobile and integrated advertising services, such as content, media booking and direct booking across multiple mobile advertising networks on behalf of our customers.

Due to the nature of the services that we provide, our customer contracts may include service level requirements that may require us to pay financial penalties if we fail to meet the required service levels. We recognize any such penalties, when incurred, as a reduction to revenue.

24

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Costs and Expenses

We classify our costs and expenses into seven categories: third‑party, datacenter and direct project, general and administrative, sales and marketing, research and development, acquisition related charges, and depreciation and amortization. We charge share‑based compensation expense resulting from the amortization of the fair value of deferred share and share option grants to each employee's principal functional area. We allocate certain facility‑related and other common expenses such as rent, office and information technology to functional areas based on headcount.

Third‑Party Costs. Our third‑party costs are fees that we pay to third parties to secure advertising space or content, or to obtain media inventory for the placement of advertising and media messaging services, primarily in connection with mGage Exchange, as well as fees paid to third parties for creative development and other services in connection with the creation and execution of marketing and advertising campaigns. Third‑party costs also include the costs of certain content, media, or advertising that we acquire for a campaign, and costs associated with incentives and promotional items provided to consumers in order to participate in the campaigns as well as certain computer hardware or software that we might acquire for a customer. Third‑party costs also include costs paid to third parties for technology and local integration that is not performed by our personnel and primarily relate to our SaaS revenue. On SaaS revenue other than from mGage Exchange, we may incur third‑party costs in advance of the revenue recognized on the campaigns to which such costs relate. On SaaS revenue from mGage Exchange, we incur third‑party costs at the time we recognize revenue. Additionally, SaaS revenue generated by mGage Exchange typically incurs higher third‑party costs than our mobile marketing SaaS revenue.

Datacenter and Direct Project Costs. Datacenter and direct project costs consist primarily of personnel and outsourcing costs for operating our datacenters, which host our Velti mGage platform on behalf of our customers. Additional expenses include costs directly attributable to specific campaigns as well as allocated facility rents, power, bandwidth capacity, IT maintenance and support. In addition, direct project costs include personnel costs to customize our software solutions for specific customer contracts.

General and Administrative Expenses. Our general and administrative, or G&A, expenses primarily consist of personnel costs for our executive, finance and accounting, legal, human resource and information technology personnel. Additional G&A expenses include consulting and professional fees and other corporate and travel expenses. We expect that our G&A expenses will increase in absolute dollars as we grow our company, add personnel and build the necessary infrastructure to support our growth. In addition, G&A expenses are expected to increase as a result of increased audit fees, increased directors' and officers' insurance costs, legal fees and other costs of a U.S. public company, including the costs to comply with the Sarbanes‑Oxley Act and related regulations.

Sales and Marketing Expenses. Our sales and marketing expenses primarily consist of salaries and related costs for personnel engaged in sales and sales support functions, customer services and support, as well as marketing and promotional expenditures. Marketing and promotional expenditures include the direct costs attributable to our sales and marketing activities, such as conference and seminar hosting and attendance, travel, entertainment and advertising expenses. In order to continue to grow our business, we expect to continue to commit resources to our sales and marketing efforts, and accordingly, we expect that our selling expenses will increase in future periods as we continue to expand our sales force in order to add new customers, expand our relationship with existing customers and expand our global operations. While sales and marketing expenses will increase in absolute dollars, we expect the expenses as a percentage of revenue to decline as we grow revenue.

Research and Development. Research and development expenses consist primarily of personnel‑related expenses including payroll expenses, share‑based compensation and engineering costs related principally to the design of our new products and services.

Depreciation and Amortization. Depreciation and amortization expenses consist primarily of depreciation on computer hardware and leasehold improvements in our datacenters, amortization of purchased intangibles and of our capitalized software development costs and amortization of purchased intangibles, offset by allocation of government grant income.

Acquisition Related Charges. Acquisition related charges consist primarily of changes in the fair value of contingent payments for acquisitions.

Interest Expense

Interest expense includes interest we incur as a result of our borrowings and factoring obligations. For a description of our borrowing and factoring obligations see Note 10 to notes to consolidated financial statements. During the six months ended June 30, 2011 we repaid $53.2 million of the debt outstanding as of December 31, 2010. We anticipate that this repayment of debt will reduce our interest expense significantly in future periods.

25

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Gain (Loss) from Foreign Currency Transactions

The financial statements of our foreign subsidiaries have been translated into U.S. dollars from their local currencies by translating all assets and liabilities at period-end exchange rates. Income statement items are translated at an average exchange rate for the period. Translation adjustments are not included in determining net income (loss), but are accumulated and reported as a component of shareholders' equity as accumulated other comprehensive income. Realized and unrealized gains and losses which result from foreign currency transactions are included in determining net income (loss), except for intercompany foreign currency transactions that are of a long-term investment nature, for which changes due to exchange rate fluctuations are accumulated and reported as a component of shareholders' equity as accumulated other comprehensive income.

As some of our assets, liabilities and transactions are denominated in euro, British pounds sterling, Russian ruble, Bulgarian lev, Ukrainian hyrvnia, Indian rupee, and Chinese yuan, the rate of exchange between the U.S. dollar and other foreign currencies continues to impact our financial results. Fluctuations in the exchange rates between the U.S. dollar and other functional currencies of entities consolidated within our consolidated financial statements may affect our reported earnings or losses and the book value of our shareholders' equity as expressed in U.S. dollars, and consequently may affect the market price of our ordinary shares. We do not hedge our foreign currency transactions, which are primarily accounts receivable and accounts payable.

Loss from Equity Method Investments

Our equity method investments include all investments in entities over which we have significant influence, but not control, generally including a beneficial interest of between 20% and 50% of the voting rights. Our share of our equity method investments' post acquisition profits or losses is recognized in the consolidated statement of operations. For a discussion of our equity method investments see Note 9 to notes to consolidated financial statements.

Income Tax Expense

We are subject to tax in jurisdictions or countries in which we conduct business, including the U.K., Greece, Cyprus, Bulgaria, and the U.S. Earnings are subject to local country income tax and may be subject to current income tax in other jurisdictions.

Our deferred income tax assets represent temporary differences between the financial statement carrying amount and the tax basis of existing assets and liabilities that will result in deductible amounts in future years, including net operating loss carry‑forwards. Based on estimates, the carrying value of our net deferred tax assets assumes that it is more likely than not that we will be able to generate sufficient future taxable income in certain tax jurisdictions. Our judgments regarding future profitability may change due to future market conditions, changes in U.K. or international tax laws and other factors.

Geographic Concentration

We conduct our business primarily in three geographical areas: Europe, Americas, and Asia/Africa. The following table provides revenue by geographical area. Revenue from customers for whom we provide services in multiple locations is allocated according to the location of the respective customer's domicile. Revenue from customers for whom we provide services in a single or very few related locations is allocated according to the location of the respective customer's place of operations.

