Exhibit 99.1
 
LOGO
 
4350 Executive Drive, Suite 100 San Diego, CA 92121        858-373-1600    www.infosonics.com
 
Company Contact:
IR Contact:
Jeffrey A. Klausner
Todd Kehrli or Mary Magnani
Chief Financial Officer
MKR Group, Inc.
(858) 373-1600
(323) 468-2300
ir@infosonics.com
ifon@mkr-group.com


INFOSONICS REPORTS THIRD QUARTER 2008 FINANCIAL RESULTS

SAN DIEGO, CA, November 13, 2008 - InfoSonics Corporation (NASDAQ: IFON), one of the premier providers and distributors of wireless handsets and accessories serving Latin America, today announced results for the third quarter ended September 30, 2008.

“Net sales in South America remained strong in the third quarter, but were offset by significant weakness in the Central American marketplace, which resulted in a decrease in revenue when compared to the third quarter of last year.” said Joseph Ram, President and Chief Executive Officer of InfoSonics Corporation. “However, we have achieved 11% growth in year-to-date net sales, which is attributable to the growth we have experienced in South America and the contribution of our verykool® line.”

“The Central American markets are closely linked to the North American market, and as such, our third quarter revenue in that region was impacted by the slowdown in consumer spending. In South America, our revenue held steady, driven by strong performances in Argentina and Colombia. Additionally, we are planning to launch three new verykool® handsets during the fourth quarter, pending carrier testing and approvals,” continued Ram.

Ram concluded, “In the current economic environment, we are pleased we have strengthened our balance sheet, increased our liquidity and maintained access to our bank line of credit. During the quarter we took several steps to prepare for continued weakness in the economy, including the reduction of our inventory levels and more appropriately aligning of our cost structure to our current needs. We continue to have working capital of nearly $32 million, and believe this will allow us to benefit from growth opportunities when they present themselves in the immediate future or when the economy turns around.”

Third Quarter Results
 
Net sales from continuing operations in the third quarter of 2008 were $52.9 million, a decrease of 18% compared to $64.4 million in the third quarter of 2007. South America sales increased 7% to $44.1 million and represented 83% of net sales, compared to $41.1 million in the same quarter of last year. Central America sales represented 17% of net sales or $8.8 million, compared to $23.3 million in the third quarter of 2007, a decrease of 62%.

The Company sold approximately 657,000 units in the third quarter of 2008, bringing the year to date total to more than 2.2 million units sold. Average selling price per unit increased 2% year-over-year for the third quarter, whereas the year to date average selling price has decreased 3% over the same period in 2007.

Gross profit for the third quarter of 2008 was $2.9 million, or 5.5% of net sales, as compared to $3.9 million, or 6.1% of net sales for the third quarter of 2007.

Income from continuing operations for the quarter was $182,000 which included $650,000 of other income from the settlement of an outstanding claim against a former service provider. While discontinued operations had a loss of $81,000, the overall result was net income of $101,000, or $0.01 per diluted share.

5

InfoSonics ended the third quarter with quick assets (cash and accounts receivable) of $51.7 million and working capital (current assets minus current liabilities) of $31.8 million, compared to $45.3 million of quick assets capital and $31.4 million of working capital for the second quarter of 2008.

Nine-Month Financial Results
 
Total revenues for the nine months ended September 30, 2008 increased 11% to $179.9 million, compared to $161.9 million for the nine months ended September 30, 2007. Revenue from South America represented 76% of total revenue or $136.4 million, versus $109.0 million in for the first nine months of 2007. Revenue from Central America represented 24% of total revenue or $43.5 million, versus $52.9 million for the first nine months of 2007.

Approximately 2.2 million units were sold in the first nine months of 2008 representing an increase of 12% over the first nine months of 2007.

Gross profit for the first nine months of 2008 increased 4% to $9.7 million, or 5.4% of total sales, as compared to $9.3 million, or 5.7% of total sales for the first nine months of 2007.

Continuing operations had a loss for the nine months ended September 30, 2008 of $306,000, or $0.02 per share, while discontinued operations had a loss of $2.2 million, the overall result was net loss of $2.5 million, compared to a net loss of $632,000 for the same period in the prior year.

Investor Conference Call

InfoSonics management will host a conference call today, Thursday, November 13, 2008, at 1:30 pm PT (4:30 pm ET) to review the third quarter financial results. Joseph Ram, President and Chief Executive Officer, and Jeff Klausner, Chief Financial Officer, will be on-line to discuss these results.

The call can be accessed by dialing (866) 770-7051 and giving the pass code, “InfoSonics.” Participants are asked to call the assigned number approximately 10 minutes before the conference call begins. In addition, the conference call will be available over the Internet at www.infosonics.com.


