Communication Intelligence Corporation Fourth Quarter and Fiscal 1999 Results.

Business Editors

REDWOOD SHORES, Calif.--(BUSINESS WIRE)--Feb. 29, 2000

Communication Intelligence Corporation ("CIC" or the "Company") (Nasdaq:CICI), the leading supplier of natural input and electronic signature solutions, today announced its financial results for the fourth quarter and the year ended December 31, 1999.

Revenue for the fourth quarter increased 107% to $1.8 million from $0.9 million in the comparable quarter of the prior year. For the 1999 fiscal year, CIC posted revenue of $6.5 million, a 42% increase over revenue of $4.5 million for the 1998 fiscal year.

The net loss for the fourth quarter ended December 31, 1999 fell to $0.4 million, or $0.01 on 80.2 million weighted average common shares as compared to a net loss for the quarter ended December 31, 1998 of $0.9 million, or $0.01 on 70.9 million weighted average common shares. For fiscal year 1999, the net loss decreased to $1.7 million, or $0.02 per share on 79.6 million weighted average common shares, as compared to a net loss of $3.6 million, or $0.06 per share on 56.2 million weighted average common shares, in the 1998 fiscal year.

These results together with the enhanced cash position, at December 31, 1999, reflect the Company's strategic direction focusing on natural input and electronic signature solutions for wireless Internet devices, aftermarket software sales and enterprise applications such as e-Commerce, document automation and corporate security. Based on the company's current cash position and projections the Company believes it is now self-funding.

CIC's president and CEO, Guido DiGregorio stated, "As we enter the new millennium, we believe that CIC is well positioned to participate in emerging, rapid growth markets. We have the right products and the right strategic partners. In addition, becoming self-funding provides the stability needed to capitalize on our positioning as we move towards accelerated sales and profitability."

The Company's OEM revenues in 1999, new sales versus the recognition of past years' deferred revenue, more than doubled over 1998 (approximately $2,641,000 versus $1,300,000). This growth was driven primarily by license revenue from Ericsson and Microsoft, $1,500,000 and $400,000 respectively.

Consumer sales of the Company's software sold primarily via CIC's website (www.cic.com), for the 1999 year, increased 402% to $1.7 million from $0.3 million as compared to the 1998 year. This growth reflects the rapid and effective porting of Jot(R) and QuickNotes(TM) to the Palm operating system (which runs on all Palm models) and new products introduced for the Palm operating system including InkSnap(TM), WordComplete(TM), RecoEcho(TM) and Sign-On(TM), the first biometric signature verification security utility for Palm organizers.

Enterprise sales efforts in 1999 focused on leveraging our electronic signature solutions in fast growth, large potential applications such as e-Commerce, document automation and corporate security. This involved direct business development activity in signature dependent vertical markets including financial services, insurance, health care, and real estate in an effort to secure agreements for initial installations which have the potential for significant rollout and follow-up sales. The Company believes meaningful sales will result in the year 2000 and beyond based on the substantive progress made with target accounts, the present status of agreements, ongoing negotiations and sales activity with strategic partners.

Communication Intelligence Computer Corporation (CICC), a 90% owned Chinese joint venture, achieved sales of $1.6 million in 1999. Breakthrough orders from Wacom, the largest digitizer tablet manufacturer in the world, and from Legend, the largest computer manufacturer in the PRC in January of 2000, confirm the success and acceptance of the Chinese versions of our core input technologies. The Company believes that CIC has significant growth potential in the year 2000 and beyond due to the emerging market in China for wireless Internet devices, the acceptance of our products by leading OEMs, the legitimacy and stability provided by joint venture status and the growth potential of the China market, now enhanced by World Trade Organization membership.

Selected financial information follows. Detail corporate and financial information is available on CIC's website at www.cic.com.

About CIC

Communication Intelligence Corporation (CIC) is a leading supplier of natural input and electronic signature solutions for wireless Internet and e-Commerce applications. The Company's core software technologies include multilingual handwriting recognition systems, dynamic signature verification, natural messaging, and operating system extensions that enable pen input. CIC's products are designed to increase the ease of use, functionality, and security of wireless electronic devices ranging from handheld companions to cellular phones. Key licensees of the Company's technologies include Ericsson, Fujitsu, Hitachi, Microsoft, Mitsubishi, National Semiconductor, and Symbian. CIC is headquartered in Redwood Shores, California and has a joint venture, CICC, in Nanjing, China. For more information please visit our website at www.cic.com.

Certain statements contained in this press release, including without limitation, statements containing the words "believes," "anticipates," "hopes," "intends," "expects," and other words of similar import, constitute "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known or unknown risks, uncertainties and other factors, which may cause actual events to differ materially from expectations. Such factors include the following: (1) technological, engineering, quality control or other circumstances which could delay the sale or shipment of the products; (2) economic, business, market and competitive conditions in the software industry and technological innovations which could affect the Company's business; (3) the Company's inability to protect its trade secrets or other proprietary rights, operate without infringing upon the proprietary rights of others or prevent others from infringing on the proprietary rights of the Company; and (4) general economic and business conditions and the availability of sufficient financing.

Note to Editors: CIC, and its logo and Jot are registered trademarks and QuickNotes, InkSnap, WordComplete, RecoEcho and Sign-On are trademarks of Communication Intelligence Corporation. All other trademarks and registered trademarks are the property of their respective holders.

                COMMUNICATION INTELLIGENCE CORPORATION
       Selected Consolidated Statement of Operations Information
               (In thousands, except per share amounts)

                      Fourth Quarter Ended             Year Ended
                           (unaudited)
                      12/31/99     12/31/98     12/31/99     12/31/98
                      --------     --------     --------     --------

Revenue(1)            $  1,869     $    899     $  6,518     $  4,581

Total cost of sales      1,019          577        3,317        1,973

Gross profit               850          322        3,201        2,608

Total operating
 expenses                1,253        1,209        4,923        5,893

Operating profit
 (loss)                   (403)        (887)      (1,722)      (3,285)

Other (income)
 expenses                  (43)          14          (18)        (307)

Net loss(2)           $   (446)    $   (873)    $ (1,740)    $ (3,592)

Basic and diluted
 net loss per
 common share         $  (0.01)    $  (0.01)    $  (0.02)    $  (0.06)

Weighted average
 common shares
 outstanding            80,254       70,876       79,625       56,233


           Selected Consolidated Balance Sheet Information
                            (In thousands)

                                            12/31/99         12/31/98
                                            --------         --------
Cash & cash equivalents                       $2,374           $  795
Total current assets                           4,205            2,368
Total assets                                   4,963            3,354
Deferred revenue(3)                               35              651
Total current liabilities(4)                   1,276            2,022
Total long-term debt                           1,338               --
Stockholders' equity                           2,349            1,332

NOTES:

(1)  For the fourth quarter ended 12/31/98, revenues included $192
     from discontinued retail hardware products. For the year ended
     12/31/99 and 12/31/98, respectively, revenues included $78 and
     $748 from discontinued retail hardware products. In addition,
     revenues include recognition of past years deferred revenues of
     $404 for the year ended December 31, 1998.

(2)  Net loss for 1998 includes $435 of cumulative dividends related
     to the Company's Series A and Series B Convertible Preferred
     Stock.

(3)  Deferred revenue consists principally of non-recurring
     engineering payments from licensees.

(4)  Includes deferred revenue.