Wireless Ronin Reports First Quarter 2012 Results

16% Sequential Increase in Revenue Includes Record Recurring Revenue

MINNEAPOLIS – May 9, 2012 – Wireless Ronin Technologies, Inc. (NASDAQ: RNIN), a marketing technologies company with leading expertise in current and emerging digital media solutions, reported financial results for the first quarter ended March 31, 2012.

Q1 2012 Highlights

  • Revenue increased 16% sequentially to $1.8 million
  • Recurring revenue increased 18% year-over-year to a record $466,000
  • Gross profit increased sequentially to $949,000 or 54% of revenue
  • Deployed RoninCast® digital marketing solutions in ECOtality electric vehicle charging stations

Q1 2012 Financial Results
Revenue in the first quarter of 2012 increased 16% sequentially to $1.8 million from $1.5 million in the prior quarter, and decreased 26% from $2.4 million in the same year-ago period. The year-over-year decrease was primarily attributable to lower orders of the iShowroom-branded tower application received from individual Fiat dealerships.

Recurring revenue in the first quarter of 2012 from the company’s hosting and support services increased 11% to a record $466,000 or 26% of total revenue from $422,000 or 27% of total revenue in the previous quarter, and increased 18% from $395,000 or 17% of total revenue in the same year-ago period.

Gross profit in the first quarter of 2012 increased sequentially to $949,000 or 54% of total revenue from $446,000 or 29% of total revenue in the previous quarter, and decreased 13% from $1.1 million or 46% of total revenue in the same year-ago period.

Net loss in the first quarter of 2012 totaled $1.8 million or $(0.08) per basic and diluted share, as compared to a net loss of $1.7 million or $(0.08) per basic and diluted share in the previous quarter, and a net loss of $2.3 million or $(0.12) per basic and diluted share in the same year-ago period. Net loss for the first quarter of 2012 included $161,000 of non-cash stock compensation expense versus $48,000 in the previous quarter and $345,000 in the first quarter of 2011.

Non-GAAP operating loss in the first quarter of 2012 totaled $1.5 million or $(0.06) per basic and diluted share, compared to a non-GAAP operating loss of $1.5 million or $(0.07) per basic and diluted share in the previous quarter, and from a non-GAAP operating loss of $1.8 million or $(0.09) per basic and diluted share in the same year-ago period. The company defines non-GAAP operating loss as GAAP operating loss with the add-back of certain items. Reconciliation to GAAP operating loss on a quarterly basis is contained in a table following the unaudited financial information accompanying this release.

Management Commentary
“Our financial performance in Q1 reflects our continued aggressive focus on driving revenue growth, particularly recurring revenue, along with margin expansion and expense optimization,” said Scott Koller, president and CEO of Wireless Ronin. “In fact, the first quarter marked the highest recurring revenue in company history, driven by higher margin software, services and hosting fees.

“Our strategy shift to offering marketing technology solutions continued to yield new wins in Q1, spurred by expanding opportunities outside our historical core offerings and verticals. Our deployment with ECOtality is a prime example. We also secured and deployed a pilot for our marketing technology offerings with a national fast-casual dining chain with more than 800 locations in North America. We believe this implementation validates our capabilities beyond traditional digital menu boards and can generate revenue for us in the future. The fast-casual deployment also confirms that the market is adopting these types of multi-platform digital solutions.

“As the demand for new marketing technologies continues to accelerate, we believe we are positioned with industry-leading technologies to drive market share expansion and further penetration of our key verticals.”

Conference Call
The company will hold a conference call tomorrow (Thursday, May 10, 2012) to discuss these financial results. The company's president and CEO, Scott Koller and SVP and CFO, Darin McAreavey, will host the call starting at 4:30 p.m. Eastern time (3:30 p.m. Central time). A question and answer session will follow management's presentation.

To participate in the call, dial the appropriate number 5-10 minutes prior to the start time, ask for the Wireless Ronin conference call and provide the conference ID:

Dial-In number: 1-877-941-1427
International: 1-480-629-9664
Conference ID#: 4531923

The presentation will be webcast live and available for replay via the Investors section of the company's website at www.wirelessronin.com. Please go to the website at least 15 minutes early to register, download, and install any necessary audio software. If you have any difficulty connecting with the conference call or webcast, please contact Liolios Group at 949-574-3860.

A replay of the call will be available after 7:30 p.m. Eastern time on May 10, 2012 and until June 10, 2012.

Toll-free replay number: 1-877-870-5176
International replay number: 1-858-384-5517
Replay PIN#: 4531923

About Wireless Ronin Technologies, Inc.
Wireless Ronin Technologies (WRT) (www.wirelessronin.com), is a marketing technologies company with leading expertise in current and emerging digital media solutions, including signage, interactive kiosks, mobile, social media and web, that enable clients to transform how they engage with their customers. WRT provides marketing technology solutions and services to clients, helping increase revenue and improve operating efficiencies in the execution of marketing initiatives. Since the initial launch of RoninCast® digital signage software in 2003, WRT has taken a leadership position in the digital signage industry by committing to bring leading edge technology, services and support to its clients. WRT offers an array of services to support its clients’ marketing technology needs including consulting, creative development, project management, installation, training, and support and hosting. The company's common stock trades on the NASDAQ Capital Market under the symbol "RNIN". Follow us on http://twitter.com/#!/wirelessronin. Like us on Facebook under Wireless Ronin Technologies, Inc.

