Airspan Networks Provides Preliminary Third Quarter Results and Updated Financial Outlook; Revenues Improved Sharply and Cash Utilization Decreased.

Business Editors/High-Tech Writers

BOCA RATON, Fla.--(BUSINESS WIRE)--Oct. 1, 2002

Airspan Networks Inc. (Nasdaq:AIRN), a leading worldwide equipment provider of wireless DSL networks, today announced preliminary third quarter revenue results and updated its outlook for the remainder of 2002.

Preliminary unaudited revenues for its third quarter 2002 are expected to be in the range of $9.0 to $9.5 million, a significant percentage increase over second quarter 2002 revenues of $2.6 million and an improvement over the third quarter of 2001. This compares favorably with the analysts' consensus mean estimate of $7.2 million for third quarter revenues. The earnings per share (EPS) figure for the third quarter is also expected to be better than the FirstCall consensus of $(0.16).

Cash on hand at the close of the third quarter of 2002 is approximately $58 million, a decrease of $2.3 million from the June 30, 2002 position. The $3 million purchase price for the WipLL acquisition will be paid in the fourth quarter in cash out of the third-quarter closing cash balance. Cash usage during the third quarter is lower than previous quarters due to a combination of lower base expenses and improved working capital management. Cash on hand is offset by approximately $2.5 million in existing borrowings.

"We're encouraged by the way we've been able to produce a solid quarter amidst the overall weakness in the telecommunications market and the challenging economic environment," said Eric Stonestrom, president and chief executive officer of Airspan Networks. "This is a demonstration of the continued demand for final mile access, even as carriers grapple with excess backbone capacity. We continue to build upon our leadership position in our sector, by improving operational results for the existing business and enhancing our product portfolio and addressable market through the strategic acquisitions of Marconi's broadband fixed wireless business."

Revenue in the fourth quarter is expected to be in the $12 million range, through a combination of the additional revenue from the WipLL product and stable or slightly higher revenues from the existing core Airspan business. Gross margins are expected to be positively impacted by sales of the WipLL product line.

"We have also progressed substantially on the restructuring plans outlined in the last quarterly update, and we are on track to reduce the quarterly operating expenses in our existing business to $6 million by the second quarter of 2003 from the $7.9 million we spent in second quarter of this year. We have instituted a series of cost cutting measures, including an 8 percent staff reduction and a reduction in salaries and conditions for many other employees. We anticipate a modest restructuring charge in the third quarter as a result of the recent actions. The impact of our restructuring initiatives will take effect from the fourth quarter."

The addition of the Marconi WipLL division will increase operating expenses by approximately $1.5 million per quarter, mainly for salaries, benefits, and facilities for the approximately 60 new employees in Israel. The combined entity expects to spend approximately $8.5 million in operating expenses in the fourth quarter of 2002. This is expected to decline to approximately $7.5 million by the second quarter of 2003.

Airspan will release third quarter 2002 results after the 4 p.m. (EDT) close of the U.S. financial markets on Wednesday, October 30. An investor conference call is scheduled for 5 p.m. (EDT) on the same day.

There will be a live webcast of the conference call available on the investor relations section of the Airspan Web site at http://www.airspan.com. The webcast will also be distributed over CCBN's Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through CCBN's individual investor center at http://www.companyboardroom.com or by visiting any of the investor sites in CCBN's Individual Investor Network such as America Online's Personal Finance Channel, Fidelity Investments(R) (Fidelity.com) and others. Institutional investors can access the call via CCBN's password protected event management site, StreetEvents (http://www.streetevents.com).

For those who cannot listen to the live broadcast, an audio replay of the call will be available on the Airspan Web site for 30 days.

About Airspan Networks

Airspan provides wireless DSL systems and solutions to operators around the world with licenses in frequency bands between 900 MHz to 4 GHz, including PCS. The company has deployments with more than 90 operators in more than 45 countries. Airspan's systems are based on radio technology that delivers excellent area coverage, high security and resistance to fading. Airspan's systems can be deployed rapidly and cost effectively, providing an attractive alternative to traditional wired communications networks. Airspan also offers radio planning, network installation, integration, training and support services to facilitate the deployment and operation of its systems. More information on Airspan can be found at http://www.airspan.com

This press release contains forward-looking statements relating to future events or future financial performance that involve risks and uncertainties. These statements are only predictions and actual results could differ materially from those anticipated in these statements based on those factors identified in the company's filings with the SEC. The words "believe", "expect", "intend", "anticipate", variations of such words and similar expressions identify forward-looking statements but their absence does not mean that the statement is not forward looking. Examples of forward looking statements in this release include statements that the company believes that it will be able to continue to reduce operating expenses in the future, and that it will have revenues of $12 million range in the fourth quarter of 2002. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date of this announcement.