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ATLANTA, February 13, 2008 - Jacada Ltd. (Nasdaq: JCDA), a leading provider of unified desktop and process optimization solutions for customer service operations, today reported financial results for the fourth quarter and for the fiscal year ended December 31, 2007.

Fourth Quarter Highlights:

During the fourth quarter of 2007, the Company:



Announced, on December 20, 2007, the sale of its application modernization (legacy) business to Software AG for gross proceeds of $26 million in cash, including approximately $3 million to be held in escrow. The transaction closed on January 1, 2008.

Announced that Paul O’Callaghan will become the CEO of Jacada effective January 1, 2008, and Gideon Hollander will become Chairman of the Board.

Signed contracts with 3 new telecommunications customers, including:

A material contract with O2 UK, a leading provider of mobile telecommunications services to consumers and businesses in the United Kingdom.

A contract with a major telecommunications provider in Canada.

A contract with a premiere telecommunications provider in Eastern Europe.

Signed a material contract with a major North American insurance company.

Announced that Station Casinos selected the Jacada Unified Service Desktop Solution to create a unified interface and desktop for their guest service agents.

Announced that Guy Tweedale was hired to lead European operations.

“We are extremely pleased to report a strong year comprised of solid execution and rapid growth, as evidenced in our financial performance, which tracked well according to plan,” commented Paul O’Callaghan, chief executive officer for Jacada. “Including revenues from our legacy business, we achieved record annual revenues of $25.8 million, which is in line with our guidance, and represents 25% growth over 2006. This growth was driven by a 57% increase in our call center business.”

“Throughout the year, we continued to experience record-level growth in our call center revenues, booking and backlog and we anticipate achieving significant growth in each of these categories throughout 2008,” continued Mr. O’Callaghan. “As of December 31, 2007, our call center backlog, which provides visibility for our future revenues, was $14.7 million, representing a year-over-year increase of 76%. We expect the majority of this backlog to be recognized as revenue in 2008. We added 14 new, marquee accounts during the year, in both established and new verticals, and announced distribution agreements with two leading, global IT integration and services firms. We expect these partners, and others that we continue to pursue, to play an important role in our migration to a business model with a higher software component. We continue to make the required investments to support our growth, and we expect that a higher software revenue component will gradually improve our margins and significantly reduce our operating and net losses.”

NOTE: Jacada fourth quarter and year-end financial reports reflect the divestiture of its application modernization (legacy) business, which generated approximately $12.5 million in revenues and $9.5 million in GAAP net income during 2007. This business was sold prior to year-end and has been classified in the GAAP financial tables as “Discontinued Operations.” The sale of this business was announced on December 20, 2007 and closed on January 1, 2008, for gross proceeds of $26 million in cash, which includes approximately $3 million currently being held in escrow. The following non-GAAP financial discussion pertains only to continuing operations (call center business). The difference between the non-GAAP numbers and GAAP numbers includes net income from discontinued operations (legacy business), income tax benefits associated with the discontinued operation, stock-based compensation expenses and amortization of acquired intangible assets related to acquisitions effected by Jacada in previous years.

For the fiscal year 2007, total call center revenues grew 57% to a record $13.3 million from $8.5 million in the fiscal year 2006. Non-GAAP gross profit for the fiscal year 2007 was $6.2 million or 47% gross margin, compared to $4.6 million and 54%, respectively, for the fiscal year 2006. GAAP gross profit was $5.8 million or 43% gross margin, compared to $4.4 million and 52%, respectively, in the fiscal year 2006.

Annual non-GAAP net loss was ($11.0 million), or ($0.54) per share in 2007 compared to a net loss of ($12.2 million), or ($0.62) per share in 2006. Overall annual GAAP net income in 2007 was $4.1 million, or $0.20 per share, which included $9.5 million in income from discontinued operations and an income tax benefit associated with discontinued operation of $6.7 million. This compared to a net loss of ($2.6 million), or ($0.13) per share in fiscal year 2006, which included $9.1 million in income from discontinued operations and a tax benefit associated with discontinued operation of $1.3 million.

For the fourth quarter, total reported revenues from continuing operations rose 137% to a record $6.15 million compared to $2.6 million in the fourth quarter of 2006. Non-GAAP gross profit for the fourth quarter was $2.5 million, or 41% gross margin, compared to $1.4 million in gross profit, or 55% gross margin in the fourth quarter last year. Total GAAP gross profit was $2.3 million or 37% gross margin, compared to $1.3 million and 52%, respectively, in last year’s fourth quarter.

