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Cyberdefender Reports Over 500% Increase In 1Q Revenues

Net loss increased. primarily due to increase in advertising/customer acquisition expense
CyberDefender Corporation ("the Company") (OTC Bulletin Board: CYDE), a provider of award-winning PC security, Antispyware/ Antivirus Software, PC Optimization, PC Support, and Identity Theft Prevention solutions, announced today that following its recently reported doubling in sales in 2008, the Company generated a more than 500% increase in revenues in its first quarter ended March 31, 2009 as compared to the first quarter of 2008.

First quarter 2009 revenues increased to $3,191,630 from $475,046 in the first quarter of 2008, and increased 30% compared to revenues in the fourth quarter of 2008, while gross profit in the 2009 first quarter increased to $2,511,926 from $401,061 in the same period last year. As anticipated, CyberDefender's net loss increased to approximately $ 4.8 million , primarily reflecting its strategic decision to increase advertising/customer acquisition expense by approximately $3.48 million from $269,000 in last year's first quarter.

Mr. Gary Guseinov, CEO of CyberDefender, commented, "Our decision to dramatically ramp up advertising to build new sales, coupled with the positive reception to our newest CyberDefender(TM) Registry Cleaner product and our Premium Technical Support services, were the key contributors to growth in the period. As we continue to see a very high percentage of new licensees become repeat customers and the number of new customers continues to grow, our confidence in building a profitable and dramatically expanded customer base continues to be high."

Other Positive Growth Indicators

The Company also reported that average sales per customer grew 30% to $81.02 in the first quarter of 2009 as compared to $62.38 in the 2008 fourth quarter. It attributed this to the success of its newest products and services, CyberDefender(TM) Registry Cleaner and CyberDefender's Premium Technical Support services.

The quarterly growth in new licensees also continued and reached 99,804 at quarter end, a 37% gain over the fourth quarter of 2008.

CyberDefender also saw revenues in the quarter increase month by month, a trend it believes will continue, as it monitors and balances advertising expenditures and cash flow to optimize utilization of its resources.

Quarterly Cash Receipts Up 54%

CyberDefender noted that in the first quarter of 2009 cash receipts from the sales of new licenses, which become deferred income on its books over the 12 to 36 month terms of each license, increased to $5.5 million from $3.6 million in the fourth quarter of 2008 and $2.5 million in the third quarter 2008.

Mr. Kevin Harris, CFO of CyberDefender, commented, "As we have continued to accelerate customer acquisitions with an aggressive multi-channel advertising campaign, we have looked to outside financing to help build, as rapidly as possible, a critical mass in our customer base. Over the past quarter we nevertheless have reduced our overall debt by approximately $1.4 million. Looking at our anticipated sales growth, cash flow and current and planned expenditures, we believe we should achieve positive cash flow from operations by the end of the third or fourth quarter this year."

TV Ad Launched: Goal is $8 million to $10 million a month in new revenues

One of the most significant events in CyberDefender's history occurred during the quarter, which was expanding its relationship with Guthy-Renker, a major direct response marketing firm, for the launch of a national radio and television marketing campaign with an advertising budget of up to $16 million.

To date, CyberDefender has mostly utilized search engine advertising on the Internet and an increasing number of ads on radio. Since the agreement with Guthy-Renker, several test TV ads have been run and an additional four to five TV ads will be tested over the next 60 days. After this, the ads will be launched nationally, and the Company believes the anticipated increased exposure has the potential to help CyberDefender profitably generate $8 million to $10 million per month in new revenues.

CyberDefender also expects to launch a new retail program which will provide customers with pre-paid cards for per use access to CyberDefender's products and services.

Outlook

"Looking ahead," Mr. Guseinov said, "we are excited about moving closer to our goal of a full launch of all of our marketing channels, which will magnify the opportunity for consumers to learn more about CyberDefender products. We also continue to focus on constant improvement of our customer service and on providing new services that respond to customer needs. Happy customers are repeat customers, and that ultimately is what will propel CyberDefender to achieve its growth goals."

Conference Call Information

The Company will host a conference call to discuss first quarter 2009 results on Tuesday, May 19, 2009 at 4:15pm ET.

Interested participants should call 1-877-941-8632 when calling within the United States or 1-480-629-9821 when calling internationally. Please ask for the CyberDefender Corporation Conference Call, Pass Code 4080078. There will be a playback available until 05/26/2009. To listen to the playback, please call 1-800-406-7325 when calling within the United States or 1-303-590-3030 when calling internationally. Use the Pass Code 4080078 for the replay.

This call is also being webcast by ViaVid Broadcasting and can be accessed by clicking on this link, http://viavid.net/dce.aspx?sid=000064C1, or at ViaVid's website at http://www.viavid.net. This event is optimized for Microsoft's Windows media player version 9. To download go to http://www.microsoft.com/windows/windowsmedia/download.

About CyberDefender Corporation

CyberDefender Corporation (OTCBB: CYDE) believes that its Internet security technology offers the earliest possible detection and most aggressive defense against Internet security attacks. CyberDefender believes that it is the only Internet security software company to combat spyware, viruses, and identity theft using a secure peer-to-peer distributed network (the earlyNETWORK(TM)), enabling protection that is unparalleled in speed and flexibility. Products employing the earlyNETWORK(TM) include CyberDefender's MyIdentityDefender(TM) Toolbar, CyberDefenderFREE(TM) 2.0, and CyberDefender Early Detection Center(TM) 2.0. All of these products are fully compatible with Microsoft's Vista Operating system and available at http://www.cyberdefender.com/.

Forward Looking Statements

Statements in this press release that are not statements of historical or current fact, such as CyberDefender's expectation of future revenue growth and profitability, constitute "forward-looking statements". Such forward-looking statements involve known and unknown risks, uncertainties and other unknown factors that could cause CyberDefender's actual results to be materially different from the historical results or from any future results expressed or implied by such forward-looking statements. Factors that could cause CyberDefender's results to be materially different from the forward-looking statements include whether CyberDefender will be able to find financing when and as it needs it and whether CyberDefender's revenues will eventually exceed its expenses. The forward-looking statements contained herein are also subject generally to other risks and uncertainties that are described from time to time in CyberDefender's reports and registration statements filed with the Securities and Exchange Commission, which are available for review at http://www.sec.gov/.

CONTACT: Web Site: http://www.cyberdefender.com/

Kevin Harris Chief Financial Officer CyberDefender [email protected] Tel: 213-689-8631 X127 Fax: 213-689-8640

Ken Donenfeld DGI Investor Relations [email protected] Tel: 212-425-5700 Fax: 646-381-9727

SOURCE CyberDefender Corporation