ITEX Announces Results for Third Quarter of Fiscal 2007

Operating income increases 16% to $423,000

Net Cash provided by Operating Activities increases 31% to $577,000

Bellevue, WA May 30, 2007 ITEX Corporation (OTCBB: ITEX), The Membership Trading CommunitySM, a leading marketplace for cashless business transactions in North America, today filed its Form 10-QSB with the Securities and Exchange Commission reporting its results for its fiscal 2007 third quarter ended April 30, 2007.

Net cash provided by operating activities and operating income showed strong gains this quarter even though we recognized a 5% decline in revenue from the same period last year. We attribute the decline in revenue primarily to the continued consolidation of broker offices and member accounts since the acquisition of BXI. said Steven White, Chairman and CEO.  Our margins, costs and expenses are right where they should be; allowing us to invest in our technology and revenue growth initiatives while we continue profitable operations.  Revenue growth is our number one priority. We introduced our new Executive Privileges Program to our franchise network at the end of the third quarter which we anticipate will assist franchisees in registering new member businesses and retaining existing members.  Increased member growth and retention will translate into increased transaction volume, revenue and net income.  

Third Quarter 2007 Highlights

·         Operating income was $423,000 compared to $365,000 for the third quarter in fiscal year 2006, a 16% increase.  Operating income for nine months was $1,246,000 compared to $955,000, a 30% increase.

Net cash provided by operating activities increased 31% to $577,000 compared to $440,000 in the third quarter in fiscal 2006.   Net cash provided by operating activities for the nine month period was $1,944,000 compared to $1,790,000, a 9% increase.  Revenue was $3,265,000 compared to $3,419,000 for the third quarter in fiscal year 2006, a 5% decrease.  Revenue for nine months was $10,720,000 compared to $11,140,000, a 4% decrease.

·         Selling, general and administrative costs increased 2% to $156,000 compared to $153,000 for the third quarter in fiscal 2006.  Selling, general and administrative costs for the nine month period were $830,000 compared to $1,136,000, a 27% decrease.

More than $62,000,000 in transaction volume was completed by processing more than 129,000 transactions.

ITEX Corporation's report on Form 10-QSB can be found at www.sec.gov.

About ITEX

ITEX, The Membership Trading CommunitySM, is a thriving community of 22,000 member businesses buying and selling more than $250 million a year in ITEX dollar transactions.  Member businesses increase sales through an exclusive distribution channel managed by 95 franchisees and licensees, by utilizing ITEX dollars to exchange goods and services.  ITEX is powered by ITEX Payment Systems, the leading payment technology platform for processing cashless business transactions.  ITEX is headquartered in Bellevue, Washington.  

Contact:

Alan Zimmelman

ITEX Corporation

425.463.4017

alan@itex.com

About ITEX:

ITEX, The Cashless Marketplace, is a leading marketplace for cashless business transactions in North America. ITEX processes more than $250 million a year in transactions through 22,000 member businesses managed by 95 franchisees and licensees. Member businesses increase sales through an exclusive distribution channel by utilizing the ITEX Dollar to exchange goods and services. ITEX is powered by ITEX Payment Systems, the leading payment technology platform for processing cashless business transactions. ITEX is headquartered in Bellevue, Washington.

Contact:
Alan Zimmelman
425.463.4017
alan@itex.com

This press release contains forward-looking statements that involve risks and uncertainties concerning our expected performance (as described without limitation in the quotations from current management in this release) and comments within the safe harbor provisions established under The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from the results predicted and reported results should not be considered as an indication of our future performance. We believe that these potential risks and uncertainties include, without limitation: the continuing development of successful marketing strategies for our concepts; our ability to increase revenues and sustain profitability; the availability of adequate working capital; our dependence both on key personnel and our broker network; and the effect of changes in the overall economy and in technology. Statements in this release should be evaluated in light of these factors. These risk factors and other important factors that could affect our business and financial results are discussed in our periodic reports and filings with the Securities and Exchange Commission, including our Forms 10-KSB and Forms 10-QSB, which are available at www.sec.gov., including under the caption, "Management's Discussion and Analysis of Financial Condition and Results of Operations." All information set forth in this release is as of May 30, 2007, and ITEX undertakes no duty to update this information