EXHIBIT 99.1

EXHIBIT 99.1

FOR IMMEDIATE RELEASE

CONTACTS:

Steve Moore Darby Dye Manfred Mueller
Chief Financial Officer Investor Relations - US Investor Relations - Europe
510 360 2300 510 360 2302 +49 89 9595 5140
smoore@scmmicro.com ddye@scmmicro.com mmueller@scmmicro.de


SCM MICROSYSTEMS REPORTS FOURTH QUARTER AND FISCAL 2003 RESULTS

DIVESTED DAZZLE RETAIL BUSINESS AND REFOCUSED COMPANY AROUND SECURITY IN 2003;
INCREASED CASH TO $55 MILLION

FREMONT, CA - FEBRUARY 19, 2004 - SCM Microsystems, Inc. (Nasdaq: SCMM, Prime
Standard: SMY), a leading provider of solutions that open the Digital World,
today announced results for its fiscal fourth quarter and year ended December
31, 2003.

SCM's reported financial performance for the 2003 fourth quarter and
fiscal year reflect continuing operations for the Company's Security business
only, as SCM sold its retail digital media and video business in July of 2003.
SCM's continuing Security business is focused on enabling secure access to
digital content and services through the digital television and PC platforms.
Financial results for the digital media and video business are being treated as
discontinued operations.

FOURTH QUARTER RESULTS

Revenues from continuing operations in the fourth quarter of 2003 were $12.6
million, as communicated by SCM in a preliminary press release on February
3, 2004. This compares with revenues of $23.8 million in the fourth
quarter of 2002. By product segment, fourth quarter 2003 revenues included
$5.4 million from sales of Digital TV security modules, $4.2 million from
sales of smart card readers and other products for PC and network
security, and $3.0 million from sales of flash media reader technology.
Gross margin from continuing operations in the fourth quarter of 2003 was
42%, at the high end of management's previously communicated guidance of
39% to 42%.

Operating expenses for continuing operations for SCM's Security business in the
fourth quarter of 2003, as reported in accordance with GAAP, were $11.3
million. This figure includes amortization of intangibles of $0.3 million
and restructuring and infrequent charges of $2.9 million. Operating loss
for the quarter was $(6.0) million. This compares with operating loss of
$(13.8) million in the year ago

/More...

1
quarter, which included amortization of intangibles of $0.3 million,
impairment of goodwill of $6.6 million and restructuring and infrequent
charges of $5.1 million.

Net loss from continuing operations for SCM's Security business for the fourth
quarter of 2003, as reported in accordance with GAAP, was $(5.0) million,
or $(0.33) per share, compared with net loss of $(15.1) million, or
$(0.97) per share, in the fourth quarter of 2002.

Loss from discontinued operations for SCM's retail digital media and video
business was $(4.3) million in the fourth quarter of 2003, and included
$(3.3) million of loss on sale of discontinued operations and $(1.0)
million of operational loss for the business in the fourth quarter.

Balance Sheet

SCM ended the fourth quarter with cash, cash equivalents and short-term
investments of $55.0 million, a 40% increase over the $39.4 million held at the
end of the previous quarter. As anticipated, the company received approximately
$25 million in cash during the fourth quarter related to the sale of its retail
digital media and video business, which was partially offset by expenses related
to the disposition.

Fiscal 2003 Results

For the year ended December 31, 2003, revenues from continuing operations
for the Company's Security business were $66.5 million, compared with
revenues of $90.1 million for the year ended December 31, 2002. Net loss
from continuing operations for fiscal 2003, as reported in accordance with
GAAP, was $(8.8) million, or $(0.57) per share, compared with net loss of
$(18.7) million, or $(1.20) per share for fiscal 2002.

