Blue Nile 8-K/A Results of Operations and Financial Condition

Exhibit 99.2

BLUE NILE, INC.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)

	Year to date ended
	July 1,			July 2,
	2007			2006
Operating activities:
Net income	$	6,944		$	5,487
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization		776			952
(Gain) loss on disposal of fixed assets		(6	)		2
Stock-based compensation		2,723			1,859
Deferred income taxes		(563	)		2,009
Tax benefit from exercise of stock options		2,974			592
Excess tax benefit from exercise of stock options		(320	)		(34	)
Changes in assets and liabilities:
Receivables, net		62			1,056
Inventories		(53	)		553
Prepaid federal income taxes		(1,596	)		—
Other prepaid expenses and assets		(246	)		57
Accounts payable		(24,124	)		(22,475	)
Accrued liabilities		(3,134	)		(1,919	)
Deferred rent		(95	)		(118	)
Net cash used in operating activities		(16,658	)		(11,979	)
Investing activities:
Purchases of property and equipment		(2,066	)		(1,182	)
Proceeds from the sale of property and equipment		8			1
Purchases of marketable securities		(20,230	)		(25,195	)
Proceeds from the maturity of marketable securities		40,000			53,000
Transfers of restricted cash		120			—
Net cash provided by investing activities		17,832			26,624
Financing activities:
Repurchase of common stock		(13,532	)		(46,370	)
Proceeds from stock option exercises		2,668			1,087
Excess tax benefit from exercise of stock options		320			34
Net cash used in financing activities		(10,544	)		(45,249	)
Effect of exchange rate changes on cash and cash equivalents		(5	)		—
Net decrease in cash and cash equivalents		(9,375	)		(30,604	)
Cash and cash equivalents, beginning of period		78,540			71,921
Cash and cash equivalents, end of period	$	69,165		$	41,317