<p>MOSCOW and AMSTERDAM, Netherlands, Feb. 18, 2015 (GLOBE NEWSWIRE) -- Yandex (Nasdaq:YNDX), one of Europe's largest internet companies and the leading search provider in Russia, today announced its financial results for the fourth quarter and the full year ended December 31, 2014.</p>
<p>
    <strong><u>Q4 2014 Financial Highlights(1)(2)</u></strong></p>
<ul>
    <li>
        <strong>Revenues </strong>of RUR 14.7 billion ($260.7 million), up 21% compared
                                  with Q4 2013
    </li>
    <li>
        <strong>Ex-TAC revenues</strong> (excluding traffic acquisition costs) up 25%
                                         compared with Q4 2013
    </li>
    <li>
        <strong>Income from operations </strong>of RUR 4.5 billion ($79.6 million), up
                                                14% compared with Q4 2013
    </li>
    <li>
        <strong>Adjusted EBITDA </strong>of RUR 6.1 billion ($108.0 million), up 18%
                                         compared with Q4 2013
    </li>
    <li>
        <strong>Operating margin</strong> of 30.5%
    </li>
    <li>
        <strong>Adjusted EBITDA margin </strong>of 41.4%
    </li>
    <li>
        <strong>Adjusted</strong> <strong>ex-TAC EBITDA margin</strong> of 52.5%
    </li>
    <li>
        <strong>Net income</strong> of RUR 7.6 billion ($134.6 million), up 126%
                                    compared with Q4 2013
    </li>
    <li>
        <strong>Adjusted net income</strong> of RUR 4.0 billion ($70.5 million), up 13%
                                             compared with Q4 2013
    </li>
    <li>
        <strong>Net income margin</strong> of 51.6%
    </li>
    <li>
        <strong>Adjusted net income margin </strong>of 27.0%
    </li>
    <li>
        <strong>Adjusted</strong> <strong>ex-TAC net income margin</strong> of 34.3%
    </li>
    <li>
        <strong>Cash, cash equivalents and deposits </strong>of RUR 49.2 billion ($874.0
                                                             million) as of December 31,
                                                             2014
    </li>
</ul>
<p>
    <strong><u>FY 2014 Financial
               Highlights(1)(2)</u></strong></p>
<ul>
    <li>
        <strong>Revenues </strong>of RUR 50.8 billion ($902.4 million), up 29% compared
                                  with FY 2013 (and up 30% excluding revenues of
                                  Yandex.Money)
    </li>
    <li>
        <strong>Ex-TAC revenues</strong> (excluding traffic acquisition costs) up 25%
                                         compared with FY 2013 (and up 27% excluding the
                                         impact of Yandex.Money)
    </li>
    <li>
        <strong>Income from operations </strong>of RUR 15.3 billion ($272.4 million), up
                                                19% compared with FY 2013
    </li>
    <li>
        <strong>Adjusted EBITDA </strong>of RUR 21.0 billion ($374.2 million), up 21%
                                         compared with FY 2013
    </li>
    <li>
        <strong>Operating margin</strong> of 30.2%
    </li>
    <li>
        <strong>Adjusted EBITDA margin </strong>of 41.5%
    </li>
    <li>
        <strong>Adjusted</strong> <strong>ex-TAC EBITDA margin</strong> of 53.0%
    </li>
    <li>
        <strong>Net income</strong> of RUR 17.0 billion ($302.5 million), up 26%
                                    compared with FY 2013
    </li>
    <li>
        <strong>Adjusted net income</strong> of RUR 13.8 billion ($244.4 million), up
                                             13% compared with FY 2013
    </li>
    <li>
        <strong>Net income margin</strong> of 33.5%
    </li>
    <li>
        <strong>Adjusted net income margin </strong>of 27.1%
    </li>
    <li>
        <strong>Adjusted</strong> <strong>ex-TAC net income margin</strong> of 34.6%
    </li>
</ul>
<p>
    "The company performed well in the fourth quarter and demonstrated another full year
    of excellent results, despite the difficult macroeconomic environment. We continue
    to develop our existing services and products as well as new business models, such
    as the recently launched Yandex Data Factory," said Arkady Volozh, Chief Executive
    Officer of Yandex. "Although we face challenging economic headwinds, including
    substantial currency fluctuations, we are managing Yandex for the long term. We will
    continue to improve monetization, pursue cost efficiencies in our core business and
    manage our forex exposure, while investing into critical growth areas such as mobile
    and advertising technologies."</p>
<p>
    The following table provides a summary of key financial results for the three months
    and twelve months ended December 31, 2013 and 2014:</p>
<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">
<tbody>
    <tr>
            <td class="gnw_label_uline" style="border-bottom: none;">
            <em><strong>In RUR millions</strong></em></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Three months <br>
                    ended December 31,</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months <br>
                    ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Revenues
        </td>
        <td class="gnw_num_uline">
            12,086
        </td>
        <td class="gnw_num_uline">
            14,667
        </td>
        <td class="gnw_num_uline">
            <em>21%</em></td>
        <td class="gnw_num_uline">
            39,502
        </td>
        <td class="gnw_num_uline">
            50,767
        </td>
        <td class="gnw_num_uline">
            <em>29%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Ex-TAC revenues<sup>2</sup></td>
        <td class="gnw_num_uline">
            9,258
        </td>
        <td class="gnw_num_uline">
            11,572
        </td>
        <td class="gnw_num_uline">
            <em>25%</em></td>
        <td class="gnw_num_uline">
            31,652
        </td>
        <td class="gnw_num_uline">
            39,691
        </td>
        <td class="gnw_num_uline">
            <em>25%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Income from operations
        </td>
        <td class="gnw_num_uline">
            3,921
        </td>
        <td class="gnw_num_uline">
            4,478
        </td>
        <td class="gnw_num_uline">
            <em>14%</em></td>
        <td class="gnw_num_uline">
            12,837
        </td>
        <td class="gnw_num_uline">
            15,323
        </td>
        <td class="gnw_num_uline">
            <em>19%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Adjusted EBITDA<sup>2</sup></td>
        <td class="gnw_num_uline">
            5,148
        </td>
        <td class="gnw_num_uline">
            6,078
        </td>
        <td class="gnw_num_uline">
            <em>18%</em></td>
        <td class="gnw_num_uline">
            17,367
        </td>
        <td class="gnw_num_uline">
            21,052
        </td>
        <td class="gnw_num_uline">
            <em>21%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Net income
        </td>
        <td class="gnw_num_uline">
            3,346
        </td>
        <td class="gnw_num_uline">
            7,572
        </td>
        <td class="gnw_num_uline">
            <em>126%</em></td>
        <td class="gnw_num_uline">
            13,474
        </td>
        <td class="gnw_num_uline">
            17,020
        </td>
        <td class="gnw_num_uline">
            <em>26%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Adjusted net income<sup>2</sup></td>
        <td class="gnw_num_uline">
            3,519
        </td>
        <td class="gnw_num_uline">
            3,967
        </td>
        <td class="gnw_num_uline">
            <em>13%</em></td>
        <td class="gnw_num_uline">
            12,140
        </td>
        <td class="gnw_num_uline">
            13,751
        </td>
        <td class="gnw_num_uline">
            <em>13%</em></td>
    </tr>

</tbody>
</table>
<p>
    <sup>1 </sup>Pursuant to SEC rules regarding convenience translations, Russian ruble
                 (RUR) amounts have been translated into U.S. dollars at a rate of RUR
                 56.2584 to $1.00, the official exchange rate quoted as of December 31,
                 2014 by the Central Bank of the Russian Federation.&nbsp;</p>
<p>
    <sup>2</sup> The following measures presented in this release are "non-GAAP
                 financial measures": ex-TAC revenues; adjusted EBITDA; adjusted EBITDA
                 margin; adjusted ex-TAC EBITDA margin; adjusted net income; adjusted
                 net income margin and adjusted ex-TAC net income margin. Please see the
                 section headed "Use of Non-GAAP Financial Measures" below for a
                 discussion of how we define these measures, as well as reconciliations
                 at the end of this release of each of these measures to the most
                 directly comparable US GAAP measures.</p>
<p>
    <strong><u>Q4 2014 Operational and Corporate Highlights</u></strong></p>
<ul>
    <li>
        <strong>Share of Russian search market</strong> (including mobile) averaged
                                                        59.7% in Q4 2014 (according to
                                                        LiveInternet)
    </li>
    <li>
        <strong>Search queries</strong> grew 9% compared with Q4 2013
    </li>
    <li>
        <strong>The number of advertisers</strong> increased to 317,000, up 14% from Q4
                                                   2013 and 5% from Q3 2014
    </li>
    <li>
        Selected as the <strong>default search provider </strong><strong>in</strong>
        <strong>Mozilla Firefox</strong> in Russia
    </li>
    <li>
        Launched<strong> Yandex Data Factory</strong>, a new B2B venture developing big
        data solutions for local and international businesses and research institutions
    </li>
    <li>
        Released the alpha version of our <strong>new Yandex.Browser</strong></li>
    <li>
        <strong>Repurchased</strong> 980,000 Class A shares as part of the previously
                                     announced program to repurchase up to 3 million
                                     additional shares
    </li>
</ul>
<p>
    <strong>Revenues</strong></p>
<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">
<tbody>

    <tr>
            <td class="gnw_label_uline" style="border-bottom: none;">
            <em><strong>In RUR millions</strong></em></td>
        <td class="gnw_colhead_uline " colspan="3">
            <strong>Three months <br>
                    ended December 31,</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months <br>
                    ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Advertising revenues:
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline gnw_label_i10">
            &nbsp;Text-based advertising
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline gnw_label_i25">
            <em>Yandex websites</em></td>
        <td class="gnw_num_uline">
            8,006
        </td>
        <td class="gnw_num_uline">
            9,965
        </td>
        <td class="gnw_num_uline">
            <em>24%</em></td>
        <td class="gnw_num_uline">
            27,584
        </td>
        <td class="gnw_num_uline">
            35,228
        </td>
        <td class="gnw_num_uline">
            <em>28%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline gnw_label_i25">
            <em>Ad network</em></td>
        <td class="gnw_num_uline">
            2,830
        </td>
        <td class="gnw_num_uline">
            3,270
        </td>
        <td class="gnw_num_uline">
            <em>16%</em></td>
        <td class="gnw_num_uline">
            7,885
        </td>
        <td class="gnw_num_uline">
            11,410
        </td>
        <td class="gnw_num_uline">
            <em>45%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline gnw_label_i10">
            <em>&nbsp;Total text-based advertising</em></td>
        <td class="gnw_num_uline">
            10,836
        </td>
        <td class="gnw_num_uline">
            13,235
        </td>
        <td class="gnw_num_uline">
            <em>22%</em></td>
        <td class="gnw_num_uline">
            35,469
        </td>
        <td class="gnw_num_uline">
            46,638
        </td>
        <td class="gnw_num_uline">
            <em>31%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline gnw_label_i10">
            &nbsp;Display advertising
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline gnw_label_i25">
            <em>Yandex websites</em></td>
        <td class="gnw_num_uline">
            1,015
        </td>
        <td class="gnw_num_uline">
            997
        </td>
        <td class="gnw_num_uline">
            <em>-2%</em></td>
        <td class="gnw_num_uline">
            3,185
        </td>
        <td class="gnw_num_uline">
            3,034
        </td>
        <td class="gnw_num_uline">
            <em>-5%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline gnw_label_i25">
            <em>Ad network</em></td>
        <td class="gnw_num_uline">
            137
        </td>
        <td class="gnw_num_uline">
            184
        </td>
        <td class="gnw_num_uline">
            <em>34%</em></td>
        <td class="gnw_num_uline">
            194
        </td>
        <td class="gnw_num_uline">
            475
        </td>
        <td class="gnw_num_uline">
            <em>145%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline gnw_label_i10">
            <em>&nbsp;Total display advertising&nbsp;</em></td>
        <td class="gnw_num_uline">
            1,152
        </td>
        <td class="gnw_num_uline">
            1,181
        </td>
        <td class="gnw_num_uline">
            <em>3%</em></td>
        <td class="gnw_num_uline">
            3,379
        </td>
        <td class="gnw_num_uline">
            3,509
        </td>
        <td class="gnw_num_uline">
            <em>4%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Total advertising revenues
        </td>
        <td class="gnw_num_uline">
            11,988
        </td>
        <td class="gnw_num_uline">
            14,416
        </td>
        <td class="gnw_num_uline">
            <em>20%</em></td>
        <td class="gnw_num_uline">
            38,848
        </td>
        <td class="gnw_num_uline">
            50,147
        </td>
        <td class="gnw_num_uline">
            <em>29%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Online payment commissions
        </td>
        <td class="gnw_num_uline">
            --
        </td>
        <td class="gnw_num_uline">
            --
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            394
        </td>
        <td class="gnw_num_uline">
            --
        </td>
        <td class="gnw_num_uline">
            <em>-100%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Other
        </td>
        <td class="gnw_num_uline">
            98
        </td>
        <td class="gnw_num_uline">
            251
        </td>
        <td class="gnw_num_uline">
            <em>156%</em></td>
        <td class="gnw_num_uline">
            260
        </td>
        <td class="gnw_num_uline">
            620
        </td>
        <td class="gnw_num_uline">
            <em>138%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Total revenues
        </td>
        <td class="gnw_num_uline">
            12,086
        </td>
        <td class="gnw_num_uline">
            14,667
        </td>
        <td class="gnw_num_uline">
            <em>21%</em></td>
        <td class="gnw_num_uline">
            39,502
        </td>
        <td class="gnw_num_uline">
            50,767
        </td>
        <td class="gnw_num_uline">
            <em>29%</em></td>
    </tr>

