3Com Corrects and Replaces Previous Third Quarter Fiscal 1998 Results.

SANTA CLARA, Calif.--(BUSINESS WIRE)--March 24, 1998--3Com Corporation (Nasdaq:COMS), a leading global data networking company, today reported financial results for its third fiscal quarter, ended March 1, 1998. Sales for the quarter of $1.25 billion increased 4 percent from the previous quarter. Net income of $13.9 million, or $.04 per share, included a net reduction of approximately $9.9 million to merger-related charges associated with the company's acquisition of U.S. Robotics in June 1997. Excluding this adjustment, net income was $7.4 million, or $0.02 per share.

Further, the company also completed its transition to a new channel inventory model, determined late in the second fiscal quarter, that is expected to help increase both the predictability and linearity of sales in addition to simplifying the administration of inventory in global channels. Weeks supply of channel inventories for the company's network interface cards, modems and systems products all are now within the intended range, as illustrated below: -0-

             Desirable On-Hand Channel Inventory

 Major Product Line              Model         End of Q3'98

    NICs                        4-6 weeks         6 weeks
    Modems                      6-8 weeks         7 weeks
    Systems                     5-7 weeks         7 weeks

"Converging on our revised channel inventory model and reducing expenses were our primary objectives this quarter," said Eric Benhamou, 3Com chairman and chief executive officer. "I am pleased we were able to meet both of these goals and still post a modest sequential increase in both sales and earnings. It is now time to focus our operational and marketing expertise on each of our four target markets -- large enterprise, small and medium enterprise, carriers and network service providers, and consumers -- to leverage our global presence, increasing product depth and strong new product cycle."

For the quarter, systems products which include switches, hubs, remote access concentrators, and internetworking platforms, totaled $549.9 million, or 44 percent of total sales. Client access products, which include network interface cards and modems, were $700.3 million, or 56 percent of total sales.

During the quarter, the company announced a series of significant new products and alliances that are expected to accelerate the widespread deployment of voice, video and data applications on converged network infrastructures for customers in all market segments. Please see "Q3 in Review" attachment for further details.

This news release, other than historical financial information, may consist of forward-looking statements that involve risks and uncertainties, including, but not limited to, quarterly fluctuations in results, the timely availability of new products, the impact of competitive products and pricing, and the other risks detailed in the company's SEC reports, including 3Com's Form 10-K for the year ended May 31, 1997 and Form 10-Q/As for the quarters ended August 31 and November 30, 1997; U.S. Robotics' Form 10-Q for the quarter ended March 30, 1997; and the Joint Proxy Statement/Prospectus dated May 8, 1997. Actual results may vary materially.

About 3Com

3Com Corporation enables individuals and organizations worldwide to communicate and share information and resources at anytime from anywhere. As one of the world's preeminent suppliers of data, voice and video communications technology, 3Com has delivered networking solutions to more than 100 million customers worldwide. The company provides large enterprise, small and medium enterprise, carriers and network service providers, and consumers comprehensive, innovative information access products and system solutions for building intelligent, reliable and high performance local and wide area networks. For further information including comments from 3Com's management on today's conference call, visit 3Com's World Wide Web site at http://www.3Com.com or the press site at http//www.3Com.com/pressbox. -0- Note to Editors:

3COM Q3'98 IN REVIEW

Beginning this quarter, 3Com will highlight several significant events that occurred during the reported quarter. Each quarter, these events will be categorized by the market (Corporate Enterprise, Carrier, Small/Medium Enterprise Markets, Consumer) and will typically include strategic alliance updates, significant customer wins, new products and product awards.

Corporate Enterprise-

Alliances:

3Com and Siemens AG expanded their strategic alliance and announced plans to deliver the industry's first stackable networking solutions to meet the market needs of corporate users implementing converged voice/data networks. The new solutions will lower the cost of ownership of voice and data communications systems and will be available this year from both companies.

Also during the third quarter, 3Com entered into a long-term strategic alliance with Newbridge Networks Corporation to cooperate in the development and deployment of end-to-end networks supporting converged voice, video and data applications. The alliance provides enterprise customers with a one-stop-shop for network products and support.

3Com announced its Gigabit Ethernet guarantee program, designed to assure customers deploying 3Com Gigabit Ethernet products today full interoperability with the final IEEE 802.3z standard, presently targeted for final ratification in June 1998.

Products:

3Com announced new hardware and software features for its NETBuilder routers, providing users a migration path to next-generation Intranets and Virtual Private Networks (VPNs) without sacrificing existing network infrastructure.

Customer Wins:

Ericsson, Inc., the Sweden-based telecommunications systems leader, announced that they will standardize a fully switched network in their U.S. Headquarters and Data Center in Richardson,Texas on 3Com's Corebuilder(tm) 3500 layer 3 switches.