	For the Three Months Ended June 30,								For the Six Months Ended June 30,
Revenue:	2011				2010				2011				2010
	(in thousands, except percentages)
Europe:
United Kingdom	$	4,707	13.7	%	$	6,444	29.4	%	$	11,681	18.3	%	$	12,152	31.8	%
Russia	940		2.7	%	6,231		28.4	%	1,876		2.9	%	8,314		21.8	%
Greece	3,209		9.3	%	2,947		13.4	%	5,489		8.6	%	3,953		10.4	%
All other European countries	11,419		33.2	%	2,829		12.9	%	20,000		31.3	%	6,040		15.8	%
Total Europe	20,275		59.0	%	18,451		84.1	%	39,046		61.1	%	30,459		79.8	%
Americas	7,361		21.4	%	297		1.4	%	15,513		24.3	%	657		1.7	%
Asia/Africa	6,722		19.6	%	3,181		14.5	%	9,349		14.6	%	7,044		18.5	%
Total revenue	$	34,358	100.0	%	$	21,929	100.0	%	$	63,908	100.0	%	$	38,160	100.0	%

26

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

We expect to continue to expand outside of Europe and anticipate that our geographic revenue concentration in Europe as a whole will decrease as a percentage of our total revenue as we continue to expand our footprint in the Americas, Asia and Africa. See Note 11 to notes to consolidated financial statements for a discussion of the geographic concentration of our pre-tax income (loss).

Customer Concentration

There were no customers that accounted for 10% or more of our revenues for the three and six months ended June 30, 2011. Three customers accounted for 39% of our revenue in the aggregate for the three months ended June 30, 2010 with each customer individually accounting for more than 10%. There were no customers that accounted for 10% or more of our revenues for the six months ended June 30, 2010.

Critical Accounting Policies and Significant Judgments and Estimates

Our Consolidated Financial Statements are prepared in conformity with U.S. generally accepted accounting principles. In preparing our Consolidated Financial Statements, we make assumptions, judgments and estimates that can have a significant impact on amounts reported in our Consolidated Financial Statements. We base our assumptions, judgments and estimates on historical experience and various other factors that we believe to be reasonable under the circumstances. Actual results could differ materially from these estimates under different assumptions or conditions. We regularly reevaluate our assumptions, judgments and estimates. Our significant accounting policies are described in Note 2, “Basis of Presentation and Summary of Significant Accounting Policies,” in the Notes to Consolidated Financial Statements in our 2010 Form 20-F. In addition, we highlighted those policies that involve a higher degree of judgment and complexity with further discussion of these judgmental areas in Item 5, “Operating and Financial Review and Prospects” in the 2010 Form 20-F. We believe these policies are the most critical to aid in fully understanding and evaluating our financial condition and results of operations. Updates on the relevant periodic financial disclosures related to these policies are provided below.

Revenue Recognition

We derive our revenue from three sources:

▪ software as a service (SaaS) revenue, which consists of fees from customers who subscribe to our hosted mobile marketing and advertising platform, generally referred to as “usage‑based” services, and fees from customers who utilize our software solutions to measure the progress of their transaction‑ based mobile marketing and advertising campaigns, generally referred to as “performance‑based” services;

▪ license and software revenue, which consists of revenue from customers who license our mobile marketing and advertising platform and fees for customized software solutions delivered to and installed on the customers' server; and

▪ managed services revenue, which consists of fees charged to customers for professional services related to the implementation, execution, and monitoring of customized mobile marketing and advertising solutions.

We account for our revenue for these services and licenses in accordance with Accounting Standards Codification (ASC) Topic 605 - Revenue Recognition and ASC Topic 985-605 - Certain Revenue Arrangements that Include Software Elements. We recognize revenue when all of the following conditions are satisfied: (i) there is persuasive evidence of an arrangement; (ii) the service has been rendered or delivery has occurred; (iii) the fee to be paid by the customer is fixed or determinable; and (iv) collectibility of the fee is reasonably assured.

SaaS revenue generated from our “usage‑based” services, including subscription fees for use of individual software modules and our automated mobile marketing campaign creation templates, and fees charged for access to our technology platform, are recognized ratably over the period of the agreement as the fees are earned.

SaaS revenue generated from our “performance‑based” services is generally based on specified metrics, typically relating to the number of transactions performed or number of text messages generated during the campaign multiplied by the cost per action or response in accordance with the terms of the related contracts. Some of our performance‑based contracts include performance incentive provisions that link a portion of revenue that we may earn under the contract to the performance of the customer's campaign relative to quantitative or other milestones, such as the growth in the consumer base, reduced consumer churn, or the effectiveness of the end-user response. We consider the performance‑based fees to be contingent fees and recognize revenue monthly as the contingency is resolved, the fees are earned and the amount of the fee can be reliably measured. Our performance‑based arrangements are typically invoiced upon completion of the campaign, which can occur in a period subsequent to revenue being recognized.

27

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

License and software revenue consists of fees charged for our mobile marketing and advertising technology provided on a perpetual license. These types or arrangements do not typically include any ongoing support arrangements or rights to upgrades or enhancements and therefore revenue related to perpetual licensing arrangements is recognized upon the delivery of the license. Fees charged to customize our software solution are recognized using the completed contract or percentage-of-completion method according to ASC 605-35, Revenue Recognition - Construction-Type and Production-Type Contracts, based on the ratio of costs incurred to the estimated total costs at completion.

Managed services revenue, when sold with software and support offerings, are accounted for separately when these services (i) have value to the customer on a standalone basis, (ii) are not essential to the functionality of the software and (iii) there is objective and reliable evidence of the selling price of each deliverable. When accounted for separately, revenue is recognized as the services are rendered for time and material contracts, and ratably over the term of the contract when accepted by the customer for fixed price contracts. For revenue arrangements with multiple deliverables, such as an arrangement that includes license, support and professional services, we allocate the total amount the customer will pay to the separate units of accounting based on their relative selling prices, as determined by the price of the undelivered items when sold separately.

The timing of revenue recognition in each case depends upon a variety of factors, including the specific terms of each arrangement and the nature of our deliverables and obligations, and the existence of evidence to support recognition of our revenue as of the reporting date. For contracts with extended payment terms for which we have not established a successful pattern of collection history, we recognize revenue when all other criteria are met and when the fees under the contract are due and payable.

For the majority of our contracts, we act as the principal and contract directly with suppliers for purchase of media and other third-party production costs, and are responsible for payment of such costs as the primary obligor. We recognize the revenue generated on fees charged for such third-party costs using the gross method. We recognize revenue at the gross amount billed when revenue is earned for services rendered and record the associated fees we pay as third-party costs in the period such costs are incurred.