</tbody>
</table>
<p>
    <strong>Text-based advertising revenues</strong> grew 22% compared with Q4 2013 and
                                                     continued to determine overall
                                                     top-line performance, contributing
                                                     90% of total revenues in Q4 2014.
</p>
<p>
    <strong>Text-based advertising revenues from Yandex websites</strong> increased 24%
                                                                          compared with
                                                                          Q4 2013 and
                                                                          accounted for
                                                                          68% of total
                                                                          revenues
                                                                          during Q4
                                                                          2014.</p>
<p>
    <strong>Text-based advertising revenues from our ad network</strong> increased 16%
                                                                         compared with
                                                                         Q4 2013 and
                                                                         contributed 22%
                                                                         of total
                                                                         revenues during
                                                                         Q4 2014, 110
                                                                         basis points
                                                                         lower than in
                                                                         Q4 2013.</p>
<p>
    <strong>Paid clicks</strong> on Yandex's and its partners' websites, in aggregate,
                                 increased 18% in Q4 2014 compared with Q4 2013 and
                                 demonstrated steady growth rates compared with Q3 2014.
                                 Our average cost per click in Q4 2014 grew 3% compared
                                 with Q4 2013.</p>
<p>
    <strong>Display advertising revenue, </strong>accounting for 8% of total revenues in
                                                  Q4 2014, was up 3% compared with Q4
                                                  2013, with our display advertising
                                                  network driving overall display
                                                  revenue growth in Q4 2014.</p>
<p>
    <strong>Operating Costs and Expenses</strong></p>
<p>
    Yandex's operating costs and expenses consist of cost of revenues, product
    development expenses, sales, general and administrative expenses (SG&amp;A), and
    depreciation and amortization expenses (D&amp;A). Apart from D&amp;A, each of the
    above expense categories includes personnel-related costs and expenses, relevant
    office space rental, and related share-based compensation expense. Increases across
    all cost categories, excluding D&amp;A, reflect investments in overall growth,
    including personnel. In Q4 2014, Yandex added 102 full-time employees, an increase
    of 2% from September 30, 2014, and up 15% from December 31, 2013. The total number
    of full-time employees was 5,616 as of December 31, 2014.</p>
<p>
    <strong>Costs of revenues, including traffic acquisition costs (TAC)</strong></p>
<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">

<tbody>

    <tr>
            <td class="gnw_label_uline" style="border-bottom: none;">
            <em><strong>In RUR millions</strong></em></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong><strong>Three months <br>
                            ended December 31,</strong></strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong><strong>Twelve months <br>
                            ended December 31,</strong></strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <strong><strong>&nbsp;</strong></strong></td>
        <td class="gnw_colhead_uline">
            <strong><strong>2013</strong></strong></td>
        <td class="gnw_colhead_uline">
            <strong><strong>2014</strong></strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
        <td class="gnw_colhead_uline">
            <strong><strong>2013</strong></strong></td>
        <td class="gnw_colhead_uline">
            <strong><strong>2014</strong></strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            TAC:
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Related to the Yandex ad network
        </td>
        <td class="gnw_num_uline">
            2,023
        </td>
        <td class="gnw_num_uline">
            2,102
        </td>
        <td class="gnw_num_uline">
            <em>4%</em></td>
        <td class="gnw_num_uline">
            5,377
        </td>
        <td class="gnw_num_uline">
            7,520
        </td>
        <td class="gnw_num_uline">
            <em>40%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Related to distribution partners
        </td>
        <td class="gnw_num_uline">
            805
        </td>
        <td class="gnw_num_uline">
            993
        </td>
        <td class="gnw_num_uline">
            <em>23%</em></td>
        <td class="gnw_num_uline">
            2,473
        </td>
        <td class="gnw_num_uline">
            3,556
        </td>
        <td class="gnw_num_uline">
            <em>44%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Total TAC
        </td>
        <td class="gnw_num_uline">
            2,828
        </td>
        <td class="gnw_num_uline">
            3,095
        </td>
        <td class="gnw_num_uline">
            <em>9%</em></td>
        <td class="gnw_num_uline">
            7,850
        </td>
        <td class="gnw_num_uline">
            11,076
        </td>
        <td class="gnw_num_uline">
            <em>41%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Total TAC as a % of total revenues</em></td>
        <td class="gnw_num_uline">
            <em>23.4%</em></td>
        <td class="gnw_num_uline">
            <em>21.1%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
        <td class="gnw_num_uline">
            <em>19.9%</em></td>
        <td class="gnw_num_uline">
            <em>21.8%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Other cost of revenues
        </td>
        <td class="gnw_num_uline">
            713
        </td>
        <td class="gnw_num_uline">
            912
        </td>
        <td class="gnw_num_uline">
            <em>28%</em></td>
        <td class="gnw_num_uline">
            2,756
        </td>
        <td class="gnw_num_uline">
            3,260
        </td>
        <td class="gnw_num_uline">
            <em>18%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Other cost of revenues as a % of revenues</em></td>
        <td class="gnw_num_uline">
            <em>5.9%</em></td>
        <td class="gnw_num_uline">
            <em>6.2%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
        <td class="gnw_num_uline">
            <em>7.0%</em></td>
        <td class="gnw_num_uline">
            <em>6.4%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Total cost of revenues
        </td>
        <td class="gnw_num_uline">
            3,541
        </td>
        <td class="gnw_num_uline">
            4,007
        </td>
        <td class="gnw_num_uline">
            <em>13%</em></td>
        <td class="gnw_num_uline">
            10,606
        </td>
        <td class="gnw_num_uline">
            14,336
        </td>
        <td class="gnw_num_uline">
            <em>35%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Total cost of revenues as a % of revenues</em></td>
        <td class="gnw_num_uline">
            <em>29.3%</em></td>
        <td class="gnw_num_uline">
            <em>27.3%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
        <td class="gnw_num_uline">
            <em>26.8%</em></td>
        <td class="gnw_num_uline">
            <em>28.2%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
    </tr>

</tbody>
</table>
<p>
    TAC decreased slightly as percentage of total revenues from 23.4% in Q4 2013 to
    21.1% in Q4 2014 and grew only 9% compared with Q4 2013. The slowdown in the growth
    of partner TAC was mostly due to changes in partner revenue mix. Partner TAC
    includes traffic acquisition costs related to both our text-based and our display
    advertising networks.</p>
<p>
    <strong>Other cost of revenues</strong> in Q4 2014 increased 28% compared with Q4
                                            2013, primarily reflecting growth of
                                            personnel costs and an increase in our
                                            rental expenses, attributable to additional
                                            office space that we started to lease in May
                                            2014 and to the material appreciation of the
                                            U.S. dollar during Q4 2014, given that the
                                            rent for our Moscow headquarters is U.S.
                                            dollar-denominated.</p>
<p>
    <strong>Product development</strong></p>
<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">

<tbody>

    <tr>
            <td class="gnw_label_uline" style="border-bottom: none;">
            <em><strong>In RUR millions</strong></em></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Three months <br>
                    ended December 31,</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months <br>
                    ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Product development
        </td>
        <td class="gnw_num_uline">
            1,651
        </td>
        <td class="gnw_num_uline">
            2,673
        </td>
        <td class="gnw_num_uline">
            <em>62%</em></td>
        <td class="gnw_num_uline">
            5,827
        </td>
        <td class="gnw_num_uline">
            8,842
        </td>
        <td class="gnw_num_uline">
            <em>52%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>As a % of revenues</em></td>
        <td class="gnw_num_uline">
            <em>13.7%</em></td>
        <td class="gnw_num_uline">
            <em>18.2%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
        <td class="gnw_num_uline">
            <em>14.8%</em></td>
        <td class="gnw_num_uline">
            <em>17.4%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
    </tr>

</tbody>
</table>
<p>
    Growth in product development costs in Q4 2014 primarily reflects growth of
    personnel expenses and increased rental costs, attributable to additional office
    space that we started to lease in May 2014 and to the material appreciation of the
    U.S. dollar during Q4 2014, given that the rent for our Moscow headquarters is U.S.
    dollar-denominated. In 2014, development headcount increased 14% from 2,924 as of
    December 31, 2013, to 3,329 as of December 31, 2014, with 57 employees added since
    September 30, 2014.</p>
<p>
    <strong>Selling, general and administrative (SG&amp;A)</strong></p>
<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">

<tbody>

    <tr>
            <td class="gnw_label_uline" style="border-bottom: none;">
            <em><strong>In RUR millions</strong></em></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Three months <br>
                    ended December 31,</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months <br>
                    ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Sales, general and administrative
        </td>
        <td class="gnw_num_uline">
            1,983
        </td>
        <td class="gnw_num_uline">
            2,303
        </td>
        <td class="gnw_num_uline">
            <em>16%</em></td>
        <td class="gnw_num_uline">
            6,537
        </td>
        <td class="gnw_num_uline">
            7,782
        </td>
        <td class="gnw_num_uline">
            <em>19%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>As a % of revenues</em></td>
        <td class="gnw_num_uline">
            <em>16.4%</em></td>
        <td class="gnw_num_uline">
            <em>15.7%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
        <td class="gnw_num_uline">
            <em>16.5%</em></td>
        <td class="gnw_num_uline">
            <em>15.3%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
    </tr>