Banta Digital Group, a Minneapolis-based division of Banta Corporation and a leading provider of Digital Imaging and Publishing Services chose 3Com for its new ATM network to be deployed at four U.S. facilities enabling the company to deliver graphics-intensive files 15 times faster than their previous network solution.

CellIT, a large Miami-based telecommunications provider, has chosen 3Com ATM and Ethernet network Solutions to deliver their first enterprise-wide, multimedia system for the call center/service bureau industry. The U.S. Call Center industry presently exceeds $4.5 billion and is growing at a projected rate of more than 26 percent per year.

Demonstrating that the trend toward migration to 10/100/1000 networks is accelerating, 3Com announced GMAC Commercial Mortgage Company, Ohio State University's Fisher College of Business, and the SAS Institute are deploying the company's Gigabit Ethernet line of Super Stack products in their production networks.

Product Awards:

Corebuilder(tm) 3500 receives 1997 Hot Product award from DataCommunications Magazine. SuperStack II 9300 switch receives Tester's Choice Award from DataCommunications Magazine.

Carrier Market Highlights-

3Com is the leading provider of remote access concentrators and systems to carrier and network service providers.

Alliances:

3Com and Siemens Public Communications Networks, Munich entered into a joint development agreement that will produce the industry's first combined voice and data central office switching system. The new system designed for enterprise customer needs featuring custom calling services that makes using the Internet and the telephone easier and more cost effective.

USA Global Link, Inc. the world's largest provider of discount international telecommunications services, signed a letter of intent with 3Com to supply network infrastructure products for its worldwide Internet telephony system.

UUNET Technologies, Inc., announced it will offer integrated solutions packages combining leading edge hardware from 3Com.

Products:

3Com announced the addition of Voice over IP capability for its Total Control(tm) Access Concentrator in a move that represents one of the industry's first efforts at combining voice,video,fax,virtual private networking and content all on a single platform. 3Com's Total Control platform is currently the industry leader with 40 percent marketshare, according to a Dell'Oro Group,Q3,1997 report.

Product Awards:

3Com's Total Control(tm) HIPER(tm) access system awarded Data Communications Testers Choice award for delivering the fastest remote access server performance against seven other industry vendors. According to a recent study by Infonetics Research, "3Com dominates the medium business market for LAN products (hubs, switches, LAN routers, and network management tools), with 45% of (small - medium businesses) ... having 3Com equipment installed now." In a recent study of the small business computing market by IDC Link, 3Com was the leading provider of NICs (44.4 percent) and hubs (34.5 percent).

Small/Medium Enterprise Markets-

Alliances:

The Hewlett-Packard Company has joined 3Com's Network Ready Program. 3Com and HP have developed a joint certification process for resellers and distributors to offer server systems pre-configured With a 3Com network interface card already installed allowing HP channel partners to reduce the time s pent on configuration and accelerate the shipment of a 3Com Network Ready(tm) HP server to customers.

3Com is the leading provider of networking solutions for the small to medium sized businesses. The small to medium sized business with 25 to 500 users represents one of the fastest growing segments of the networking industry worldwide.

Products:

At Comnet in January, 3Com introduced the industry's broadest, fully integrated and affordable 10/100/1000 mbps stackable workgroup system of products and the Fast EtherLink XL Network Interface card for small to medium enterprise users. The system features end-to-end management and control for policy-based Networking.

3Com established the Server Networking category with the introduction, this quarter, of a broad standards-based family of high performance server network interface cards for Gigabit Ethernet, Fast Ethernet and Token Ring environments.

Product Awards:

3Com's SuperStack(tm) II Switch 9300 received Data Communications Tester's Choice Award in its February Lab Test of Gigabit Ethernet switches.

Consumer-

3Com connects more people to the Internet from their homes and mobile computing devices than any other networking company.

Alliances:

3Com and Rockwell Semiconductor Systems successfully completed interoperability testing of their respective implementations allowing for 56k interoperability and paving the way for a spur of expected market growth. 3Com also announced a collaboration with Lucent Technologies to ensure compatibility between the two companies modem products.

3Com and QUALCOMM announced that QUALCOMM has licensed the company's industry leading Palm Computing Platform for use in their next generation wireless communication products that will facilitate the use of data applications, e-mail and the Internet in wireless computing environments.

Products:

3Com announced shipment of the industry's first International Telecommunications Union(ITU) standards-based V.90 modems and free software upgrades to the new standard for existing users.

3Com introduced the Palm III(tm) connected organizer, the third generation of its award-winning PalmPilot(tm) products based on the Palm Computing(R) platform.

3Com also shipped, during the quarter, two new combination PC cards, 10Mbps and 10/100 bps with 56K capability. Mobile users are increasingly adopting notebooks as their primary computers making both LAN and modem connectivity essential. Combination PC cards reduce installation time, compatibility issues and cost while leaving the second PC Card slot available for future expansion needs.

