HONG KONG, March 14, 2008 (PRIME NEWSWIRE) -- Hong Kong-based Artificial Life, Inc. (OTCBB:ALIF) (www.artificial-life.com), a leading full service provider of award winning mobile technology and applications, today reported results for its fiscal fourth quarter, which ended December 31, 2007, and for the year ended December 31, 2007.

Revenues for the fourth quarter were $3,116,754 as compared to $259,882 for the fourth quarter ended December 31, 2006. The increase of revenues of $2,856,872 or approximately 1,000% as compared to the fourth quarter of 2006 was mainly due to increased product license income from pre-installment deals for mobile handsets, increased download and monthly subscription revenues for 3G games derived from mobile operators, resellers and hand set distributors.

Net income for the fourth quarter was $2,199,996 as compared to a net loss of $2,231,686 for the same quarter in 2006. Net income for the fourth quarter of 2007 was mainly due to the substantial increase in revenues and a gain on extinguishment of liabilities.

Revenues for the fiscal year ended December 31, 2007 were $5,801,212 as compared to $856,334 for the year ended December 31, 2006. The increase of $4,944,878 or 577% was primarily due to increased licensing revenue generated from our core mobile products.

Net Income for the year ended December 31, 2007 was $1,011,817 as compared to a net loss of ($2,942,532) for the year ended December 31, 2006. This increase of $3,954,349 was primarily due to a strong increase in sales of our mobile products and technologies, a gain on extinguishment of liabilities and decrease of stock-based compensation expense offset by increased costs for global expansion.

The net income per share for the year ended December 31, 2007 was $0.03 as compared to a net loss per share of ($0.10) for the year ended December 31, 2006.

Eberhard Schoneburg, Artificial Life's Chief Executive Officer, said, "2007 was a very successful year for us with strong growth and major progress in our global expansion. We are now selling our products through over 100 active channels of resellers and carriers around the globe and sold over 4 million licenses of our mobile games in 2007.We have also been able to attract major global brands as new partners and became a full service mobile applications provider offering not only games but also medical applications and even interactive mobile TV systems. As a result of all this our revenues increased strongly while we kept cost of operations under tight control and therefore turned profitable. We will put all our efforts into maintaining this positive trend in 2008 and beyond. Our short term goal in 2008 is to penetrate many more new markets including China and South America. In addition we will release several new exciting mobile games in the coming weeks and months for the usual 2G and 3G handsets and will also start launching games for the iPhone(r) and iPod Touch(r) platforms. Besides expanding further in the mobile games market we also intend to make strong progress in the area of mobile business applications, mobile diabetes monitoring and mobile TV with the first major installations of our SMS Galaxy system."


       Consolidated Statements of Operations for the Years Ended
                      December 31, 2006 and 2007

                                               2007             2006
                                              ------           ------
 Revenue:
         Software license agreements       $   841,334      $5,784,211
         Application services and other         15,000          17,000
                                           -----------      ----------
         Total revenues                        856,334       5,801,212
                                           -----------      ----------

 Operating expenses:
         Engineering and cost of sales       1,330,967       2,113,172
         General and administrative          1,625,017       1,492,012
         Research and development              341,861         296,283
         Sales and marketing                 1,045,562       1,853,777
                                           -----------      ----------
         Total operating expenses            4,343,407       5,755,244
                                           -----------      ----------

 (Loss) income from operations              (3,487,073)         45,968
                                           -----------      ----------

 Other income (expense):
         Interest income                        32,269          19,271
         Interest expense                      (22,185)       (157,412)
         Gain on extinguishment of
          liabilities                               --         685,130
         Foreign currency transaction
          gains (losses) and other             (17,418)         85,730
         Gain on value of derivative
          liability                            551,875              --
                                           -----------      ----------
                                               544,541         632,719
                                           -----------      ----------

 (Loss) income before income tax            (2,942,532)        678,687
 Income tax benefit                                 --         333,130
                                           -----------      ----------
 Net (loss) income                          (2,942,532)      1,011,817
 Foreign currency translation adjustment            --         (34,114)
                                           -----------      ----------
 Comprehensive (loss) income               $(2,942,532)     $  977,703
                                           ===========      ==========