</tbody>
</table>
<p>
    SG&amp;A costs grew slower than revenue, increasing by 16% in Q4 2014 compared to Q4
    2013. Personnel expenses and the growth in rental costs for our Moscow headquarters
    related to the SG&amp;A category were offset by decreases in advertising and
    marketing spend.</p>
<p>
    <strong>Share-based compensation (SBC) expense </strong></p>
<p>
    SBC expense is included in each of the cost of revenues, product development, and SG&amp;A
    categories discussed above.</p>
<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">

<tbody>

    <tr>
            <td class="gnw_label_uline" style="border-bottom: none;">
            <em><strong>In RUR millions</strong></em></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Three months <br>
                    ended December 31,</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months <br>
                    ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            SBC expense included in cost of revenues
        </td>
        <td class="gnw_num_uline">
            18
        </td>
        <td class="gnw_num_uline">
            32
        </td>
        <td class="gnw_num_uline">
            <em>78%</em></td>
        <td class="gnw_num_uline">
            61
        </td>
        <td class="gnw_num_uline">
            101
        </td>
        <td class="gnw_num_uline">
            <em>66%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            SBC expense included in product development
        </td>
        <td class="gnw_num_uline">
            128
        </td>
        <td class="gnw_num_uline">
            254
        </td>
        <td class="gnw_num_uline">
            <em>98%</em></td>
        <td class="gnw_num_uline">
            435
        </td>
        <td class="gnw_num_uline">
            780
        </td>
        <td class="gnw_num_uline">
            <em>79%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            SBC expense included in SG&amp;A
        </td>
        <td class="gnw_num_uline">
            77
        </td>
        <td class="gnw_num_uline">
            90
        </td>
        <td class="gnw_num_uline">
            <em>17%</em></td>
        <td class="gnw_num_uline">
            258
        </td>
        <td class="gnw_num_uline">
            329
        </td>
        <td class="gnw_num_uline">
            <em>28%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Total SBC expense
        </td>
        <td class="gnw_num_uline">
            223
        </td>
        <td class="gnw_num_uline">
            376
        </td>
        <td class="gnw_num_uline">
            <em>69%</em></td>
        <td class="gnw_num_uline">
            754
        </td>
        <td class="gnw_num_uline">
            1,210
        </td>
        <td class="gnw_num_uline">
            <em>60%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>As a % of revenues</em></td>
        <td class="gnw_num_uline">
            <em>1.8%</em></td>
        <td class="gnw_num_uline">
            <em>2.6%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
        <td class="gnw_num_uline">
            <em>1.9%</em></td>
        <td class="gnw_num_uline">
            <em>2.4%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
    </tr>

</tbody>
</table>
<p>
    Total SBC expense increased 69% in Q4 2014 compared with Q4 2013. The increase is
    primarily related to the material appreciation of the U.S. dollar during Q4 2014 as
    well as to new equity-based grants made in 2013-2014.</p>
<p>
    <strong>Depreciation and amortization (D&amp;A) expense</strong></p>
<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">

<tbody>

    <tr>
            <td class="gnw_label_uline" style="border-bottom: none;">
            <em><strong>In RUR millions</strong></em></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Three months <br>
                    ended December 31,</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months <br>
                    ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Depreciation and amortization
        </td>
        <td class="gnw_num_uline">
            990
        </td>
        <td class="gnw_num_uline">
            1,206
        </td>
        <td class="gnw_num_uline">
            <em>22%</em></td>
        <td class="gnw_num_uline">
            3,695
        </td>
        <td class="gnw_num_uline">
            4,484
        </td>
        <td class="gnw_num_uline">
            <em>21%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>As a % of revenues</em></td>
        <td class="gnw_num_uline">
            <em>8.2%</em></td>
        <td class="gnw_num_uline">
            <em>8.2%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
        <td class="gnw_num_uline">
            <em>9.4%</em></td>
        <td class="gnw_num_uline">
            <em>8.8%</em></td>
        <td class="gnw_label_uline">
            <em>&nbsp;</em></td>
    </tr>