Non-GAAP Financial Measures
In addition to disclosing financial measures prepared in accordance with Generally Accepted Accounting Principles (GAAP), this press release and the accompanying tables contain the following non-GAAP financial measures: non-GAAP operating loss and non-GAAP operating loss per common share. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

Non-GAAP operating loss and non-GAAP operating loss per share. We define non-GAAP operating loss as the GAAP operating loss less stock-based compensation expense, depreciation and amortization, severance expense and other one-time charges. We define non-GAAP operating loss per share as non-GAAP operating loss divided by the weighted average basic and diluted shares outstanding. Our management utilizes a number of different financial measures, both GAAP and non-GAAP, in making operating decisions, in forecasting and planning, and in analyzing and assessing our company's overall performance. Our annual financial plan is prepared and reviewed both on a GAAP and non-GAAP basis. We budget and forecast for revenue and expenses on GAAP and non-GAAP bases, and assess actual results on GAAP and non-GAAP bases against our annual financial plan. Our board of directors and management utilize these financial measures (both GAAP and non-GAAP) to determine our allocation of resources. In addition, and as a consequence of the importance of these non-GAAP financial measures in managing our business, we use non-GAAP financial measures in the evaluation process to establish management compensation. For example, our senior management’s bonus program is partially based upon the achievement of non-GAAP operating income (loss). Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding the items mentioned above. We consider the use of non-GAAP operating loss per share helpful in assessing the ongoing performance of the continuing operations of our business, as it excludes recurring non-cash items and non-recurring one-time charges. Our rationale for the items we omit from our non-GAAP measures is as follows:

Stock-based compensation. We exclude non-cash stock-based compensation expense because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use under FASB ASC 718-10. Stock-based compensation expense is a recurring expense for our company and is expected to be in the future as we have a history of granting stock options and other equity instruments as a means of incentivizing and rewarding our employees.

Depreciation and amortization expense. Depreciation and amortization are non-cash charges that are impacted by our accounting methods and book value of assets. By excluding these non-cash charges, our management, together with our investors, are provided with supplemental metrics to evaluate cash earnings, distinguishing performance’s impact on earnings from performance’s impact on cash. Management believes that the review of these supplemental metrics in conjunction with other GAAP metrics, such as capital expenditures, is useful for management and investors in understanding our business. Depreciation is a recurring expense for our company and is expected to continue to be in the future as we continue to make further investments in our infrastructure through the acquisition of property, plant and equipment. Due to the exclusion of these non-cash items, investors should not use this metric as a measure of evaluating our liquidity. Instead, to evaluate our liquidity, investors should refer to the Consolidated Statements of Cash Flow and the Liquidity and Capital Resources section contained within Management's Discussion and Analysis in our most recently filed periodic reports.

Severance and other one-time charges. We exclude severance and other one-time charges that are the result of other, unplanned events as one means of measuring operating performance. Included in these expenses are items such as severance costs associated with the termination of employees as part of an unplanned restructuring, a non-acquisition-related restructuring and other charges. Because these events are unplanned and arise outside the ordinary course of continuing operations, by providing this information, we believe our management and our investors may more fully understand the financial results of what we consider to be organic continuing operations.

There are a number of limitations related to the use of non-GAAP operating loss and non-GAAP operating loss per share versus operating income and loss per share calculated in accordance with GAAP. First, these non-GAAP financial measures exclude stock-based compensation and depreciation expenses that are recurring. Both stock-based expenses and depreciation have been, and will continue to be for the foreseeable future, a significant recurring expense with an impact upon our company notwithstanding the lack of immediate impact upon cash. Second, stock-based awards are an important part of our employees’ compensation and impact their performance. Third, there is no assurance we will avoid further personnel changes and, therefore, may recognize additional severance and other one-time charges associated with a future restructuring. Fourth, there is no assurance the components of the costs that we exclude in our calculation of non-GAAP operating loss do not differ from the components that our peer companies exclude when they report their results of operations. Our management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from these non-GAAP financial measures and evaluating these non-GAAP financial measures together with their most directly comparable financial measures calculated in accordance with GAAP. The accompanying tables have more details on these non-GAAP financial measures, including reconciliations between these financial measures and their most directly comparable GAAP equivalents.

Forward-Looking Statements
This release contains certain forward-looking statements of expected future developments, as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect management's expectations regarding continued operating improvement and other matters and are based on currently available data; however, actual results are subject to future risks and uncertainties, which could materially affect actual performance. Risks and uncertainties that could affect such performance include, but are not limited to, the following: estimates of future expenses, revenue and profitability; the pace at which the company completes installations and recognizes revenue; trends affecting financial condition and results of operations; ability to convert proposals into customer orders; the ability of customers to pay for products and services; the revenue recognition impact of changing customer requirements; customer cancellations; the availability and terms of additional capital; ability to develop new products; dependence on key suppliers, manufacturers and strategic partners; industry trends and the competitive environment; and the impact of losing one or more senior executives or failing to attract additional key personnel. These and other risk factors are discussed in detail in the risk factors section of the company's Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 21, 2012.

First Quarter 2012 Financials

Company Contact:
Darin P. McAreavey
Senior Vice President and Chief Financial Officer

Investor Relations Contact:
Scott Liolios or Matt Glover
Liolios Group, Inc.