Firstwave Technologies, Inc.

Description

ATLANTA, GA — May 8, 2006 — Firstwave Technologies, Inc. (NASDAQ: FSTW), a web-based, CRM solutions provider, today announced preliminary financial results for the quarter ended March 31, 2006.The loss from continuing operations applicable to common shareholders for the first quarter of 2006 decreased 77.2% to $187,000, or ($0.06) per fully diluted share, as compared to a loss from continuing operations applicable to common shareholders of $821,000 in the first quarter of 2005, or ($0.30) per fully diluted share. As more fully explained below, the decreases in license and services revenues are in part the result of a shift in the product marketing approach from a direct model to a channel model as reflected in our previously announced relationship with M1 Global which commenced in October 2005. Software license revenues decreased 42.7% to $47,000 in the first quarter of 2006 from $82,000 in the first quarter of 2005. Services revenues decreased 53.0% to $94,000 in the first quarter of 2006 as compared to $200,000 in the same quarter a year ago. Maintenance revenues decreased 20.9% to $458,000 in first quarter of 2006 from $579,000 in the first quarter of 2005. Total revenues for the first quarter of 2006 were $599,000, a 32.0% decrease from the first quarter of 2005 revenues of $881,000. Of the total revenue decrease in the first quarter of 2006, $138,000 relates to the fact that Firstwave now receives a percentage of revenues from M1 Global’s sales (33% of license revenues and 20% of services revenues); however, the costs relating to making such sales are borne by M1 Global so the amounts received by Firstwave from these revenues benefit the bottom line.Although revenues decreased during the first quarter 2006 as compared to the same period last year, the bottom line improved primarily due to the M1 Global relationship and the significant reductions in our operating expenses associated therewith.

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