In the event that we have incurred costs associated with a specific revenue arrangement prior to the execution of the related contract, those costs are expensed as incurred.

Fees that have been invoiced are recorded in trade receivables and in revenue when all revenue recognition criteria have been met. Fees that have not been invoiced as of the reporting date but for which all revenue recognition criteria are met are reported as accrued contract receivables on the balance sheets.

We present revenue net of value‑added tax, sales tax, excise tax and other similar assessments. Our revenue arrangements do not contain general rights of return.

Valuation of Long-lived and Intangible Assets

We periodically evaluate events or changes in circumstances that indicate the carrying amount of our long-lived and intangible assets may not be recoverable or that the useful lives of the assets may no longer be appropriate. The process of assessing potential impairment of our long-lived and intangible assets is highly subjective and requires significant judgment. An estimate of future undiscounted cash flow can be affected by many assumptions, requiring that management make significant judgments in arriving at these estimates. Although there are inherent uncertainties in this assessment process, the estimates and assumptions we use to estimate future cash flows including sales volumes, pricing, and market penetration are consistent with our internal planning. Significant future changes in these estimates or their related assumptions could result in an impairment charge related to individual or groups of these assets.

Goodwill

Goodwill is generated when the consideration paid for an acquisition exceeds the fair value of net assets acquired. Goodwill is recognized as an asset and reviewed for impairment at least annually, or whenever events or circumstances indicate that the carrying amount of goodwill may not be recoverable. We have selected December 31 as the date to perform the annual impairment testing of goodwill. There have been no indicators of impairment during the six months ended June 30, 2011.

Fair Value Measurements

The Company considers fair value as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market in which we would transact business in an orderly transaction on the measurement date. We consider assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

28

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

We use observable inputs whenever possible and minimize the use of unobservable inputs when measuring fair value. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect the Company’s market assumptions. The inputs are then classified into the following hierarchy: (1) Level 1 Inputs—quoted prices in active markets for identical assets and liabilities; (2) Level 2 Inputs—observable market-based inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities in active markets, quoted prices for similar or identical assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data; (3) Level 3 Inputs—unobservable inputs that are supported by little or no market activity such as certain pricing and discounted cash flow models.

Our financial assets and liabilities consist principally of cash and cash equivalents, accounts payable, accrued liabilities, current and non-current notes payable. Cash and cash equivalents are stated at cost, which approximates fair value. As of June 30, 2011 and December 31, 2010, we do not have readily marketable securities that are classified as cash equivalents. Accounts payable and accrued liabilities are carried at cost that approximates fair value due to their expected short maturities. Our long-term debt bears interest at variable rates which approximate the interest rates at which we believe we could refinance the debt. Accordingly, the carrying amount of long-term debt as of June 30, 2011 and December 31, 2010 approximates its fair value. As of June 30, 2011, we did not have any financial assets or liabilities for which Level 1 or Level 2 inputs were required to be disclosed.

The fair value of our contingent payments associated with our recent acquisitions is determined based on an internal cash flow model using inputs based on estimates and assumptions developed by us and is remeasured on each reporting date. The rates used to discount net cash flows to their present value were based on our weighted average cost of capital for similar transactions and an assessment of the relative risk inherent in the associated cash flows. The inputs were current as of the measurement date. These inputs tend to be unobservable and, as such, are considered Level 3 in the fair value hierarchy. This liability is our only Level 3 fair value measurement.

On May 1, 2011 we amended our agreement with Mobclix to change the terms of the contingent payment in order to facilitate our integration efforts. The terms of the amendment set the fixed portion of the contingent payment at $18.1 million. In addition, we agreed the contingent amount is now based solely upon EBITDA performance between January 1 and December 31, 2011, and has a minimum of zero and a maximum additional payment of $5.0 million. Both amounts are payable in either cash or shares at our discretion with no change in the original payment dates. On May 1, 2011, we estimated the fair value of the amended minimum deferred consideration utilizing a present value factor based on the cost of capital and the timing of the payments, which resulted in recording an additional $6.1 million of acquisition related charges. In addition, we estimated the fair value of the contingent payout utilizing an internal cash flow model based on the revised terms in the amendment and determined the fair value was zero on the amendment date.

The following table provides a summary of changes in fair value of the contingent payments measured using significant unobservable inputs (Level 3):

	Fair Value
	(in thousands)
Balance as of December 31, 2010	$	9,116
Change in fair value of contingent payment liabilities	1,174
Reclassified to deferred consideration not measured at fair value	(10,290		)
Balance as of June 30, 2011	$	—

29

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Other Financial Information

We present certain non-GAAP financial measures as a supplemental measure of our performance. These non-GAAP financial measures are not a measure of financial performance or liquidity calculated in accordance with accounting principles generally accepted in the U.S., referred to herein as GAAP, and should be viewed as a supplement to, not a substitute for, our results of operations presented on the basis of GAAP. Reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures are detailed in the table below.

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2011			2010			2011			2010
Non-GAAP Measures:	(in thousands except per share amounts)
Adjusted net loss	$	(2,030	)	$	(3,447	)	$	(7,234	)	$	(6,632	)
Adjusted EBITDA	$	3,087		$	1,012		$	4,366		$	1,469
Adjusted net loss per share - basic	$	(0.04	)	$	(0.09	)	$	(0.14	)	$	(0.18	)
Adjusted net loss per share - diluted	$	(0.04	)	$	(0.09	)	$	(0.14	)	$	(0.18	)

Our non-GAAP measures should be read in conjunction with the corresponding GAAP measures. These non-GAAP financial measures have limitations as an analytical tool and shareholders should not consider them in isolation from, or as a substitute for, analysis of our results as reported in accordance with GAAP.

We define adjusted EBITDA as net income (loss) before provision for income taxes, interest expense, gains or losses from our equity method investments, foreign exchange gains and losses, depreciation and amortization, share-based compensation expense, acquisition related and non-recurring expenses. Adjusted EBITDA is not necessarily comparable to similarly-titled measures reported by other companies.

We define adjusted net income by excluding one-time losses from equity method investments and acquisition-related depreciation and amortization, in addition to the items excluded from adjusted EBITDA.

Adjusted earnings per share is adjusted net income divided by diluted shares outstanding.

We believe these non-GAAP financial measures are useful to management, investors and other users of our financial statements in evaluating our operating performance because this financial measure is an additional tool to compare business performance across companies and across periods. We believe that:

• these non-GAAP financial measures are often used by investors to measure a company's operating performance without regard to items such as interest expense, taxes, depreciation and amortization and foreign exchange gains and losses, which can vary substantially from company to company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired; and

• investors commonly use these non-GAAP financial measures to eliminate the effect of restructuring and share-based compensation expenses, one-time non-recurring expenses, and acquisition-related expenses, which vary widely from company to company and impair comparability.

