A.D.A.M., Inc. Reports Financial Results for First Quarter 2006; Net Income of $0.07 Per Share, Healthcare Licensing Revenues Increase 18%.

ATLANTA -- A.D.A.M., Inc. (Nasdaq:ADAM):

Financial and Operating Highlights:

--Revenues for the quarter ended March 31, 2006 were $2,482,000 as compared to $2,338,000 in the year ago period. Revenues from healthcare licensing were $2,122,000 for the first quarter of 2006, an increase of 18% year over year attributable to the company's expanding customer licensing base. Revenues from education products and one-time sales were $360,000, a decrease of 33% from the year ago period. The decrease was primarily attributable to strong sales in 2005 of a new product after its initial release. Recurring revenues from healthcare licensing for the first quarter represented 85% of the company's total revenues, up from 77% from the year ago period.

--Renewal rates for the company's licensing contracts for the first quarter ended March 31, 2006 was over 90%.

--Net income increased 43% for the quarter ended March 31, 2006 to $728,000, or $0.07 per share on a fully diluted basis as compared to $508,000, or $0.06 per share on a fully diluted basis for the year ago period.

--Operating margin for the quarter ended March 31, 2006, was 24%, an increase of 4% from 20% in the year ago period.

--Proforma operating income, after removing non-cash stock-based compensation expenses, was $590,000 for the first quarter ended March 31, 2006, compared to $565,000 for the year ago period. Non-cash stock-based compensation expense primarily relates to variable compensation costs associated with options cancelled and re-issued in 1999 as well as the effects of the accounting treatment for incentive stock options granted to employees.

--Cash and investments totaled $12,103,000 as of March 31, 2006, an increase of $1,426,000 from $10,677,000 as of December 31, 2005.

"Our core healthcare licensing revenues are increasing at a steady pace and we are pleased with the customer adoptions and strong renewal rates we continue to experience," said Kevin S. Noland, A.D.A.M.'s president and chief executive officer. "Our new product for education, A.D.A.M. Interactive Anatomy 4.0, was well received in the first quarter last year and sales continue to be strong, but were not anticipated to stay at last year's initial sales volume.

"We continue to be focused on the expansion of our initiatives into the consumer directed healthcare market," Noland continued. "During the first quarter, we introduced two key products, our health risk assessment reporting tools, and DecisionAssist, a library of tools that help consumers make informed choices about their use of healthcare services, such as whether to have a particular surgery, proceed with a test, or see a specialist. We believe that these types of tools, enhanced with A.D.A.M.'s consumer-friendly, interactive health content, speak directly to the growing needs of consumers as they take more control of their health decisions and cost of healthcare. We are excited by what we see happening in this marketplace, and believe that A.D.A.M. is well positioned to capitalize on its position as the trusted source of healthcare information and the emerging trends in consumer directed healthcare."

About A.D.A.M.

For more than a decade, A.D.A.M.'s unique, visually engaging health content, decision support tools and educational products have been helping millions of people "get smart" about their health and wellness. With one of the largest consumer-oriented medical information libraries in the world, A.D.A.M. markets its solutions to leading healthcare and pharmaceutical organizations, government, employers, and educational institutions. These innovative products empower consumers with the information they need to effectively participate in consumer directed health plans, make positive changes in behavior and improve overall health. To learn more about A.D.A.M., visit www.adam.com or call 1-800-408-ADAM.

Three Months Ended
                                                March 31,   March 31,
                                                  2006        2005
                                               ----------- -----------

Revenues, net                                  $    2,482  $    2,338
                                               -----------  ----------
Operating costs and expenses
     Cost of revenues (exclusive of
      depreciation shown below)                       489         498
     General and administrative                       560         594
     Product and content development                  360         319
     Sales and marketing                              435         401
     Depreciation and amortization                     37          54
                                               ----------- -----------
       Total operating costs and expenses           1,881       1,866
                                               ----------- -----------
       Operating income                               601         472
Interest income, net                                  127          36
                                               ----------- -----------
       Income before taxes                            728         508
                                               ----------- -----------
       Net Income                              $      728  $      508
                                               =========== ===========
Basic net income per common share              $     0.09  $     0.06
                                               =========== ===========
Basic weighted average number of common
     shares outstanding                             8,316       7,930
                                               =========== ===========
Diluted net income per common share            $     0.07  $     0.06
                                               =========== ===========
Diluted weighted average number of common
     shares outstanding                             9,896       9,114
                                               =========== ===========


       Summary Balance Sheet Data
       --------------------------
                                                3/31/2006  12/31/2005
                                               ----------- -----------
Cash and short-term investments                $   12,103  $   10,677
Accounts receivable-net                               902       1,840
Current portion of deferred tax asset                 221         221
Total current assets                               13,810      13,294
Deferred tax asset, net of current portion          5,279       5,279
Goodwill                                            2,043       2,043
Total assets                                       22,327      21,880
Deferred revenue                                    3,227       3,643
Short term debt                                        21          20
Total current liabilities                           3,943       4,718
Total liabilities                                   3,955       4,736
Shareholders' equity                               18,372      17,144
Working capital                                     9,867       8,576