1-800-FLOWERS.COM(R) Reports Revenues Grew 21.6 Percent or $24.4 Million to $137.1 Million for Its Fiscal 2007 First Quarter

1-800-FLOWERS.COM, Inc. (NASDAQ: FLWS), the world’s leading florist and a provider of specialty gifts for all occasions, today reported record revenues of $137.1 million for its fiscal first quarter ended October 1, 2006, representing an increase of 21.6 percent, or $24.4 million, compared with revenues of $112.7 million reported in the prior-year period. Revenue growth for the quarter was aided by the contribution from Fannie May Confections Brands, Inc., acquired by the Company in May 2006. Excluding the contribution from Fannie May, the Company’s organic revenue growth was approximately 10 percent compared with the prior year period. The Company noted that the solid revenue growth was achieved despite the fact that the fiscal first quarter is its lowest in terms of revenues due to the lack of gifting occasions during the summer months. Highlighting the fiscal first quarter results was the improved operating leverage the Company achieved, reducing its operating expense ratio* by 320 basis points to 44.4 percent compared with the prior year period. Gross margin for the quarter, primarily reflecting the seasonally lower margins associated with its Fannie May business, was 40 percent compared with 40.8 percent in the year-ago period. The combination of these factors resulted in an EBITDA improvement for the quarter of $1.5 million, or 20.3 percent, to ($6.1) million compared with ($7.6) million in the prior year period. (*Excludes depreciation and amortization expense.) The Company noted that its improved EBITDA for the quarter was offset by the financing and intangible amortization costs associated with its Fannie May Confections Brands acquisition. As a result, GAAP net loss for the first quarter was $7.4 million or ($0.11) per share compared with a loss of $6.6 million or ($0.10) per share in the prior year period. Pro forma net loss for the first quarter was $6.7 million or ($0.10) per share compared with $5.9 million or ($0.09) per share in the year-ago period. (The Company’s definition of Pro forma net loss is included below under "Definitions.”). The Company noted that it anticipates significantly higher revenue and gross margin contributions from the Fannie May business during the current fiscal second quarter which includes the key year-end holiday period. Jim McCann, CEO of 1-800-FLOWERS.COM, said, "We made significant progress, during the first quarter, toward our stated goals of solid revenue growth and improving our operating leverage to enhance full-year bottom-line performance. Our revenue growth of approximately 22 percent, or more than $24 million, was aided by our most recent acquisitions, particularly Fannie May Confections Brands in our fast growing Food, Wine and Gift Basket category. Importantly, we achieved this growth in a period that is our lowest, in terms of revenue. We anticipate continued revenue growth across all of our businesses in the current fiscal second quarter which includes the calendar year-end holiday period. In addition, we expect to continue to enhance our operating leverage as well as drive substantially higher gross profit margins through a combination of sourcing, process improvements and focused merchandising programs.” McCann also noted that, during the fiscal first quarter, the Company continued to achieve strong growth in its BloomNet wire service business. "BloomNet grew its revenues almost 60 percent during the first quarter. Importantly, by leveraging its increasing scale, it increased its EBITDA contribution by more than 150 percent. This strong growth and profitability illustrates the enthusiastic response BloomNet’s superior value proposition is receiving from florists throughout the country. We continue to focus our efforts in this area on developing and introducing a comprehensive suite of products and services designed to help our florists grow their businesses and enhance their profitability,” he said. During the fiscal first quarter, the Company attracted 548,000 new customers, 67 percent of whom, or 365,000, came to the Company through its online channels. These customers were attracted to the Company’s leading position in the floral category as well as its expanded Specialty Brands gift offerings through a combination of targeted marketing programs as well as its convenient, multi-channel customer access. More than 1.3 million customers placed orders during the period of which 59.3 percent were repeat customers. This reflects the Company’s ongoing focus on deepening the relationship with its existing customers as their trusted source for gifts and services for all of their celebratory occasions. CATEGORY RESULTS: As discussed in the Company’s August 10, 2006 press release and conference call, beginning with this press release regarding results for the first quarter of fiscal 2007 and going forward, the Company will provide selected financial results for its Floral and Specialty Brands business