We use these non-GAAP financial measures:

• as a measure of operating performance to assist in comparing performance from period to period on a consistent basis;

• as a measure for planning and forecasting overall expectations and for evaluating actual results against such expectations;

• as a primary measure to review and assess the operating performance of our company and management team in connection with our executive compensation plan incentive payments; and

• in communications with our board of directors, stockholders, analysts and investors concerning our financial performance.

The following is an unaudited reconciliation of adjusted EBITDA to net income (loss) before non-controlling interest, the most directly comparable GAAP measure, for the periods presented:

30

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2011			2010			2011			2010
Reconciliation to adjusted EBITDA:	(in thousands except per share amounts)
Net loss before non-controlling interest	$	(25,125	)	$	(6,404	)	$	(41,048	)	$	(11,651	)
Adjustments:
Foreign exchange losses	2,181			1,195			1,803			2,056
Non-cash share based compensation(1)	13,291			1,482			19,853			2,407
Non-recurring and acquisition-related expenses(2)	6,995			—			9,277			—
Loss (gain) from equity method investments(3)	(169		)	—			1,289			—
Depreciation and amortization - acquisition related	797			280			1,592			556
Adjusted net loss	$	(2,030	)	$	(3,447	)	$	(7,234	)	$	(6,632	)
Loss (gain) from equity method investments - other	(151		)	978			(644		)	1,477
Depreciation and amortization - other	3,311			2,404			6,270			4,697
Income tax expense (benefit)	721			(228		)	2,958			(440		)
Interest expense, net	1,398			1,305			3,102			2,367
Other income	(162		)	—			(86		)	—
Adjusted EBITDA	$	3,087		$	1,012		$	4,366		$	1,469
Adjusted net loss per share - basic	$	(0.04	)	$	(0.09	)	$	(0.14	)	$	(0.18	)
Adjusted net loss per share - diluted	$	(0.04	)	$	(0.09	)	$	(0.14	)	$	(0.18	)
Basic shares	53,047			37,704			50,073			37,617
Diluted shares	53,047			37,704			50,073			37,617

⁽¹⁾  Non-cash share based compensation for the six months ended June 30, 2011 includes $10.5 million related to the vesting of performance-based deferred share awards that occurred in March 2011. The three months ended June 30, 2011 includes $7.2 million related to these same awards. This is non-cash and there will be no related future expense related to these grants. See Note 13 to notes to the consolidated financial statements.

⁽²⁾ Non-recurring and acquisition-related expenses in 2011 included primarily acquisition-related expenses incurred related to our acquisition of Mobclix in September 2010, interest expense related to recognition of the remaining debt discount upon repayment of certain loan facilities, and interest expense related to an additional fee due to one of our lenders related to our US public offering, offset by the reversal of a one-time tax liability accrual related to pre-US public offering performance share awards that were released to employees in 2010.

⁽³⁾ Loss from equity method investments represents deferral of our equity investments' net profits related to transactions with Velti.

31

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Operating Results

Comparison of the three months ended ended June 30, 2011 and 2010

The following table sets forth our consolidated results of operations for the three months ended June 30, 2011 and 2010:

	For the Three Months Ended June 30,
	2011			2010			$ Change			% Change
	(unaudited)
Revenue:	(in thousands)
Software as a service (SaaS) revenue	$	27,550		$	13,788		$	13,762		100	%
License and software revenue	4,077			5,540			(1,463		)	(26	)%
Managed services revenue	2,731			2,601			130			5	%
Total revenue	34,358			21,929			12,429			57	%
Cost and expenses:
Third-party costs	10,717			9,059			1,658			18	%
Datacenter and direct project costs	5,140			1,467			3,673			250	%
General and administrative expenses	14,409			3,909			10,500			269	%
Sales and marketing expenses	11,586			6,263			5,323			85	%
Research and development expenses	3,563			1,701			1,862			109	%
Acquisition related charges	6,142			—			6,142			100	%
Depreciation and amortization	4,108			2,684			1,424			53	%
Total cost and expenses	55,665			25,083			30,582			122	%
Loss from operations	(21,307		)	(3,154		)	(18,153		)	576	%
Interest expense, net	(1,398		)	(1,305		)	(93		)	7	%
Loss from foreign currency transactions	(2,181		)	(1,195		)	(986		)	83	%
Other income	162			—			162			100	%
Loss before income taxes, equity method investments and non-controlling interest	(24,724		)	(5,654		)	(19,070		)	337	%
Income tax (expense) benefit	(721		)	228			(949		)	(416	)%
Gain (loss) from equity method investments	320			(978		)	1,298			(133	)%
Net loss	(25,125		)	(6,404		)	(18,721		)	292	%
Net loss attributable to non-controlling interest	(49		)	(17		)	(32		)	188	%
Net loss attributable to Velti	$	(25,076	)	$	(6,387	)	$	(18,689	)	293	%

Revenue

Our total revenue for the three months ended June 30, 2011 increased by $12.4 million, or 57%, compared to the same period in 2010. This increase was primarily the result of growth in our SaaS revenue of $13.8 million, $5.5 million of which was related to revenue from Mobclix, together with an increase in revenue from both new and existing customers. For the three months ended June 30, 2011, our revenue from existing customers was $25.4 million and from new customers was $9.0 million, compared to $18.5 million and $3.4 million, respectively, for the same period in 2010.

Third‑Party Costs

Third‑party costs for the three months ended June 30, 2011 increased by $1.7 million, or 18%, compared to the same period in 2010. This increase in third‑party costs was primarily due to the inclusion of $4.5 million in third‑party costs associated with revenue generated from Mobclix, as well as increased costs associated with the increase in total revenue, offset by the benefit of better focus on controlling costs during the current period. The three months ended June 30, 2010 included higher promotional costs related to certain campaigns on which revenue is being recognized on a gross basis.

Datacenter and Direct Project Costs

Datacenter and direct project costs for the three months ended June 30, 2011 increased by $3.7 million, or 250%, compared to the same period in 2010. This increase was primarily due to a $1.6 million increase in share‑based compensation expense, and a $584,000 increase in personnel‑related expense due to an increase in headcount to support growth in our business, combined with an increase in datacenter and direct project costs resulting from the growth in SaaS revenue.

32

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

General and Administrative Expenses

General and administrative expenses for the three months ended June 30, 2011 increased by $10.5 million, or 269%, compared to the same period in 2010. This increase was primarily due to a $5.0 million increase in share‑based compensation expense, a $3.0 million increase in personnel‑related expense due to an increase in headcount to support growth in our business, a $1.0 million increase in professional service costs associated with being a public company in the U.S., combined with an increase in facilities and related infrastructure costs associated with our geographic expansion.

