This summary is based on the fourth quarter fiscal 2007 earnings call conducted by CNET Networks Inc. (CNET: chart) on January 29, 2007.

Management:

Chief Executive Officer: Neil Ashe
Chief Financial Officer: George Mazzotta
Investor Relations: Cameron McLaughlin

Key Investor Issues:

- Full year revenue was $387.7 million versus $338 million in fiscal 2005.
- Q4 net income was $6.3 million compared with $20.7 million last year quarter.
- The management projects Q1 fiscal 2007 total revenues of $90 million to $94 million.

Fiscal 2007 Financial Highlights

- The operating income totaled $9.4 million during fiscal 2006 versus operating income of $29.9 million for 2005. The reported operating income also reflects $13.7 million in costs related to the company’s restatement and stock investigation.
- The operating income before depreciation, amortization, impairments and stock compensation expense was $66.7 million for the year ended December 31, 2006. Excluding stock option investigation costs of $13.7 million, operating income before depreciation, amortization, asset impairments and stock compensation expense was $80.5 million, a 24% increase versus $65 million during 2005.
- The profit margin of operating income before depreciation, amortization, asset impairments and stock compensation expense was 17%. Excluding stock option investigation expenses, the profit margin of operating income before depreciation, amortization, impairments and stock compensation expense increased to 21% from 19% in fiscal 2005.
- The net cash provided by operating activities for 2006 was $61.8 million compared with $43.2 million in 2005. The free cash flow for the year 2006 was $29 million.
- Excluding stock compensation expense, impairment, realized gain (loss) on investments, loss from discontinued operations and stock option investigation costs, adjusted net income for the year 2006 was $43.6 million, or 29 cents per share, compared with $36.8 million, or 24 cents per share in fiscal 2005.

Fourth-Quarter Financial Highlights

The quarter operating income was $9.7 million versus $23 million in the year ago quarter.

- The reported operating income also reflects $6.5 million in costs related to the company’s restatement and stock option investigation.
- The operating income before depreciation, amortization, impairments and stock compensation expense was $26.6 million for Q4 fiscal 2006. Excluding the stock option investigation costs of $6.5 million, operating income before depreciation, amortization, asset impairments and stock compensation expense was $33.1 million, an increase of 7% compared with $31 million for Q4 fiscal 2005.

The profit margin of operating income before depreciation, amortization, impairments and stock compensation expense was 22%.

- This compares to 30% in the fourth quarter of fiscal 2005.
- Excluding stock option investigation costs, the profit margin of operating income before depreciation, amortization, asset impairments and stock compensation expense was 28%.

The net cash provided by operating activities for the fourth quarter of 2006 was $8.6 million.

- This represents a decrease from the Q4 fiscal 2005 amount of $8.8 million.
- The quarter free cash flow was $2.7 million.
- The management advised that the free cash flow is defined as cash flow from operating activities less CapEx.

On a reported basis, net income for the fourth quarter was 4 cents per diluted share versus 13 cents per diluted share in the year ago quarter.

- The reported net income for the quarter was negatively affected by $6.5 million in stock option investigation costs.
- Excluding stock compensation expense, stock option investigation costs, impairments, realized gains on investments and loss from discontinued operations, adjusted net income for the fourth quarter of 2006 was $19.6 million, or 13 cents per diluted share versus $23.3 million, or 15 cents per diluted during the same period in the previous year.

The company’s global network of Internet properties reached an average of 136 million unique monthly users during the quarter.

- This represents an increase of 17% from Q4 fiscal 2005.
- The management reported that average daily page views increased to more than 85 million during the quarter although down 18% from the past year quarter.

The company continued to expand its network and identify new growth opportunities in the Q4.

- This included the ongoing development of recent brand additions like CHOW, the beta launch of FilmSpot and the acquisition of new brands in France and China.
- CHOW is a food web site for those who live to eat. It continues to grow rapidly in popularity reaching more than one million monthly unique visitors at the end of fiscal 2006.
- The FilmSpot was launched in December 2006 and aims to combine content and community features in an immersive environment that satisfies the interests of movie fans.
- The company also acquired GameKult, a leading French provider of interactive content for video game enthusiasts. It is ranked among the top two gaming sites in France with more than one million users per month.
- During the quarter, the company also extended its growing online portfolio in China with the acquisition of EA3W, a leading consumer electronics buying guide based in Beijing.