</tbody>
</table>
<p>
    D&amp;A expense increased 22% in Q4 2014 compared with Q4 2013 and primarily
    reflected investments in servers and data centers made in 2013 and early 2014.</p>
<p>
    As a result of the factors described above,<strong> income from operations</strong>
    was RUR 4.5 billion ($79.6 million) in Q4 2014, a 14% increase from Q4 2013, while
    <strong>adjusted EBITDA</strong> reached RUR 6.1 billion ($108.0 million) in Q4
    2014, up 18% from Q4 2013.</p>
<p>
    <strong>Interest income, net</strong> in Q4 2014 was RUR 257 million, down from RUR
                                          414 million in Q4 2013, mainly due to interest
                                          expenses related to our convertible notes
                                          issued in December 2013 and January 2014.</p>
<p>
    <strong>Foreign exchange gain</strong> in Q4 2014 was RUR 4,707 million, compared
                                           with a foreign exchange gain of RUR 99
                                           million in Q4 2013. This gain is due to the
                                           material appreciation of the U.S. dollar
                                           during Q4 2014 from RUR 39.3866 to $1.00 on
                                           September 30, 2014, to RUR 56.2584 to $1.00
                                           on December 31, 2014. Yandex's Russian
                                           operating subsidiaries' functional currency
                                           is the Russian ruble, and therefore changes
                                           due to exchange rate fluctuations in the
                                           ruble value of these subsidiaries' monetary
                                           assets and liabilities that are denominated
                                           in other currencies are recognized as foreign
                                           exchange gains or losses in the income
                                           statement. Although the U.S. dollar value of
                                           Yandex's U.S. dollar-denominated assets and
                                           liabilities was not impacted by these
                                           currency fluctuations, they resulted in an
                                           upward revaluation of the ruble equivalent of
                                           these U.S. dollar-denominated monetary assets
                                           and liabilities in Q4 2014.<strong><br>
    <br>
    Income tax expense </strong>for Q4 2014 was RUR 2,338 million, up from RUR 1,083
                                           million in Q4 2013. Our
    <strong>effective</strong> <strong>tax rate </strong>of 23.6% in Q4 2014 was
                                           generally in line with the effective tax rate
                                           in Q3 2014. Our effective tax rate was higher
                                           in 2014 than in 2013 because in Q1 2014 we
                                           began to accrue for a 5% dividend withholding
                                           tax on the portion of the current year profit
                                           of our principal Russian operating subsidiary
                                           that we considered not to be permanently
                                           reinvested in Russia.</p>
<p>
    <strong>Adjusted net income </strong>in Q4 2014 was RUR 4.0 billion ($70.5 million),
                                         a 13% increase from Q4 2013.</p>
<p>
    <strong>Adjusted net income margin</strong> was 27.0% in Q4 2014, compared with
                                                29.1% in Q4 2013.</p>
<p>
    <strong>Net income</strong> was RUR 7.6 billion ($134.6 million) in Q4 2014, up 126%
                                compared with Q4 2013, mainly due to the&nbsp;foreign
                                exchange gain that we recognized in Q4 2014.</p>
<p>
    As of December 31, 2014, Yandex <strong>had cash, cash equivalents and
                                            deposits </strong>of RUR 49.2 billion
    ($874.0 million).</p>
<p>
    <strong>Net operating cash flow and capital expenditures</strong> for Q4 2014 were
                                                                      RUR 4.0 billion
                                                                      ($66.2 million)
                                                                      and RUR 3.0
                                                                      billion ($53.3
                                                                      million),
                                                                      respectively.</p>
<p>
    During Q4 2014, we repurchased $100 million in principal of our <strong>1.125%
                                                                            convertible
                                                                            senior
                                                                            notes</strong>
    due 2018 for approximately $85.6 million.</p>
<p>
    The <strong>total</strong> <strong>number of shares issued and outstanding</strong>
    as of December 31, 2014 was 317,643,671, including 255,592,322 Class A shares,
    62,051,348 Class B shares, and one Priority share and excluding 12,378,083 Class A
    shares held in treasury and all Class C shares outstanding solely as a result of the
    conversion of Class B shares into Class A shares; all such Class C shares will be
    cancelled. There were also employee share options outstanding to purchase up to an
    additional 5.0 million shares, at a weighted average exercise price of $5.41 per
    share, of which options to purchase 4.9 million shares were fully vested;
    equity-settled share appreciation rights equal to 2.4 million shares, at a weighted
    average measurement price of $27.77, 0.6 million of which were fully vested; and
    restricted share units covering&nbsp;3.9 million shares, of which restricted share
    units to acquire 0.9 million shares were fully vested.</p>
<h2>Financial outlook</h2>
<p>
    The current outlook is limited to quarterly guidance because of high level of
    uncertainty in the current macroeconomic situation.</p>
<p>
    Currently we expect revenue to grow approximately 15% in Q1 2015.</p>
<p>
    This outlook reflects our current and preliminary view, based on the trends that we
    currently see. &nbsp;</p>
<p>
    <strong><u>Conference Call Information</u></strong></p>
<p>
    Yandex's management will hold an earnings conference call on February 18, 2015 at
    8:00 AM U.S. Eastern Time (4:00 PM Moscow time; 1:00 PM London time).</p>
<p>
    To access the conference call live, please dial:</p>
<blockquote>
    <p>
        US: +1 877 280 2342 <br>
        UK: +44 (0) 20 3427 1912 <br>
        Russia: 8 800 500 9311</p>
    <p>
        Passcode: 3861283#</p>
</blockquote>
<p>
    A replay of the call will be available through February 25, 2015. To access the
    replay, please dial:</p>
<blockquote>
    <p>
        US: +1 866 932 5017 <br>
        Russia/International: +44 (0) 20 3427 0598</p>
    <p>
        Passcode: 3861283#</p>
</blockquote>
<p>
    A live and archived webcast of this conference call will be available at</p>
<p>
    <a href="/Tracker?data=zCzyDQN4U1e_fskGvn8R2L1Sf8j61bGwK_imb_u8HuJt5tk1XeuxR8EJLIu3uJL962CuiR5l4QDZwkU4KkH5kros0PZj_zPszIxMqnrDuj0fDNJQKgcjhv44BKveRKrW" rel="nofollow" title="">http://edge.media-server.com/m/p/h2rkyhrs</a>
</p>
<p>
    <strong><u>ABOUT YANDEX</u></strong></p>
<p>
    <a href="https://yandex.com/company" rel="nofollow" title="">https://yandex.com/company</a>.
<p>
    <strong><u>FORWARD-LOOKING STATEMENTS </u></strong></p>
<p>
    This press release contains forward-looking statements that involve risks and
    uncertainties. These include statements regarding our anticipated revenues for Q1
    2015.&nbsp;Actual results may differ materially from the results predicted or
    implied by such statements, and our reported results should not be considered as an
    indication of future performance. The potential risks and uncertainties that could
    cause actual results to differ from the results predicted or implied by such
    statements include, among others, macroeconomic and geopolitical developments
    affecting the Russian economy, competitive pressures, changes in advertising
    patterns, changes in user preferences, changes in the political, legal and/or
    regulatory environment, technological developments, and our need to expend capital
    to accommodate the growth of the business, as well as those risks and uncertainties
    included under the captions "Risk Factors" and "Operating and Financial Review and
    Prospects" in our Annual Report on Form 20-F for the year ended December 31, 2013,
    which is on file with the Securities and Exchange Commission and is available on our
    investor relations website at
    <a href="/Tracker?data=zCzyDQN4U1e_fskGvn8R2B7rovxVrExK4qsA-lp7bnup0UV1YbkL7C07tvuM-VKY323Elqu3AiMI4D0TEch_1DNsKdvsYI9U781hfsuacqk%3D" rel="nofollow" title="">http://ir.yandex.com/sec.cfm</a>
    and on the SEC website at
    <a href="/Tracker?data=-TSjnrZLYahTQRkpptFqtDk36gOW8Iu8dsNUB3wbwjljP8d0jrtULNJwnR9HO7rb" rel="nofollow" title="www.sec.gov">www.sec.gov</a>.
    All information in this release and in the attachments is as of February 18, 2015,
    and Yandex undertakes no duty to update this information unless required by law.</p>
<p>
    <strong><u>USE OF NON-GAAP FINANCIAL MEASURES</u></strong></p>
<p>
    To supplement our consolidated financial statements, which are prepared and
    presented in accordance with US GAAP, we present the following non-GAAP financial
    measures: ex-TAC revenue, adjusted EBITDA, adjusted EBITDA margin, adjusted ex-TAC
    EBITDA margin, adjusted net income, adjusted net income margin and adjusted ex-TAC
    net income margin. The presentation of these financial measures is not intended to
    be considered in isolation or as a substitute for, or superior to, the financial
    information prepared and presented in accordance with US GAAP. For more information
    on these non-GAAP financial measures, please see the tables captioned
    "Reconciliations of non-GAAP financial measures to the nearest comparable US GAAP
    measures", included following the accompanying financial tables. We define the
    various non-GAAP financial measures we use as follows:</p>
<ul>
    <li>
        <strong>Ex-TAC revenue </strong>means US GAAP revenues less total traffic
                                        acquisition costs (TAC)
    </li>
    <li>
        <strong>Adjusted EBITDA </strong>means net income <u>plus</u> (1) depreciation
                                         and amortization, (2) share-based compensation
                                         expense, (3) accrual of expense related to the
                                         contingent compensation that was payable to
                                         employees in connection with our acquisition of
                                         the mobile software business of SPB Software
                                         and our acquisition of KitLocate (described
                                         below) and (4) provision for income taxes, <u>less</u>
                                         (A) interest income and (B) other
                                         income/(expense)
    </li>
    <li>
        <strong>Adjusted EBITDA margin</strong> means adjusted EBITDA divided by US GAAP
                                                revenues
    </li>
    <li>
        <strong>Adjusted ex-TAC EBITDA margin</strong> means adjusted EBITDA divided by
                                                       ex-TAC revenues
    </li>
    <li>
        <strong>Adjusted net income</strong> means US GAAP net income <u>plus</u> (1)
                                             SBC expense adjusted for the income tax
                                             reduction attributable to SBC expense, (2)
                                             accrual of expense related to the
                                             contingent compensation that was payable to
                                             certain employees in connection with our
                                             acquisition of the mobile software business
                                             of SPB Software and our acquisition of
                                             KitLocate (described below), (3) foreign
                                             exchange losses (less foreign exchange
                                             gains) adjusted for the (reduction)
                                             increase in income tax attributable to the
                                             foreign exchange losses / (gains), (4)
                                             impairment of investments in equity
                                             securities adjusted for the related
                                             reduction in income tax and (5)
                                             amortization of debt discount related to
                                             our convertible debt adjusted for the
                                             related reduction in income taxes;
        <u>less</u> (1) gain from the sale and deconsolidation of equity investments,
                                             (2) gain from repurchases of our
                                             convertible notes adjusted for the related
                                             increase in income tax
    </li>
    <li>
        <strong>Adjusted net income margin </strong>means adjusted net income divided by
                                                    US GAAP revenues
    </li>
    <li>
        <strong>Adjusted ex-TAC net income margin </strong>means adjusted net income
                                                           divided by ex-TAC revenues
    </li>
</ul>
<p>
    These non-GAAP financial measures are used by management for evaluating financial
    performance as well as decision-making. Management believes that these metrics
    reflect the organic, core operating performance of the company, and therefore are
    useful to analysts and investors in providing supplemental information that helps
    them understand, model and forecast the evolution of our operating business.</p>
<p>
    Although our management uses these non-GAAP financial measures for operational
    decision making and considers these financial measures to be useful for analysts and
    investors, we recognize that there are a number of limitations related to such
    measures. In particular, it should be noted that several of these measures exclude
    some costs, particularly share-based compensation, that are recurring. In addition,
    the components of the costs that we exclude in our calculation of the measures
    described above may differ from the components that our peer companies exclude when
    they report their results of operations.</p>
<p>
    Below we describe why we make particular adjustments to certain US GAAP financial
    measures:</p>
<p>
    <i>TAC</i></p>
<p>
    We believe that it may be useful for investors and analysts to review certain
    measures both in accordance with US GAAP and net of the effect of TAC, which we view
    as comparable to sales commissions but, unlike sales commissions, are not deducted
    from US GAAP revenues. By presenting revenue, adjusted EBITDA margin and adjusted
    net income margin net of TAC, we believe that investors and analysts are able to
    obtain a clearer picture of our business without the impact of the revenues we share
    with our partners.</p>
<p>
    <i>SBC</i></p>
<p>
    SBC is a significant expense item, and an important part of our compensation and
    incentive programs. As it is a non-cash charge, however, and highly dependent on our
    share price at the time of equity award grants, we believe that it is useful for
    investors and analysts to see certain financial measures excluding the impact of
    these charges in order to obtain a clear picture of our operating performance.</p>
<p>
    <i>Acquisition-related costs</i></p>
<p>
    We may incur expenses in connection with acquisitions that are not indicative of our
    recurring core operating performance. In particular, we were required under US GAAP
    to accrue as expense the contingent compensation that was payable to certain
    employees in connection with our acquisition of the mobile software business of SPB
    Software in November 2011 and our acquisition of KitLocate, the developer of an
    energy efficient geolocation technology for mobile devices, in March 2014. The
    aggregate amount of such contingent compensation paid in connection with SPB
    Software acquisition was $14.1 million, $7.1 million of which was paid in November
    2012, $4.1 million of which was paid in February 2013, and $2.9 million of which was
    paid in November 2013. The maximum aggregate amount of contingent compensation to be
    paid in connection with the KitLocate acquisition is $3.9 million payable upon the
    continued employment of the sellers. We have eliminated these acquisition-related
    expenses from adjusted EBITDA and adjusted net income to provide management and
    investors a tool for comparing on a period-to-period basis our operating performance
    in the ordinary course of operations.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</p>
<p>
    <i>Foreign exchange gains and losses</i></p>
<p>
    Because we hold significant assets in currencies other than our Russian ruble
    operating currency, and because foreign exchange fluctuations are outside of our
    operational control, we believe that it is useful to present adjusted net income and
    related margin measures excluding these effects, in order to provide greater clarity
    regarding our operating performance.</p>
<p>
    <i>Impairment of investment in equity securities</i></p>
<p>
    Adjusted net income for the quarter ended September 30, 2014, excludes a loss from
    the impairment of our equity investment in Blekko Inc. We review our investments
    quarterly for indicators of other-than-temporary impairment. In the quarter ended
    September 30, 2014, our review identified certain adverse external and internal
    events indicating that the decline in fair value of our investment in Blekko Inc. is
    now other-than-temporary and recorded an impairment charge of $18.5 million. We
    believe that it is useful to present adjusted net income and related margin measures
    excluding impacts not related to our core operations.</p>
<p>
    <i>Gain from the sale and deconsolidation of equity investments</i></p>
<p>
    Adjusted net income also excludes a gain in the quarter ended September 30, 2013
    from deconsolidation of Yandex.Money following the sale of a 75% stake in
    Yandex.Money to Sberbank on July 4, 2013. We believe that it is useful to present
    adjusted net income and related margin measures excluding the effect of this
    significant item in order to provide a clearer picture of our underlying operating
    performance.</p>
<p>
    <i>Amortization of debt discount</i></p>
<p>
    We also adjust net income for interest expense representing amortization of the debt
    discount related to our convertible notes issued in Q4 2013 and Q1 2014. We have
    eliminated this expense from adjusted net income as it is non-cash in nature and is
    not indicative of our ongoing operating performance.</p>
<p>
    <i>Gain from repurchases of convertible debt</i></p>
<p>
    Adjusted net income also excludes a gain from repurchase of $150 million in
    principal of our 1.125% convertible senior notes due 2018 for approximately $131.3
    million that we recorded in the&nbsp;year ended December 31, 2014. We have
    eliminated this gain from adjusted net income as it is not indicative of our ongoing
    operating performance.</p>
<p>
    The tables at the end of this release provide detailed reconciliations of each
    non-GAAP financial measure we use to the most directly comparable US GAAP financial
    measure.</p>
<br>
<br>
<p class="text-align-center">
    <strong>YANDEX&nbsp;N.V.</strong>
    <br>
    <strong>Unaudited Condensed Consolidated Balance Sheets</strong>
    <br><br>
    <strong>(in millions of Russian rubles and U.S. dollars, except share and per
            share data)</strong>
</p>
<table cellpadding="0" cellspacing="6" class="gnw_table_long_yandex_old">
<tbody>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>As of</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>December&nbsp;31, 2013*</strong></td>
        <td class="gnw_colhead_uline">
            <strong>December&nbsp;31, 2014</strong></td>
        <td class="gnw_colhead_uline">
            <strong>December&nbsp;31, 2014</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead">
            <strong>RUR</strong></td>
        <td class="gnw_colhead">
            <strong>RUR</strong></td>
        <td class="gnw_colhead">
            <strong>$</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>ASSETS</strong></td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Current assets:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Cash and cash equivalents&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;33,394
        </td>
        <td class="gnw_num">
            &nbsp;17,645
        </td>
        <td class="gnw_num">
            &nbsp;313.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Marketable securities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;87
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Term deposits&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;5,863
        </td>
        <td class="gnw_num">
            &nbsp;104.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Investments in debt securities
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;3,124
        </td>
        <td class="gnw_num">
            &nbsp;55.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Accounts receivable, net&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;2,785
        </td>
        <td class="gnw_num">
            &nbsp;3,703
        </td>
        <td class="gnw_num">
            &nbsp;65.8
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Prepaid expenses&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;689
        </td>
        <td class="gnw_num">
            &nbsp;1,556
        </td>
        <td class="gnw_num">
            &nbsp;27.8
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Deferred tax assets&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;596
        </td>
        <td class="gnw_num">
            &nbsp;180
        </td>
        <td class="gnw_num">
            &nbsp;3.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Other current assets&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;1,332
        </td>
        <td class="gnw_num_uline">
            &nbsp;3,736
        </td>
        <td class="gnw_num_uline">
            &nbsp;66.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Total current assets&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;38,883
        </td>
        <td class="gnw_num">
            &nbsp;35,807
        </td>
        <td class="gnw_num">
            &nbsp;636.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Property and equipment, net&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;9,729
        </td>
        <td class="gnw_num">
            &nbsp;17,107
        </td>
        <td class="gnw_num">
            &nbsp;304.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Intangible assets, net&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;633
        </td>
        <td class="gnw_num">
            &nbsp;2,425
        </td>
        <td class="gnw_num">
            &nbsp;43.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Goodwill
        </td>
        <td class="gnw_num">
            &nbsp;2,946
        </td>
        <td class="gnw_num">
            &nbsp;8,920
        </td>
        <td class="gnw_num">
            &nbsp;158.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Long-term prepaid expenses&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;1,042
        </td>
        <td class="gnw_num">
            &nbsp;1,590
        </td>
        <td class="gnw_num">
            &nbsp;28.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Restricted cash&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;104
        </td>
        <td class="gnw_num">
            &nbsp;932
        </td>
        <td class="gnw_num">
            &nbsp;16.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Term deposits&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;15,180
        </td>
        <td class="gnw_num">
            &nbsp;25,663
        </td>
        <td class="gnw_num">
            &nbsp;456.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Investments in non-marketable equity securities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;1,250
        </td>
        <td class="gnw_num">
            &nbsp;871
        </td>
        <td class="gnw_num">
            &nbsp;15.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Investments in debt securities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;2
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Deferred tax assets&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;3
        </td>
        <td class="gnw_num">
            &nbsp;4
        </td>
        <td class="gnw_num">
            &nbsp;0.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Other non-current assets&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;1,539
        </td>
        <td class="gnw_num_uline">
            &nbsp;1,605
        </td>
        <td class="gnw_num_uline">
            &nbsp;28.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>TOTAL ASSETS&nbsp;</strong></td>
        <td class="gnw_num_dline">
            <strong>&nbsp;71,311 </strong></td>
        <td class="gnw_num_dline">
            <strong>&nbsp;94,924 </strong></td>
        <td class="gnw_num_dline">
            <strong>&nbsp;1,687.3 </strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>LIABILITIES AND SHAREHOLDERS' EQUITY</strong></td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Current liabilities:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Accounts payable and accrued liabilities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;3,710
        </td>
        <td class="gnw_num">
            &nbsp;5,053
        </td>
        <td class="gnw_num">
            &nbsp;89.8
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Taxes payable&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;1,688
        </td>
        <td class="gnw_num">
            &nbsp;2,930
        </td>
        <td class="gnw_num">
            &nbsp;52.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Deferred revenue&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;1,501
        </td>
        <td class="gnw_num">
            &nbsp;1,808
        </td>
        <td class="gnw_num">
            &nbsp;32.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Deferred tax liabilities&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;16
        </td>
        <td class="gnw_num_uline">
            &nbsp;5
        </td>
        <td class="gnw_num_uline">
            &nbsp;0.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Total current liabilities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;6,915
        </td>
        <td class="gnw_num">
            &nbsp;9,796
        </td>
        <td class="gnw_num">
            &nbsp;174.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Convertible debt
        </td>
        <td class="gnw_num">
            &nbsp;16,429
        </td>
        <td class="gnw_num">
            &nbsp;26,325
        </td>
        <td class="gnw_num">
            &nbsp;467.9
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Deferred tax liabilities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;1,245
        </td>
        <td class="gnw_num">
            &nbsp;1,587
        </td>
        <td class="gnw_num">
            &nbsp;28.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Other accrued liabilities&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;125
        </td>
        <td class="gnw_num_uline">
            &nbsp;1,480
        </td>
        <td class="gnw_num_uline">
            &nbsp;26.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Total liabilities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;24,714
        </td>
        <td class="gnw_num">
            &nbsp;39,188
        </td>
        <td class="gnw_num">
            &nbsp;696.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Commitments and contingencies&nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Shareholders' equity:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Priority share: €1 par value; 1 share authorized, issued and outstanding&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;—&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;—&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;—&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Preference shares: €0.01 par value; 2,000,000,001 and 1,000,000,001, shares
            authorized, nil shares issued and outstanding&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;—&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;—&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;—&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Ordinary shares: par value (Class A €0.01, Class B €0.10 and Class C €0.09);
            shares authorized (Class A: 2,000,000,000 and 1,000,000,000, Class B:
            102,115,140 and 71,870,411, and Class C: 102,115,140 and 71,870,411); shares
            issued (Class A: 256,998,306 and 267,970,405, Class B: 72,923,447 and
            62,051,348, and Class C: 23,110,819 and 8,919,063, respectively); shares
            outstanding (Class A: 250,732,061 and 255,592,322, Class B: 72,923,447 and
            62,051,348, and Class C: nil)&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;242
        </td>
        <td class="gnw_num">
            &nbsp;182
        </td>
        <td class="gnw_num">
            &nbsp;3.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Treasury shares at cost (Class A: 6,266,245 and 12,378,083)&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(6,886)
        </td>
        <td class="gnw_num">
            &nbsp;(14,179)
        </td>
        <td class="gnw_num">
            &nbsp;(252.0)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Additional paid-in capital&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;15,701
        </td>
        <td class="gnw_num">
            &nbsp;16,192
        </td>
        <td class="gnw_num">
            &nbsp;287.8
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Accumulated other comprehensive income&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;2,042
        </td>
        <td class="gnw_num">
            &nbsp;1,023
        </td>
        <td class="gnw_num">
            &nbsp;18.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Retained earnings&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;35,498
        </td>
        <td class="gnw_num_uline">
            &nbsp;52,518
        </td>
        <td class="gnw_num_uline">
            &nbsp;933.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Total shareholders' equity&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;46,597
        </td>
        <td class="gnw_num_uline">
            &nbsp;55,736
        </td>
        <td class="gnw_num_uline">
            &nbsp;990.7
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY&nbsp;</strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;71,311 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;94,924 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;1,687.3 </strong></td>
    </tr>
    <tr>
        <td class="gnw_label" colspan="4">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label" colspan="4">
            <em>* Derived from audited financial statements</em></td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>

