Exhibit 99.1

Conference call:

 

Today, Wednesday, March 14, 2007 at 4:30 P.M. EDT

Webcast / Replay URL:

 

http://www.wave.com

Dial-in numbers:

 

212-896-6010 or 415-537-1960

 

Wave Q4 and Full-Year 2006 Revenues Rise 149% and 206% to $866,000 and
$3.1 Million, Respectively, on Continued Strength in OEM Software Royalties

Lee, MA — March 14, 2007 - Wave Systems Corp. (NASDAQ: WAVX; www.wave.com) today reported results for the fourth quarter (Q4) and year ended December 31, 2006 and reviewed recent corporate progress and developments.

Principally reflecting a 155% increase in license revenues in Q4 2006 versus last year, Wave’s Q4 2006 net revenues rose to $866,000, compared to Q4 2005 net revenues of $348,000 and Q3 2006 net revenues of $846,000.  The improvement in license revenues was principally due to royalties earned from increased shipments of Wave software by Wave’s OEM partners.  Wave’s services revenues in Q4 2006 were $12,000 versus services revenue of $13,000 in the year ago period.

For Q4 2006 Wave reported a net loss of $4.8 million, or $0.12 per basic share, including non-cash, share-based compensation expense of $414,268, or $0.01 per basic share, recorded in accordance with the implementation of SFAS 123(R) for “Share-based Payment,” effective January 1, 2006.  Wave’s Q4 2005 net loss of $4.5 million, or $0.15 per basic share, did not include any share-based compensation expense.  Per share figures are based on a weighted average number of basic shares outstanding in the fourth quarters of 2006 and 2005 of 41,054,796 and 29,711,000, respectively.  Wave’s shares outstanding and loss per share figures for the fourth quarter and full year periods in 2006 and 2005 have been adjusted to reflect the Company’s 1-for-3 reverse stock split that went into effect on July 26, 2006.

For the full year 2006, Wave’s net revenues rose by 206% to $3.1 million, compared to net revenues of $1.0 million in the prior year.  For 2006 Wave reported a net loss of $18.8 million, or $0.51 per basic share, including non-cash, share-based compensation expense of $1,556,043, or $0.04 per basic share.  Wave’s net loss of $17.6 million, or $0.63 per basic share, in 2005 did not include any share based compensation expense.  The weighted average number of basic shares outstanding in 2006 and 2005 were 36,735,059 and 27,726,221, respectively.

Balance Sheet Snapshot & Auditor’s Opinion Letter Disclosure

As of December 31, 2006 Wave had total current assets of $8.8 million, working capital of approximately $5.4 million and no long-term debt.  Pursuant to Rule 4350 of the NASD Marketplace Rules, Wave is announcing, as it has done the past two years at this time, that its auditors’ opinion letter which will be contained in Wave’s Form-10-K for the year ended December 31, 2006 raises “substantial doubt” about Wave’s ability to continue as a going concern given its recurring losses from operations, working capital position and its accumulated deficit.

Steven Sprague, Wave’s president and CEO, commented, “Though the formation of a global market for trusted computing solutions remains in the early stages, during 2006 Wave continued to expand its market position, base of industry relationships and the breadth of its product offerings, including both PC and server applications.  Importantly, this progress was reflected in increased revenues as key PC OEM partners commenced their bundled shipments of Wave’s EMBASSY Trust Suite software.  While there have been normal delays and challenges as the market becomes better educated and the decision making on deployment strategy proceeds, trusted computing deployment has continued to expand.  Industry analysts estimate that the total installed base of PCs with enabling TPM security chip technology exceeds 50 million deployed units, and we believe that the rate of TPM deployment of this technology will accelerate through 2007.



The following information was filed by Wave Systems Corp (WAVXQ) on Thursday, March 15, 2007 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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