724 Solutions Announces Preliminary Second Quarter Results.

Business Editors

TORONTO & AUSTIN, Texas--(BUSINESS WIRE)--July 5, 2001

724 Solutions Inc. (Nasdaq:SVNX) (TSE:SVN) today announced preliminary results for the second fiscal quarter ended June 30, 2001. Revenues for the quarter will be approximately $14.1 million, a 255 percent increase compared to the same period of fiscal 2000. Pro forma loss per share for the quarter is expected to be $(0.27) to $(0.29), an improvement of approximately 30 percent compared to the same period of fiscal 2000. Pro forma loss is net loss for the period, adjusted for amortization of intangibles, equity in income (loss) of affiliate, stock-based compensation and certain non-recurring expenses, including one time costs incurred in connection with the integration of TANTAU Software, and the realignment of 724 Solutions' business. These adjustments are expected to be in the range of $5.0-6.0 million. (All amounts in U.S. dollars.)

"Our global pipeline of opportunities is the strongest it has ever been, but the economic uncertainty is causing some of our larger license deals to take longer to close," said John Sims, Chief Executive Officer, 724 Solutions. "Given the uncertain economic outlook -- and the potential that this may continue to affect our sales cycle on large strategic contracts -- we believe that it is prudent to adjust our revenue expectations for the year to $67.0 million."

724 Solutions will announce its second quarter earnings and provide more detailed company results on July 25, 2001 during a conference call scheduled for 5:00 pm EST. Participants can access the call via the Company's website at www.investors.724.com or by dialing 416-620-2406 (Canada) or 1-888-434-1242 (International). A replay of the teleconference will also be available for 48 hours and can be accessed by dialing 416-626-4100, reservation #19309027.

About 724 Solutions Inc.

724 Solutions Inc. is a leading global provider of Internet infrastructure software that enables the delivery of secure financial services applications and mobile transaction solutions across a wide range of Internet-enabled devices. The 724 Solutions suite of products and services enables companies to realize value through the mobile Internet by building, deploying, and integrating personalized and secure mobile commerce and lifestyle applications. With dual headquarters in Toronto, Canada, and Austin, Texas, the company has development and sales offices around the world. 724 Solutions' common shares are listed on the NASDAQ National Market (SVNX) and The Toronto Stock Exchange (SVN). For additional information visit www.724.com.

This press release contains statements of a forward-looking nature. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements include the statements herein regarding our revenues for the year ending December 31, 2001 and our ability to increase our customer base and to expand our business. The accuracy of these statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including the risk that demand for wireless financial and transactional services will not increase as we anticipate; the risk that we will not be able to successfully sell our products and services to new customers; the risk that the sale of our products and services involves a long sales cycle; the risk that the economic environment and business conditions will remain difficult to predict and that general economic activity could decline; competition in our target markets; the risk that we will not respond adequately to evolving technologies; the risk that we will not have adequate capital or personnel to develop and market our products and services; the risk that we will encounter difficulties in integrating the operations of acquired companies with our own; the risk of conducting our operations in a variety of international locations; and other risks described in our filings with the Securities and Exchange Commission, including our annual report on Form 10-K. These risks are also described in our filings with the Canadian Securities Administrators, including our prospectuses, material change reports, Annual Information Form and Management Information Circular. 724 Solutions does not undertake any obligation to update this forward-looking information, except as required under applicable law.