Data Domain Reports Q3

SANTA CLARA, Calif. -- Data Domain, Inc. (NasdaqGM:DDUP - News) today announced results for its third quarter ended September 30, 2007. Net revenue for the third quarter of 2007 was $32.0 million, an increase of 21% from the second quarter of 2007 and an increase of 189% from the third quarter of 2006. Net revenue for the nine months ended September 30, 2007 was $78.7 million, an increase of 176% from the nine months ended September 30, 2006.

Data Domain posted a GAAP net loss for the third quarter of 2007 of $880,000, or $0.02 per share. This compares to a GAAP net loss of $1.2 million, or $0.11 per share, in the immediately preceding second quarter of 2007, and a GAAP net loss of $934,000, or $0.12 per share, in the third quarter of 2006.

Excluding the impact of stock-based compensation and related payroll taxes in all periods, the non-GAAP net income for the third quarter of 2007 was $2.6 million, or $0.04 per fully diluted share, compared to a non-GAAP net loss of $607,000, or $0.08 per share, in the third quarter of 2006.

"Data Domain's strong revenue growth in the third quarter reinforces the continuing demand for our industry-leading technology and the rapid expansion of our market," commented Frank Slootman, president and chief executive officer of Data Domain. "During the past quarter, Data Domain added approximately 228 new customers, bringing its cumulative customer count to approximately 1,200 worldwide since it first began shipping its Enterprise Protection Storage systems in 2004."

In a separate release:SANTA CLARA, Calif. -- Data Domain, Inc. (NasdaqGM:DDUP - News) today announced that it intends to file a registration statement with the Securities and Exchange Commission for an underwritten offering of approximately 8,500,000 shares of its common stock. The shares of common stock expected to be sold in the offering will include approximately 4,000,000 shares to be sold by Data Domain and approximately 4,500,000 shares to be sold by certain existing stockholders of Data Domain. In addition, Data Domain and the selling stockholders expect to grant the underwriters of the offering an option to purchase additional shares of common stock constituting up to fifteen percent of the total number of shares offered.

Data Domain and the selling stockholders have not yet made a final determination regarding the aggregate size of the offering, but will do so based on market conditions and other factors at the time of the offering. Data Domain intends to file the registration statement by the end of this month and anticipates completing the public offering prior to the end of 2007. However, there can be no assurance as to whether or when the offering will be completed or its exact size.

Data Domain intends to use the net proceeds it receives from the offering for working capital and other general corporate purposes. Data Domain will not receive any proceeds from the sale of shares by the selling stockholders.

Data Domain Inc.