52% to $45.3 million compared to $29.8 million and product revenue was $189.4 million versus $195.4 million for the nine months ended September 30, 2004.

The Company’s net loss for the nine months ended September 30, 2005 increased to $1.2 million, or $0.05 per basic and diluted share, compared to a net loss of $0.9 million, or $0.04 per basic and diluted share, in the corresponding period in 2004. Excluding year-to-date incremental relocation-related charges of $1.4 million, the Company’s results would have been a net income of $0.2 million, or $0.01 per basic and diluted share, for the first nine months of 2005.

EBITDA for the nine months ended September 30, 2005 climbed 25% to $5.4 million ($6.7 million excluding incremental relocation-related costs) from $4.3 million in the same period last year. Gross profit rose to $24.1 million for the first nine months in 2005 from $21.3 million in the year-earlier period, an increase of 13%.

Thomas Madden, PFSweb Chief Financial Officer, said, “In the third quarter, we realized final costs of $1.2 million related to the relocation of two of our facilities from Memphis to Southaven. The move, completed in September, included higher than expected costs in the third quarter but we expect our streamlined operations to produce greater efficiencies over the long run as we continue to expand our business.”

Layton concluded, “We anticipate continued benefits in the current fourth quarter from new business contracts signed last year. Clearly, 2005 has been a slow year for new contract signings as we focused on larger contracts with blue-chip companies. This strategic shift has lengthened our sales cycle, which has led to challenges in signing new business on a consistent basis.

“For the current fiscal year, we are reiterating our previous guidance of 30% to 40% growth in service fees and an approximate 5% decline in product revenue compared to fiscal 2004. We anticipate a net loss of $0.04 to $0.01 per share in 2005, but excluding the impact of $1.4 million in relocation-related costs, or $0.06 per share, which we believe are not reflective of our core business activities, we remain on target to achieve earnings per share of $0.02 to $0.05 in 2005.

“This is an exciting time for PFSweb. We believe our proposed merger with eCOST.com, announced earlier today with the signing of a non-binding letter of intent, provides substantial long-term growth opportunities for both companies. eCOST’s 1.3 million total customers, broad product offering, merchandising and direct marketing expertise combined with PFSweb’s advanced distribution and fulfillment engine and IT capabilities will bring together the core strengths of both organizations. eCOST’s established consumer direct sales model highly complements our operational infrastructure producing a company with combined revenue for the trailing twelve months ended September 30, 2005 of $528 million.”

PFSweb has scheduled a conference call for Thursday, November 10, 2005 at 4:00 p.m. Central Time (5:00 p.m. Eastern Time). To listen to the call, please dial (973) 935-2800, confirmation code: 6699625 at least five minutes before the scheduled start time. Investors can also access the call in a “listen only” mode via the Internet at the Company’s website, www.pfsweb.com. Please allow extra time prior to the call to visit the site and download any necessary audio software.