83 cents in the fourthquarter of 2007 and 5

We have identified specific initiatives that we believerepresent opportunities to produce EBITDA growth: implementing enhanced pricingand quoting strategies, developing more advantageous termination capacity andcoverage, enhancing our mobile services portfolio, reducing costs and pursuingadditional outsourcing transactions." Sources of Revenue - Q4 08 ($ in millions)WholesaleOutsourcingRetailTotal TradingMinutes (in billions)4.40.70.6 5.7Revenue$220.7 $53.4$25.7 $299.8 Gross Profit$17.3$9.8 $3.9$31.0Gross Margin 7.8 18.515.1 10.3 Revenue less data communications and telecommunications costs Operational MilestonesMinutes of use on The iBasis Network in the fourth quarter of 2008 was 5.7billion, compared to traffic of 6.0 billion minutes in Q4 2007 and 5.8 billionminutes in the Q3 2008. Average revenue per minute was 5.27 cents, compared to 5.83 cents in the fourthquarter of 2007 and 5.78 cents in the third quarter of 2008. Average margin perminute was 0.55 cents, compared to 0.65 cents in the fourth quarter of 2007 and0.55 cents in the third quarter of 2008. Goodwill Impairment ChargeAs of December 31, 2008, our market capitalization was substantially below theCompanys book value. This required us to evaluate, for potential impairment,the carrying value of $249 million in goodwill which resulted from the KPNTransaction. Based on that evaluation we have determined that the carrying valueof goodwill has been impaired. We will recognize a non-cash impairment charge against goodwill, which weestimate will be between $220 million and $249 million, in the fourth quarter.We expect to complete our analysis and determine the amount of this chargewithin the next few weeks.

The final goodwill impairment charge, along with itseffects on the Companys provision for income taxes, if any, will be included inresults of operations filed with the Companys annual report on Form 10-K inmid-March. None of the matters under review would impact cash flows, but netloss and net loss per share will be greater and stockholders equity will bereduced. GuidanceIn light of the current challenging business conditions and downturn in theglobal economy, we expect our business to be relatively flat in 2009. Weanticipate capital expenditures of approximately $15 million in 2009. The public is invited to listen to the simultaneous webcast by loggingin through the iBasis investor relations website at About iBasisFounded in 1996, iBasis (NASDAQ: IBAS) is a leading wholesale carrier ofinternational long distance telephone calls and a provider of retail prepaidcalling services and enhanced services for mobile operators. In October2007, iBasis acquired KPN Global Carrier Services to create one of the threelargest carriers of international voice traffic in the world (1), and KPN becamea majority stockholder of iBasis. iBasis carried approximately 24 billionminutes of international voice traffic in 2008.

The Company can be reached atits worldwide headquarters in Burlington, Mass., USA at 1 781-505-7500 or onthe Internet at (1) Telegeography 2008 and iBasis pro forma 2007 traffic. iBasis and Pingo are registered marks, and The iBasis Network is a trademark ofiBasis, Inc. All other trademarks are the property of their respective owners. Except for historical information, all of the expectations, plans andassumptions contained in the foregoing press release constitute forward-lookingstatements under Section 21E of the Securities Exchange Act of 1934 and involverisks and uncertainties. Examples of forward-looking statements include, but arenot limited to, any forward statements implied by our pro forma results, as wellas forward-looking statements regarding: (i) our estimates with respect to theimpairment charge of goodwill; (ii) our belief that declines in our financialresults are attributable to the downturn in the global economy generally and thecalling card market in particular; (iii) the amount and timing of the synergiesfrom the KPN and TDC transactions that we expect to realize; (iv) the expectedgrowth from cross-selling and more transparent pricing in our Retail business;(v) our expectation that we will be able to take advantage of the consolidationtrends in the international voice industry; (vi) our beliefs regarding the basesfor growth and our expectations regarding the future growth of our business; and(vii) our expected Adjusted EBITDA and capital asset expenditures in the fourthquarter of 2008; and (viii) our expectations for revenue and EBITDA growth in2009. Such forward-looking statements are only as of the date they aremade, and we have no current intention to update any forward-looking statements.Use of Non-GAAP Financial MeasuresIn this press release, our financial results are provided both in accordancewith accounting principles generally accepted in the United States (GAAP) andusing certain non-GAAP financial measures which are not an alternative to GAAPand may be different from non-GAAP financial measures used by other companies.In particular, we provide (i) Adjusted EBITDA, and (ii) combined pro formafinancial information which in each case results in a non-GAAP financialmeasure.

