NEW YORK – February 15, 2006 - eSpeed, Inc. (NASDAQ: ESPD), a leading developer of electronic marketplaces and related trading technology for the global capital markets, today reported results for fourth quarter and full year ended December 31, 2005.

Fourth Quarter 2005 Earnings
eSpeed reported net income of $0.3 million, or $0.01 per diluted share, for fourth quarter 2005 based on Generally Accepted Accounting Principles (GAAP). To reflect earnings generated from the Company's operations, eSpeed also reports non-GAAP net operating income. For fourth quarter 2005, the Company reported non-GAAP net operating income of $0.9 million, or $0.02 per diluted share. The difference between non-GAAP net operating income and GAAP net income for the quarter stemmed primarily from a gain from insurance proceeds of $1.1 million and a gain of $0.5 million due to the reversal of previously accrued costs associated with the Company’s attempt to acquire MTS, offset by a $1.6 million charge for the impairment of fixed assets and capitalized software costs, and $0.6 million in costs related to patent litigation. All of these differences were net of tax.

For comparative purposes, eSpeed reported GAAP net income of $0.4 million, or $0.01 per diluted share for fourth quarter 2004. During the same period, the Company earned non-GAAP net operating income of $5.0 million, or $0.09 per diluted share. The difference between non-GAAP net operating income and GAAP net income for fourth quarter 2004 was due to charges of $4.6 million for the impairment of capitalized costs related to software development and certain patent claims, litigation defense costs, and business partner securities, all net of tax.

Full Year 2005 Earnings
For the full year 2005, eSpeed reported GAAP net income of $2.0 million, or $0.04 per diluted share. For the same period, the Company reported non-GAAP net operating income of $7.4 million, or $0.14 per diluted share. The difference between non-GAAP net operating income and GAAP net income for the year included litigation costs of $3.0 million, $2.1 million in costs associated with the Company’s attempt to acquire MTS, charges related to fixed asset and capitalized software costs of $1.6 million, a charitable contribution of $0.3 million, and $0.2 million in amortization of business partner securities. These were partially offset by a gain from insurance proceeds of $1.1 million and by a gain on investment of $0.6 million, all net of tax.

For comparative purposes, eSpeed reported GAAP net income of $25.9 million, or $0.46 per diluted share for full year 2004. For the same period, the Company reported non-GAAP net operating income of $31.1 million, or $0.55 per diluted share. The difference between non-GAAP net operating income and GAAP net income for the full year 2004 was due to charges of $5.2 million for impairment of capitalized costs related to software development and certain patent claims, litigation defense costs, a charitable contribution, and business partner securities, all net of tax.

Fourth Quarter 2005 Revenues
eSpeed's total GAAP revenues for fourth quarter 2005 were $37.8 million. For the same period, eSpeed also reported non-GAAP revenue of $36.1 million. The difference between GAAP and non-GAAP revenues for fourth quarter 2005 was a $1.7 million gain from insurance proceeds. The Company reported GAAP and non-GAAP total revenues of $39.3 million for fourth quarter 2004.

Fourth quarter 2005 fully electronic revenues were $16.5 million compared to $22.9 million for fourth quarter 2004. Revenues from Software Solutions in fourth quarter 2005 were $10.8 million versus $9.4 million in the year ago period. Voice assisted and screen assisted revenues totaled $7.0 million in fourth quarter 2005 versus $5.9 million in fourth quarter 2004. Fourth quarter 2005 pre-tax operating margin was 3.4 percent.

Full Year 2005 Revenues
eSpeed's total GAAP revenues for full year 2005 were $152.9 million. During the same timeframe, the Company also reported non-GAAP revenues of $150.2 million. The difference between GAAP and non-GAAP revenues for 2005 was a $1.7 million gain from insurance proceeds and a gain on investment of $1.0 million. The Company reported GAAP and non-GAAP total revenues of $166.5 million for full year 2004.

