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Press Release

Jacada Reports Second Quarter and First Half 2008 Results

Revenue grows 135% for first six months, company boosts revenue guidance for full year 2008
Growth fueled by accelerated product acceptance and new contracts from existing customers

ATLANTA, August 14, 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 second quarter ended June 30, 2008.

For the second quarter of 2008, total reported revenues rose 198% to $6.0 million compared to $2.0 million in the second quarter of 2007. Total reported revenues for the first six months of 2008 rose 135% to $11.9 million compared to $5.1 million for the first six months of 2007.

Non-GAAP gross profit for the second quarter was $3.2 million, or 53% gross margin, compared to $1.1 million in gross profit, or 52% gross margin in the second quarter last year. For the first six months of 2008, non-GAAP gross profit was $7.0 million, or 59% gross margin compared to $3.0 million or 60% gross margin for the first six months of 2007.

The second quarter non-GAAP net loss from continuing operations improved 64 percent to ($1.1 million), or ($0.06) per share, when compared to ($3.2 million), or ($0.16) per share in the second quarter of 2007. Non-GAAP net loss for the first six months of 2008 improved 71 percent to ($1.6 million) compared to a net loss of ($5.4 million) for the first six months of 2007.

Total GAAP gross profit was $3.2 million, or 52% gross margin, compared to $982,000 and 49%, respectively, in last year's second quarter. For the first six months of 2008, GAAP gross profit was $6.9 million, or 58% gross margin compared to $2.9 million or 57% gross margin for the first six months of 2007.

Overall GAAP net loss for the second quarter of 2008 was ($1.6 million), or ($0.08) per share, which includes ($1.2 million) of net loss from continuing operations and a ($399,000) net loss from discontinued operations. This is compared to a GAAP net loss of ($681,000) or ($0.03) per share for the second quarter of fiscal year 2007, which includes ($2.5 million) of net loss from continuing operations and $1.8 million of net income from discontinued operations. GAAP net income for the first six months of 2008 was $18.5 million, or $0.89 per share, which includes ($1.7 million) of net loss from continuing operations and $20.2 million of capital gain net of taxes from discontinued operations. This is compared to a GAAP net loss of ($213,000) or ($0.01) per share for the first six months of fiscal year 2007, which includes ($4 million) of net loss from continuing operations and $3.8 million of net income from discontinued operations.

"In what continues to be a very tough economic climate, we are very excited to report another strong quarter in 2008 and significant progress towards our stated financial objectives," commented Paul O'Callaghan, chief executive officer for Jacada. "We have recorded 32% more software revenue in the first six months of 2008 than we did in all of 2007, with software revenue now representing 41% of total revenue for the first six months of the year, compared to 37% last year. We remain encouraged that major customers are experiencing clear and early benefits from the deployment of Jacada solutions, leading to further investment. In the second quarter we recognized significant revenue from achieving critical milestones in many customer projects and received additional orders from existing customers. Media reports continue to emphasize a direct correlation between customer service quality and financial performance, as more and more companies are feeling the effects of the competitive market and commoditized offerings. We continue to see significant interest in the Jacada customer service solutions driven by the dramatic impact we can make on the quality of service our customers deliver."

During the second quarter, Jacada repurchased approximately 390,000 of its ordinary shares at a cost of $1.4 million under its current stock repurchase program under which it is authorized to use of up to $10 million of its available cash to repurchase outstanding ordinary shares. The company plans to continue with the acquisition of its own shares through a self-tender offer, per the details in a press release issued this morning.

At the end of the second quarter of 2008, cash and investments were $53.7 million, compared to $33.8 million reported on December 31, 2007. The increase in the company's cash position is a result of the sale of the company's legacy business to Software AG, which closed on January 1, 2008. An additional $2.6 million is being held in escrow as part of the transaction.

During the second quarter, the company signed its second material contract in less than nine months with O2 UK, a leading provider of mobile services to consumers and businesses in the United Kingdom. The first Jacada project, which was announced via a press release on November 17, 2007, is ongoing within the company's prepaid division. This new agreement is for a project with the retentions group in the post-pay consumer area of the O2 UK business.

"We see tremendous upside revenue potential within the large corporations we serve," said O'Callaghan. "Our customers frequently engage us, initially, to help improve the efficiency and effectiveness in one of their customer service centers, typically for one function or department within their enterprise. When they successfully deploy and begin to realize the financial and service benefits that result from a unified and automated customer service desktop, they quickly turn to other customer service functions within their business to see how they can apply our solutions. The recently announced agreements with O2 UK and Nationwide Insurance in the U.S. are indicative of this growth potential within our install base."

"Due to our backlog, visibility into our sales pipeline, and the growing opportunity to expand our relationships with existing customers, we are raising our revenue guidance for 2008 to $21 to $23 million, which represents an increase of 57% to 72% year-over-year," concluded O'Callaghan. "As demonstrated in this quarter's results, we are well on our way to achieving our stated objectives of reducing our annual non-GAAP net loss by as much as 40% to 50% in 2008 compared to 2007. We also still anticipate reaching non-GAAP profitability during 2009."

Conference Call Details

Any investor or interested individual can participate in the teleconference, which will begin at 10:30 a.m. Eastern Time on August 14, 2008. To participate in the teleconference, please call toll-free 888.680.0865, or 617.213.4853 for international callers, and provide passcode 54369018 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 August 14, 2008. To access the replay, dial toll-free 888-286-8010, or for international callers dial 617-801-6888, and provide passcode 27778676.

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