3Com introduced the newest version of its Big Picture(tm) video phone system which now includes a video a application, launcher, video phone, software supporting h.324, h.323, multi-party video chat, video e-mail, video capture and editing software. -0-

                        3Com Corporation
                   Consolidated Statements of Income
           (Unaudited. In thousands, except per share data)

                      Three Months Ended         Nine Months Ended
                    March 1,      Feb. 28,      March 1,      Feb. 28,
                     1998          1997          1998          1997

Sales              $1,250,191    $1,462,891   $4,044,896    $4,234,334

Cost of Sales         707,188       725,116    2,183,961     2,175,625

Gross margin          543,003       737,775    1,860,935     2,058,709

Operating expenses:
  Sales and
   marketing          315,174       290,607      955,886       766,244
  Research and
   development        144,237       135,264      432,013       346,645
  General and
   administrative      67,775        63,623      201,905       169,776
  Purchased in-process
   technology           -              -           -            54,000
  Merger-related
   charges (credits)   (9,926)         -         258,632         6,600
Total operating
  expenses            517,260       489,494    1,848,436     1,343,265

Operating income       25,743       248,281       12,499       715,444
Other income
 (expense), net        (4,423)        4,490        6,175        10,300

Income before
 income taxes          21,320       252,771       18,674       725,744
Income tax provision    7,462        73,667       52,028       266,998

Net income (loss)   $  13,858     $ 179,104    $ (33,354)    $ 458,746

Earnings per share
     Basic          $    0.04     $    0.54    $   (0.10)    $    1.39
     Diluted        $    0.04     $    0.50    $   (0.10)    $    1.30
-0-

     Net income for the quarter ended March 1, 1998 includes a pre-tax
credit of approximately $9.9 million ($0.02 per share) associated with
the merger with U.S. Robotics, Inc. (U.S. Robotics). Excluding this
credit, pro forma net income was $7.4 million ($0.02 per share). Net
income for the quarter ended February 28, 1997 included a tax benefit
of approximately $17.9 million ($0.05 per share) associated with U.S.
Robotics' acquisition of Scorpio Communications, Ltd (Scorpio).
Excluding this tax benefit, pro forma net income was $161.2 million
($0.45 per share).

     Net income for the nine months ended March 1, 1998 included a
pre-tax charge of approximately $258.6 million ($0.59 per share)
associated with the merger with U.S. Robotics. Excluding this charge,
pro forma net income was $180.2 million ($0.49 per share). Net income
for the nine months ended February 28, 1997 included a charge of
approximately $54.0 million ($0.15 per share) for purchased in-process
technology associated with U.S. Robotics' acquisition of Scorpio, a
charge of approximately $6.6 million ($0.02 per share) associated with
3Com's acquisition of OnStream Networks, Inc. and a tax benefit of
approximately $17.9 million ($0.05 per share) associated with U.S.
Robotics' acquisition of Scorpio. Excluding these charges and benefit,
pro forma net income was $501.4 million ($1.42 per share).
-0-

                           3Com Corporation
                 Condensed Consolidated Balance Sheets
                      (Unaudited. In thousands.)


                                 March 1, 1998        May 31, 1997
ASSETS
Current Assets:
 Cash and cash equivalents        $   386,028          $   351,237
 Short-term investments               514,892              538,706
 Accounts receivable, net             888,955              996,080
 Inventories, net                     769,815              513,740
 Deferred income taxes                222,503              196,875
  Other                               161,109               93,040
Total current assets                2,943,302            2,689,678

Property and equipment, net           831,353              731,301
Other assets                           96,625              118,804

Total assets                      $ 3,871,280          $ 3,539,783


LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
  Short-term debt                 $        -           $   134,700
  Accounts payable                    406,557              308,581
  Other accrued liabilities           742,042              503,232
  Income taxes payable                 25,174              168,942
Total current liabilities           1,173,773            1,115,455

Long-term obligations                  46,811              170,652
Deferred income taxes                  43,745               25,332

Stockholders' Equity:
  Common stock                      1,593,890            1,183,926
  Retained earnings                 1,016,207            1,049,561
  Unrealized gain on
    investments, net                    1,545                2,320
  Unamortized restricted
    stock grants                       (4,684)              (5,165)
  Accumulated translation
    adjustments                            (7)              (2,298)
Total stockholders' equity          2,606,951            2,228,344

Total liabilities and
stockholders' equity               $3,871,280           $3,539,783

May 31, 1997 amounts have been recombined. 3Com's balance sheet as of
May 31, 1997 has been recombined with U.S. Robotics' balance sheet as
of May 25, 1997.

CONTACT: 3Com

Shirley Stacy, 408/764-6301 (Investor Relations)

[e-mail]

or

Leslie Davis, 408/764-7187 (Public Relations)

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