Sales and Marketing Expenses

Sales and marketing expenses for the three months ended June 30, 2011 increased by $5.3 million, or 85%, compared to the same period in 2010. This increase was primarily due to a $3.3 million increase in share‑based compensation expense, a $2.7 million increase in personnel‑related expense due to an increase in headcount to support growth in our business, together with additional costs to support the continued expansion of our global operations and the development of new markets, offset by a $800,000 reduction in marketing and professional services expenses.

Research and Development Expenses

Research and development expenses for the three months ended June 30, 2011 increased by $1.9 million, or 109%, compared to the same period in 2010. This increase was primarily due to a $1.7 million increase in share‑based compensation expense together with a $1.3 million increase in personnel‑related expense due to an increase in headcount, offset by an increase in the amount of capitalized internally developed software costs.

Acquisition‑Related Charges

Acquisition‑related charges for the three months ended June 30, 2011 were $6.1 million, related to the amendment of the Mobclix acquisition agreement. There was no similar activity in the prior period. See Note 6 to notes to consolidated financial statements for further information.

Depreciation and Amortization

Depreciation and amortization expenses for the three months ended June 30, 2011 increased by $1.4 million, or 53%, compared to the same period in 2010, primarily as a result of higher intangible asset balances primarily due to our increased spending on purchased software and our amortization of intangible assets acquired as part of the Mobclix and Media Cannon acquisitions.

Interest Expense

Interest expense for the three months ended June 30, 2011 increased by $93,000, or 7%, compared to the same period in 2010. While the overall outstanding balance of our debt decreased significantly during the period, our average effective interest rate was significantly higher in the prior year due to our financial condition and the use of receivables factoring to fund working capital needs.

Gain (loss) from Foreign Currency Transactions

Loss from foreign currency transactions, a non-cash item, for the three months ended June 30, 2011 increased by $986,000 or 83%, compared to the same period in 2010. The increase was primarily due to foreign exchange translation adjustments on cash balances denominated in currencies other than the functional currency during 2011. In the prior year, the losses from foreign currency transactions related to intercompany loans that resulted from changes in exchange rates in Russian rubles and Ukrainian hryvnia. Our intercompany loans are loans that we made to subsidiaries in euros to fund costs and expenses incurred in local currencies.

Income Tax Expense

We recorded an income tax expense of $721,000 on a worldwide pre-tax loss of $24.4 million for the three months ended June 30, 2011 compared to an income tax benefit of $228,000 on a worldwide pre-tax loss of $6.6 million for the same period in 2010. The expense in 2011 was primarily related to the implementation of our global tax strategy.

Gain (Loss) from Equity Method Investments

During the three months ended June 30, 2011 our share of gain from equity method investments was $320,000 compared to a loss from equity method investments of $978,000 for the same period in 2010. This change was primarily due to the improved results of the equity method investments. For a discussion of our equity method investments, see Note 9 to notes to consolidated financial statements.

33

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

Comparison of the six months ended ended June 30, 2011 and 2010

The following table sets forth our consolidated results of operations for the six months ended June 30, 2011 and 2010:

	For the Six Months Ended June 30,
	2011			2010			$ Change			% Change
	(unaudited)
Revenue:	(in thousands)
Software as a service (SaaS) revenue	$	50,829		$	21,361		$	29,468		138	%
License and software revenue	6,868			10,421			(3,553		)	(34	)%
Managed services revenue	6,211			6,378			(167		)	(3	)%
Total revenue	63,908			38,160			25,748			67	%
Cost and expenses:
Third-party costs	21,350			13,083			8,267			63	%
Datacenter and direct project costs	8,091			2,800			5,291			189	%
General and administrative expenses	23,877			9,280			14,597			157	%
Sales and marketing expenses	19,579			10,952			8,627			79	%
Research and development expenses	6,393			2,983			3,410			114	%
Acquisition related charges	7,603			—			7,603			100	%
Depreciation and amortization	7,862			5,253			2,609			50	%
Total cost and expenses	94,755			44,351			50,404			114	%
Loss from operations	(30,847		)	(6,191		)	(24,656		)	398	%
Interest expense, net	(4,881		)	(2,367		)	(2,514		)	106	%
Loss from foreign currency transactions	(1,803		)	(2,056		)	253			(12	)%
Other income	86			—			86			100	%
Loss before income taxes, equity method investments and non-controlling interest	(37,445		)	(10,614		)	(26,831		)	253	%
Income tax (expense) benefit	(2,958		)	440			(3,398		)	(772	)%
Loss from equity method investments	(645		)	(1,477		)	832			(56	)%
Net loss	(41,048		)	(11,651		)	(29,397		)	252	%
Net loss attributable to non-controlling interest	(100		)	(41		)	(59		)	144	%
Net loss attributable to Velti	$	(40,948	)	$	(11,610	)	$	(29,338	)	253	%

Revenue

Our total revenue for the six months ended June 30, 2011 increased by $25.7 million, or 67%, compared to the same period in 2010. This increase was primarily the result of growth in our SaaS revenue of $29.5 million, $11.9 million of which was related to increased revenue from Mobclix, together with an increase in revenue from both new and existing customers. This increase was offset by a decrease in license and software revenue of $3.6 million as existing customers transitioned to our SaaS offerings. For the six months ended June 30, 2011, our revenue from existing customers was $50.5 million and from new customers was $13.4 million, compared to $32.5 million and $5.7 million, respectively, for the same period in 2010.

Third‑Party Costs

Third‑party costs for the six months ended June 30, 2011 increased by $8.3 million, or 63%, compared to the same period in 2010. This increase in third‑party costs was primarily due to the inclusion of $10.0 million in third‑party costs associated with revenue generated from Mobclix, as well as increased costs associated with the increase in total revenue, offset by the benefit of better focus on controlling costs during the current period. The six months ended June 30, 2010 included higher promotional costs related to certain campaigns on which revenue is being recognized on a gross basis

Datacenter and Direct Project Costs

Datacenter and direct project costs for the six months ended June 30, 2011 increased by $5.3 million, or 189%, compared to the same period in 2010. This increase was primarily due to a $2.2 million increase in share‑based compensation expense, and a

34

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

$1.1 million increase in personnel‑related expense due to an increase in headcount to support growth in our business, combined with an increase in datacenter and direct project costs resulting from the growth in SaaS revenue.

General and Administrative Expenses

General and administrative expenses for the six months ended June 30, 2011 increased by $14.6 million, or 157%, compared to the same period in 2010. This increase was primarily due to a $8.2 million increase in share‑based compensation expense, a $4.2 million increase in personnel‑related expense due to an increase in headcount to support growth in our business, a $1.2 million increase in professional service costs associated with being a public company in the U.S., combined with an increase in facilities and related infrastructure costs associated with our geographic expansion.