categories in the tables attached to this release and as follows: FLORAL: 1-800-FLOWERS.COM Consumer Floral: During the fiscal 2007 first quarter, revenues in this category increased 8.2 percent to $82.5 million compared to $76.3 million in the prior year period. Gross margin for the quarter was 38 percent compared with 38.3 percent in last year’s first quarter. Reflecting improved operating leverage, Category EBITDA improved 32.5 percent, or $1.9 million, to $7.8 million compared with $5.9 million in the prior year period. The Company defines Category EBITDA as earnings before interest, taxes, depreciation and amortization and before allocation of corporate overhead expenses. BloomNet Wire Service: Revenues increased 58.7 percent to $7.2 million compared with $4.5 million in the year ago period. Gross margin was 57.2 percent compared with 57.9 percent in the prior year period. Category EBITDA increased 152.9 percent to $1.7 million compared with $673,000 in last year’s first quarter, reflecting the growth in florist membership and product and service offerings compared with the prior year. SPECIALTY BRANDS: Home and Children’s Gifts: Revenues increased 8.5 percent to $24.6 million compared with $22.7 million in the prior year period. Gross margin was 41.3 percent compared with 42.7 percent in the same period last year. Category EBITDA was ($2.1) million compared with ($1.9) million in the prior year period. Gourmet Food, Wine and Gift Baskets: Revenues increased 158.3 percent to $22.2 million compared with $8.6 million in the prior year period. Gross margin was 38.3 percent compared with 43.9 percent in the year ago first quarter. Category EBITDA was ($1.6) million compared with ($1.4) million in the prior year period. Results in this category reflect product mix and seasonality primarily associated with the Fannie May business. The Company noted that the Specialty Brands category’s strongest period, in terms of both revenues and profitability, is the current fiscal second quarter which includes the year-end holiday period. Company Guidance: The Company reiterated its guidance for fiscal 2007 which calls for revenue growth of 17-to-20 percent and EBITDA (earnings before interest, taxes, depreciation and amortization) and EPS growth of more than 100 percent. Regarding its current fiscal second quarter, which includes the calendar-year-end holiday period, the Company expects the period will represent approximately 36-to-38 percent of full-year revenues. Definitions: Pro forma earnings (net loss): The Company defines pro forma earnings (net loss) as GAAP net income (loss) excluding stock-based compensation expense, net of the related tax effect, as calculated under FAS No. 123R. The Company believes pro forma earnings provide a meaningful measure of year-to-year period comparative performance; however, its use and corresponding per share results do not lessen the importance of comparable GAAP net income (loss). EBITDA: Net income (loss) before interest, taxes, depreciation and amortization. The Company presents EBITDA because it considers such information a meaningful supplemental measure of its performance and believes it is frequently used by the investment community in the evaluation of companies with comparable market capitalization. The Company also uses EBITDA as one of the factors used to determine the total amount of bonuses available to be awarded to executive officers and other employees. The Company’s credit agreement uses EBITDA (with additional adjustments) to measure compliance with covenants such as interest coverage and debt incurrence. EBITDA is also used by the Company to evaluate and price potential acquisition candidates. EBITDA has limitations as an analytical tool, and should not be considered in isolation or as a substitute for analysis of the Company's results as reported under GAAP. Some of these limitations are: (a) EBITDA does not reflect changes in, or cash requirements for, the Company's working capital needs; (b) EBITDA does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on the Company's debts; and (c) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and EBITDA does not reflect any cash requirements for such capital expenditures. Because of these limitations, EBITDA should only be used on a supplemental basis combined with GAAP results when evaluating the Company's performance. About 1-800-FLOWERS.COM® For more than 30 years, 1-800-FLOWERS.COM Inc. – "Your Florist of Choicesm” – has been providing customers around the world with the freshest flowers and finest selection of plants, gift baskets, gourmet foods and confections, and plush stuffed animals perfect for every occasion. 