</tbody>
</table>
<p class="text-align-center">
    <strong>YANDEX&nbsp;N.V.</strong>
    <br>
    <strong>Unaudited Condensed Consolidated Statements of
                                                                                   Income</strong>
    <br><br>
    <strong>(in millions of Russian rubles and U.S. dollars, except share and
                                                        per share data)</strong>
</p>
<table cellpadding="0" cellspacing="6" class="gnw_table_long_yandex_old">
<tbody>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Three months ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead">
            <strong>RUR</strong></td>
        <td class="gnw_colhead">
            <strong>RUR</strong></td>
        <td class="gnw_colhead">
            <strong>$</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Revenues
        </td>
        <td class="gnw_num">
            12,086
        </td>
        <td class="gnw_num">
            14,667
        </td>
        <td class="gnw_num">
            260.7
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Operating costs and expenses:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Cost of revenues<sup>(1)</sup></td>
        <td class="gnw_num">
            3,541
        </td>
        <td class="gnw_num">
            4,007
        </td>
        <td class="gnw_num">
            71.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Product development<sup>(1)</sup></td>
        <td class="gnw_num">
            1,651
        </td>
        <td class="gnw_num">
            2,673
        </td>
        <td class="gnw_num">
            47.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Sales, general and administrative<sup>(1)</sup></td>
        <td class="gnw_num">
            1,983
        </td>
        <td class="gnw_num">
            2,303
        </td>
        <td class="gnw_num">
            41.0
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Depreciation and amortization&nbsp;
        </td>
        <td class="gnw_num_uline">
            990
        </td>
        <td class="gnw_num_uline">
            1,206
        </td>
        <td class="gnw_num_uline">
            21.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Total operating costs and expenses
        </td>
        <td class="gnw_num_uline">
            8,165
        </td>
        <td class="gnw_num_uline">
            10,189
        </td>
        <td class="gnw_num_uline">
            181.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Income from operations
        </td>
        <td class="gnw_num">
            3,921
        </td>
        <td class="gnw_num">
            4,478
        </td>
        <td class="gnw_num">
            79.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Interest income, net
        </td>
        <td class="gnw_num">
            414
        </td>
        <td class="gnw_num">
            257
        </td>
        <td class="gnw_num">
            4.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Other income, net
        </td>
        <td class="gnw_num_uline">
            94
        </td>
        <td class="gnw_num_uline">
            &nbsp;5,175
        </td>
        <td class="gnw_num_uline">
            &nbsp;92.0
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Net income before income taxes
        </td>
        <td class="gnw_num">
            4,429
        </td>
        <td class="gnw_num">
            9,910
        </td>
        <td class="gnw_num">
            176.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Provision for income taxes
        </td>
        <td class="gnw_num_uline">
            1,083
        </td>
        <td class="gnw_num_uline">
            2,338
        </td>
        <td class="gnw_num_uline">
            41.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Net income
        </td>
        <td class="gnw_num_dline">
            3,346
        </td>
        <td class="gnw_num_dline">
            7,572
        </td>
        <td class="gnw_num_dline">
            134.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Net income per Class&nbsp;A and Class&nbsp;B share:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Basic
        </td>
        <td class="gnw_num_dline">
            10.30
        </td>
        <td class="gnw_num_dline">
            23.83
        </td>
        <td class="gnw_num_dline">
            0.42
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Diluted
        </td>
        <td class="gnw_num_dline">
            10.08
        </td>
        <td class="gnw_num_dline">
            23.44
        </td>
        <td class="gnw_num_dline">
            0.42
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Weighted average number of Class A and Class B shares outstanding
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Basic
        </td>
        <td class="gnw_num">
            324,736,336
        </td>
        <td class="gnw_num">
            317,775,863
        </td>
        <td class="gnw_num">
            317,775,863
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Diluted
        </td>
        <td class="gnw_num">
            331,906,108
        </td>
        <td class="gnw_num">
            323,082,053
        </td>
        <td class="gnw_num">
            323,082,053
        </td>
    </tr>
    <tr>
        <td class="gnw_label_uline" colspan="4">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label" colspan="4">
            <sup>(1)</sup>These balances exclude depreciation and amortization expenses,
                          which are presented separately, and include share-based
                          compensation expenses of:
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Cost of revenues
        </td>
        <td class="gnw_num">
            18
        </td>
        <td class="gnw_num">
            32
        </td>
        <td class="gnw_num">
            0.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Product development
        </td>
        <td class="gnw_num">
            128
        </td>
        <td class="gnw_num">
            254
        </td>
        <td class="gnw_num">
            4.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Sales, general and administrative
        </td>
        <td class="gnw_num">
            77
        </td>
        <td class="gnw_num">
            90
        </td>
        <td class="gnw_num">
            1.6
        </td>
    </tr>