Full year 2005 fully electronic revenues were $74.7 million, compared to $108.0 million in 2004. Full year 2005 revenues from Software Solutions were $41.4 million versus $32.1 million in 2004. Voice assisted and screen assisted revenues totaled $28.1 million in the full year 2005 versus $23.0 million the prior year. Full year 2005 pre-tax operating margin was 7.4 percent.
See "Non-GAAP Financial Measures" below for a detailed description of the Company’s non-GAAP financial measures.

Fourth Quarter 2005 Volume & Transactions
Fully electronic volume, excluding new products, was $7.5 trillion for fourth quarter 2005, compared to $8.0 trillion in third quarter 2005 and $5.7 trillion in fourth quarter 2004. This represented a decline of 6.4 percent and a gain of 32.3 percent, respectively. This compares to a sequential decrease of 5.0 percent and a year-over-year increase of 5.6 percent in overall quarterly US Treasury volume as reported by the Federal Reserve. Average daily Federal Reserve US Treasury volume was $538 billion for fourth quarter 2005. eSpeed's voice-assisted volume for fourth quarter 2005 was $7.6 trillion, a decrease of 11.3 percent versus the $8.6 trillion reported in third quarter 2005 and an increase of 106.3 percent over the $3.7 trillion reported in fourth quarter 2004.

Fully electronic volume for new products, which the Company defines as mortgage-backed securities, foreign exchange, interest rate swaps, futures and repos, was $540 billion for fourth quarter 2005, compared to 376 billion in third quarter 2005 and $497 billion in fourth quarter 2004. This represented increases of 43.5 percent and 8.6 percent, respectively. Volume for the eSpeed Equities direct access product was 147 million shares for fourth quarter 2005, down 5.0 percent against the 154 million shares traded in the third quarter 2005 and up 19.5 percent as compared to the 123 million shares traded in fourth quarter 2004.

Full Year 2005 Volume & Transactions
Fully electronic volume, excluding new products, was up 2.9 percent to $29.0 trillion in 2005, versus $28.2 trillion in the prior year. This growth compares to an 11.5 percent increase in overall US Treasury volume as reported by the Federal Reserve over the same timeframe. Average daily Federal Reserve US Treasury volume was $555 billion for the full year 2005. eSpeed's voice-assisted volume for the 2005 was $28.3 trillion, an increase of 104.6 percent over the $13.8 trillion reported in 2004.

Fully electronic volume for new products was $1.9 trillion in 2005, compared to $1.2 trillion in 2004, an increase of 54.1 percent. Volume for the eSpeed Equities direct access product was 648 million shares for full year 2005, up 56.1 percent, compared to the 415 million shares traded in the prior year.

Free Cash Flow & Cash
The Company’s free cash flow, defined as cash from operations less net cash used in investing activities, was ($5.9) million for fourth quarter 2005 and ($2.8) million for full year 2005. Excluding related party receivables and payables, free cash flow for fourth quarter 2005 was ($11.0) million and ($0.7) million for full year 2005. As of December 31, 2005, eSpeed's cash and cash equivalents were approximately $178.4 million.

Outlook
For the first quarter 2006, eSpeed expects to generate revenues in excess of $37 million and expects non-GAAP net operating income to be in the range of $0.00 to $0.01 per diluted share. This is based on the Company's expectations that the average daily Federal Reserve US Treasury volume will be between $585 and $600 billion for the first quarter 2006. For full year 2006, the Company expects to generate revenues in excess of $152 million, operating expenses to be in the range of $147 million to $150 million and non-GAAP net operating income to be in the range of $0.02 to $0.06 per diluted share.

The Company will host a conference call on Thursday, February 16, 2006 at 8:30 a.m EST, to discuss the above results. To listen to the call via audio webcast, please visit www.espeed.com. Please note: listeners must have a Real Media or Windows Media plug in and headphones or speakers to listen to the webcast.

