Yandex Announces Preliminary Financial Results for 2006

— Year-Over-Year Revenues Double Again —

MOSCOW, RUSSIA — February 7, 2007 — Yandex, Russia’s largest Internet portal and search engine, today announced preliminary financial results for the full-year 2006. Unaudited revenues for the year totaled $72 million, more than double 2005 revenues.

Yandex derives nearly all of its revenue from advertisers seeking to reach the audience of Yandex users, which numbered approximately 5 million a day in December of 2006. Search/context advertisements represented more than 80% of revenues and media (banner) advertising represented the remainder of advertising revenues.

“Our internal research indicates that 2006 was the first year that search/context advertising accounted for more than half of Russia’s total online advertising,” — said Arkady Volozh, General Director and co-founder of Yandex. “We are pleased with the trends we are seeing, with experts estimating that current growth rates of online advertising may result in online advertising overtaking radio advertising in Russia in just a couple of years.”

For the full-year 2006, the total number of Yandex.Direct system of search/context ad placement) active advertisers increased by approximately 50% over full-year 2005 levels. For 2006, more than 30,000 advertisers placed search/context advertisements on Yandex search results pages and more than 11 billion advertisements were displayed.

In 2006, Yandex offered a range of new tools to expand Yandex.Direct’s access to a wider range of advertisers. Among these services are autofocus, autobudget and an opportunity for advertisers to place their contact information (phone numbers and addresses) directly on Yandex. In addition, the minimum bid for placing advertisements on Yandex.Direct was significantly reduced in 2006 to approximately 30 kopecks (approximately $0.01) per click.

By the year end, The Yandex Advertising Network contained hundreds of popular Russian web-resources, with Mail.ru being the largest. The number of page views with Yandex.Direct ads on the Yandex Advertising Network partner sites is now comparable to the page views on the Yandex.ru portal and growing fast.

Sales of media advertising increased at the same rate as search/context advertisements in 2006, and also were double compared to full-year 2005 figures.

The Public Opinion Foundation estimated that Internet penetration in Russia increased to 26 million people by year end, placing it ahead of Italy and France among European countries.

Expert estimates of Internet advertising market volume:

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Contact:
Media Relations
Vladimir Isaev, Ochir Mandzhikov
Phone: +7 495 739-7000
E-mail: pr@yandex-team.com