The fourth quarter non-GAAP net loss from continuing operations was ($2.4 million), or ($0.11) per share, compared to ($2.9 million), or ($0.14) per share in the fourth quarter of 2006. Overall fourth quarter GAAP net income was $5.4 million, or $0.26 per share, which included $2.6 million in income from discontinued operations and an income tax benefit associated with discontinued operation of $5.6 million. This compared to a net loss of ($634,000), or ($0.03) per share in the fourth quarter of fiscal year 2006, which included $2.2 million in income from discontinued operations and a tax benefit associated with discontinued operation of $200,000.

At the end of the fourth quarter of 2007 cash and investments were $33.8 million, compared to $35.9 million reported on December 31, 2006. Subsequent to the end of the quarter, the sale of the company’s legacy business added gross proceeds of $26 million, including approximately $3 million held in escrow, to the balance sheet.

“We are delivering a solution to the market that is achieving significant cost savings and revenue growth opportunities for our clients,” continued Mr. O’Callaghan. “What is also critically important to our clients is the enhanced customer experience that our clients can now offer through efficient call resolutions. This is contributing to measurable gains for our call center clients as their customer retention rates improve. The flexibility of our solution is enabling us to penetrate new verticals and go deeper into our established markets, resulting in a rapidly intensifying market opportunity.”

“Due to our backlog, visibility in our sales pipeline and the progress of project deliverables, we are raising our revenue guidance for 2008 to $20 to $22 million, which represents an increase of 50% to 65% year-over-year,” concluded Mr. O’Callaghan. “We also expect to reduce our annual non-GAAP net loss by as much as 40% to 50% in 2008 compared to 2007, and based on our current financial model, we anticipate reaching non-GAAP profitability during 2009. We are confident that we will continue to meet or exceed our long-term financial milestones.” Conference Call Details Any investor or interested individual can participate in the teleconference, which will begin at 10:30 a.m. Eastern Time on February 13, 2008. To participate in the teleconference, please call toll-free 888-713-4213, or 617-213-4865 for international callers, and provide passcode 46963571 approximately 10 minutes prior to the start time. A (live audio) webcast will also be available over the Internet at www.jacada.com (under "About Us" then "Investors") or www.earnings.com. A replay of the teleconference will be available for three days beginning at 12:30 p.m. ET on February 13, 2008. To access the replay, dial toll-free 888-286-8010, or for international callers dial 617-801-6888, and provide passcode 87488338.

Use of Non-GAAP Financial Information
In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, Jacada uses non-GAAP measures of operating income (loss), net income (loss) and income (loss) per share, which are adjustments from results based on GAAP to exclude discontinued operations, taxes, non-cash stock-based compensation expenses in accordance with SFAS 123R and amortization of acquired intangible assets related to acquisitions effected by Jacada in previous years. Jacada's management believes the non-GAAP financial information provided in this release is useful to investors' understanding and assessment of Jacada's on-going core operations and prospects for the future. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Management uses both GAAP and non-GAAP information in evaluating and operating business internally and as such deemed it important to provide all this information to investors.

About Jacada
Jacada is a leading global provider of unified service desktop and process optimization solutions that simplify and automate customer service processes. By bridging disconnected systems into a single, intelligent desktop, Jacada solutions create greater operational efficiency and increase agent and customer satisfaction. Founded in 1990, Jacada operates globally with offices in Atlanta, Georgia; Herzliya, Israel; London, England and Munich, Germany. Jacada can be reached at www.jacada.com. Forward Looking Statement This news release may contain forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. The words "may," "could," "would," "will," "believe," "anticipate," "estimate," "expect," "intend," "plan," and similar expressions or variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of the future performance and involve risks and uncertainties, many of which are beyond the Company’s ability to control. Actual results may differ materially from those projected in the forward-looking statements as a result of various factors including the performance and continued acceptance of our products, general economic conditions and other Risk Factors specifically identified in our reports filed with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise any forward-looking statement for events or circumstances after the date on which such statement is made. Jacada is a trademark of Jacada Inc. All other brands or product names are trademarks of their respective owners. Jacada is a trademark of Jacada Ltd. All other brands or product names are trademarks of their respective owners.

CONTACT: Tzvia Broida
Chief Financial Officer
Jacada
972 9 9525927
Tzvia@jacada.com


Or

Peter Seltzberg
Hayden Communications
(646) 415-8972
peter@haydenir.com


The accompanying financial tables can be found on the Jacada website at http://www.jacada.com/news/PR273.htm.