1-800-FLOWERS.COM® offers the best of both worlds: exquisite, florist-designed arrangements individually created by some of the nation’s top floral artists and hand-delivered the same day, and spectacular flowers shipped from our growers to your door fresh. Customers can "call, click or come in” to shop 1-800-FLOWERS.COM twenty four hours a day, 7 days a week at 1-800-356-9377 or www.1800flowers.com. Sales and Service Specialists are available 24/7, and fast and reliable delivery is offered same day, any day. As always, 100 percent satisfaction and freshness is guaranteed. The 1-800-FLOWERS.COM collection of brands also includes home decor and children’s gifts from Plow & Hearth® (1-800-627-1712 or www.plowandhearth.com), Problem Solvers® (www.problemsolvers.com), Wind & Weather® (www.windandweather.com), Madison Place® (www.madisonplace.com), HearthSong® (www.hearthsong.com) and Magic Cabin® (www.magiccabin.com); gourmet gifts including popcorn and specialty treats from The Popcorn Factory® (1-800-541-2676 or www.thepopcornfactory.com); exceptional cookies and baked gifts from Cheryl&Co.® (1-800-443-8124 or wwwcherylandco.com); premium chocolates and confections from Fannie May Confections Brands® (www.fanniemay.com and www.harrylondon.com); gourmet foods from GreatFood.com® (www.greatfood.com); wine gifts from Ambrosia.com (www.ambrosia.com); gift baskets from 1-800-BASKETS.COM® (www.1800baskets.com) and the BloomNet® international floral wire service providing quality products and diverse services to a select network of florists. 1-800-FLOWERS.COM, Inc. stock is traded on the Nasdaq market under ticker symbol FLWS. Special Note Regarding Forward-Looking Statements: The statements in this press release regarding current and future expectations involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the applicable statements. These risks and uncertainties include, but are not limited to: the Company’s ability to achieve its revenue and profitability growth guidance for fiscal years 2007-2009; its ability to reduce costs and enhance its profit margins; its ability to manage the increased seasonality of its businesses; its ability to effectively integrate and grow its acquired companies; its ability to cost effectively acquire and retain customers; its ability to compete against existing and new competitors; its ability to manage expenses associated with sales and marketing and necessary general and administrative and technology investments; its ability to cost efficiently manage inventories; its ability to leverage its operating infrastructure; and general consumer sentiment and economic conditions that may affect levels of discretionary customer purchases of the Company’s products. For a more detailed description of these and other risk factors, please refer to the Company’s SEC filings including the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The Company expressly disclaims any intent or obligation to update any of the forward looking statements made in this release or in any of its SEC filings except as may be otherwise stated by the Company. Conference Call: The Company will conduct a conference call to discuss the attached financial results today, Thursday, October 26th, 2006 at 11:00 a.m. ET. The call will be "web cast” live via the Internet and can be accessed from the Investor Relations section of the 1-800-FLOWERS.COM web site. An indexed recording of the call will be posted on the Investor Relations section of the Company’s web site within 2 hours of the call’s completion. A replay of the call can be accessed via telephone beginning at 2:00 p.m. (ET) on 10/26/06 through midnight on 10/27/06 at: 1-888-203-1112 (domestic) or 1-719-457-0820 (international). Enter reservation #1716419. [Note: Attached tables are an integral part of this press release without which the information presented in this press release should be considered incomplete.] 1-800-FLOWERS.COM, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (In thousands) October 1, 2006 July 2, 2006 (unaudited) Assets Current assets: Cash and equivalents $9,698  $24,599  Receivables, net 19,993  13,153  Inventories 74,535  52,954  Deferred income taxes 22,292  17,427  Prepaid and other 27,123  10,347  Total current assets 153,641  118,480    Property, plant and equipment, net 62,071  59,732  Goodwill 131,390  131,141  Other intangibles, net 28,851  29,822  Deferred income taxes 6,224  6,224  Other assets 1,614  1,235  Total assets $383,791  $346,634    Liabilities and stockholders’ equity Current liabilities: Accounts payable and accrued expenses $70,260  $63,869  Current maturities of long-term debt and obligations under capital leases 47,187  10,360  Total current liabilities 117,447  74,229    Long-term debt and obligations under capital leases 77,701  78,063  Other liabilities 1,721  1,159  Total liabilities 196,869  153,451  Total stockholders’ equity 186,922  193,183  Total liabilities and stockholders’ equity 383,791  $346,634  1-800-FLOWERS.COM, Inc. and Subsidiaries Selected Financial Information Consolidated Statements of Income (Unaudited) (In thousands, except for per share data) Three Months Ended October 1, 2006 October 2, 2005   Net revenues: E-commerce (combined online and telephonic) $109,259  $100,655  Other 27,873  12,110  Total net revenues 137,132  112,765  Cost of revenues 82,318  66,739  Gross profit 54,814  46,026    Operating expenses: Marketing and