3Com Reports Second-Quarter Results for Fiscal 2009

MALAYSIA — December 24, 2008 — 3Com 3Com Corporation (Nasdaq: COMS) today reported financial results for its fiscal 2009 second quarter, which ended November 28, 2008. Revenue in the quarter was $354.6 million, compared to revenue of $317.8 million in the corresponding period in fiscal 2008, an 11.6 percent increase.

Net income in the quarter was $12.9 million, or $0.03 per diluted share, compared with a net loss of $35.6 million, or $0.09 per share, in the second quarter of fiscal year 2008. On a non-GAAP basis, net income was $46.9 million, or $0.12 per diluted share, compared with net income of $13.0 million, or $0.03 per diluted share, for the second quarter of fiscal year 2008.

Revenue for the first six months of fiscal year 2009 was $697.2 million, compared with $637.2 million for the same period in the prior year, a 9.4 percent increase. Year-to-date net income was $92.7 million, or $0.23 per diluted share, compared with a net loss of $54.3 million, or $0.14 per share, for the first six months of the prior year. On a non-GAAP basis, net income was $90.3 million, or $0.23 per diluted share, compared with net income of $25.2 million, or $0.06 per diluted share, for the first half of fiscal year 2008.

"We are very pleased with these strong results," said Bob Mao, 3Com CEO. "Q2 was an excellent quarter for 3Com as we achieved GAAP profitability for the second consecutive quarter and we continued our string of profitable results on a non-GAAP basis. We continue to
deliver on our three key objectives: revenue growth, margin improvement and cash generation. We executed on our strategy and delivered these financial results in a very difficult economic environment."

In the second quarter, 3Com generated $56.8 million in cash from operations. 3Com's cash and cash equivalents balance at November 28, 2008, was $460.8 million.

During the quarter 3Com completed the repurchase of 21,264,430 shares of its common stock at a total cost of approximately $50.0 million. The repurchases were made in the open market under the Company's previously-announced buyback program.

Also in the quarter, 3Com retired $88 million of its long term debt, reducing the balance to $213 million from an original loan of $430 million. The repayment included a voluntary early payment of $40 million.

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