These results are provided as a complement to results provided inaccordance with GAAP because management believes these non-GAAP financialmeasures help indicate underlying trends in our business and are important incomparing current results with prior period results. We believe the most directly comparable GAAP financialmeasure to Adjusted EBITDA is net income (loss) and we have provided areconciliation of GAAP net income (loss) to Non-GAAP Adjusted EBITDA and proforma combined Adjusted EBITDA in this press release.Accounting Treatment of KPN Transaction and Use of Pro Forma DataOn October 1, 2007, iBasis acquired KPN Global Carrier Services.As thistransaction has been treated as a reverse acquisition of iBasis by KPN GlobalCarrier Services under the purchase method of accounting, the financial resultsof KPN Global Carrier Services have become the historical financial results ofthe combined company and replace the historical financial results of iBasis as astandalone company for periods prior to the closing of the acquisition.Thus, theGAAP financial results for full year 2007 include the results of KPN GlobalCarrier Services for the first nine months of 2007 and the results of thecombined Company for the fourth quarter of 2007.Historical GAAP results for KPNGlobal Carrier Services as a wholly-owned subsidiary of Royal KPN are notnecessarily indicative of results that would have been achieved on a standalonebasis.To make comparisons to prior periods more useful, we are providing supplementalpro forma data which include the consolidated historical results of both iBasisand KPN Global Carrier Services.These consolidated historical results are notnecessarily indicative of results that would have been achieved on a combinedbasis. iBasis, Inc.Preliminary Condensed Consolidated Balance SheetsExcluding Goodwill Impairment Charge (unaudited)(In thousands)December 31, December 31, 2008 2007AssetsCash, cash equivalents and short-term investments$56,912 $65,734Accounts receivable, net 237,790204,883 Prepaid expenses and other current assets6,4774,687 Property and equipment, net34,836 34,966Goodwill and other intangible assets (1) 318,626342,595 Other assets 1,8277,008 Total assets $656,468$659,873 Liabilities and Stockholders EquityAccounts payable $155,676$146,899 Accrued expenses 152,534136,903 Deferred revenue 13,894 11,503Bank borrowings and other debt 27,957 25,755Other long term liabilities3,4294,323 Total liabilities353,490325,383 Stockholders equity (1) 302,978334,490Total liabilities and stockholders equity $656,468$ 659,873(1) December 31, 2008 balance is expected to be reduced by $220 million to $249million for an impairment charge iBasis, Inc. Preliminary Condensed Consolidated Statements of Operations Excluding Goodwill Impairment Charge (1)(unaudited) (In thousands, except per share data)Three Months Ended December 31, 2008 2007Total net revenue $299,819$350,645Costs and operating expenses:Data communications and telecommunications costs (excluding depreciation and amortization)268,800311,370 Operating expenses23,466 29,848Depreciation and amortization 7,8139,159Total costs and operating expenses300,079350,377Income (loss) from operations ( 260) 268Interest income (expense), net( 271) 109 Foreign exchange gain (loss)1,688( 630) Income (loss) before income taxes 1,157( 253) Income tax expense (2)18,921 1,766Net loss$( 17,764)$(2,019)Net loss per share:Basic $(0.25) $(0.03)Diluted $(0.25) $(0.03) Weighted average common shares outstanding:Basic 71,228 74,749Diluted 71,228 74,749 (1) Results for the Three Months Ended December 31, 2008 exclude an impairmentcharge, which is expected to be between $220 million and $249 million. (2) We have recorded additional income tax expense in the fourth quarter of$17.4 million, which is a non-cash charge. This additional income tax expense isa result of the utilization of our previously reserved net operating losscarry-forwards.