Alvarion® Reports Q2 2011 Results

Tel Aviv, July 26, 2011 — Alvarion Ltd. (NASDAQ:ALVR), the world’s leading provider of 4G networks in the Broadband Wireless Access (BWA) market today announced financial results for the second quarter of 2011.

Q2 Highlights:

Shipments of $49.1 million, a 14.5% sequential increase
Revenues of $55.4 million, a 19.1% sequential increase
GAAP net income of $0.01 per share; non-GAAP net income of $0.02 per share

In the second quarter of 2011, revenues were $55.4 million, an increase of 19.1% from $46.5 million in the first quarter of 2011, and an increase of 13.1% from $49 million in the second quarter of 2010. GAAP net income in the second quarter of 2011 was $0.3 million, or $0.01 per share. This compares to a net loss of ($14.5) million, or ($0.23) per share in Q1 2011, including restructuring and other charges of approximately $7.1 million related mainly to employee termination expenses and vacating office space. GAAP net loss in the second quarter of 2010 was ($10.6) million, or ($0.17) per share. Excluding stock based compensation, restructuring and related charges, as well as impairment charges, on a non-GAAP basis, the company reported net income of $1.5 million, or $0.02 per share, compared with non-GAAP net loss of ($6.5) million, or ($0.10) per share in the first quarter of 2011, and non-GAAP net loss of ($6.6) million, or ($0.11) per share in the second quarter of 2010.

Please refer to the accompanying financial table for reconciliation of GAAP financial information to non-GAAP for the second quarter of 2011 and the comparative periods. Cash provided by operations in the second quarter of 2011 was $1.4 million. As of June 30, 2011, cash, cash equivalents and investments totaled $69.7 million.

Management Comments

“We are pleased to report that we have met our target of returning to profitability in Q2,” said Eran Gorev, President and CEO of Alvarion. “More importantly, we believe we have achieved a stable core business that will serve as a foundation upon which we can build through new growth-oriented initiatives.”

“In order-of-magnitude terms, our current core business is capable of sustaining a revenue run rate of about $200 million per year with the prospect of moderate margin improvement. We remain committed to the carrier market where we continue to see profitable WiMAX infrastructure opportunities using the selective approach we adopted earlier this year. Margin improvement is expected to come from a gradual shift in business mix toward enterprise and vertical market applications. Near term, a particular quarter may be affected by temporary seasonal factors or the impact of recognizing revenue from shipments during earlier periods but, overall, we have created a right-sized, sustainably profitable operation.”

“Having stabilized the core business, our current priority is to develop new growth engines to expand operating leverage and improve valuation.”

Guidance

Management believes revenues in the second half of 2011 will be similar to the first half of the year at approximately $100 million, skewed somewhat toward the fourth quarter. Depending on shipment volume and mix, Q3 results are likely to range between breakeven and a modest loss on a non-GAAP basis. However, management expects a small non-GAAP profit for the second half, as a stronger Q4 is expected to offset the timing issues for shipments in Q3.

Alvarion management will host a conference call today, July 26, at 9:00 a.m. Eastern time to discuss Q2 results and other matters.

Please call the following dial in number to participate:
USA: (800) 230-1074; International: +1(612) 234-9959.

The public is invited to listen to the live webcast of the conference call.
For details please visit Alvarion’s website at www.alvarion.com.
An archive of the online broadcast will be available on the website.

A replay of the call will be available from 11:00 a.m. EST on July 26, 2011 through 11:59 a.m. EST on August 26, 2011.

To access the replay, please call:
USA: (800) 475-6701
International: +1(320) 365-3844.

To access the replay, users will need to enter the following code: 208605.

Alvarion has scheduled dates for the earnings announcements during 2011 and this schedule is available on the website at http://www.alvarion.com/index.php/en/investors.

About Alvarion
Alvarion (NASDAQ:ALVR) is a global 4G communications leader with the industry’s most extensive customer base, including hundreds of commercial 4G deployments. Alvarion’s industry leading network solutions for broadband wireless technologies WiMAX, TD-LTE and WiFi, enable broadband applications for service providers and enterprises covering a variety of industries such as mobile broadband, residential and business broadband, utilities, municipalities and public safety agencies. Through an open network strategy, superior IP and OFDMA know-how, and ability to deploy large scale end-to-end turnkey networks, Alvarion is delivering the true 4G broadband experience today

(www.alvarion.com).

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations or beliefs of Alvarion’s management and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: potential impact on our business of the current global recession, the inability of our customers to obtain credit to purchase our products as a result of global credit market conditions, the failure to fund projects under the U.S. broadband stimulus program, continued delays in 4G license allocation in certain countries; the failure of the market for 4G products to develop as anticipated;, Alvarion’s inability to capture market share in the expected growth of the 4G market as anticipated, due to, among other things, competitive reasons or failure to execute in our sales, marketing or manufacturing objectives; the failure of Alvarion’s strategic initiatives to enable Alvarion to more effectively capitalize on market opportunities as anticipated; inability to further identify, develop and achieve success for new products, services and technologies; increased competition and its effect on pricing, spending, third-party relationships and revenues; as well as the inability to establish and maintain relationships with commerce, advertising, marketing, and technology providers and other risks detailed from time to time in the Company’s 20-F Annual Report Risk Factors section as well as in other filings with the Securities and Exchange Commission.

Information set forth in this press release pertaining to third parties has not been independently verified by Alvarion and is based solely on publicly available information or on information provided to Alvarion by such third parties for inclusion in this press release. The web sites appearing in this press release are not and will not be included or incorporated by reference in any filing made by Alvarion with the Securities and Exchange Commission, which this press release will be a part of.

You may request Alvarion's future press releases by contacting Sivan Farfuri, This e-mail address is being protected from spambots. You need JavaScript enabled to view it or +972.3.767.4159. For further information visit the Investor section of Alvarion’s website at: http://www.alvarion.com/index.php/en/investors
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