CounterPath Reports Third Quarter Fiscal 2007 Financial Results

Vancouver, BC, Canada — March 9, 2007 — CounterPath Solutions, Inc. (OTCBB: CTPS), a leading provider of VoIP (Voice over IP) and Video over IP SIP softphones, today announced the financial and operating results for its third quarter ended January 31, 2007, and updated its fiscal 2007 revenue guidance.

Third quarter highlights: “Our company continues to be the SIP softphone of choice for large telecom service providers and infrastructure manufacturers, as demonstrated by our customer list, and I am personally proud of our team and what we have achieved to date,” stated Mark Bruk, Chief Executive Officer of CounterPath. ”Notwithstanding a significant pipeline of revenue opportunities, our Q3 revenue results were impacted by a product launch delay, a focus of engineering resources on meeting existing customer commitments, deployment delays by existing customers and a lengthened sales cycle, and it is now unlikely that we will meet our previous revenue guidance of $10 million within the fiscal 2007 time frame. We will continue to see increasing software and service revenues from our telecom service provider customers, such as AT&T, British Telecom, Deutsche Telekom, mobilkom austria and Portugal Telecom, as the momentum behind their deployments of our software escalates. In addition, our infrastructure manufacturer customers and partners such as Cisco, Alcatel-Lucent and Huawei will drive revenues and new partner deployment opportunities and we continue to expand on our interoperability with key industry players like Sylantro, Nortel and BroadSoft while establishing key partnerships such as with Intel, Microsoft and Oracle, all of which will serve to grow our business.“

Financial Results - Unaudited

(All amounts in U.S. dollars and in accordance with U.S. GAAP unless otherwise specified)

For the quarter ended January 31, 2007, we generated $1,007,582 in revenue compared to $1,237,932 for the quarter ended January 31, 2006, representing a decrease of 19% from the same period last year. Software revenues were $653,332 for the quarter ended January 31, 2007 compared to $1,033,610 for the quarter ended January 31, 2006, representing a decrease of 37% from revenues recorded the same period last year. For the quarter ended January 31, 2007, service revenue grew by 73% to $354,250 compared to $204,322 for the quarter ended January 31, 2006. Over the current quarter, the total number of customers that have deployed our software increased by 23 to 259, as of January 31, 2007.

For the nine months ended January 31, 2007, we generated $4,441,256 in revenue compared to $3,151,329 for the nine months ended January 31, 2006 representing an increase of 41% or $1,289,927 over the same period last year. We generated $3,339,116 in software revenue for the nine months ended January 31, 2007 compared to $2,475,452 for the nine months ended January 31, 2006, representing an increase of 35% or $863,664 over the same period last year. For the nine months ended January 31, 2007, service revenue was $1,102,140 compared to $675,877 for the nine months ended January 31, 2006, an increase of 63% or $426,263 over the same period last year.

Operating expenses for the quarter ended January 31, 2007 were $1,638,966 compared to $1,276,195 for the quarter ended January 31, 2006, representing an increase of 28% or $362,771. Operating expenses for the nine months ended January 31, 2007 were $4,913,964 compared to $3,462,866 for the nine months ended January 31, 2006, representing an increase of 42% or $1,451,098. Increases in operating expenses primarily reflect the addition of personnel and related wages and benefits and include the non-cash fair value of employee stock-based compensation of $653,215, the majority of which we began expensing this fiscal year.

The net loss for the quarter ended January 31, 2007 was $1,347,046 ($0.04 per share) compared to $428,942 ($0.01 per share) recorded for the quarter ended January 31, 2006. For the nine months ended January 31, 2007, the net loss was $2,059,837 ($0.06 per share) compared to $997,469 ($0.03 per share) recorded for the nine months ended January 31, 2006.

As of January 31, 2006, we had $2,141,673 in cash compared to $2,369,021 at April 30, 2006. Our working capital was $2,888,403 as of January 31, 2007 compared to $1,975,881 at April 30, 2006.

Financial tables follow:

Q3 Fiscal 2007 Results - Image 1

Q3 Fiscal 2007 Results - Image 2

The Company's Quarterly Report on Form 10-QSB for the quarter ended January 31, 2007 is available for viewing at www.sec.gov.

About CounterPath
CounterPath Solutions, Inc., formerly Xten Networks, Inc., is a developer of award-winning, carrier-grade VoIP and Video over IP SIP softphones for telecom and Internet telephony service providers, cable operators, IP-PBX manufacturers and infrastructure manufacturers. CounterPath's SIP softphones and softphone SDKs (Software Development Kits), which provide VoIP, Video over IP, IM (Instant Messaging) and Presence functionality and can be preconfigured to our customer's VoIP service, are predominantly licensed on a per seat or per subscriber basis, either co-branded or private labeled. CounterPath's technology is deployed by over 250 customers in more than 50 countries. Additional information about CounterPath and CounterPath's products and services is available at www.counterpath.com.

Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995: Statements in this document regarding managements’ future expectations, beliefs, goals, plans or prospects constitute forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. For this purpose, any statements that are contained herein that are not statements of historical fact may be deemed to be forwardlooking statements. Without limiting the foregoing, the words ”believes“, ”anticipates“, ”plans“, ”intends“, ”will“, ”should“, ”expects“, ”projects“, and similar expressions are intended to identify forward-looking statements. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause actual results, future circumstances, or events to differ materially from those projected in the forward-looking statements. These risks include, but are not limited to, those associated with competition, securing and maintaining corporate alliances, market acceptance of the Company's products, product obsolescence, the strength of intellectual property, financing capability, the potential dilutive effects of any financing and other risks detailed from time-to-time in the Company's public disclosure documents and other filings with the U.S. Securities and Exchange Commission and Canadian securities regulatory authorities. Forward-looking statements are made as of the date hereof, and the Company disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

For more information, please contact:

David Karp, CFO
+1.604.320.3344 x114
ir@counterpath.com