</tbody>
</table>
<p class="text-align-center">
    <strong>YANDEX&nbsp;N.V.</strong>
    <br><strong>Unaudited Condensed Consolidated Statements of
                                                                                   Income</strong>
    <br><br>
    <strong>(in millions of Russian rubles and U.S. dollars, except share and
                                                        per share data)</strong>
</p>
<table cellpadding="0" cellspacing="6" class="gnw_table_long_yandex_old">
<tbody>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013*</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead">
            <strong>RUR</strong></td>
        <td class="gnw_colhead">
            <strong>RUR</strong></td>
        <td class="gnw_colhead">
            <strong>$</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            <strong>&nbsp;</strong></td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Revenues
        </td>
        <td class="gnw_num">
            39,502
        </td>
        <td class="gnw_num">
            50,767
        </td>
        <td class="gnw_num">
            902.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Operating costs and expenses:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Cost of revenues<sup>(1)</sup></td>
        <td class="gnw_num">
            10,606
        </td>
        <td class="gnw_num">
            14,336
        </td>
        <td class="gnw_num">
            254.8
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Product development<sup>(1)&nbsp;</sup></td>
        <td class="gnw_num">
            5,827
        </td>
        <td class="gnw_num">
            8,842
        </td>
        <td class="gnw_num">
            157.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Sales, general and administrative<sup>(1)</sup></td>
        <td class="gnw_num">
            6,537
        </td>
        <td class="gnw_num">
            7,782
        </td>
        <td class="gnw_num">
            138.3
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Depreciation and amortization&nbsp;
        </td>
        <td class="gnw_num_uline">
            3,695
        </td>
        <td class="gnw_num_uline">
            4,484
        </td>
        <td class="gnw_num_uline">
            79.7
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Total operating costs and expenses
        </td>
        <td class="gnw_num_uline">
            26,665
        </td>
        <td class="gnw_num_uline">
            35,444
        </td>
        <td class="gnw_num_uline">
            630.0
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Income from operations
        </td>
        <td class="gnw_num">
            12,837
        </td>
        <td class="gnw_num">
            15,323
        </td>
        <td class="gnw_num">
            272.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Interest income, net
        </td>
        <td class="gnw_num">
            1,717
        </td>
        <td class="gnw_num">
            856
        </td>
        <td class="gnw_num">
            15.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Other income, net
        </td>
        <td class="gnw_num_uline">
            &nbsp;2,159
        </td>
        <td class="gnw_num_uline">
            6,296
        </td>
        <td class="gnw_num_uline">
            111.9
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Net income before income taxes
        </td>
        <td class="gnw_num">
            16,713
        </td>
        <td class="gnw_num">
            22,475
        </td>
        <td class="gnw_num">
            399.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Provision for income taxes
        </td>
        <td class="gnw_num_uline">
            3,239
        </td>
        <td class="gnw_num_uline">
            5,455
        </td>
        <td class="gnw_num_uline">
            97.0
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Net income
        </td>
        <td class="gnw_num_dline">
            13,474
        </td>
        <td class="gnw_num_dline">
            17,020
        </td>
        <td class="gnw_num_dline">
            302.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Net income per Class&nbsp;A and Class&nbsp;B share:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Basic
        </td>
        <td class="gnw_num_dline">
            41.25
        </td>
        <td class="gnw_num_dline">
            53.30
        </td>
        <td class="gnw_num_dline">
            0.95
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Diluted
        </td>
        <td class="gnw_num_dline">
            40.27
        </td>
        <td class="gnw_num_dline">
            52.27
        </td>
        <td class="gnw_num_dline">
            0.93
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Weighted average number of Class A and Class B shares outstanding
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Basic
        </td>
        <td class="gnw_num">
            326,657,778
        </td>
        <td class="gnw_num">
            319,336,782
        </td>
        <td class="gnw_num">
            319,336,782
        </td>
    </tr>
    <tr>
        <td class="gnw_label_i10">
            Diluted
        </td>
        <td class="gnw_num">
            334,571,212
        </td>
        <td class="gnw_num">
            325,610,277
        </td>
        <td class="gnw_num">
            325,610,277
        </td>
    </tr>
    <tr>
        <td class="gnw_label_uline" colspan="4">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label" colspan="4">
            <sup>(1)</sup>These balances exclude depreciation and amortization expenses,
                          which are presented separately, and include share-based
                          compensation expenses of:
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Cost of revenues
        </td>
        <td class="gnw_num">
            61
        </td>
        <td class="gnw_num">
            101
        </td>
        <td class="gnw_num">
            1.8
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Product development
        </td>
        <td class="gnw_num">
            435
        </td>
        <td class="gnw_num">
            780
        </td>
        <td class="gnw_num">
            13.9
        </td>
    </tr>
    <tr>
        <td class="gnw_label gnw_label_i10">
            Sales, general and administrative
        </td>
        <td class="gnw_num">
            258
        </td>
        <td class="gnw_num">
            329
        </td>
        <td class="gnw_num">
            5.8
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label" colspan="4">
            <em>* Derived from audited financial statements</em></td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>

</tbody>
</table>
<p class="text-align-center">
    <strong>YANDEX&nbsp;N.V.</strong>
    <br>
    <strong>Unaudited Condensed Consolidated Statements of Cash Flows</strong>
    <br><br>
    <strong>(in millions of Russian rubles and U.S. dollars)</strong>
</p>
<table cellpadding="0" cellspacing="6" class="gnw_table_long_yandex_old">
<tbody>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Three months ended December&nbsp;31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_colhead">
            <strong>RUR</strong></td>
        <td class="gnw_colhead">
            <strong>RUR</strong></td>
        <td class="gnw_colhead">
            <strong>$</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            CASH FLOWS FROM OPERATING ACTIVITIES:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Net income&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;3,346
        </td>
        <td class="gnw_num">
            &nbsp;7,572
        </td>
        <td class="gnw_num">
            &nbsp;134.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Adjustments to reconcile net income to net cash provided by operating
            activities:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Depreciation and amortization of property and equipment&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;945
        </td>
        <td class="gnw_num">
            &nbsp;1,091
        </td>
        <td class="gnw_num">
            &nbsp;19.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Amortization of acquisition-related intangible assets&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;45
        </td>
        <td class="gnw_num">
            &nbsp;115
        </td>
        <td class="gnw_num">
            &nbsp;2.0
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Amortization of debt discount and issuance costs&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;24
        </td>
        <td class="gnw_num">
            &nbsp;240
        </td>
        <td class="gnw_num">
            &nbsp;4.3
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Share-based compensation expense&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;223
        </td>
        <td class="gnw_num">
            &nbsp;376
        </td>
        <td class="gnw_num">
            &nbsp;6.7
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Deferred income taxes&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;58
        </td>
        <td class="gnw_num">
            &nbsp;136
        </td>
        <td class="gnw_num">
            &nbsp;2.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Foreign exchange gains
        </td>
        <td class="gnw_num">
            &nbsp;(99)
        </td>
        <td class="gnw_num">
            &nbsp;(4,707)
        </td>
        <td class="gnw_num">
            &nbsp;(83.7)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Gain from repurchases of convertible debt
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(548)
        </td>
        <td class="gnw_num">
            &nbsp;(9.7)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Other&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(6)
        </td>
        <td class="gnw_num">
            &nbsp;33
        </td>
        <td class="gnw_num">
            &nbsp;0.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Changes in operating assets and liabilities excluding the effect of
            acquisitions:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Accounts receivable, net&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(450)
        </td>
        <td class="gnw_num">
            &nbsp;(352)
        </td>
        <td class="gnw_num">
            &nbsp;(6.3)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Prepaid expenses and other assets&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(424)
        </td>
        <td class="gnw_num">
            &nbsp;(941)
        </td>
        <td class="gnw_num">
            &nbsp;(16.7)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Accounts payable and accrued liabilities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;920
        </td>
        <td class="gnw_num">
            &nbsp;498
        </td>
        <td class="gnw_num">
            &nbsp;8.8
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Deferred revenue&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;206
        </td>
        <td class="gnw_num_uline">
            &nbsp;212
        </td>
        <td class="gnw_num_uline">
            &nbsp;3.8
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Net cash provided by operating activities&nbsp;
        </td>
        <td class="gnw_num_uline">
            <strong>&nbsp;4,788 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;3,725 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;66.2 </strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            CASH FLOWS PROVIDED BY INVESTING ACTIVITIES:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Purchase of property and equipment&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(1,665)
        </td>
        <td class="gnw_num">
            &nbsp;(2,998)
        </td>
        <td class="gnw_num">
            &nbsp;(53.3)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Proceeds from sale of property and equipment
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;96
        </td>
        <td class="gnw_num">
            &nbsp;1.7
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Acquisitions of businesses, net of cash acquired&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(2,438)
        </td>
        <td class="gnw_num">
            &nbsp;(531)
        </td>
        <td class="gnw_num">
            &nbsp;(9.4)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Investments in non-marketable equity securities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(12)
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Proceeds from maturity of debt securities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;2,668
        </td>
        <td class="gnw_num">
            &nbsp;575
        </td>
        <td class="gnw_num">
            &nbsp;10.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Investments in term deposits&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(935)
        </td>
        <td class="gnw_num">
            &nbsp;(16.6)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Maturities of term deposits&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;2,620
        </td>
        <td class="gnw_num">
            &nbsp;5,518
        </td>
        <td class="gnw_num">
            &nbsp;98.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            (Loans granted) / proceeds from repayments of loans granted
        </td>
        <td class="gnw_num">
            &nbsp;(109)
        </td>
        <td class="gnw_num">
            &nbsp;2
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Escrow cash deposit&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;(5)
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Net cash provided by investing activities&nbsp;
        </td>
        <td class="gnw_num_uline">
            <strong>&nbsp;1,059 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;1,727 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;30.7 </strong></td>
    </tr>
    <tr>
        <td class="gnw_label" colspan="2">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label" colspan="2">
            CASH FLOWS PROVIDED BY/(USED IN) FINANCING ACTIVITIES:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Proceeds from exercise of share options&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;61
        </td>
        <td class="gnw_num">
            &nbsp;68
        </td>
        <td class="gnw_num">
            &nbsp;1.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Proceeds from issuance of convertible debt&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;19,719
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Repurchases of convertible debt
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(4,675)
        </td>
        <td class="gnw_num">
            &nbsp;(83.1)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Payment of debt discount and issuance costs&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(179)
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Repurchases of ordinary shares&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;(3,368)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(1,066)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(18.9)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Net cash provided by/(used in) financing activities&nbsp;
        </td>
        <td class="gnw_num_uline">
            <strong>&nbsp;16,233 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;(5,673)</strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;(100.8)</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            Effect of exchange rate changes on cash and cash equivalents&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;(68)
        </td>
        <td class="gnw_num_uline">
            &nbsp;4,947
        </td>
        <td class="gnw_num_uline">
            &nbsp;87.9
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Net change in cash and cash equivalents&nbsp;
        </td>
        <td class="gnw_num_uline">
            <strong>&nbsp;22,012 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;4,726 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;84.0 </strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            Cash and cash equivalents at beginning of period&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;11,382
        </td>
        <td class="gnw_num">
            &nbsp;12,919
        </td>
        <td class="gnw_num">
            &nbsp;229.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Cash and cash equivalents at end of period&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;33,394
        </td>
        <td class="gnw_num">
            &nbsp;17,645
        </td>
        <td class="gnw_num">
            &nbsp;313.6
        </td>
    </tr>