sales 42,370  38,224  Technology and development 5,161  4,769  General and administrative 13,343  10,636  Depreciation and amortization 4,744  3,524  Total operating expenses 65,618  57,153  Operating loss (10,804) (11,127) Other income (expense): Interest income 337  215  Interest expense (1,828) (84) Other 11  6  Total other income (expense), net (1,480) 137  Loss before income taxes (12,284) (10,990) Income tax benefit (4,865) (4,364)   Net loss ($7,419) ($6,626)   Basic and diluted net loss per common share ($0.11) ($0.10) Weighted average shares used in the calculation of basic and diluted net loss per common share 65,195  65,088  1-800-FLOWERS.COM, Inc. and Subsidiaries Selected Financial Information Consolidated Statements of Cash Flows (In thousands) (unaudited) Years Ended October 1, 2006 October 2, 2005   Operating activities: Net loss ($7,419) ($6,626) Reconciliation of net loss to net cash provided by operations: Depreciation and amortization 4,744  3,524  Deferred income taxes (4,865) (4,365) Bad debt expense 238  75  Share based compensation 1,020  937  Other non-cash items 56  -  Changes in operating items: Receivables (7,078) (2,382) Inventories (21,581) (17,637) Prepaid and other (16,776) (15,232) Accounts payable and accrued expenses 6,319  14,617  Other assets (387) 145  Other liabilities 562  (112) Net cash used in operating activities (45,095) (27,056) Investing activities: Proceeds from sale of investments -  6,647  Capital expenditures, net of non-cash expenditures (6,146) (7,196) Other (262) 38  Net cash used in investing activities (6,408) (511) Financing activities: Acquisition of treasury stock -  (1,324) Proceeds from employee stock options 138  122  Proceeds from bank borrowings 37,000  -  Repayment of notes payable and bank borrowings (363) (237) Repayment of capital lease obligations (173) (398) Net cash provided by (used in) financing activities 36,602  (1,837) Net change in cash and equivalents (14,901) (29,404) Cash and equivalents: Beginning of period 24,599  39,961  End of period $9,698  $10,557  1-800-FLOWERS.COM, Inc. and Subsidiaries Selected Financial Information Category Information (unaudited) Three Months Ended Net Revenues October 1, 2006 October 2, 2005 % Change  (in thousands) Net revenues: 1-800-Flowers.com Consumer Floral $82,525  $76,275  8.2% BloomNet Wire Service 7,166  4,516  58.7% Gourmet Food, Wine & Gift Baskets 22,176  8,587  158.3% Home & Children’s Gifts 24,595  22,676  8.5% Corporate (*) 1,378  1,399  (1.5%) Intercompany eliminations (708) (688) (2.9%) Total net revenues $137,132  $112,765  21.6% Three Months Ended Gross Profit October 1, 2006 October 2, 2005 % Change  (in thousands) Gross Profit: 1-800-Flowers.com Consumer Floral $31,373  $29,201  7.4% BloomNet Wire Service 4,100  2,613  115.6% Gourmet Food, Wine & Gift Baskets 8,487  3,768  125.2% Home & Children’s Gifts 10,166  9,690  4.9% Corporate (*) 732  796  (8.0%) Intercompany eliminations (44) (42) (4.8%) Total gross profit $54,814  $46,026  19.1% Three Months Ended EBITDA October 1, 2006 October 2, 2005 % Change  (in thousands) Category Contribution Margin: 1-800-Flowers.com Consumer Floral $7,841  $5,916  32.5% BloomNet Wire Service 1,702  673  152.9% Gourmet Food, Wine & Gift Baskets (1,606) (1,428) (12.5%) Home & Children’s Gifts (2,055) (1,942) (5.8%) Category Contribution Margin Subtotal: 5,882  3,219  82.7% Corporate (*) (11,942) (10,822) (10.3%) EBITDA ($6,060) ($7,603) 20.3% (*) Corporate expenses consist of the Company’s enterprise shared     service cost centers, and include, among others, Information     Technology, Human Resources, Accounting and Finance, Legal,     Executive and Customer Service Center functions. In order to     leverage the Company’s infrastructure, these functions are     operated under a centralized management platform, providing     support services throughout the organization. The costs of these     functions, (including share-based compensation), other than those     of the Customer Service Center, which are allocated directly to     the above categories based upon usage, are included within     corporate expenses as they are not directly allocable to a     specific category. 1-800-FLOWERS.COM, Inc. and Subsidiaries Selected Financial Information Reconciliations of Historical Information (unaudited) Reconciliation of EBITDA to GAAP Net Loss: Three Months Ended October 1, 2006 October 2, 2005 (in thousands)   Net loss ($7,419) ($6,626) Add: Interest expense 1,828  84  Depreciation and amortization 4,744  3,524  Less: Interest income 337  215  Other income (expense) 11  6  Income tax benefit 4,865  4,364    EBITDA ($6,060) ($7,603) Reconciliation of Net Loss before Share-Based Compensation Expense to GAAP Net Loss: Three Months Ended October 1, 2006 October 2, 2005 (in thousands)   Net loss ($7,419) ($6,626) Less: Share-based compensation expense, net of tax 739  727    Loss before share based compensation expense ($6,680) ($5,899)   Basic and diluted net loss per common share before share based compensation expense ($0.10) ($0.09)