The Company expects to receive net proceeds (including underwriting discounts but before other expenses) of approximately $80,910,000 from the offering and intends to use the net proceeds for general corporate purposes. All 5,800,000 shares sold were offered by Shutterfly. In addition, the underwriters have been granted an option to purchase up to an additional 870,000 shares from selling stockholders within the next 30 days.

J. P. Morgan Securities Inc. acted as sole book-running manager for the offering with Piper Jaffray & Co. and Jefferies & Company, Inc. acting as co-managers.

Copies of the final prospectus relating to the offering may be obtained by contacting:

J. P. Morgan National Statement Processing Prospectus Library
4 Chase Metrotech Center
CS Level
Brooklyn, NY 11245
Phone: 718-242-8002
Fax: 718-242-1350

This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

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