Sales and Marketing Expenses

Sales and marketing expenses for the six months ended June 30, 2011 increased by $8.6 million, or 79%, compared to the same period in 2010. This increase was primarily due to a $4.7 million increase in share‑based compensation expense, a $3.8 million increase in personnel‑related expense due to an increase in headcount to support growth in our business, together with additional costs to support the continued expansion of our global operations and the development of new markets, offset by a $1.0 million reduction in marketing and professional services expenses.

Research and Development Expenses

Research and development expenses for the six months ended June 30, 2011 increased by $3.4 million, or 114%, compared to the same period in 2010. This increase was primarily due to a $2.4 million increase in share‑based compensation expense together with a $2.5 million increase in personnel‑related expense due to an increase in headcount, offset by an increase in the amount of capitalized internally developed software costs.

Acquisition‑Related Charges

Acquisition‑related charges for the six months ended June 30, 2011 were $7.6 million, of which $1.2 million was related to recording changes in the fair value of contingent payments prior to the amendment of the Mobclix acquisition agreement and $6.1 million was related to the amendment. There was no similar activity in the prior period. See Note 6 to notes to consolidated financial statements for further information.

Depreciation and Amortization

Depreciation and amortization expenses for the six months ended June 30, 2011 increased by $2.6 million, or 50%, as compared to the same period in 2010, primarily as a result of higher intangible asset balances primarily due to our increased spending on purchased software and our amortization of intangible assets acquired as part of the Mobclix and Media Cannon acquisitions.

Interest Expense

Interest expense for the six months ended June 30, 2011 increased by $2.5 million, or 106%, compared to the same period in 2010. The increase was primarily due to non-cash interest accretion of $1.4 million and $500,000 in interest associated with our debt repayment after our January 2011 U.S. public offering. While the overall outstanding balance of our debt decreased significantly by June 30, 2011, our average effective interest rate was significantly higher in the prior year due to our financial condition and the use of receivables factoring to fund working capital needs.

Loss from Foreign Currency Transactions

Gain from foreign currency transactions, a non-cash item, for the six months ended June 30, 2011 decreased by $253,000 or 12%, compared to the same period in 2010. The decrease was primarily due to foreign exchange translation adjustments on cash balances denominated in currencies other than the functional currency during 2011. In the prior year, the losses from foreign currency transactions related to intercompany loans that resulted from changes in exchange rates in Russian rubles and Ukrainian hryvnia. Our intercompany loans are loans that we made to subsidiaries in euros to fund costs and expenses incurred in local currencies.

Income Tax Expense

We recorded an income tax expense of $3.0 million on a worldwide pre-tax loss of $40.1 million for the six months ended June 30, 2011 compared to an income tax benefit of $440,000 on a worldwide pre-tax loss of $12.1 million for the same period in 2010. The expense in 2011 was primarily related to the implementation of our global tax strategy and an increase in reserves for uncertain tax positions.

Loss from Equity Method Investments

During the six months ended June 30, 2011 our share of loss from equity method investments was $645,000 compared to a loss

35

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

from equity method investments of $1.5 million for the same period in 2010. This change was primarily due to the improved results of the equity method investments offset by the elimination of profit on transactions with certain of our equity method investments. For a discussion of our equity method investments, see Note 9 to notes to consolidated financial statements.

Liquidity and Capital Resources

Since our inception we have financed our operations and acquisitions primarily through the public offerings of our ordinary shares on AIM in 2006 and 2007 and on NASDAQ in January and June 2011, our October 2009 private placement, borrowings under our bank credit facilities and cash generated from our operations. As of June 30, 2011, we had $159.4 million in cash and cash equivalents. In addition, we had a receivable as of June 30, 2011 for $21.4 million related to the June 30, 2011 exercise of the underwriters over-allotment from the June public offering, which was received in July.

As of June 30, 2011, we had $22.0 million in outstanding long‑term debt. The effective interest rates to finance our borrowings as of June 30, 2011 ranged from 3.5% to 7%. We plan to repay a portion of our outstanding debt during the period ended September 30, 2011.

Based on our current business plan, we believe that net proceeds from our public offerings, together with our existing cash balances and any cash generated from operations, will be sufficient to meet our anticipated cash needs for working capital and capital expenditures for at least the next 12 months. We anticipate that the use of proceeds from the public offerings will, in part, fund the existing needs of our operating companies in geographies that require expansion capital. In addition, any unremitted earnings from profitable subsidiaries will be used for the ongoing expansion needs in the local geographies for the foreseeable future.

If our estimates of revenues, expenses or capital or liquidity requirements change or are inaccurate or if cash generated from operations is insufficient to satisfy our liquidity requirements, we may seek to sell additional shares or arrange debt financing. Further, we may seek to sell additional ordinary shares or arrange for additional debt financing, to the extent it is available, in order to provide us financial flexibility to pursue acquisition or investment opportunities that may arise in the future, however we do not have any current agreements or commitments for any specific new acquisition or investments.

	For the Six Months Ended June 30,
	2011			2010
	(in thousands)
Cash generated from (used in):
Operating activities	$	(30,738	)	$	360
Investing activities	(25,571		)	(12,446		)
Financing activities	196,073			10,572
Effect of exchange rate fluctuations	2,322			(2,075		)
Increase (decrease) in cash and cash equivalents	$	142,086		$	(3,589	)

In September 2010, we acquired Mobclix, Inc. and paid at closing approximately $1.1 million in cash and issued 150,220 shares to former Mobclix stockholders and creditors. We paid an additional $8.5 million to former Mobclix shareholders and an additional $0.7 million in employee bonuses in the three months ended March 31, 2011.

Following our May 1, 2011 amendment of our agreement with Mobclix, we have agreed to pay, on March 1, 2012, $18.1 million. We have also agreed to pay an amount contingent upon EBITDA performance of Mobclix between January 1 and December 31, 2011 with a minimum of $0 and a maximum additional payment of $5.0 million. Both amounts are payable in either cash or shares at our discretion.

Operating Activities. Net cash used in operating activities during the six months endedJune 30, 2011was $30.7 million, compared to net cash provided by operating activities of $360,000during the six months endedJune 30, 2010. The increase in cash used in operating activities is attributable to higher prepaid third‑party costs, both organically to support our increased sales activity and as a result of our Mobclix acquisition, as well as quicker payment of amounts due to our vendors during the six months ended June 30, 2011, offset by a reduction in our DSO's.