 Net (loss) income per share:
         Basic                             $     (0.10)     $     0.03
                                           ===========      ==========
         Diluted                           $     (0.10)     $     0.03
                                           ===========      ==========
 Weighted average shares outstanding:
         Basic                              30,801,573      35,977,335
                                           ===========      ==========
         Diluted                            30,801,573      40,159,151
                                           ===========      ==========

 * Based on Audited Financial Statements


        Consolidated Balance Sheet December 31, 2006 and 2007

                                ASSETS

                                           December 31,    December 31,
                                               2007             2006
                                              ------           ------
 Current assets:
         Cash and cash equivalents         $ 6,210,435      $1,338,158
         Accounts receivable                 5,198,028         294,005
         Receivable from issuance of
          common stock                         224,500              --
         Prepaid expenses and other            355,541              --
         Deferred tax asset                    170,000              --
                                           -----------      ----------
         Total current assets              $12,158,504      $1,632,163
                                           -----------      ----------

 Fixed assets                                1,810,978          98,796
                                           -----------      ----------

 Prepaid license rights                        591,093         200,000
 Prepaid expenses, deposits and other
  assets                                       271,137         332,607
 Deferred tax asset                            163,130              --
                                           -----------      ----------
                                           $ 1,025,360      $  532,607
                                           -----------      ----------

         TOTAL ASSETS                      $14,994,842      $2,263,566
                                           ===========      ==========


                   LIABILITIES AND STOCKHOLDERS' EQUITY

 Current liabilities:
         Accounts payable                  $   789,166      $1,414,157
         Accrued expenses                    1,113,585         414,167
         Note payable to officer/stockholder   751,860         222,805
         Notes payable, net of discount of
          $99,000                              901,000              --
                                           -----------      ----------
         Total liabilities (all current)     3,555,611       2,051,129
                                           -----------      ----------

 Commitments and contingency 
 Stockholders' equity:
         Preferred stock, $.01 par value;
          5,000,000 shares authorized, no
          shares issued and outstanding
         Common stock, $.01 par value;
          130,000,000 shares authorized,
          43,905,509 shares issued and
          outstanding                          439,055         337,134
         Additional paid-in capital         46,315,296      36,168,126
         Notes receivable from stockholders    (19,577)        (19,577)
         Accumulated deficit               (35,261,429)    (36,273,246)
         Accumulated other comprehensive
          loss                                 (34,114)             --
                                           -----------      ----------
         Total stockholders' equity         11,439,231         212,437
                                           -----------      ----------
        TOTAL LIABILITIES AND
         STOCKHOLDERS' EQUITY              $14,994,842      $2,263,566
                                           ===========      ==========
  * Based on Audited Financial Statements

About Artificial Life

Artificial Life, Inc. (OTCBB:ALIF) is a public U.S. corporation headquartered in Hong Kong with offices in Berlin (EMEA headquarters) and Tokyo. We are a leading global full service provider of award winning mobile technology, mobile TV, content, games and business applications (see also our Company's homepage: www.artificial-life.com; and our m-commerce portal: www.botme.com).

Forward-Looking Statements:

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, without limitation, statements regarding our future results of operations, financial condition and business prospects. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "intend," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue," or the negative of these terms or other comparable terminology. Although such statements are based on our own information and information from other sources we believe to be reliable, you should not place undue reliance on them. These statements involve risks and uncertainties, and actual market trends or our actual results of operations, financial condition or business prospects may differ materially from those expressed or implied in these forward looking statements for a variety of reasons. Potential risks and uncertainties include, but are not limited to, our ability to obtain additional funding to operate and grow our business; the unproven potential of our mobile gaming business model; changing consumer preferences and uncertainty of market acceptance of our products; timely adoption and availability of 3G mobile technology; market acceptance for use of mobile handheld devices to play the interactive games; unpredictable mobile game development schedules; our reliance on a relatively small number of brands; our ability to license brands from others; our dependence upon resellers and telecommunication carriers and operators to distribute our products; our ability to successfully develop, introduce, and sell new or enhanced products in a timely manner; and the timing of new product announcements or introductions by us or by our competitors. For additional discussion of these risks and uncertainties and other factors, please see the documents we file from time to time with the Securities and Exchange Commission, including our Annual Report on Form 10-K filed on March 13, 2008. We assume no obligation to update any forward-looking statements, which apply only as of the date of this press release.

Artificial Life, Inc.
Ada Fong
+852 3102 2800