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OmniSky Anticipates Better Than Expected Earnings and EBITDA for Second Quarter
Company Completes Initiatives to Accelerate Deployment of Wireless ASP Services
SAN FRANCISCO--(BUSINESS WIRE)--July 26, 2001--OmniSky Corporation (NASDAQ National Market: OMNY - news), a leading global provider of award-winning wireless applications and services, announced today that it anticipates reporting second quarter revenues of between $4.6 and $4.7 million, in line with prior guidance. Service revenues are expected to be in a range of between $3.8 and $3.9 million, based on approximately 42,000 subscribers at the end of the period.

OmniSky also expects to report a significantly smaller EBITDA loss of between $19.0 and $21.0 million (excluding anticipated non-cash and one-time charges) compared with previous guidance of between $31.0 and $33.0 million for the second quarter; net loss is expected to be between $27.0 and $29.0 million compared with previous guidance of between $41.0 and $43.0 million. These significant improvements reflect initiatives begun several months ago to focus the company`s resources on the full-scale deployment of its Oxygen platform.

``We continue to leverage our award-winning services while managing our costs and further reducing operating expenses,`` said Patrick McVeigh, chairman and CEO of OmniSky. ``We expect to see the results of these efforts, with several commercial launches on the Oxygen platform in the late fall, positioning us as a leading provider of applications and services for wireless carriers, online service providers, and hardware manufacturers.``

In connection with these efforts, the company has restructured its business, forming a consumer unit focused on the company`s target market of mobile professionals and an applications and services unit to market its advanced suite of applications and services known as ``OmniSky Oxygen.`` Added McVeigh, ``We believe this organizational structure will enable us to more efficiently manage our resources and respond to customer needs.``

``We will continue to closely monitor our operating and capital expenditures as we move to support our ASP business,`` said Lawrence Winkler, CFO. ``The actions we`ve taken significantly reduce our cash burn while we continue ongoing discussions with vendors and partners to raise the capital necessary to take us to profitability.``

As part of its ongoing business review, the company has reduced its global workforce by nearly 100 employees. The company continued to realize synergies from its consolidation of OmniSky International by reducing its European workforce and closing several European offices. Consumer-focused beta trials in the United Kingdom and Germany are nearing completion, and the company expects to close the trials as it assimilates information from those trials into its European product offerings. In the future, the company intends to deliver its applications and services throughout Europe in partnership with carriers, online service providers, hardware manufacturers and others.

OmniSky also confirmed that it would announce second quarter results on August 7, at which time management expects to update investors on the company`s progress in marketing the Oxygen platform and expectations for the remainder of the year.

About OmniSky

OmniSky (NasdaqMNY - news) is a leading global provider of wireless applications and services and offers its proprietary wireless applications and services, including Communications, Content Delivery, and Location-Based Services to telecommunications carriers, online service providers, hardware manufacturers, and other third parties. OmniSky enables these companies to offer differentiated wireless data solutions on any mobile device, from WAP-compliant cell phones to PDAs and laptop computers, and on the most widely available wireless networks, such as CDPD, CDMA, GSM and GPRS.

OmniSky`s award-winning service offers mobile professionals access to up to six e-mail accounts, including corporate e-mail via Microsoft Outlook as well as POP3 e-mail, the ability to search and surf the Internet, a broad range of optimized Web content, and the ability to securely conduct e-commerce transactions. The OmniSky service is available on the Palm V and Palm Vx, Handspring Visor Platinum, Visor Prism and Visor Edge, HP Jornada 520/540 Series Pocket PCs, the Compaq iPAQ Pocket PC, the Casio E-125 and HP Pavilion Notebook PCs, and can be purchased online or in over 2,000 retail outlets across the U.S. Service coverage includes over 167 major metropolitan areas within the United States, encompassing over 172 million people.

OmniSky is headquartered in San Francisco. For more information visit www.omnisky.com or call 415/764-2200.

This press release contains preliminary information regarding the company`s second quarter operating results and may be subject to further adjustments. Actual results may differ from these preliminary results.

The foregoing information contains forward-looking statements that are based on our current expectations. These expectations are subject to risks, uncertainties and other factors that could cause our actual results to differ materially from those referred to in these forward-looking statements. Factors that could cause our actual results to differ include, but are not limited to, risks related to: market acceptance of an early stage service such as ours; delays in the development or introduction of new versions of our service; technical difficulties with networks or operating systems on which we rely to deliver our service; changes in technologies that affect the wireless, Internet or handheld mobile device industries; the ability of an early stage company such as ours to manage its growth; the protection of our proprietary information; release of competitive products and services; and general economic downturns. These and other risks are more fully described in OmniSky`s periodic reports and registration statements filed with the Securities and Exchange Commission and can be obtained online at the Commission`s web site at http://www.sec.gov. Readers should consider the information contained in this release together with other publicly available information about OmniSky for a more informed overview of the company.

Note to Editors: The OmniSky name and logo are trademarks of OmniSky Corporation. All other trademarks are the property of their respective owners.


--------------------------------------------------------------------------------
Contact:

OmniSky Corporation, San Francisco
Amanda Higgins, 415/764-2257


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