Three months ended

October 31, 2000

July 31, 2000

October 31, 1999

(Unaudited)

Revenue……………………………………………………..

 $              41,022

 $          66,667

 $          20,017

Cost of revenue:

     Cost of revenue…………………………………………..

                 29,758

             35,629

             16,223

     Amortization of developed technology…………………..

                      784

                       -  

                       -  

Total cost of revenue…………………………..

                 30,542

             35,629

             16,223

Gross profit…………………………………….

                 10,480

             31,038

               3,794

Operating expenses:

     In-process research and development…………………….

                      700

                       -  

                       -  

     Research and development………….……………………

                 11,481

             11,128

               3,293

     Selling and marketing…………………………………….

                32,364

             34,106

            11,947

     General and administrative………………………………

                 17,739

             11,067

               2,773

     Amortization of goodwill and other intangibles………….

               115,902

             88,251

               4,239

     Restructuring costs………………………………………

                   4,130

                       -  

                       -  

     Stock compensation……………………………………..

                   3,576

                  126

                  102

Total operating expenses……………………….

               185,892

           144,678

             22,354

Loss from operations………………………………………..

            (175,412)

         (113,640)

           (18,560)

Other income (expense):

     Minority interest in loss of subsidiary………..…….……..

                      343

                  227

                       -  

     Equity in loss of joint venture……………………………

                          -  

                (102)

                (326)

     Other income (expense)………………………………….

                  (420)

                (118)

                      8

     Interest income…………………………………………..

                   2,021

               1,997

               1,356

     Interest expense………………………………………….

                  (349)

                (619)

                (360)

Net loss……………………………………………………...

 $         (173,817)

 $      (112,255)

 $        (17,882)

Basic and diluted net loss per share………………………….

 $            (0.92)

 $         (0.64)

Weighted average number of basic

     and diluted shares outstanding……………………………

188,739

176,210

Pro forma basic and diluted net loss per share (b)(c)………...

        ($0.17)

Pro forma weighted average number of basic

     and diluted shares outstanding (b)(c) ……………………..

106,961

(a) All amounts herein, including the share and per share amounts, have been retroactively adjusted to reflect the financial results of Adsmart for all periods presented in a manner similar to a pooling of interests.

(b) Historical basic and diluted net loss per share have not been presented for the three months ended October 31, 1999 because they are irrelevant due to the issuance of shares in the Flycast acquisition on January 13, 2000 and the impact of the conversion of debt to CMGI and preferred stock for Adsmart, after adjustment for the Engage exchange ratio, as of the date of the beginning of each period, or date of issuance, if later, using the if-converted method.

(c) The share and per share amounts herein have been adjusted to reflect the two-for-one stock split on April 3, 2000 to stockholders of record at the close of business on March 20, 2000.

Engage, Inc.

Consolidated Balance Sheets

(In thousands)

October 31, 2000

July 31, 2000

(Unaudited)

Assets

Current assets:

Cash and cash equivalents………………………………………….

 $             107,275

 $             119,809

Available for sale securities…………………………………………..

                       669

                  16,147

Accounts receivable, net………………………………………………..

                  58,519

                  79,799

Prepaid expenses and other current assets……………………………..

                    4,325

                    2,570

Total current assets………………………………………………..

                170,788

                218,325

Property and equipment, net…………………………………………….

                  36,200

                  31,334

Intangible assets, net……………………………………………………..

             1,016,921

                873,323

Other assets………………………………………………………………..

                  11,053

                    9,915

Total assets………………………………………………………..

 $          1,234,962

 $          1,132,897

Liabilities and Stockholders' Equity

Current liabilities:

Obligation under capital lease……………………………………….

 $                 5,157

 $                 4,650

Current portion of long-term debt………………………………..

                    1,930

                    2,010

Accounts payable……………………………………………………….

                  25,625

                  33,365

Due to CMGI…………………………………………………………

                  29,533

                  27,287

Accrued expenses…………………...………………………………..

                  37,136

                  24,599

Deferred revenue………………………………………………………

                  12,838

                    7,604

Total current liabilities……………………………………………

                112,219

                  99,515

Deferred revenue………………………………………………………….

                       180

                       651

Obligation under capital lease, net of current portion……………………..

                    2,541

                    2,905

Long-term debt, net of current portion……………………………………

                    1,395

                    1,843

Other long-term liabilities………………………………………………..

                       922

                       843

Minority interest…………………………………………………………

                    8,356

                    8,812

Stockholders' equity:

Common stock……………………………………………………….

                    1,959

                    1,789

Additional paid-in capital……………………………………………….

             3,878,237

             3,650,059

Deferred compensation………………………………………………

                (23,236)

                  (1,234)

Accumulated other comprehensive income……………………………..

                     (102)

                     (260)

Accumulated deficit………………………………………………….

           (2,747,509)

           (2,632,026)

Total stockholders' equity………………………………………

             1,109,349

             1,018,328

Total liabilities and stockholders' equity…………………………..

 $          1,234,962

 $          1,132,897