CounterPath Reports Fiscal 2010 Financial Results

Vancouver, BC, Canada — July 27, 2010 — CounterPath Corporation (“CounterPath” or the “Company”) (OTCBB: CPAH; TSX-V: CCV), an award-winning provider of desktop and mobile VoIP software products and solutions, today announced financial and operating results for the year ended April 30, 2010.

Financial and operating highlights for the year include: “We are starting to see many positive signs that we are emerging from the economic downturn that persisted through most of calendar year 2009 including the increase in orders reflected in our Q4 results,” stated Donovan Jones, President and CEO, CounterPath. “Fiscal 2010 was a challenging year for us, but we have come out of it stronger. We made significant reductions in expenses providing a competitive cost profile while continuing to innovate and deliver to the expectations of our customers and partners. As a leading provider of softphones, mobile clients, integrated unified communications (UC) and fixed mobile convergence (FMC) solutions, CounterPath is uniquely positioned for growth and market share expansion as enterprise and service providers rapidly embrace VoIP and new forms of communications,” continued Jones.

Financial Results

(All amounts in U.S. dollars and in accordance with accounting principles generally accepted in the United States (“GAAP”) unless otherwise specified.)

For the fiscal year ended April 30, 2010, revenue was $8.0 million compared to $9.8 million for fiscal 2009. Software revenue for the fiscal year ended April 30, 2010 was $6.0 million compared to $6.9 million for the previous year. Service revenue for the fiscal year ended April 30, 2010 was $2.0 million compared to $3.0 million for fiscal 2008.

Operating expenses for the fiscal year ended April 30, 2010 were $13.3 million compared to $26.2 million for fiscal 2009. The decrease in operating expenses was primarily due to the restructuring of operations in fiscal 2009 which reduced operating costs in fiscal 2010.

Sales and marketing expenses were $3.1 million for the fiscal year ended April 30, 2010 compared to $4.1 million for the previous year. For the fiscal year ended April 30, 2010, research and development expenses were $3.6 million and general and administrative expenses were $3.7 million, compared to $7.1 million and $6.5 million, respectively, for the previous year.

Operating expenses for the fiscal year ended April 30, 2010 include a non-cash charge of $0.9 million for amortization of intangible assets acquired from NewHeights Software Corporation, FirstHand Technologies Inc. and BridgePort Networks, Inc., compared to $2.0 million in fiscal 2009. Other non-cash charges included a non-cash $0.9 million stock-based compensation expense for fiscal year ended April 30, 2010 compared to $1.4 million in fiscal 2009.

The net loss for the fiscal year ended April 30, 2010 was $5.5 million, or a loss of $0.18 per share, compared to a net loss of $15.8 million, or a loss of $0.57 per share, for fiscal 2009.

At April 30, 2010, the Company had $1.6 million in cash, compared to $2.9 million at April 30, 2009. At April 30, 2010, the Company’s working capital was $0.8 million, compared to $1.6 million at April 30, 2009.

About CounterPath
CounterPath Corporation is a leading provider of innovative desktop and mobile VoIP software products and solutions. The Company’s product suite includes SIP-based softphones, server applications and Fixed Mobile Convergence (FMC) solutions that enable service providers, enterprises and Original Equipment Manufacturers (OEM) to cost-effectively integrate voice, video, presence and Instant Messaging (IM) applications into their VoIP offerings and extend functionality across both fixed and mobile networks.

CounterPath’s customers include some of the world's largest telecommunications service providers and network equipment providers including AT&T, Verizon, BT (British Telecommunications PLC), Deutsche Telekom, Cisco Systems and Mitel.

Visit www.counterpath.com.

Non-GAAP Financial Measures

This news release contains “non-GAAP financial measures”. The non-GAAP financial measures in this news release consist of non-GAAP operating expenses, which exclude non-cash stock-based compensation, amortization and impairment of intangible asset charges relative to operating expenses and operating losses calculated in accordance with GAAP. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. CounterPath utilizes both GAAP and non-GAAP financial measures to assess what it believes to be its core operating performance and to evaluate and manage its internal business and assist in making financial operating decisions. CounterPath believes that the inclusion of non-GAAP financial measures, together with GAAP measures, provides investors with an alternative presentation useful to investors' understanding of CounterPath’s core operating results and trends.



Forward-Looking Statements

This news release contains "forward-looking statements". Statements in this news release, which are not purely historical, are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future, such as the following: (1) We are starting to see many positive signs that we are emerging from the economic downturn that persisted through most of calendar year 2009 including the increase in orders; and (2) CounterPath is uniquely positioned for growth and market share expansion as enterprise and service providers rapidly embrace VoIP and new forms of communications.

It is important to note that actual outcomes and the Company’s actual results could differ materially from those in such forward-looking statements. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others: (1) the failure to develop new and innovative products using the Company’s technologies, (2) the Company’s ability to remain competitive as other parties develop and release competitive products, (3) the Company’s ability to retain the employees necessary to continue research and development of current and new products, (4) the success by the Company of the sales of its current and new products, (5) the impact of technology changes on the Company’s products and on the VoIP industry, (6) the compatibility of the Company’s products with new computer operating systems, (7) the rate of adoption by service providers and the general public of VoIP as a replacement for regular and cellular phone service, (8) general economic conditions as they affect CounterPath and its current and prospective customers, including a continued downturn in general economic conditions internationally, (9) the ability of the Company to control costs operating, general administrative and other expenses, and (10) insufficient investor interest in the Company’s securities which may impact on the Company’s ability to raise additional financing as required. Readers should also refer to the risk disclosures outlined in the Company’s quarterly reports on Form 10-Q, annual reports on Form 10-K and the Company’s other disclosure documents filed from time-to-time with the Securities and Exchange Commission at www.sec.gov and the Company’s interim and annual filings and other disclosure documents filed from time-to-time on SEDAR at www.sedar.com.

Disclaimer: Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact

David Karp
Chief Financial Officer
CounterPath Corporation
+1.604.320.3344 ext 1114
ir@counterpath.com

(TABLES TO FOLLOW)