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Foundry Reports Record Results for Fiscal 2000

Company reports 183% revenue growth and 185% Earnings Growth

San Jose, CA - January 24, 2001 - Foundry Networks®, Inc. (Nasdaq: FDRY), a performance and total system leader for best-of-breed end-to-end broadband IP switching and routing solutions, today reported its fourth quarter and year ended December 31, 2000 financial results. Revenues were $105.1 million in the fourth quarter of 2000, a 91% increase over the $55.1 million of revenues in the fourth quarter of 1999. Pro forma net income for the fourth quarter of 2000, excluding non-cash charges for amortization of deferred stock compensation, was $21.5 million or $0.17 per share, compared to pro forma net income of $15.5 million or $0.12 per share for the fourth quarter of 1999.

Revenues were $377.2 million in the year ended December 31, 2000, a 183% increase over the $133.5 million of revenues in the year ended December 31, 1999. Pro forma net income for the year ended December 31, 2000, excluding non-cash charges for amortization of deferred stock compensation, was $93.6 million or $0.74 per share, compared to pro forma net income of $29.5 million or $0.26 per share for the year ended December 31, 1999.

"We believe that all of our core markets - Layer 3 LAN Switching, Layer 4-7 Web Content Switching and Internet Routers - will continue to see sustained growth throughout 2001 and beyond," said Bobby Johnson, Foundry's President and CEO. "Foundry remains focused on extending its solutions in anticipation of our customers' needs. We shipped new products during the quarter that significantly enhance the performance, scalability, and reliability of our customers' networks."

"Foundry continues to have excellent financial metrics," stated Tim Heffner, Foundry's Chief Financial Officer. "Gross margins remain among the highest in the industry and our revenue per employee continues to lead our competitors. We believe we are well positioned to further our success in our targeted markets."

Outlook
For the first quarter ended March 31, 2001, Foundry believes revenue will be in the range of $100 million to $110 million. For the year ended December 31, 2001, Foundry believes revenue will be in the range of $475 million to $525 million. Foundry believes that gross margins will settle in the range of 60% to 62%, and believes that total operating expenses will be in the range of 32% to 34% of revenue for the year.

Safe Harbor Statement This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, and is subject to the safe harbor created by that section.  These forward-looking statements include the financial projections for the first quarter and fiscal year 2001, and statements by Bobby Johnson regarding Foundry's sales patterns, industry trends, new products and belief that Foundry will see sustained growth in 2001 and beyond in its core markets, as well as statements by Tim Heffner regarding financial metrics and Foundry's positioning with respect to future success in its targeted markets.  The expected results described in this press release are subject to a number of risks and uncertainties, which could cause actual results to differ materially from those expressed or implied by our forward-looking statements.  These risks and uncertainties are discussed here and in more detail in our most recent Quarterly Report on Form 10-Q and 1999 Annual Report on Form 10-K available from Foundry or from the SEC at www.sec.gov.  These risks and uncertainties include continued demand for Internet related equipment and acceptance of Foundry's current and future products, the risks posed by rapid changes in technology including Foundry's ability to introduce new and superior products and predict future industry standards and the risk of delays in developing and releasing new products, the comparative quality of new products offered by Foundry's competitors in the intensely competitive networking market, and Foundry's ability to attract and retain skilled employees in an intensely competitive hiring market.  Our business is also subject to the risks and uncertainties of loss, reduction, cancellation or delay in large purchases which we expect to receive from a few significant customers; any changes in economic conditions which affect the ability or desire of our customer base to make purchases of our products such as the ability of existing and potential customers to obtain outside financing or funding to make purchases of Foundry product; cancellations of orders and payment delays and defaults by customers who are unable to obtain outside financing or funding to make purchase of Foundry product; difficulties Foundry may have in offering vendor-financing programs for customers who wish Foundry to finance purchases of Foundry product and who otherwise may be unable to obtain outside financing (including administrative costs and threat of default by less credit-worthy customers).  Our expected profit margins are subject to the risk of the erosion of selling prices due to competition and other factors which our industry has experienced and which we expect will continue in the future but whose magnitude is difficult to predict.  In addition, we may experience substantial period-to-period fluctuations in future operating results due to the erosion of our average selling prices.  Our projected operating expenses are subject to the risk that we incur actual expenses that we do not or cannot foresee or that we foresee but do not accurately evaluate.  Foundry assumes no obligation to update the forward looking statements contained in this press release.

About Foundry Networks

Foundry Networks, Inc. (NASDAQ: FDRY) is a leading provider of high-performance enterprise and service provider switching, routing, security and Web traffic management solutions, including Layer 2/3 LAN switches, Layer 3 Backbone switches, Layer 4-7 application switches, wireless LAN and access points, metro routers and core routers. Foundry's customers include the world's premier ISPs, metro service providers, and enterprises, including e-commerce sites, universities, entertainment, health and wellness, government, financial and manufacturing companies. For more information about the company and its products, call 1.888.TURBOLAN or visit www.foundrynet.com.

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