Netscape Reports 18 Percent Growth on Revenues of $150.2 Million for Quarter Ending July 31, 1998; Announces New Board Member

MOUNTAIN VIEW, Calif. (August 18, 1998) - Netscape Communications Corporation (NASDAQ: NSCP) today reported revenues of $150.2 million for the three months ending July 31, 1998, an 18 percent increase over the $127.2 million in revenues posted during the quarter ended April 30, 1998. Revenues from Netscape's enterprise software and services business grew 16 percent during the quarter to $111.6 million, compared to $96.1 million in the previous quarter. Revenue from Netscape Netcenter increased 24 percent to $38.7 million for the quarter ending July 31, 1998, compared to $31.1 million for the quarter ended April 30, 1998.

Netscape's operating margin improved by 6.5 points for an operating loss of $2.1 million for the quarter, compared to an operating loss of $10.1 million for the preceding quarter ended April 30, 1998. Net income for the quarter totaled $0.1 million, or $0.00 per share, compared with net income of $0.0 million, or $0.00 earnings per share, in the preceding quarter.

"Overall, we are pleased with the results we posted for the quarter," said Jim Barksdale, president and chief executive officer. "We're seeing strong momentum in both the enterprise software and Netcenter businesses as demonstrated by the number of significant customer wins announced during the quarter, including Ford, Visteon, Digital Equipment Corporation, Bay Networks, Fujitsu, Citibank, America Online, Excite, LookSmart, Lycos, Infoseek, and AltaVista."

In addition to presenting Consolidated Statements of Operations for the company, Netscape for the first time is presenting separate Statements of Operations for its enterprise software and Netcenter segments. "We believe it's important to provide the investor and analyst communities with an enhanced level of detail to evaluate the performance of both sides of our business," explained Peter Currie, executive vice president and chief administrative officer.

Netscape also announced today that Bill V. Campbell, chairman of the board of directors at Intuit, will join Netscape's board of directors. Mr. Campbell is credited with helping Intuit become the largest, most successful publisher of financial software in the world. Additionally, Mr. Campbell serves on the board of directors of Apple Computer, Inc. He replaces John E. Warnock, chairman and chief executive officer of Adobe Systems, Inc. "John has been an outstanding contributor during his four years of service on Netscape's board, and we'll miss him greatly," said Jim Barksdale. "Meanwhile, we look forward to the valuable contributions Bill will make as our newest board member."

Enterprise Overview
During the quarter, Netscape made several significant announcements related to its enterprise software business. Ford Motor Company is using the Netscape Directory Server software as the foundation for the Ford Supplier Network, an extranet that lets Ford deliver information and applications to Ford's suppliers around the world. Additionally, Visteon, a $20 billion parts supplier and Ford spin-off, licensed the entire Netscape CommerceXpert line and Netscape Application Server software.

Netscape Singapore announced plans to work with NETS (Network for Electronic Transfers Singapore) to establish Asia's first Internet-based online payment system for business-to-business electronic commerce. The companies will provide the infrastructure for the new online payment system in partnership with Asia Manufacturing Online (AMO), a subsidiary of Silkroute Ventures, using electronic-commerce software developed by Netscape Communications and Java technology from Sun Microsystems.

Netscape also shipped BuyerXpert 1.0, delivering the industry's first solution to automate both the internal and external steps of the procurement process, from placing orders to managing internal approvals and exchanging orders. The insurance and financial services giant John Hancock selected BuyerXpert to automate its corporate procurement processes and reduce the costs associated with purchasing $300 million in supplies and services for its 7,000 employees nationwide.

On the reseller front, SCO announced plans to be the first to deliver an integrated, enterprise-class Messaging Server for the Intel platform by bundling Netscape Messaging, Directory and FastTrack servers on SCO UnixWare 7. Digital expanded its existing license agreement with Netscape to include the Netscape Application Server line. In addition, Fujitsu announced plans to ship a Japanese localized version of Netscape Application Server. The Fujitsu announcement was made in conjunction with its partners CTC, FJB, NEC and Hitachi, essentially making Netscape Application Server the definitive industry standard for application servers in Japan. Also in the quarter, Bay Networks licensed Netscape's Directory Server software and plans to bundle it with each member of its Contivity Extranet Switch product family.

Netcenter Overview
As a follow-on to the sweeping enterprise software agreement that Netscape and Citibank announced in May, the two companies announced a second strategic worldwide agreement that will make Citibank the anchor tenant of the upcoming Personal Finance channel on Netscape Netcenter. This multiyear agreement not only is one of the largest in the industry for finance channels but also represents the first major Internet portal relationship for Citibank.

Additionally during the quarter, Netscape and America Online signed a strategic agreement to make AOL's Digital City the exclusive local content provider for Netcenter. Netscape launched the Netscape Silver Screen Sweepstakes with entertainment and consumer products company cosponsors including Warner Bros. Online, Paramount Digital Entertainment, Hollywood Online and Sony in a creative promotion to drive membership growth.

The company's two-month "Project 60" campaign to build Netscape Netcenter into a major Internet portal culminated in June 1998 with the launch of Netscape Netcenter 2.0, a revamped Web site with a new look and feel, a new search service featuring six premier content providers (including Netscape branded search), and a complete set of content channels and consumer-based Internet services ranging from Web-based email to improved search engine technology.

In July, Netscape announced the beta release of Netscape Communicator 4.5, the first browser designed to link the Netscape Netcenter portal site's content and services with ease-of-use advances in the browser to make it simpler for people to find information on the Internet. Technology advances introduced in the release include Smart Browsing, a new set of features that make Web searches more sophisticated and intelligent; Smart Update, a button in the browser that shortens the process of downloading software; and Smart Addressing, an easier way to find and communicate with other people on the Internet. Additionally, Netscape launched My Netscape, a new Netcenter service that allows people to fully personalize their Web experience - complete with search functionality, news, weather, stock quotes, bookmarks and links to applications such as WebMail and Instant Messenger.

Netscape Communications Corporation is a leading provider of software and services for businesses that want to transform the way they create and keep customers in the emerging Net Economy. The company offers a full line of enterprise software solutions, professional services, and a leading Internet portal to help companies build, buy or outsource Internet applications that drive revenue growth, build customer loyalty, and create new levels of business efficiency. Traded on NASDAQ under the symbol NSCP, Netscape Communications Corporation is based in Mountain View, California.

Additional information on Netscape Communications Corporation is available on the Internet at http://home.netscape.com, by sending email to info@netscape.com or by calling 650/937-2555 (corporate customers) or 650/937-3777 (individuals).

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