Press Releases

Successful Wireless ISP Continues to Expand One of the World's Largest BWA Deployments

Tel – Aviv, Israel, November 5, 2002 – Alvarion Ltd. (NASDAQ: ALVR), a leading provider of Broadband Wireless Access (BWA) solutions, today announced its financial results for the third quarter ended September 30, 2002. Revenues for the third quarter of 2002 were $21.6 million, compared with $22.3 million for the second quarter of 2002 and $27.8 million for the third quarter of 2001.

Net loss for the third quarter of 2002 was $(4.8) million, or $(0.09) per share, compared with $(5.0) million, or $(0.09) per share, for the second quarter of 2002, and $(72.5) million, or $(1.61) per share, in the third quarter of 2001.

If amortization of current technology and deferred stock compensation were excluded from the Company’s third quarter 2002 results, the net loss on a pro-forma basis for the quarter would have been $(4.0) million, or $(0.07) per share. This compares with a pro-forma net loss of $(4.3) million, or $(0.08) per share, in the second quarter of 2002.

For the nine month period ended September 30, 2002, revenues were $66.5 million, compared with revenues of $74.1 million for the comparable period in 2001. Net loss for the nine months was $(15.3) million, or $(0.28) per share, compared with a net loss of $(93.4) million, or $(2.83) per share for the nine months ended September 30, 2001.

Cash reserves as of September 30, 2002 were $170.0 million, compared with $175.2 million as of June 30, 2002. This reduction of cash reserves resulted from $3.4 million relating to operational expenses and $1.8 million relating to the Company’s continued repurchase of its outstanding shares. Since the initiation of the share buyback plan, a total of 2.1 million shares have been purchased at a total consideration of $4.5 million.

The Company also announced today that it has implemented workforce reductions designed to better align expenses with revenues. This program, which includes a workforce reduction of about 60 employees, is expected to result in a decrease in the company’s expenses of at least $1 million per quarter. The savings will be fully reflected in the results of the first quarter of 2003.

Commenting on the third quarter, Zvi Slonimsky, CEO of Alvarion, said, “Our solid third quarter results in the face of continued weakness in the telecom market confirm the value of our diverse customer base and product lines. We are on track with our work plan, which continues to deliver improved gross margins and decreased operating expenses together with a reduced cash burn and loss per share. We remain committed to continue developing our leading products for all our segments, including both carriers and service providers.”

Mr. Slonimsky continued, “Our North American sales improved during the quarter and continue to be strong. For example, Midwest Wireless, a large cellular service provider in Minnesota, has deployed a BreezeACCESS network across a vast rural region to support new revenue-generating Internet access services. To address the region’s emerging Emergency Service opportunity, we have recently launched the BreezeACCESS SU-M Mobile Radio Unit. This unit is specifically designed to support the growing demand for Homeland security. We see some very promising opportunities in this market and expect them to start materializing early in 2003.

“Sales were also strong in Southeast Asia and Eastern Europe. During the quarter, we announced orders from CamGSM, Cambodia’s largest cellular operator, and from Moscow Cellular Communications, a leading Russian cellular operator. These and other cellular operators are combining their existing cellular assets with our products to launch uniquely cost-effective Internet access and VPN services.”

Mr. Slonimsky concluded, “Notwithstanding today’s difficult environment, we continue to see demand for BWA. We are confident that the combination of our comprehensive product offerings, worldwide presence, and determined sales and marketing effort will position us to take full advantage of growth in broadband demand as the global economy and technology sector improve. We continue to invest in our company to secure our position as the leader of the BWA market.”

The Company will hold a teleconference today, November 5, 2002, at 9:00 a.m. EST to discuss the quarter's results. To participate in the call, please dial (888) 417-2310 (in the U.S.), or (973) 582-2710 (internationally), approximately five minutes prior to the scheduled call start time. The call will also be available live as a Webcast on www.kcsa.com and www.alvarion.com, where it will be archived and available for replay for 30 days. A replay of the call can also be accessed via telephone from 11:00 a.m. EST on November 5, 30, 2002 through 11:59 p.m. on November 12, 2002 by calling (877) 519-4471 in the Unites States, or (973) 341-3080 internationally, and entering the following access code: 3543822.

About Alvarion
Alvarion is a premier provider of solutions based on Point-to-Multipoint (PMP) Broadband Wireless Access (BWA) used by telecom carriers, service providers, and enterprises worldwide. Alvarion systems provide Internet access and voice and data services in the last mile, cellular network feeding, building-to-building and wireless local area network (LAN) connectivity.

Alvarion offers the broadest range of BWA solutions by market segment and frequency band, designed to address all carriers’ and service providers’ business models. With its combined market experience, strong customer base, diversified distribution channels and field-proven deployments, Alvarion is a leading BWA pure play provider for every end user profile, from residential subscribers to business customers.

This press release may contain 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: 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 filings with the Securities and Exchange Commission.

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