Commented Robert Schneider, chief executive officer of SCM Microsystems,
"The economic environment remained challenging in 2003. Even so, we accomplished
major objectives to strengthen our strategic position. We successfully disposed
of our low margin, retail digital media and video division and refocused the
Company around our core Security business. Through this transaction, we
significantly increased our cash reserves, while carefully managing transaction
related costs. We restructured our organization to better align resources around
market opportunities in the security space. We are optimistic that these efforts
will begin to yield results beginning in mid-2004, as digital TV projects in
Korea and smart card projects in the U.S. and Europe start to gain momentum."

GUIDANCE

For the first quarter of 2004, management estimates that revenues from its
continuing Security business will be in the range of $12 million to $15 million,
reflecting continued economic pressure in

/More...

2
Europe and the U.S. and a lack of visibility into the timing of known digital
security projects in the U.S. and Europe. Gross margin is expected to be between
40% and 42%. Within this range of revenue and gross margin, SCM expects to
record an operating loss for its continuing Security business in the first
quarter.

CONFERENCE CALL

SCM will hold a conference call and webcast on February 19,
2004 at 8:30 AM Eastern Time to discuss the results of its fiscal
2003 fourth quarter and year. The webcast can be accessed through
the Company's investor relations site at
www.scmmicro.com/ir_en/index.html.

About SCM Microsystems

SCM Microsystems is a leading supplier of solutions that open the Digital World
by enabling people to conveniently access digital content and services. The
company markets and sells its smart card reader technology for network and
physical access and conditional access modules for secure digital TV decryption
to OEM customers in the government, financial, enterprise and broadcasting
markets worldwide. Global headquarters are in Fremont, California, with European
headquarters in Ismaning, Germany. For additional information, visit the SCM
Microsystems web site at www.scmmicro.com.

NOTE: This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934.
These statements are subject to risks and uncertainties which may
cause actual results to differ materially from those contemplated
herein. These include, without limitation, our statements regarding
(i) our expectations for revenue, gross margin and operating loss
for the first quarter; (ii) our expectations that projects planned
by our digital TV and PC security customers will go forward in 2004
as anticipated; and (iii) our expectations that we will realize
benefits from these projects beginning in the middle of 2004 or
ever. Actual results could differ materially. Our financial results
may not meet expectations. Our customers may not go forward with
planned projects that we believe would create demand for our
products, and these projects, even if carried out, may not create
demand for our products or result in the realization of any benefit
to us. We may not successfully execute against our market
opportunities or the identified markets and market opportunities may
grow or develop differently than anticipated or not at all. Other
risks and uncertainties that could cause SCM's actual business and
operating results to differ include, but are not limited to our
ability to manage our business given the greater volatility in sales
and net margins we experience as an OEM Security company; our
ability to grow based on a strategy of participating in multiple
early stage markets; our ability to successfully develop and
introduce new

/More...

3
products that satisfy the evolving and increasingly complex
requirements of customers; the markets in which we participate or
target may not grow, converge or standardize at anticipated rates or
at all; we may not successfully compete in the markets in which we
participate or target; and competitors could take market share or
create pricing pressure. For a discussion of further risks and
uncertainties related to SCM's business, please refer to SCM's
public company reports, including the Report on Form 10-Q for the
quarter ended September 30, 2003, filed with the U.S. Securities and
Exchange Commission.

###

All trade names are trademarks or registered trademarks of their respective
holders.

-- FINANCIALS FOLLOW --

NOTE: The Condensed Consolidated Statements of Operations in this
press release include pro forma operating results that are not in accordance
with GAAP. A reconciliation of the presentation of pro forma results to GAAP is
also provided in this release. As described in the tables, pro forma net
earnings exclude charges related to the amortization of intangible assets,
impairment of goodwill and restructuring, and infrequent charges. We believe pro
forma results allow for SCM and our investors to better evaluate comparable
operating results. Further, our pro forma results are a primary indicator our
management uses to plan and forecast for future periods. These pro forma results
are not intended as a substitute for information presented in accordance with
GAAP. Furthermore, our pro forma information may not be comparable to pro forma
information that other companies provide.

4
SCM MICROSYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)