Non-GAAP Financial Measures
To supplement eSpeed's consolidated financial statements presented in accordance with GAAP and to better reflect the Company's quarter-over-quarter and comparative year-over-year operating performance, eSpeed uses non-GAAP financial measures of revenues, net income and earnings per share, which are adjusted to exclude certain expenses and gains. In addition, the Company provides a computation of free cash flow. These non-GAAP financial measurements do not replace the presentation of eSpeed's GAAP financial results but are provided to improve overall understanding of the Company's current financial performance and its prospects for the future. Specifically, eSpeed believes the non-GAAP financial results provide useful information to both management and investors regarding certain additional financial and business trends relating to the Company's financial condition and results from operations. In addition, eSpeed's management uses these measures for reviewing the Company's financial results and evaluating eSpeed's financial performance. For fourth quarter and full year 2005, the difference between GAAP net income and non-GAAP net operating income was ($0.6) million and ($5.4) million, respectively, net of tax. eSpeed considers "non-GAAP net operating income" to be after-tax income generated from the Company's continuing operations excluding certain non-recurring or non-core items such as, but not limited to, asset impairments, litigation judgments, costs or settlements, restructuring charges, costs related to potential acquisitions, charitable contributions, insurance proceeds, business partner securities, gains or losses on investments and similar events. The amortization of patent costs and associated licensing fees (including those made in settlement of litigation) from such patents are generally treated as operating items. Material judgments or settlement amounts paid or received and impairments to all or a portion of such assets are generally treated as non-operating items. Management does not provide guidance of GAAP net income because certain items identified as excluded from non-GAAP net operating income are difficult to forecast.

eSpeed, Inc. (NASDAQ: ESPD) is a leader in developing and deploying electronic marketplaces and related trading technology that offers traders access to the most liquid, efficient and neutral financial markets in the world. eSpeed operates multiple buyer, multiple seller real-time electronic marketplaces for the global capital markets, including the world's largest government bond markets and other fixed income and equities marketplaces. eSpeed's suite of marketplace tools provides end-to-end transaction solutions for the purchase and sale of financial products over eSpeed's global private network or via the Internet. eSpeed's neutral platform, reliable network, straight-through processing and superior products make it the trusted source for electronic trading at the world's largest fixed income and foreign exchange trading firms and major exchanges. To learn more, please visit www.espeed.com.

The information in this press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based upon current expectations that involve risks and uncertainties. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. Our actual results and the timing of certain events may differ significantly from the results discussed in the forward-looking statements. Factors that might cause or contribute to such a discrepancy include, but are not limited to, the costs and expenses of developing, maintaining and protecting our intellectual property, including judgments or settlements paid or received and their related costs, the possibility of future losses and negative cash flow from operations, the effect of market conditions, including trading volume and volatility, our pricing strategy and that of our competitors, our ability to develop new products and services, to enter new markets, to secure and maintain market share, to enter into marketing and strategic alliances, to hire new personnel, to expand the use of our electronic system, to induce clients to use our marketplaces and services and to effectively manage any growth we achieve, the effects of the attacks on the World Trade Center on September 11, 2001, and other factors that are discussed under "Risk Factors" in eSpeed’s Annual Report on Form 10-K filed with the Securities and Exchange Commission. We believe that all forward-looking statements are based upon reasonable assumptions when made; however, we caution that it is impossible to predict actual results or outcomes or the effects of risks, uncertainties or other factors on anticipated results or outcomes and that, accordingly, you should not place undue reliance on these statements. Forward-looking statements speak only as of the date when made, and we undertake no obligation to update these statements in light of subsequent events or developments. Actual results and outcomes may differ materially from anticipated results or outcomes discussed in forward-looking statements.

Contacts:

Media:

Michael Geller, Vice President, Media Relations
212-610-2430
mgeller@espeed.com

Investors:

Tristan B. Peniston-Bird, Director Gavin Anderson & Company on behalf of eSpeed
212-515-1900
TPeniston-Bird@GavinAnderson.com

OR

Jason McGruder, Vice President, Investor Relations
212-938-5000
jmcgruder@espeed.com

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