About InfoSonics Corporation

InfoSonics is one of the premier providers and distributors of wireless handsets and accessories serving Latin America. For the wireless telecommunications industry, InfoSonics provides flexible and cost effective solutions, including product assembly, purchasing, marketing, selling, warehousing, order assembly, programming, packing, shipping, and delivery. InfoSonics supports manufacturers in moving their products to agents, resellers, distributors, independent dealers, retailers and wireless network operators in Latin America. For additional information, please visit www.infosonics.com.


Cautionary Statement for the Purpose of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995

The matters in this press release that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements about future revenues, sales levels, operating income and margins, wireless handset sales, stock-based compensation expense, gain (loss) in value of derivatives, cost synergies, operating efficiencies, profitability, market share, and rates of return, are based on current management expectations that involve certain risks and uncertainties. These risks and uncertainties, in whole or in part, could cause such expectations to fail to be achieved and have a material adverse effect on InfoSonics’ business, financial condition and results of operations, including, without limitation: (1) intense competition, regionally and internationally, including competition from alternative business models, such as manufacturer-to-carrier sales, which may lead to reduced prices, lower sales or reduced sales growth, lower gross margins, extended payment terms with customers, increased capital investment and interest costs, bad debt risks and product supply shortages; (2) inability to secure adequate supply of competitive products on a timely basis and on commercially reasonable terms; (3) foreign exchange rate fluctuations, devaluation of a foreign currency, adverse governmental controls or actions, political or economic instability, or disruption of a foreign market, and other related risks of our international operations; (4) the ability to attract new sources of profitable business from expansion of products or services or risks associated with entry into new markets, including geographies, products and services; (5) an interruption or failure of our information systems or subversion of access or other system controls may result in a significant loss of business, assets, or competitive information; (6) significant changes in supplier terms and relationships; (7) termination of a supply or services agreement with a major supplier or product supply shortages; (8) continued consolidation in the wireless handset carrier market; (9) extended general economic downturn; (10) loss of business from one or more significant customers; (11) customer and geographical accounts receivable concentration risk; (12) rapid product improvement and technological change resulting in inventory obsolescence; (13) future terrorist or military actions; (14) the loss of a key executive officer or other key employees; (15) changes in consumer demand for multimedia wireless handset products and features; (16) our failure to adequately adapt to industry changes and to manage potential growth and/or contractions; (17) seasonal buying patterns; (18) dependency on Latin American sales; (19) uncertain political and economic conditions internationally; (20) the impact, if any, of changes in EITF 00-19 or SFAS 133 guidance as it relates to warrants and registration rights and SFAS 123R as it relates to stock options; (21) the resolution of any litigation against the company; (22) the ability of the Company to successfully introduce and sell its verykool® products and the related inventory risk of such products and (23) the ability of the Company to generate taxable income in future periods in order to utilize and realize any quarterly tax benefits recorded. Our actual results could differ materially from those anticipated in our forward looking statements.

6

InfoSonics has instituted in the past and continues to institute changes to its strategies, operations and processes to address these risk factors and to mitigate their impact on InfoSonics’ results of operations and financial condition. However, no assurances can be given that InfoSonics will be successful in these efforts. For a further discussion of significant factors to consider in connection with forward-looking statements concerning InfoSonics, reference is made to Item 1A Risk Factors of InfoSonics’ Annual Report on Form 10-K for the year ended December 31, 2007 and Quarterly Reports on Form 10-Q for the period ended March 31, 2008 and June 30, 2008; other risks or uncertainties may be detailed from time to time in InfoSonics’ future SEC filings. InfoSonics does not intend to update any forward-looking statements.

-more-

7

InfoSonics Corporation and Subsidiaries
Consolidated Balance Sheets
 
   
September 30,
2008
  
December 31,
2007
  
   
(unaudited)
  
(audited)
  
ASSETS
          
Current assets:
              
Cash and cash equivalents
  
$
10,189,774
  
$
20,652,154
  
Trade accounts receivable, net of allowance for doubtful accounts of $427,326 (unaudited) and $558,342
    
