Company Press Release

Boston, MA—Eaton Vance reported earnings per diluted share of $0.40 in the third quarter of fiscal 2008 compared to earnings per diluted share of $0.41 in the third quarter of fiscal 2007. Net inflows of $5.8 billion in the third quarter of fiscal 2008 compare to net inflows of $4.2 billion, or $2.9 billion excluding closed-end fund flows, in the third quarter of fiscal 2007 and net inflows of $4.9 billion in the second quarter of fiscal 2008. Assets under management on July 31, 2008 were $155.8 billion, a decrease of $3.3 billion, or 2 percent, from April 30, 2008 as net inflows in the quarter were more than offset by market value declines of managed assets related to weak equity and credit markets.

The Company earned $1.28 per diluted share in the first nine months of fiscal 2008 compared to earnings of $0.60 per diluted share in the first nine months of fiscal 2007. Net inflows of $14.4 billion in the first nine months of fiscal 2008 compare to net inflows of $20.7 billion, or $10.8 billion excluding closed-end fund flows, in the first nine months of fiscal 2007.

“The fiscal quarter’s net inflows of $5.8 billion represent an annualized internal growth rate of 15%, one of the highest growth rates in recent Company history,” said Thomas E. Faust Jr., Chairman and Chief Executive Officer. “Attaining this level of growth in today’s challenging market environment speaks to the strength of our investment teams and the success of ongoing initiatives to enhance our distribution and service capabilities. Strong internal growth positions the Company for higher levels of financial performance as markets stabilize.”

Assets under management increased $3.5 billion, or 2 percent, to $155.8 billion on July 31, 2008 from $152.3 billion on July 31, 2007, a period in which the S&P 500 Index was down 13 percent. The growth in assets under management over the past twelve months reflects long-term fund and separate account net inflows of $16.6 billion offset by net price declines of managed assets of $13.0 billion. Gross sales and other inflows into long-term funds and separate accounts during the twelve months ended July 31, 2008 totaled $43.4 billion.

Third Quarter Highlights

Gross sales and other inflows into long-term funds and separate accounts increased 4 percent to $11.8 billion in the third quarter of fiscal 2008 from $11.4 billion in the third quarter of fiscal 2007. Excluding the $1.3 billion in closed-end fund inflows in the third quarter of fiscal 2007, gross inflows in the third quarter of fiscal 2008 increased by 17 percent over the prior period. Open-end fund net inflows increased 55 percent to $3.1 billion in the third quarter of fiscal 2008 from $2.0 billion a year earlier, reflecting a $1.5 billion increase in equity fund net inflows and a $0.6 billion decrease in fixed income fund net inflows. Retail managed account net inflows increased 33 percent to $1.6 billion in the third quarter of fiscal 2008 from $1.2 billion in the same period last fiscal year. The increase reflects continued strong net sales of Parametric Portfolio Associates’ overlay and tax-efficient core equity products and Eaton Vance Management’s large-cap value product. Institutional and high-net-worth separate account net inflows were $1.2 billion in the third quarter of fiscal 2008 compared to net outflows of $0.2 billion in the third quarter of fiscal 2007, primarily reflecting inflows to Parametric Portfolio Associates and Eaton Vance Management. Tables 1-4 summarize the Company’s assets under management and asset flows by investment category.

In evaluating operating performance, the Company considers operating income and net income, which are calculated on a basis consistent with accounting principles generally accepted in the United States of America (“GAAP”), as well as adjusted operating income, a non-GAAP performance measure. Adjusted operating income is defined as operating income plus closed-end fund structuring fees and one-time payments, stock-based compensation and the write-off of any intangible assets associated with the Company’s acquisitions. The Company believes that adjusted operating income is a key indicator of the Company’s ongoing profitability and therefore uses this measure as the basis for calculating performance-based management incentives. Adjusted operating income is not, and should not be construed to be, a substitute for operating income computed in accordance with GAAP. However, in assessing the performance of the business, management and the Board of Directors look at adjusted operating income as a measure of underlying performance, since amounts resulting from one-time events (e.g., the offering of a closed-end fund) do not necessarily represent normal results of operations. In addition, when assessing performance, management and the Board look at performance both with and without stock-based compensation.

Adjusted operating income decreased 9 percent to $101.8 million in the third quarter of fiscal 2008 from $112.3 million in the third quarter of fiscal 2007.

Revenue in the third quarter of fiscal 2008 decreased $4.1 million, or 1 percent, to $282.8 million from revenue of $286.9 million in the third quarter of fiscal 2007. Investment advisory and administration fees increased 3 percent to $211.3 million, reflecting a 4 percent increase in average assets under management. Distribution and underwriter fees decreased 19 percent due to a decrease in average fund assets that pay these fees. Service fee revenue decreased 1 percent due to a decrease in average fund assets subject to service fees. Other revenue declined in the third quarter of fiscal 2008 due to realized and unrealized losses incurred on securities held in the portfolios of consolidated funds.

Operating expenses in the third quarter of fiscal 2008 decreased 4 percent to $190.7 million compared to operating expenses of $198.1 million in the third quarter of fiscal 2007 due to one-time distribution expenses in the third quarter of fiscal 2007 of $14.8 million, or approximately $0.07 per diluted share. These expenses consisted of structuring fee payments of $12.6 million and sales-based compensation of $2.2 million incurred in connection with closed-end fund sales during the period. Excluding one-time distribution expenses, operating expenses increased by 4 percent in the third quarter of fiscal 2008 compared to the third quarter of fiscal 2007.

