Applied Voice Technology, Inc. Announces Record Financial Results for Its Quarter Ended June 30, 1998.

KIRKLAND, Wash.--(BUSINESS WIRE)--July 23, 1998--

Changes Name to "AVT Corporation" Reflecting Diversification in Its Business

Applied Voice Technology, Inc. (NASDAQ:AVTC) today reported its financial results for the quarter ended June 30, 1998 and formally announced the change of its corporate name from Applied Voice Technology, Inc. to AVT Corporation.

Sales and earnings were at record levels for the quarter, with sales of $19,439,000 and earnings of $2,710,000, a 42% increase in sales and 53% increase in earnings over the comparable prior-year quarter. Earnings per share (diluted) were $0.20 as compared to $0.14 in the prior-year quarter.

For the six months ended June 30, 1998 sales were $36,605,000, a 42% increase over the comparable prior-year period. Excluding non-recurring charges described below, earnings increased 57% and were $4,812,000 or $0.37 earnings per share (diluted), as compared with $3,072,000 or $0.25 earnings per share (diluted) in the prior-year period.

"We are extremely pleased with the significant growth in sales and earnings for the quarter," stated Richard J. LaPorte, Chairman and Chief Executive Officer. "Our continued emphasis on high margin products for larger enterprise accounts helped us achieve record sales for the quarter and for the first six months of the year, while producing operating profit margins of 20.1% and 19.0% respectively. With the exception of our basic voice messaging business, which continues to decline, all of our business lines did well in the quarter. In particular, our fax server business was robust, representing 57% of total company sales, up from 39% in the second quarter of 1997."

Commenting on the recent change in the company's name, LaPorte added: "Applied Voice Technology is a different company than it was when our founders originally established our name in the early 1980's. Through our R&D efforts and our strategic diversification initiatives the company has evolved to represent much more than just "voice" to the computer telephony marketplace. We believe the time is at hand to broaden our image beyond voice, recognizing that in addition to voice processing, we deliver robust solutions for network, enterprise and production faxing, call center management and unified messaging with products integrated with email systems from Microsoft, Lotus and Novell. By abbreviating our name to AVT Corporation we can take advantage of the excellent brand equity the "AVT" name has established in the marketplace, while we continue to diversify and expand into new areas of opportunity."

Non-recurring charges. The company filed for a follow-on offering of its common stock in October 1997. In February 1998, this offering was withdrawn resulting in the $287,000 write-off of costs associated with the offering. In January 1997, the Company acquired selected assets of Telcom Technologies which resulted in the $3,898,000 write-off of acquired in-process research and development. Including these non-recurring charges, the company reported earnings of $4,628,000 for the six months ended June 30, 1998 and $577,000 for the comparable prior-year period. Earnings per share (diluted) including these non-recurring charges were $0.35 in the six months ended June 30, 1998 quarter and $0.05 per share in the comparable prior-year period.

AVT Corporation develops, manufactures, markets and supports a broad line of open systems-based advanced computer telephony products, specializing in unified messaging, high-performance fax processing, call center productivity and customer service applications. AVT is headquartered in Kirkland, Washington, USA, and does business through its Computer Telephony Products Group, based in Kirkland, Washington and through its wholly owned subsidiaries, RightFAX, Inc. based in Tucson, Arizona and CommercePath, Inc. based in Portland, Oregon. In addition, AVT has sales and support offices in the United Kingdom, Germany, Hong Kong and Dubai. Founded in 1982, AVT is publicly traded under the symbol "AVTC" on the Nasdaq National Market. AVT maintains a site on the World Wide Web at www.AVTC.com.

RightFAX is a registered trademark of AVT Corporation. Windows NT is a registered trademark of Microsoft Corporation. Other products mentioned are trademarks of their respective owners.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties, including technical and competitive factors, which could cause the Company's results and the timing of certain events to differ materially from those discussed in the forward-looking statements. Such risks are detailed in AVT's latest Annual Report on Form 10-K and Quarter Reports on Form 10-Q filed with the Securities and Exchange Commission.

