Thermage, Inc. Reports Record Revenue and First Quarter Results Q1 Revenue Increases by 22% and Gross Profit Increases by 27% Over Prior Year Period

HAYWARD, Calif., May 1 -- Thermage, Inc. (Nasdaq: THRM), a leader in non-invasive tissue tightening in the aesthetic industry, today reported financial results for the first quarter ended March 31, 2007.

Revenue for the quarter ended March 31, 2007 was $15.2 million, up 22% from $12.4 million for the quarter ended March 31, 2006. Gross profit increased to $11.0 million or 72.6% of revenue, for the quarter ended March 31, 2007, up from $8.7 million or 69.6% of revenue for the quarter ended March 31, 2006.

The Company reported GAAP net income of $0.1 million, or breakeven earnings per share, for the quarter ended March 31, 2007, versus a net loss of $2.8 million, or $0.68 per share, for the quarter ended March 31, 2006. Non- GAAP (1) net income for the first quarter of 2007 was $1.3 million, or $0.05 per diluted share, compared to a net loss of $0.7 million, or $0.04 per share, for the prior year period.

"We continued to produce over 70% of sales from our high margin consumables products," said Stephen J. Fanning, President and Chief Executive Officer. "In addition, in mid-February we began shipping our new generator platform, ThermaCool NXT(TM), and received strong worldwide demand from both new and existing customers. As a result, we sold more generators in the first quarter than in any previous quarter for over the past two years."

"In January, we introduced a new procedure, Hands by Thermage(TM), with a corresponding new treatment tip," continued Mr. Fanning. "This is the first of several new procedures and treatment tips we plan to launch in 2007 that are designed to expand the range of applications for Thermage procedures, improve patient outcomes, and increase the value proposition for our customers."

"We continue to build the Thermage brand. In April, we launched Stars of Thermage(TM), an on-line DTC media campaign that features the real-life experiences of women who have had the Thermage procedure. We continue to be pleased with the high profile media coverage of Thermage generated recently in media such as US Magazine, USA Today, MSN Health and Fitness, and The Learning Channel. We have good momentum and will continue our strong marketing efforts to drive patient demand for Thermage applications," concluded Mr. Fanning.

Guidance: Management expects revenue for full year 2007 to be in a range of $65 million to $68 million, an increase of 20% to 25% over full year 2006. For the full year 2007, we expect GAAP diluted earnings per share to be in a range of a net loss of $0.04 per share to net income of $0.03 per share. Non-GAAP (1) diluted earnings per share are expected to be in a range of net income of $0.16 to $0.23 per share. The per share earnings amounts are based on fully diluted weighted average shares of 26 million.