Much of our business is in emerging markets where payment terms on amounts due to us may be longer than on our contracts with customers in other markets. Our DSOs have historically decreased during the first and second quarters, and increased during the third and fourth quarters, due to the seasonal nature of our business. DSOs based on trailing 12 months' revenue

36

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

were 79 as of June 30, 2011 compared to 113, 121 and 131 as of March 31, 2011, December 31, 2010 and 2009, respectively. We have not historically incurred material bad debt expense, none of our significant customers have historically failed to pay amounts due to us, and we do not believe that any of the customers contributing to our increased accounts receivable aging will fail to pay us in full. Accordingly, we have determined that none of our slow-paying customers will require an allowance for bad debt against accounts receivable. As our revenue mix changes in the future to a greater percentage of revenue from the North America and Asia, we would expect our DSOs to improve as a result of the inherent shorter payment cycle experience in these geographies as well as our intent to increase collection efforts worldwide. Additionally, we are working towards enhancing our billing processes, enabling us to invoice our customers more quickly, decreasing our accrued contract receivables and enhancing our cash flow.

Investing Activities. Net cash used in investing activities during the six months endedJune 30, 2011 was $25.6 million compared to $12.4 millionduring the six months endedJune 30, 2010. This was primarily due to increased investment in property and equipment, software development, which we capitalized, and investment in subsidiaries, including payment of deferred obligations associated with our acquisition of Mobclix on September 30, 2010.

Financing Activities. Net cash generated from financing activities during the six months endedJune 30, 2011 was $196.1 million compared to $10.6 millionduring the six months endedJune 30, 2010. The cash generated from financing activities was primarily due to the proceeds from our January and June U.S. public offerings, offset by repayment of $53.1 million of outstanding borrowings.

As of June 30, 2011, we had issued group guarantees for the $21.8 million of long-term debt outstanding as of June 30, 2011. For further information about our outstanding long‑term debt, see Note 10 in the notes to the consolidated financial statements.

Although we have an overall accumulated deficit of $60.3 million, we have unremitted positive earnings in certain jurisdictions of approximately $60.5 million. Management has assessed the requirements for indefinite reinvestment of these earnings, and has not provided for related taxes on such earnings for the following reasons: (1) based upon financial forecasts and budgets, we intend to permanently reinvest such earnings in the local geographies where the earnings are located to fund expansion and growth in the local markets, as well as retain sufficient working capital and fund other capital needs locally and (2) we will engage in intercompany financing as necessary for purposes of providing sufficient cash flow to non-income producing jurisdictions. There may also be local jurisdiction restrictions on the ability to remit dividends, including: (1) each company with positive unremitted earnings may not have sufficient distributable reserves to make such a distribution in the foreseeable future and (2) each company with unremitted earnings may not have sufficient cash available to make such a distribution.

Legal Proceedings

Indemnification Claims

We currently, and from time to time, are, subject to claims arising in the ordinary course of our business. We are not currently subject to any such claims that we believe could reasonably be expected to have a material and adverse effect on our business, results of operations and financial condition. However, we recently received a letter on behalf of one of our customers notifying us that the customer had received a letter from a third-party which alleged that certain of our customer’s applications infringed the patent rights of the third-party. In turn, our customer has alleged that we are obligated to indemnify our customer relating to this matter as the claim allegedly relates to services that we provide to the customer. We are currently investigating the related issues in order to determine how we wish to respond to the matter.

City of London Police

In 2009, the City of London Police conducted an investigation into actions (relating to arrangements in the procurement of a customer contract in the EMEA area) that may be alleged to constitute violations of English law. No charges have been filed against us or our employees or directors. We are unable to predict what consequences, if any, may result from the investigation by the City of London Police. Any investigation could result in our business being adversely impacted, and could result in civil or criminal action against us or our employees, and/or criminal penalties and/or fines and/or other court orders being imposed against us or our employees.

Mobile Device Litigation

In re iPhone Application Litigation is a purported nationwide class action filed in the Northern District of California against Apple Inc. and certain other parties, including Mobclix. The action alleges that the defendants, through the promotion of software applications, or "apps", developed, marketed, and provided or sold for use with Apple's devices, improperly and unlawfully access, capture, alter and/or use personal information they obtained from "app" users.  The defendants have filed

37

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

motions to dismiss the claims alleged in the Consolidated Complaint.  These motions are fully briefed and scheduled to be heard on September 8, 2011.

Numerous other class actions filed in state and federal courts throughout the United States allege similar claims related to "apps" sold for use with devices using the Apple iOS or Google Android operating systems. The Multi District Litigation panel consolidated the majority of the federal actions related to Apple devices with In re iPhone Application Litigation and assigned them for all purposes to the judge presiding over that matter.  Physical transfer of the files related to these actions is pending, and the parties anticipate that additional claims and classes may be alleged in an amended complaint as a result of that transfer. 

Defendant TrafficMarketplace.com recently demanded that Mobclix, pursuant to an agreement between the parties, defend and indemnify it for costs related to the class action.  Mobclix is currently drafting a response to that demand.

Mobclix was named as a defendant in one of the actions regarding Google devices, but within several months was dismissed from that action without prejudice.

Because the filed actions are in the very early stages, and due to the inherent uncertainty surrounding the litigation process, we are unable to reasonably assess the likelihood of any particular outcome of these litigations (or potential litigations) at this time.

Quantitative and Qualitative Disclosures about Market Risk

We are exposed to several financial risks, including, among others, market risk (change in exchange rates, changes in interest rates, market prices, etc.), credit risk and liquidity risk. Our principal liabilities mainly consist of bank loans and trade payables. The main purpose of these liabilities is to provide the necessary funding for our operations. We have various financial assets such as trade receivables and cash and cash equivalents. Our cash and cash equivalent instruments are managed such that there is no significant concentration of credit risk in any one bank or other financial institution. Management monitors closely the credit quality of the financial institutions with which we hold deposits.

Our financing facilities are monitored against working capital and capital expenditure requirements on a rolling 12-month basis and timely action is taken to have the necessary level of available credit lines. Our policy is to diversify funding sources. Management aims to maintain an appropriate capital structure that ensures liquidity and long-term solvency.

Foreign Currency Risk

Our reporting currency is the U.S. dollar. As a result of investments in entities that have denominated currency other than the U.S. dollar, we face foreign exchange translation risk and our results can be affected by movements in the euro versus the U.S. dollar, British pound sterling versus the U.S. dollar, as well as other currencies. We do not believe that we currently have any significant direct foreign exchange risk and have not hedged exposures denominated in foreign currencies or any other derivative financial instruments. As of June 30, 2011, we had operations in Europe, including Greece, the U.K., Bulgaria and the Ukraine, the U.S. and joint ventures or equity investments in China and India. Our reporting currency is the U.S. dollar, although the functional currencies of our subsidiaries include the U.S. dollar, euro, Russian ruble, Bulgarian lev, Ukrainian hyrvnia, Indian rupee and Chinese yuan. Personnel and facilities-related expenses are incurred in local currencies, although substantially all of our other expenses are incurred in the U.S. dollar or euro. As a result of investments in entities that have denominated currency other than the U.S. dollar, we face foreign exchange translation risk and our results can be affected by movements in the euro versus the U.S. dollar, British pound sterling versus the U.S. dollar, as well as other currencies against the U.S. dollar or the euro. Therefore, our operating results may become subject to significant fluctuations based upon changes in foreign currency exchange rates of certain currencies relative to the U.S. dollar or the euro, and foreign currency exchange rate fluctuations may adversely affect our financial results in the future.