37,314,003
    
38,027,013
  
Other receivables
    
4,150,000
    
—
  
Inventory, net of reserves of $257,556 (unaudited) and $580,438
    
8,304,763
    
13,479,861
  
Prepaid inventory
    
94,986
    
461,990
  
Prepaid expenses
    
137,520
    
87,753
  
Prepaid taxes
    
338,679
    
334,990
  
Assets of discontinued operations
    
4,733,849
    
14,118,308
  
Deferred tax asset - current
    
1,270,757
    
1,203,417
  
               
Total current assets
    
66,534,331
    
88,365,486
  
               
Property and equipment, net
    
691,289
    
1,301,985
  
Intangible assets
    
504,000
    
504,000
  
Deferred tax asset - non-current
    
1,454,789
    
1,401,671
  
Other assets
    
118,072
    
110,660
  
               
Total assets
  
$
69,302,481
  
$
91,683,802
  
               
LIABILITIES AND STOCKHOLDERS’ EQUITY
              
               
Current liabilities:
              
Line of credit
  
$
13,909,497
  
$
26,755,100
  
Accounts payable
    
11,860,580
    
20,821,601
  
Accrued expenses
    
7,551,535
    
1,105,972
  
Liabilities of discontinued operations
    
1,365,624
    
5,895,687
  
Income taxes payable
    
41,000
    
80,560
  
               
Total current liabilities
    
34,728,236
    
54,658,920
  
               
Total liabilities
    
34,728,236
    
54,658,920
  
               
Commitments and contingencies
              
               
Stockholders’ equity:
              
Preferred stock, $0.001 par value 10,000,000 shares authorized (no shares issued and outstanding as of applicable period end)
    
—
    
—
  
Common stock, $0.001 par value 40,000,000 shares authorized (14,910,808 and 14,647,067 shares issued and outstanding as of applicable periods end)
    
14,911
    
14,647
  
Additional paid-in capital
    
31,607,493
    
31,505,990
  
Accumulated other comprehensive loss
    
(38,597
)
  
(31,190
)
Retained earnings
    
2,990,438
    
5,535,435
  
               
Total stockholders’ equity
    
34,574,245
    
37,024,882
  
               
Total liabilities and stockholders’ equity
  
$
69,302,481
  
$
91,683,802
  
 
8

InfoSonics Corporation and Subsidiaries
Consolidated Statements of Operations
(unaudited)
 
   
For the Three Months
Ended September 30,
  
For the Nine Months
Ended September 30,
  
   
2008
  
2007
  
2008
  
2007
  
                   
Net sales
  
$
52,883,848
  
$
64,398,368
  
$
179,857,086
  
$
161,893,605
  
Cost of sales
    
49,982,339
    
60,459,366
    
170,141,235
    
152,591,568
  
                           
Gross profit
    
2,901,509
    
3,939,002
    
9,715,851
    
9,302,037
  
Operating expenses
    
3,210,515
    
3,622,188
    
10,127,587
    
9,370,485
  
                           
Operating income (loss) from continuing operations
    
(309,006
)
  
316,814
    
(411,736
)
  
(68,448
)
                           
Other income (expense)
                          
Other income
    
653,181
    
2,094,918
    
582,700
    
2,094,918
  
Interest (expense)
    
(33,735
)
  
(360,122
)
  
(477,456
)
  
(641,789
)
                           
Income (loss) from continuing operations before benefit for income taxes
    
310,440
    
2,051,610
    
(306,492
)
  
1,384,681
  
Benefit (provision) for income taxes
    
(128,410
)
  
(134,408
)
  
(1,054
)
  
141,126
  
                           
Income (loss) from continuing operations
    
182,030
    
1,917,202
    
(307,546
)
  
1,525,807
  
Loss from discontinued operations, net of tax
    
(80,633
)
  
(1,543,767
)
  
(2,237,452
)
  
(2,157,749
)
                           
Net Income (loss)
  
$
101,397
  
$
373,435
  
$
(2,544,998
)
$
(631,942
)
                           
Basic earnings (loss) per share
                          
From continuing operations
  
$
0.01
  
$
0.13
  
$
(0.02
)
$
0.11
  
From discontinued operations
  
$
(0.01
)
$
(0.11
)
$
(0.15
)
$
(0.15
)
Net income (loss)
  
$
0.01
  
$
0.02
  
$
(0.17
)
$
(0.04
)
Diluted earnings (loss) per share
                          
From continuing operations
  
$
0.01
  
$
0.12
  
$
(0.02
)
$
0.11
  
From discontinued operations
  
$
(0.01
)
$
(0.10
)
$
(0.15
)
$
(0.15
)
Net income (loss)
  
$
0.01
  
$
0.02
  
$
(0.17
)
$
(0.04
)
                           
Basic weighted-average number of common shares outstanding
    
14,910,808
    
14,474,353
    
14,850,469
    
14,416,322
  
                           
Diluted weighted-average number of common shares outstanding
    
15,298,685
    
15,722,324
    
14,850,469
    
14,416,322
  

9