"We are encouraged by our second quarter results and confident that the decisive actions we took during the fourth quarter of 2008, which were aimed at aligning costs with revenues in order to accelerate profitability, are gaining momentum. Notwithstanding our significant strides toward profitability, our investments in innovation, FDA approvals and our long-term growth prospects have never been stronger," said David J. Drachman, President and Chief Executive Officer. "We are increasingly confident in our ability to execute our strategic priorities and we believe strongly that successful execution will result in the restoration of our historical high-growth trends and increased shareholder value."

Financial Results

Revenues for the second quarter of 2009 were $13.8 million, a 7.3 percent decrease over second quarter 2008 revenues of $14.9 million and a sequential increase of 0.8 percent as compared to first quarter 2009 revenues. The decrease in revenues was primarily due to a reduction in revenues from the sale of capital equipment. Revenues from domestic open-heart products were $7.3 million for the second quarter of 2009 as compared to $7.4 million for the second quarter of 2008 and revenues from domestic minimally invasive products declined from $5.1 million for the second quarter of 2008 to $4.0 million for the second quarter of 2009. International revenues grew 12.5 percent, or 21.8 percent on an exchange rate neutral basis, to a record $2.6 million for the second quarter of 2009.

Gross profit for the second quarter of 2009 was $10.7 million and gross margin was 77.4 percent, compared to gross profit of $11.4 million and gross margin of 76.5 percent for the second quarter of 2008. The increase in gross margin was primarily due to a reduced mix of revenues from the sale of capital equipment and a reduction in product cost, partially offset by an increased mix of international sales.

Operating expenses were $11.7 million or an 11.3 percent reduction for the second quarter of 2009, driven primarily by a reduction in headcount-related expenses, partially offset by an increase in share-based compensation expense and an increase in costs associated with clinical trials and product development activities. The operating loss for the second quarter of 2009 improved 43.4 percent to a record low of $1.0 million. The net loss per share was $0.10 as compared to $0.11 for the second quarter of 2008. The second quarter 2009 net loss per share includes a $0.02 loss per share due to the termination of a credit facility and borrowings and costs associated with a new credit facility.

Adjusted EBITDA was $0.4 million, an improvement of $1.0 million as compared to the second quarter of 2008. Cash, cash equivalents and short-term investments were $15.7 million at June 30, 2009 and cash generated from operations during the quarter was $1.2 million.

Earnings Call Information

Management will host a conference call at 10:00 a.m. Eastern Time on Tuesday, August 4, 2009 to discuss its second quarter 2009 financial results. A live web cast of the conference call will be available online from the investor relations page of AtriCure's web site at www.atricure.com.

Pre-registration is available and recommended for this call at the following URL:

https://www.theconferencingservice.com/prereg/key.process?key=PGWBEEDBU

You may also access this call through an operator by calling 888-679-8034 for domestic callers and 617-213-4847 for international callers at least 15 minutes prior to the call start time using reservation code 72757548.

The webcast will be available on AtriCure's web site and a telephonic replay of the call will also be available through September 4, 2009. The replay dial-in numbers are 888-286-8010 for domestic callers and 617-801-6888 for international callers, using reservation code 83888704.

About AtriCure, Inc.

AtriCure, Inc. is a medical device company and a leader in developing, manufacturing and selling innovative cardiac surgical ablation systems designed to create precise lesions, or scars, in cardiac, or heart, tissue. Medical journals have described the adoption by leading cardiothoracic surgeons of the AtriCure Isolator® bipolar ablation system as a treatment alternative during open-heart surgical procedures to create lesions in cardiac tissue to block the abnormal electrical impulses that cause atrial fibrillation, or AF, a rapid, irregular quivering of the upper chambers of the heart. Additionally, medical journals and leading cardiothoracic surgeons have described the AtriCure Isolator system as a promising treatment alternative for patients who may be candidates for sole-therapy minimally invasive procedures. AF affects more than 5.5 million people worldwide and predisposes them to a five-fold increased risk of stroke. The FDA has cleared the AtriCure Isolator system and AtriCure's multifunctional pen and CoolrailTM linear ablation device, for the ablation, or destruction, of cardiac tissue during surgical procedures. Additionally, the FDA has cleared AtriCure's multifunctional pen for temporary pacing, sensing, stimulating and recording during the evaluation of cardiac arrhythmias and AtriCure's Cryo1 system for the cryosurgical treatment of cardiac arrhythmias. To date, the FDA has not cleared or approved AtriCure's products for the treatment of AF.

Use of Non-GAAP Financial Measures

To supplement AtriCure's condensed consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles, or GAAP, AtriCure uses certain non-GAAP financial measures in this release as supplemental financial metrics. Non-GAAP financial measures provide an indication of performance excluding certain items. Our management believes that in order to properly understand short-term and long-term financial trends, investors may wish to consider the impact of these excluded items in addition to GAAP measures. The excluded items vary in frequency and/or impact on our continuing operations and our management believes that the excluded items are typically not reflective of our ongoing core business operations. Further, management uses results of operations before these excluded items as a basis for its strategic planning. The non-GAAP financial measures used by AtriCure may not be the same or calculated the same as those used by other companies. Reconciliations of the non-GAAP financial measures used in this release to the most comparable GAAP measures for the respective periods can be found in tables later in this release. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for AtriCure's financial results prepared and reported in accordance with GAAP.

                                                                                                                             ATRICURE, INC.