</tbody>
</table>
<p class="text-align-center">
    <strong>YANDEX&nbsp;N.V.</strong>
    <br>
    <strong>Unaudited Condensed Consolidated Statements of Cash Flows</strong>
    <br><br>
    <strong>(in millions of Russian rubles and U.S. dollars)</strong>
</p>
<table cellpadding="0" cellspacing="6" class="gnw_table_long_yandex_old">
<tbody>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months ended December&nbsp;31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_colhead_uline">
            <strong>2013*</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_colhead">
            <strong>RUR</strong></td>
        <td class="gnw_colhead">
            <strong>RUR</strong></td>
        <td class="gnw_colhead">
            <strong>$</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            CASH FLOWS FROM OPERATING ACTIVITIES:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Net income&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;13,474
        </td>
        <td class="gnw_num">
            &nbsp;17,020
        </td>
        <td class="gnw_num">
            &nbsp;302.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Adjustments to reconcile net income to net cash provided by operating
            activities:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Depreciation and amortization of property and equipment&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;3,584
        </td>
        <td class="gnw_num">
            &nbsp;4,242
        </td>
        <td class="gnw_num">
            &nbsp;75.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Amortization of acquisition-related intangible assets&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;111
        </td>
        <td class="gnw_num">
            &nbsp;242
        </td>
        <td class="gnw_num">
            &nbsp;4.3
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Amortization of debt discount and issuance costs&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;24
        </td>
        <td class="gnw_num">
            &nbsp;811
        </td>
        <td class="gnw_num">
            &nbsp;14.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Share-based compensation expense&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;754
        </td>
        <td class="gnw_num">
            &nbsp;1,210
        </td>
        <td class="gnw_num">
            &nbsp;21.5
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Deferred income taxes&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(197)
        </td>
        <td class="gnw_num">
            &nbsp;115
        </td>
        <td class="gnw_num">
            &nbsp;2.0
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Foreign exchange gains
        </td>
        <td class="gnw_num">
            &nbsp;(139)
        </td>
        <td class="gnw_num">
            &nbsp;(6,553)
        </td>
        <td class="gnw_num">
            &nbsp;(116.5)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Gain from sale of equity securities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(2,137)
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Impairment of investment in equity securities
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;700
        </td>
        <td class="gnw_num">
            &nbsp;12.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Gain from repurchases of convertible debt
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(548)
        </td>
        <td class="gnw_num">
            &nbsp;(9.7)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Other&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(28)
        </td>
        <td class="gnw_num">
            &nbsp;38
        </td>
        <td class="gnw_num">
            &nbsp;0.7
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Changes in operating assets and liabilities excluding the effect of
            acquisitions:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Accounts receivable, net&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(966)
        </td>
        <td class="gnw_num">
            &nbsp;(714)
        </td>
        <td class="gnw_num">
            &nbsp;(12.7)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Prepaid expenses and other assets&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(1,301)
        </td>
        <td class="gnw_num">
            &nbsp;(3,069)
        </td>
        <td class="gnw_num">
            &nbsp;(54.6)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Accounts payable and accrued liabilities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;1,195
        </td>
        <td class="gnw_num">
            &nbsp;1,817
        </td>
        <td class="gnw_num">
            &nbsp;32.4
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Deferred revenue&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;401
        </td>
        <td class="gnw_num">
            &nbsp;235
        </td>
        <td class="gnw_num">
            &nbsp;4.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Assets held for sale&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(156)
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Liabilities related to assets held for sale&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;86
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Net cash provided by operating activities&nbsp;
        </td>
        <td class="gnw_num_uline">
            <strong>&nbsp;14,705 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;15,546 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;276.3 </strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            CASH FLOWS USED IN INVESTING ACTIVITIES:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Purchase of property and equipment&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(4,936)
        </td>
        <td class="gnw_num">
            &nbsp;(9,679)
        </td>
        <td class="gnw_num">
            &nbsp;(172.0)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Proceeds from sale of property and equipment
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;132
        </td>
        <td class="gnw_num">
            &nbsp;2.3
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Acquisitions of businesses, net of cash acquired&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(2,438)
        </td>
        <td class="gnw_num">
            &nbsp;(6,360)
        </td>
        <td class="gnw_num">
            &nbsp;(113.0)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Investments in non-marketable equity securities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(14)
        </td>
        <td class="gnw_num">
            &nbsp;(45)
        </td>
        <td class="gnw_num">
            &nbsp;(0.8)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Proceeds from sale of equity securities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;2,023
        </td>
        <td class="gnw_num">
            &nbsp;120
        </td>
        <td class="gnw_num">
            &nbsp;2.1
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Investments in debt securities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(2,546)
        </td>
        <td class="gnw_num">
            &nbsp;(45.3)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Proceeds from maturity of debt securities&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;4,969
        </td>
        <td class="gnw_num">
            &nbsp;575
        </td>
        <td class="gnw_num">
            &nbsp;10.2
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Investments in term deposits&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(11,450)
        </td>
        <td class="gnw_num">
            &nbsp;(17,157)
        </td>
        <td class="gnw_num">
            &nbsp;(304.9)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Maturities of term deposits&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;11,290
        </td>
        <td class="gnw_num">
            &nbsp;7,234
        </td>
        <td class="gnw_num">
            &nbsp;128.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Loans granted
        </td>
        <td class="gnw_num">
            &nbsp;(279)
        </td>
        <td class="gnw_num">
            &nbsp;(207)
        </td>
        <td class="gnw_num">
            &nbsp;(3.7)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Escrow cash deposit&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;125
        </td>
        <td class="gnw_num_uline">
            &nbsp;(656)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(11.7)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Net cash used in investing activities&nbsp;
        </td>
        <td class="gnw_num_uline">
            <strong>&nbsp;(710)</strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;(28,589)</strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;(508.2)</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            CASH FLOWS PROVIDED BY/(USED IN) FINANCING ACTIVITIES:
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Proceeds from exercise of share options&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;439
        </td>
        <td class="gnw_num">
            &nbsp;191
        </td>
        <td class="gnw_num">
            &nbsp;3.3
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Proceeds from issuance of convertible debt&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;19,719
        </td>
        <td class="gnw_num">
            &nbsp;2,981
        </td>
        <td class="gnw_num">
            &nbsp;53.0
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Repurchases of convertible debt
        </td>
        <td class="gnw_num">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(6,414)
        </td>
        <td class="gnw_num">
            &nbsp;(114.0)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Payment of debt discount and issuance costs&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;(179)
        </td>
        <td class="gnw_num">
            &nbsp;(42)
        </td>
        <td class="gnw_num">
            &nbsp;(0.7)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Repurchases of ordinary shares&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;(8,518)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(8,423)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(149.7)
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Net cash provided by/(used in) financing activities&nbsp;
        </td>
        <td class="gnw_num_uline">
            <strong>&nbsp;11,461 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;(11,707)</strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;(208.1)</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            Effect of exchange rate changes on cash and cash equivalents&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;513
        </td>
        <td class="gnw_num_uline">
            &nbsp;9,001
        </td>
        <td class="gnw_num_uline">
            &nbsp;160.0
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Net change in cash and cash equivalents&nbsp;
        </td>
        <td class="gnw_num_uline">
            <strong>&nbsp;25,969 </strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;(15,749)</strong></td>
        <td class="gnw_num_uline">
            <strong>&nbsp;(280.0)</strong></td>
    </tr>
    <tr>
        <td class="gnw_label">
            Cash and cash equivalents at beginning of period&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;7,425
        </td>
        <td class="gnw_num">
            &nbsp;33,394
        </td>
        <td class="gnw_num">
            &nbsp;593.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            Cash and cash equivalents at end of period&nbsp;
        </td>
        <td class="gnw_num">
            &nbsp;33,394
        </td>
        <td class="gnw_num">
            &nbsp;17,645
        </td>
        <td class="gnw_num">
            &nbsp;313.6
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
    <tr>
        <td class="gnw_label" colspan="4">
            <em>* Derived from audited financial statements</em></td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>

</tbody>
</table>

<p class="text-align-center">
    <strong>YANDEX&nbsp;N.V.</strong>
    <br>
    <strong>RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES</strong>
    <br>
    <strong>TO THE NEAREST COMPARABLE US GAAP MEASURES</strong>
    <br>
    <br>
    <strong>Reconciliation of Ex-TAC Revenues to US GAAP Revenues</strong>
</p>
<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">
<tbody>
    <tr>
            <td class="gnw_label_uline" style="border-bottom: none;">
            <em><strong>In RUR millions</strong></em></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Three months <br>
                    ended December 31,</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months <br>
                    ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Total revenues
        </td>
        <td class="gnw_num_uline">
            12,086
        </td>
        <td class="gnw_num_uline">
            14,667
        </td>
        <td class="gnw_num_uline">
            <em>21%</em></td>
        <td class="gnw_num_uline">
            39,502
        </td>
        <td class="gnw_num_uline">
            50,767
        </td>
        <td class="gnw_num_uline">
            <em>29%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Less: </em>traffic acquisition costs (TAC)
        </td>
        <td class="gnw_num_uline">
            2,828
        </td>
        <td class="gnw_num_uline">
            3,095
        </td>
        <td class="gnw_num_uline">
            <em>9%</em></td>
        <td class="gnw_num_uline">
            7,850
        </td>
        <td class="gnw_num_uline">
            11,076
        </td>
        <td class="gnw_num_uline">
            <em>41%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Ex-TAC revenues
        </td>
        <td class="gnw_num_uline">
            9,258
        </td>
        <td class="gnw_num_uline">
            11,572
        </td>
        <td class="gnw_num_uline">
            <em>25%</em></td>
        <td class="gnw_num_uline">
            31,652
        </td>
        <td class="gnw_num_uline">
            39,691
        </td>
        <td class="gnw_num_uline">
            <em>25%</em></td>
    </tr>
</tbody>
</table>

<p class="text-align-center">
    <strong>Reconciliation of Adjusted EBITDA to US GAAP Net Income</strong>
</p>
<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">
<tbody>
    <tr>
            <td class="gnw_label_uline" style="border-bottom: none;">
            <em><strong>In RUR millions</strong></em></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Three months <br>
                    ended December 31,</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months <br>
                    ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Net income
        </td>
        <td class="gnw_num_uline">
            &nbsp;3,346
        </td>
        <td class="gnw_num_uline">
            &nbsp;7,572
        </td>
        <td class="gnw_num_uline">
            <em>126%</em></td>
        <td class="gnw_num_uline">
            &nbsp;13,474
        </td>
        <td class="gnw_num_uline">
            &nbsp;17,020
        </td>
        <td class="gnw_num_uline">
            <em>26%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Add: </em>depreciation and amortization
        </td>
        <td class="gnw_num_uline">
            &nbsp;990
        </td>
        <td class="gnw_num_uline">
            &nbsp;1,206
        </td>
        <td class="gnw_num_uline">
            <em>22%</em></td>
        <td class="gnw_num_uline">
            &nbsp;3,695
        </td>
        <td class="gnw_num_uline">
            &nbsp;4,484
        </td>
        <td class="gnw_num_uline">
            <em>21%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Add: </em>share-based compensation expense
        </td>
        <td class="gnw_num_uline">
            &nbsp;223
        </td>
        <td class="gnw_num_uline">
            &nbsp;376
        </td>
        <td class="gnw_num_uline">
            <em>69%</em></td>
        <td class="gnw_num_uline">
            &nbsp;754
        </td>
        <td class="gnw_num_uline">
            &nbsp;1,210
        </td>
        <td class="gnw_num_uline">
            <em>60%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Add: </em>compensation expense related to contingent consideration
        </td>
        <td class="gnw_num_uline">
            &nbsp;14
        </td>
        <td class="gnw_num_uline">
            &nbsp;18
        </td>
        <td class="gnw_num_uline">
            <em>29%</em></td>
        <td class="gnw_num_uline">
            &nbsp;81
        </td>
        <td class="gnw_num_uline">
            &nbsp;35
        </td>
        <td class="gnw_num_uline">
            <em>-57%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Less: </em>interest income, net
        </td>
        <td class="gnw_num_uline">
            &nbsp;(414)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(257)
        </td>
        <td class="gnw_num_uline">
            <em>-38%</em></td>
        <td class="gnw_num_uline">
            &nbsp;(1,717)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(856)
        </td>
        <td class="gnw_num_uline">
            <em>-50%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Less:</em> other income, net
        </td>
        <td class="gnw_num_uline">
            &nbsp;(94)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(5,175)
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            &nbsp;(2,159)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(6,296)
        </td>
        <td class="gnw_num_uline">
            <em>192%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Add: </em>provision for income taxes
        </td>
        <td class="gnw_num_uline">
            &nbsp;1,083
        </td>
        <td class="gnw_num_uline">
            &nbsp;2,338
        </td>
        <td class="gnw_num_uline">
            <em>116%</em></td>
        <td class="gnw_num_uline">
            &nbsp;3,239
        </td>
        <td class="gnw_num_uline">
            &nbsp;5,455
        </td>
        <td class="gnw_num_uline">
            <em>68%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Adjusted EBITDA
        </td>
        <td class="gnw_num_uline">
            &nbsp;5,148
        </td>
        <td class="gnw_num_uline">
            &nbsp;6,078
        </td>
        <td class="gnw_num_uline">
            <em>18%</em></td>
        <td class="gnw_num_uline">
            &nbsp;17,367
        </td>
        <td class="gnw_num_uline">
            &nbsp;21,052
        </td>
        <td class="gnw_num_uline">
            <em>21%</em></td>
    </tr>
</tbody>
</table>