Compensation expense remained flat in the third quarter of fiscal 2008 compared to the third quarter of fiscal 2007, as increases in employee headcount and base salary and benefit costs were offset by reduced bonus accruals and lower sales-based incentives and stock-based compensation. Distribution expense decreased 32 percent in the third quarter of fiscal 2008 over the same period a year earlier, reflecting the closed-end fund structuring fee payments in the third quarter of fiscal 2007 described in the previous paragraph. Excluding these payments, distribution expense decreased 5 percent in the third quarter of fiscal 2008 compared to the same period a year earlier due primarily to a decrease in commissions paid on certain sales of Class A shares. Service fee expense increased 6 percent, in line with the increase in assets over one year old subject to service fees. Fund expenses increased 19 percent due to growth in fund assets for which the Company employs and pays a subadvisor. Other expenses increased 31 percent, primarily due to increases in information technology and facilities expenses related to the Company’s pending move to a new headquarters in downtown Boston.

Despite higher average cash and short-term investment balances in the third quarter of fiscal 2008 compared to the third quarter of fiscal 2007, interest income decreased 11 percent due to a lower effective interest rate earned on cash and short-term investments. Interest expense in the third quarter of fiscal 2008 increased $8.4 million from the third quarter of fiscal 2007 due to the debt offering completed in the fourth quarter of fiscal 2007. The Company’s effective tax rate, calculated as a percentage of income before minority interest and equity in net income of affiliates, was 40.5 percent and 38.8 percent in the third quarter of fiscal 2008 and fiscal 2007, respectively.

Net income in the third quarter of fiscal 2008 was $49.6 million compared to $55.8 million in the third quarter of fiscal 2007.

Nine Month Highlights

Revenue in the first nine months of fiscal 2008 increased $55.7 million, or 7 percent, to $846.0 million compared to revenue in the first nine months of fiscal 2007 of $790.3 million. Investment advisory and administration fees increased 11 percent to $623.7 million, reflecting a 10 percent increase in average assets under management and a higher effective management fee rate. Distribution and underwriter fees decreased 9 percent due to a decrease in average fund assets that pay these fees. Service fee revenue increased 4 percent due to the increase in average fund assets that pay service fees. The decrease in other revenue in the first nine months of fiscal 2008 can be attributed primarily to realized and unrealized losses on securities held in the portfolios of consolidated funds.

Operating expenses in the first nine months of fiscal 2008 decreased 16 percent to $558.6 million compared to operating expenses of $663.1 million in the first nine months of fiscal 2007, largely due to one-time distribution expenses in the first nine months of fiscal 2007 of $143.0 million, or $0.65 per diluted share. These expenses consisted of structuring fee payments of $76.0 million and sales-based compensation of $14.8 million incurred in connection with $9.9 billion of closed-end fund sales during the first nine months of fiscal 2007 and one-time payments of $52.2 million made to terminate the Company’s compensation agreements with Merrill Lynch and AG Edwards related to certain closed-end funds offered in 2007 and prior years. Excluding these one-time distribution-related expenses, operating expenses increased by 7 percent in the first nine months of fiscal 2008 compared to the first nine months of fiscal 2007.

Compensation expense in the first nine months of fiscal 2008 remained flat, as increases in employee headcount, base salaries and higher bonus accruals were offset by lower sales-based incentives in the first nine months of fiscal 2008 compared to the first nine months of fiscal 2007 due to the closed-end fund sales in the prior period. Distribution expense decreased 58 percent in the first nine months of fiscal 2008, reflecting the closed-end fund structuring fees and compensation agreement termination payments in the first nine months of fiscal 2007 described in the previous paragraph. Excluding these payments, distribution expense was flat in the first nine months of fiscal 2008. Service fee expense increased 11 percent, in line with the increase in assets subject to service fees. Fund expenses increased 34 percent due to growth in fund assets for which the Company employs and pays a subadvisor. Other expenses increased 23 percent, primarily due to increases in information technology and facilities expenses.

Interest income in the first nine months of fiscal 2008 increased 36 percent from the first nine months of fiscal 2007 due to an increase in average cash and short-term investment balances. Interest expense in the first nine months of fiscal 2008 increased $25.1 million from the first nine months of fiscal 2007 due to the debt offering completed in the fourth quarter of fiscal 2007. The Company’s effective tax rate, calculated as a percentage of income before minority interest and equity in net income of affiliates, was 39.0 percent and 38.7 percent in the first nine months of fiscal 2008 and fiscal 2007, respectively. Net income in the first nine months of fiscal 2008 was $160.7 million compared to $81.4 million in the first nine months of fiscal 2007.

Cash and cash equivalents and short-term investments decreased to $380.5 million on July 31, 2008 from $485.1 million on October 31, 2007. The Company’s strong operating cash flows in the last twelve months, combined with the proceeds from the debt offering completed in the fourth quarter of fiscal 2007 enabled it to fund $410.8 million in share repurchases and $67.4 million in dividends to shareholders over the period. There were no outstanding borrowings against the Company’s $200.0 million credit facility on July 31, 2008.

During the first nine months of fiscal 2008, the Company repurchased and retired 4.0 million shares of its non-voting common stock at an average price of $42.99 per share under its repurchase authorization. Approximately 3.2 million shares remain of the current 8.0 million share authorization.

Eaton Vance Corp., a Boston-based investment management firm, is traded on the New York Stock Exchange under the symbol EV. Through its subsidiaries, Eaton Vance Corp. manages funds and separate accounts for individual and institutional clients.

This news release contains statements that are not historical facts, referred to as “forward- looking statements.” The Company’s actual future results may differ significantly from those stated in any forward-looking statements, depending on factors such as changes in securities or financial markets or general economic conditions, the volume of sales and repurchases of fund shares, the continuation of investment advisory, administration, distribution and service contracts, and other risks discussed from time to time in the Company’s filings with the Securities and Exchange Commission.