Lehman Brothers 2nd Qtr Earnings

LEHMAN BROTHERS REPORTS SECOND QUARTER RESULTS
- Reports Net Loss of $2.8 Billion, or ($5.14) Per Share -

NEW YORK– June 16, 2008 – Lehman Brothers Holdings Inc. (ticker symbol: LEH) announced today a net loss of $2.8 billion, or ($5.14) per common share (diluted), for the second quarter ended May 31, 2008, compared to net income of $489 million, or $0.81 per common share (diluted), for the first quarter of fiscal 2008 and $1.3 billion, or $2.21 per common share (diluted), for the second quarter of fiscal 2007. For the first half of fiscal 2008, the Firm reported a net loss of approximately $2.3 billion, or ($4.33) per common share (diluted), compared to net income of $2.4 billion, or $4.17 per common share (diluted), for the first half of fiscal 2007.

The Firm reported net revenues (total revenues less interest expense) for the second quarter of fiscal 2008 of negative ($0.7) billion, compared to $3.5 billion for the first quarter of 2008 and $5.5 billion for the second quarter of fiscal 2007. Net revenues for the second quarter of fiscal 2008 reflect negative mark to market adjustments and principal trading losses, net of gains on certain debt liabilities. Additionally, the Firm incurred losses on hedges this quarter, as gains from some hedging activity were more than offset by other hedging losses. For the first six months of fiscal 2008, the Firm reported net revenues of $2.8 billion, compared to $10.6 billion for the first half of fiscal 2007.