<p class="text-align-center">
    <strong>Reconciliation of Adjusted Net Income to US GAAP Net Income</strong>
</p>
<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">
<tbody>
    <tr>
            <td class="gnw_label_uline" style="border-bottom: none;">
            <em><strong>In RUR millions</strong></em></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Three months <br>
                    ended December 31,</strong></td>
        <td class="gnw_colhead_uline" colspan="3">
            <strong>Twelve months <br>
                    ended December 31,</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <strong>&nbsp;</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
        <td class="gnw_colhead_uline">
            <strong>2013</strong></td>
        <td class="gnw_colhead_uline">
            <strong>2014</strong></td>
        <td class="gnw_colhead_uline">
            <em>Change</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Net income
        </td>
        <td class="gnw_num_uline">
            &nbsp;3,346
        </td>
        <td class="gnw_num_uline">
            &nbsp;7,572
        </td>
        <td class="gnw_num_uline">
            <em>126%</em></td>
        <td class="gnw_num_uline">
            &nbsp;13,474
        </td>
        <td class="gnw_num_uline">
            &nbsp;17,020
        </td>
        <td class="gnw_num_uline">
            <em>26%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Add: </em>SBC expense
        </td>
        <td class="gnw_num_uline">
            &nbsp;223
        </td>
        <td class="gnw_num_uline">
            &nbsp;376
        </td>
        <td class="gnw_num_uline">
            <em>69%</em></td>
        <td class="gnw_num_uline">
            &nbsp;754
        </td>
        <td class="gnw_num_uline">
            &nbsp;1,210
        </td>
        <td class="gnw_num_uline">
            <em>60%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Less: </em>reduction in income tax attributable to SBC expense
        </td>
        <td class="gnw_num_uline">
            &nbsp;(3)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(5)
        </td>
        <td class="gnw_num_uline">
            <em>67%</em></td>
        <td class="gnw_num_uline">
            &nbsp;(9)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(20)
        </td>
        <td class="gnw_num_uline">
            <em>122%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Add: </em>compensation expense related to contingent consideration
        </td>
        <td class="gnw_num_uline">
            &nbsp;14
        </td>
        <td class="gnw_num_uline">
            &nbsp;18
        </td>
        <td class="gnw_num_uline">
            <em>29%</em></td>
        <td class="gnw_num_uline">
            &nbsp;81
        </td>
        <td class="gnw_num_uline">
            &nbsp;35
        </td>
        <td class="gnw_num_uline">
            <em>-57%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Less: </em>foreign exchange gain
        </td>
        <td class="gnw_num_uline">
            &nbsp;(99)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(4,707)
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            &nbsp;(139)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(6,553)
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Add:</em> increase in income tax attributable to foreign exchange gain
        </td>
        <td class="gnw_num_uline">
            &nbsp;20
        </td>
        <td class="gnw_num_uline">
            &nbsp;937
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            &nbsp;28
        </td>
        <td class="gnw_num_uline">
            &nbsp;1,324
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Add: </em>impairment of investment in equity securities
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;700
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Less: </em>reduction in income tax attributable to impairment of
                           investment in equity securities
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;(175)
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Less: </em>gain from sale and deconsolidation of equity investments
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            &nbsp;(2,067)
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            <em>-100%</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Less: </em>gain from repurchases of convertible debt
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;(548)
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;(548)
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Add: </em>increase in income tax attributable to gain from repurchases
                          of convertible debt
        </td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;137
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            &nbsp;--&nbsp;
        </td>
        <td class="gnw_num_uline">
            &nbsp;137
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Add: </em>amortization of debt discount
        </td>
        <td class="gnw_num_uline">
            &nbsp;24
        </td>
        <td class="gnw_num_uline">
            &nbsp;243
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            &nbsp;24
        </td>
        <td class="gnw_num_uline">
            &nbsp;811
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Less: </em>reduction in income tax attributable to amortization of debt
                           discount
        </td>
        <td class="gnw_num_uline">
            &nbsp;(6)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(56)
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
        <td class="gnw_num_uline">
            &nbsp;(6)
        </td>
        <td class="gnw_num_uline">
            &nbsp;(190)
        </td>
        <td class="gnw_num_uline">
            <em>n/m</em></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            <em>Adjusted net income</em></td>
        <td class="gnw_num_uline">
            &nbsp;3,519
        </td>
        <td class="gnw_num_uline">
            &nbsp;3,967
        </td>
        <td class="gnw_num_uline">
            <em>13%</em></td>
        <td class="gnw_num_uline">
            &nbsp;12,140
        </td>
        <td class="gnw_num_uline">
            &nbsp;13,751
        </td>
        <td class="gnw_num_uline">
            <em>13%</em></td>
    </tr>
</tbody>
</table>

<p class="text-align-center">
    <strong>Reconciliation of Adjusted EBITDA Margin and Adjusted Ex-TAC EBITDA
                                                        Margin to US GAAP Net Income Margin</strong>
</p>

<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">
<tbody>
    <tr>
        <td class="gnw_label_uline">
            <em><strong>In RUR millions&nbsp;</strong></em></td>
        <td class="gnw_label" colspan="6">
            <strong>&nbsp;</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_colhead_uline">
            <strong>US GAAP <br>
                    Actual Net <br>
                    Income</strong></td>
        <td class="gnw_colhead_uline">
            <strong>Net Income <br>
                    Margin (1)</strong></td>
        <td class="gnw_colhead_uline">
            <strong>Adjustment (2)</strong></td>
        <td class="gnw_colhead_uline">
            <strong>Adjusted <br>
                    EBITDA</strong></td>
        <td class="gnw_colhead_uline">
            <strong>Adjusted <br>
                    EBITDA <br>
                    Margin (3)</strong></td>
        <td class="gnw_colhead_uline">
            <strong>Adjusted Ex-<br>
                    TAC <br>
                    EBITDA <br>
                    Margin (4)</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Three months ended December 31, 2014
        </td>
        <td class="gnw_num_uline">
            &nbsp;7,572
        </td>
        <td class="gnw_num_uline">
            51.6%
        </td>
        <td class="gnw_num_uline">
            &nbsp;(1,494)
        </td>
        <td class="gnw_num_uline">
            &nbsp;6,078
        </td>
        <td class="gnw_num_uline">
            41.4%
        </td>
        <td class="gnw_num_uline">
            52.5%
        </td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Twelve months ended December 31, 2014
        </td>
        <td class="gnw_num_uline">
            &nbsp;17,020
        </td>
        <td class="gnw_num_uline">
            33.5%
        </td>
        <td class="gnw_num_uline">
            &nbsp;4,032
        </td>
        <td class="gnw_num_uline">
            &nbsp;21,052
        </td>
        <td class="gnw_num_uline">
            41.5%
        </td>
        <td class="gnw_num_uline">
            53.0%
        </td>
    </tr>
    <tr>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
        <td class="gnw_label">
            &nbsp;
        </td>
    </tr>
</tbody>
</table>
<span>
    (1)<sup>&nbsp;</sup> Net income margin is defined as net income divided by
    total revenues.
<br>
    (2)&nbsp; Adjusted to eliminate depreciation and amortization expense, SBC
    expense, expense related to contingent compensation, interest income, net,
    other (expense)/income, net, and provision&nbsp;for income taxes. For a
    reconciliation of adjusted EBITDA to net income, please see the table above.
    <br>
    (3)&nbsp; Adjusted EBITDA margin is defined as adjusted EBITDA divided by
    total revenues.&nbsp;
    <br>
    (4)&nbsp; Adjusted ex-TAC EBITDA margin is defined as adjusted EBITDA
    divided by ex-TAC revenues.&nbsp;For a reconciliation of ex-TAC revenues to
    GAAP revenues, please see the table above.&nbsp;
</span>
<br>
<br>

<p class="text-align-center">
    <strong>Reconciliation of Adjusted Net Income Margin and Adjusted Ex-TAC Net
                                                        Income Margin to US GAAP Net Income Margin</strong>
</p>

<table cellpadding="0" cellspacing="6" class="gnw_table_yandex_old">
<tbody>
    <tr>
        <td class="gnw_label_uline">
            <em><strong>In RUR millions&nbsp;</strong></em></td>
        <td class="gnw_label" colspan="6">
            <strong>&nbsp;</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            &nbsp;
        </td>
        <td class="gnw_colhead_uline">
            <strong>US GAAP <br>
                    Actual Net <br>
                    Income</strong></td>
        <td class="gnw_colhead_uline">
            <strong>Net Income <br>
                    Margin (1)</strong></td>
        <td class="gnw_colhead_uline">
            <strong>Adjustment (2)</strong></td>
        <td class="gnw_colhead_uline">
            <strong>Adjusted <br>
                    Net Income</strong></td>
        <td class="gnw_colhead_uline">
            <strong>Adjusted <br>
                    Net Income <br>
                    Margin (3)</strong></td>
        <td class="gnw_colhead_uline">
            <strong>Adjusted Ex-<br>
                    TAC Net <br>
                    Income <br>
                    Margin (4)</strong></td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Three months ended December 31, 2014
        </td>
        <td class="gnw_num_uline">
            &nbsp;7,572
        </td>
        <td class="gnw_num_uline">
            51.6%
        </td>
        <td class="gnw_num_uline">
            &nbsp;(3,605)
        </td>
        <td class="gnw_num_uline">
            &nbsp;3,967
        </td>
        <td class="gnw_num_uline">
            27.0%
        </td>
        <td class="gnw_num_uline">
            34.3%
        </td>
    </tr>
    <tr>
        <td class="gnw_label_uline">
            Twelve months ended December 31, 2014
        </td>
        <td class="gnw_num_uline">
            &nbsp;17,020
        </td>
        <td class="gnw_num_uline">
            33.5%
        </td>
        <td class="gnw_num_uline">
            &nbsp;(3,269)
        </td>
        <td class="gnw_num_uline">
            &nbsp;13,751
        </td>
        <td class="gnw_num_uline">
            27.1%
        </td>
        <td class="gnw_num_uline">
            34.6%
        </td>
    </tr>
</tbody>
</table>
<span>
    (1)&nbsp; Net income margin is defined as net income divided by total
    revenues.
<br>
    (2)&nbsp; Adjusted to eliminate SBC expense (as adjusted for the income tax
    reduction attributable to SBC expense), expense related to contingent
    compensation, foreign exchange gain (as adjusted for&nbsp;the reduction in
    income tax attributable to the gain), impairment of investment (as adjusted
    for reduction in income tax attributable to impairment of investment in
    equity securities), gain from&nbsp;sale and deconsolidation of equity
    investments, gain from repurchases of convertible debt and amortization of
    debt discount (as adjusted for the reduction in income tax attributable to
    the expense).&nbsp;For a reconciliation of adjusted net income to net
    income, please see the table above.
    <br>
    (3)&nbsp; Adjusted net income margin is defined as adjusted net income
    divided by total revenues.&nbsp;
    <br>
    (4)&nbsp; Adjusted ex-TAC net income margin is defined as adjusted net
    income divided by ex-TAC revenues.&nbsp;For a reconciliation of ex-TAC
    revenues to US GAAP revenues, please see the table above.&nbsp;
</span>
<br><br>
<p>Investor Relations<br>
   Katya Zhukova<br>
   Phone: +7 495 974-35-38<br>
   E-mail: askIR@yandex-team.ru<br><br>

   Media Relations <br>
   Ochir Mandzhikov, Vladimir Isaev <br>
   Phone: +7 495 739-70-00<br>
   E-mail: pr@yandex-team.ru</p>
