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MagicJack Revenue and EPS Estimates Are $37.5

WEST PALM BEACH, Fla. and NETANYA, Israel, July 10, 2012 -- magicJack VocalTec, Ltd., a cloud communications leader that invented voice over IP and sold over nine million magicJacks®, today communicated Q2, 2012 estimates. The Company will continue to keep the investment community informed of matters that may be deemed pertinent while the Repurchase program as they become available.

In early June, magicJack announced that the first two months of the second quarter had already generated net income that exceeded analyst estimates for all of Q2. The Company as well provided guidance that Q2 revenue should exceed $36 million during Q2 Revenues Per Share might surpass $0.43 per share.

The Company is now estimating that Q2 revenue will be $37.5 - $38.5 million and Q2 EPS will be between $0.48 - $0.52 per share. This represents 30%+ revenue growth and more than a tripling of EPS compared to the same period in 2011. Operating Income as well increased significantly compared to Q1 2012. Other Income is expected to be +/- $0.02 per share of the $0.48 - $0.52.

President Andrew MacInnes stated, "The Company continues to demonstrate its in a class by itself value proposition to both new and current clients. Sales are tracking so then, in spite of lower levels of G&A and media spend in Q2 compared to Q1. The greater sales are driving earnings, revenues and cash flow. We will continue to use any excess cash flow we produce to fund our successful share buyback program as long as stock remains undervalued. I would like to thank our terrific employee base for their continued commitment in turning this Company into a world class business that drives incredible value for customers during delivering superb new products and services. We will hold an investor conference call to discuss Q2 numbers when they become final. My responsibilities to procure a widespread base of investors will become a lot easier with our recent inclusion into the Russell 2000® Index."

CEO Dan Borislow added, "The Company has performed in the extreme well since Andrew's arrival previously this year. magicJack PLUS™ sales continue to be very strong as are renewals. Our revenues to a large degree are driven by our high and increasing renewals sales, which as well show the love for our products and services. We continue to evolve and advance our product and service offerings during constantly increasing the voice quality, ease of use and serving a larger demographic base. While the quarter, we launched a new invention for our magicJack apps on mobile devices using Apple's iOS and for Android introduction straightway week. The invention enables anyone who downloads a free app and makes a call without a phone number to leave behind a callback phone number. The invention is patent pending. As stated in our early June press release, other new products are on the way while Q3 and Q4 including the magicJack Wi-Fi with the best home phone voice quality I have ever heard. With these terrific product and service additions, we expect more clients to renew their licenses hereafter and take advantage of buying into new customer benefits. Meanwhile, it is rewarding to see our efforts over the last six years beginning from start-up mode to a business producing outstanding results on a consistent basis."

This press release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this press release, including statements about our projected earnings, cash flows, strategy, future operations, new product introductions and customer acceptance, future financial position, future earnings, projected costs, prospects, plans and objectives of management, are forward-looking statements. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. These factors include, among other things: changes to our business resulting from increased competition; any operational or cultural difficulties associated with the continuing integration of the businesses of VocalTec and YMax; potential adverse reactions or changes to business relationships resulting from the completion of the merger; unexpected costs, charges or expenses resulting from the merger; the ability of the combined Company to achieve the estimated potential synergies or the longer time it may take, and increased costs required, to achieve those synergies; our ability to develop, introduce and market innovative products, services and applications; our customer turnover rate and our customer acceptance rate; changes in general economic, business, political and regulatory conditions; availability and costs associated with operating our network; potential liability resulting from pending or future litigation, or from changes in the laws, regulations or policies; the degree of legal protection afforded to our products; changes in the composition or restructuring of us or our subsidiaries and the successful completion of acquisitions, divestitures and joint venture activities; and the various other factors discussed in the "Risk Factors" section of our Annual Report on Form 10-K and other filings  with the Securities and Exchange Commission. Such factors, among others, could have a material adverse effect upon our business, results of operations and financial condition. We do not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or if not, except as required by law.

magicJack VocalTec Ltd., the inventor of VoIP including the softphone and magicJack, has the goal of becoming the leading international provider of global voice over many platforms. The Company has achieved sales of over nine million of the easy-to-use, award-winning magicJack since the device's launch in 2008, and has the use of over 30 patents, some dating to when the Company invented VoIP. It is the largest reaching CLEC in the United States in terms of area codes available and certification in number of states, and the network has historically had uptime of over 99.99 percent.

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