Aware, Inc. Reports Financial Results for First Quarter of 1998.

BEDFORD, Mass.--(BUSINESS WIRE)--April 16, 1998--Aware, Inc. (NASDAQ:AWRE), a worldwide leader in xDSL (digital subscriber line) technology, today reported financial results for its first quarter ended March 31, 1998.

First quarter 1998 revenue increased 11 percent to $2.0 million, compared with $1.8 million for the quarter ended March 31, 1997. The net loss for the quarter was $1.5 million, or minus 7 cents per diluted share, which compares to a net loss of $276,000, or minus 1 cent per diluted share for the same quarter last year.

Jim Bender, president and chief executive officer of Aware stated: "During our first quarter, we continued to capitalize on the industry momentum created by our splitterless DMT technology, making two major strides in the drive toward widespread ADSL deployment. The most noteworthy of these was the announcement of our agreement with Lucent Technologies to develop splitterless DMT lite software that will operate on Lucent digital signal processors."

"We also redefined the strategic partnership with our long-time chipset partner, Analog Devices, enabling both companies to more widely proliferate our technology, promote open systems and drive interoperability. Both events represent significant milestones in the industry-wide race to eliminate hurdles blocking economical mass-deployment of ADSL."

About Aware

Headquartered in Bedford, Massachusetts, Aware, Inc. is a worldwide leader in xDSL technology with products that enable new broadband services over the existing telephone network. Aware's products include xDSL technology, software modules and modems for high-speed, interactive broadband network applications. More information about Aware, Inc. can be found on the World Wide Web at http://www.aware.com.

Note to Investors:

This press release contains certain statements of a forward-looking nature relating to future events or the future financial performance of Aware. Important factors that could cause actual results to differ materially from those indicated by such forward-looking statements include the risks described in various SEC filings that Aware, Inc. has made on its Forms S-1, 10-K, and 10-Q, which factors are incorporated herein by reference.

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                                AWARE, INC.
                 CONSOLIDATED CONDENSED BALANCE SHEETS
                              (unaudited)

                                           March 31,      December 31,
                                             1998            1997

                                ASSETS
Current assets:
 Cash and cash equivalents               $ 22,569,253    $ 23,496,508
 Short-term investments                     2,045,246       2,607,411
 Accounts receivable (less
  allowance for doubtful
  accounts of $75,000 in 1998
  and $50,000 in 1997)                      2,195,621       1,824,119
 Inventories                                  173,490         215,622
 Prepaid expenses                             316,737         290,847

  Total current assets                     27,300,347      28,434,507

Property and equipment, net
 of accumulated depreciation
 and amortization of $1,667,160
 in 1998 and $1,330,281 in 1997            10,778,285      10,846,025

Total assets                             $ 38,078,632    $ 39,280,532


                 LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
 Accounts payable                        $    863,665    $  1,075,126
 Accrued expenses                             247,766         185,676
 Accrued compensation                         216,646         326,558
 Accrued professional                          53,883          73,370

  Total current liabilities                 1,381,960       1,660,730

Stockholders' equity:
 Preferred stock, $1.00
  par value; 1,000,000 shares
  authorized, none outstanding                   --              --
 Common stock, $.01 par value;
  30,000,000 shares authorized;
   issued and outstanding,
   19,838,982 in 1998 and
   19,646,024 in 1997                         198,390         196,460
 Additional paid-in capital                52,717,774      52,640,360
 Accumulated deficit                      (16,219,492)    (14,764,056)
 Treasury stock                                  --          (452,962)

  Total stockholders' equity               36,696,672      37,619,802

Total liabilities and
 stockholders' equity                    $ 38,078,632    $ 39,280,532

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                               AWARE, INC.
              CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
                              (unaudited)

                                           Three Months Ended
                                                March 31,
                                         1998               1997

Revenue:
    Product                             $435,175           $103,790
    License and royalty                  769,464          1,310,984
    Research and development             799,377            386,311
        Total revenue                  2,004,016          1,801,085

Costs and expenses:
    Cost of  product revenue             377,133            281,557
    Research and development           2,196,431          1,432,779
    Selling and marketing                767,607            374,415
    General and administrative           555,971            436,920
         Total costs and expenses      3,897,142          2,525,671

Loss from operations                  (1,893,126)          (724,586)
Other income and expense                  99,000                  -
Interest income                          338,689            448,284

Net loss before provision for
  income taxes                        (1,455,437)          (276,302)
Provision for income taxes                  -                  -

Net loss                             ($1,455,437)         ($276,302)


Net loss per share - basic                ($0.07)            ($0.01)
Net loss per share - diluted              ($0.07)            ($0.01)


Weighted average shares - basic       19,718,820         19,054,759
Weighted average shares - diluted     19,718,820         19,054,759

CONTACT: Aware, Inc.

Kristin Griffin, 781/687-0500

[e-mail]