For the three and six months ended June 30, 2011, approximately 53% and 55% of our revenue was payable in euros, respectively. This is compared to 77% and 75% for the years ended December 31, 2010 and 2009, respectively. We expect the concentration of euro denominated revenue to continue to decrease compared to historical levels as we continue to increase sales to customers in geographies outside of Europe, with revenue payable in U.S. dollars or other currencies, as well as increase the number of contracts with European customers with revenue payable in U.S. dollars. As a majority of our costs and expenses are incurred in euros, any devaluation of the euro will negatively impact revenue but positively impact costs and expenses, as reported in U.S. dollars. Any decline in the value of the dollar compared to the euro will positively impact revenue and negatively impact costs and expenses, as reported in U.S. dollars.

We currently do not plan to enter into any hedging arrangements, such as forward exchange contracts and foreign currency option contracts, to reduce the effect of our foreign exchange risk exposure. If we decided to enter into any such hedging activities in the future, we cannot assure shareholders that we would be able to effectively manage our foreign exchange risk

38

exposure. As exchange rates in these currencies vary, our revenue and operating results, when translated, may be materially and adversely impacted.

Interest Rate Risk

As of June 30, 2011, we had cash and cash equivalents of $159.4 million. These amounts are held primarily in cash and money market funds. We do not enter into investments for trading or speculative purposes. Due to the short-term nature and floating interest rates of these investments, we believe that we do not have any material exposure to changes in the fair value of our investment portfolio as a result of changes in interest rates. Due to the low margin earned on these funds we do not believe a 10% change in interest rates would have a significant impact on our operating results, future earnings, or liquidity.

We are exposed to interest rate risk related to our short term financing and long term debt, which are primarily denominated in euros with floating interest rates that are linked to Euribor plus a margin ranging between 2% to 6%. For variable rate debt, interest rate changes generally do not affect the fair value of the debt instrument, but do impact future earnings and cash flows, assuming other factors are held constant. A potential increase or decrease of Euribor by 1% would not materially impact interest expense or cash paid for interest for the remainder of 2011 based on the $22.0 million of variable rate debt outstanding as of June 30, 2011.

Credit Risk

We do not have significant concentrations of credit risk relating to our trade receivables and cash investments. The majority of our credit risk as of June 30, 2011 is attributable to trade receivables and accrued contract receivables amounting to $66.0 million in total. Trade receivables and accrued contract receivables are typically unsecured and are derived from revenue earned from customers. Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the company grants credit terms in the normal course of business. It is our policy that all customers who wish to transact on credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an ongoing basis and historically our exposure to bad debts has been minimal. Credit risk from cash balances is considered low. We restrict cash transactions to high credit quality financial institutions.

Liquidity Risk

Our financing requirements have significantly increased due to the expansion of our business, which has in the past been funded primarily through proceeds received from public offerings of our ordinary shares and debt financings. Nevertheless, we monitor our risk to a shortage of funds using a recurring cash flow planning model. Our objective is to maintain a balance between continuity of funding and flexibility through the availability of bank credit lines and the generation of positive operating cash flows.

Controls and Procedures

(a) Evaluation of disclosure controls and procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms.  Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file under the Exchange Act is accumulated and communicated to our management, including our principal executive and financial officers, as appropriate to allow timely decisions regarding required disclosure.

The Company's management, under the supervision and with the participation of the Chief Executive Officer and Chief Financial (and principal accounting) Officer, carried out an evaluation of the effectiveness of the design and operation of the Company's disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by this report.  As previously disclosed in our annual report on Form 20-F for the year ended December 31, 2010, we have determined that we have inadequate controls related to our period end financial statement close process resulting from controls over the use of spreadsheets and controls over analysis of significant estimates and have determined that we have unremediated material weaknesses resulting from these processes. As a result, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are not effective at a reasonable level of assurance, as of June 30, 2011. Notwithstanding the continuation of these material weaknesses, however, our management has concluded that our consolidated financial statements for the periods covered by and included in this interim report are fairly stated in all material respects in accordance with accounting principles generally accepted in the U.S. for interim financial information.

39

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)

(b) Management’s Report on Internal Control Over Financial Reporting

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during our most recently completed fiscal quarter. Based on that evaluation, our principal executive officer and principal financial officer concluded that there has not been any material change in our internal control over financial reporting during the period covered by this report that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

40

EX-99.2

Exhibit 99.2

CERTIFICATION PURSUANT TO

 SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Alex Moukas, certify that:

1. I have reviewed the interim condensed consolidated financial statements and interim MD&A (together, the “interim report”) of Velti, plc for the three and six months ended June 30, 2011;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;

4. The Company's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Group and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the Company's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting; and

5. The Company's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company's auditors and the Audit Committee of the Board of Directors (or persons performing the equivalents functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting, which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.

Date:	August 29, 2011	By:	/s/ Alex Moukas
			Alex Moukas
			Chief Executive Officer

EX-99.3

Exhibit 99.3

CERTIFICATION PURSUANT TO

 SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Wilson W. Cheung, certify that:

1. I have reviewed the interim condensed consolidated financial statements and interim MD&A (together, the “interim report”) of Velti, plc for the three and six months ended June 30, 2011;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;

4. The Company's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Group and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the Company's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the Company's internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting; and

5. The Company's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company's auditors and the Audit Committee of the Board of Directors (or persons performing the equivalents functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting, which are reasonably likely to adversely affect the Company's ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal control over financial reporting.

Date:	August 29, 2011	By:	/s/ Wilson W. Cheung
			Wilson W. Cheung
			Chief Financial Officer

EX-99.4

Exhibit 99.4

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER

 18 U.S.C. Section 1350,

 AS ADOPTED PURSUANT TO

 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Interim Report of Velti plc on Form 6-K for the period ended June 30, 2011 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Alex Moukas, Chief Executive Officer, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	August 29, 2011	By:	/s/ Alex Moukas
			Alex Moukas
			Chief Executive Officer

In connection with the Interim Report of Velti plc on Form 6-K for the period ended June 30, 2011 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Wilson W. Cheung, Chief Financial Officer, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	August 29, 2011	By:	/s/ Wilson W. Cheung
			Wilson W. Cheung
			Chief Financial Officer

A signed original of this written statement required by 18 U.S.C. Section 1350 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.