NOTE TO EDITORS: News releases are available from AVT's Newsroom fax server. Call 425/820-4089 and follow the prompts. This is document number 77096. News releases can also be found on AVT's World Wide Web site at www.AVTC.com. -0-

                    Applied Voice Technology, Inc.
             Consolidated Statements of Income (Unaudited)
               (in thousands, except per share amounts)


                                      Quarter ended   Six Months ended
                                          June 30           June 30
                                      1998      1997     1998     1997

Net sales                         $ 19,439  $ 13,660 $ 36,605 $ 25,722
Cost of sales                        6,969     4,958   13,313    9,548
Gross profit                        12,470     8,702   23,292   16,174
Operating expenses:
     Research and development        2,001     1,571    3,928    3,069
     Sales, general
      and administrative             6,555     4,640   12,401    8,823
     Non-recurring charges (1)           -         -      287    3,898
        Total operating expenses     8,556     6,211   16,616   15,790

Operating income                     3,914     2,491    6,676      384
Other income, net                      320       278      555      518
Income before
 income tax expense                  4,234     2,769    7,231      902
Income tax (benefit) expense         1,524       997    2,603      325
Net income                        $  2,710 $   1,772 $  4,628 $    577

Basic net income
 per share                        $   0.23 $    0.16 $   0.39 $   0.05
Diluted net income
 per share                        $   0.20 $    0.14 $   0.35 $   0.05

Weighted average
 common shares outstanding          11,946    11,302   11,813   11,254
Diluted weighted average
 common shares outstanding          13,401    12,255   13,172   12,227

Net income excluding
 non-recurring items (1)          $  2,710 $   1,772 $  4,812 $  3,072
Diluted net income
 per common share
 excluding non-recurring
 items (1)                        $   0.20 $    0.14 $   0.37 $   0.25

Diluted weighted average
 common shares outstanding (1)      13,401    12,255   13,172   12,227

     (1) Non-recurring charges consist of write-off of costs related
to the withdrawal of the follow-on stock offering in February 1998
(originally filed in October 1997) and write-off of acquired
in-process research and development associated with the acquisition of
Telcom Technologies in January 1997.


                    Applied Voice Technology, Inc.
                Consolidated Balance Sheets (Unaudited)
                            (in thousands)

                                                   June 30,   Dec. 31,
                                                     1998       1997
ASSETS:
Current assets:
     Cash, cash equivalents, and short-term
      investments                                 $  28,706  $  22,233
     Accounts receivable, net                        10,257     10,098
     Inventories                                      5,134      4,908
     Deferred income taxes                            1,725      1,119
     Prepaid expenses and other assets                1,255        968
          Total current assets                       47,077     39,326

Equipment and leasehold improvements, net             2,661      2,364
Intangibles, net                                      8,026      8,815
Deferred income taxes                                 3,739      3,905

               Total assets                       $  61,503  $  54,410

LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities:
     Accounts payable                             $   3,669  $   2,352
     Other current liabilities                        7,063      6,427
     Income taxes payable                             1,040      2,621
          Total current liabilities                  11,772     11,400

Commitments

Shareholders' equity:
     Preferred stock, par value $.01 per share,
      2,000,000 Authorized, none outstanding              -          -
     Common stock, par value $.01 per share,
      60,000,000 Authorized, 11,963,273
      and 11,522,558 outstanding, respectively          120        115
     Additional paid-in capital                      33,686     31,604
     Retained earnings                               15,925     11,291
          Total shareholders' equity                 49,731     43,010

  Total liabilities and shareholders'  equity      $ 61,503   $ 54,410


    CONTACT: AVT Corp.
              Michele Reid, 425/820-6000, ext. 3479

              [e-mail]

              or
              Michelle Taylor, 425/820-6000, ext. 3399
              [e-mail]