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Foundry Posts 20% Sequential Revenue Increase in Second Quarter 2002

San Jose, CA - July 24, 2002 - Foundry Networks™, Inc. (Nasdaq: FDRY), today reported financial results for its second quarter ended June 30, 2002.

Net revenue for the second quarter was $75.0 million, which compares to $62.4 million reported for the first quarter of 2002, a sequential increase of 20%. Pro forma net income for the second quarter of 2002, excluding non-cash charges for amortization of deferred stock compensation, was $4.3 million or $0.04 per diluted share, compared to pro forma net income of $1.4 million or $0.01 per diluted share in the first quarter of 2002. This marks the fourteenth consecutive quarter of pro forma profitability and thirteenth quarter of GAAP profitability for the Company.

"Our results this quarter are the culmination of several factors that ultimately reflect Foundry's execution of its strategy," stated Bobby Johnson, president and CEO of Foundry. "Many of our new cost-competitive products are being deployed where price sensitivity is a leading factor. At the high end, revenues of our best-of-breed JetCore products more than doubled as both new and existing feature-oriented customers adopted these products for their networks. We added more new customers this quarter than in any quarter since 2000 and we exited the quarter with a solid backlog position."

"We continued to be profitable, generate cash from operations, and manage a debt-free balance sheet," added Johnson.

Second Quarter Highlights

  • Foundry launched TrafficWorks™ IronWare™, a new ServerIron™ operating system providing major enhancements in security and high availability.
  • Foundry introduced JetScope™, a total network monitoring and accounting solution for Enterprises and Service Providers.
  • Foundry announced the new high-performance EdgeIron™ 10GC2F mid-range Gigabit-over-Copper Ethernet aggregation switch.
  • Telecom Ottawa selected Foundry to power its Metropolitan Area Network, one of the world's first standards-based 10-Gigabit Ethernet MANs.
  • Michigan's Genesee Intermediate School District and its 21 constituent districts (GenNET) deployed Foundry's end-to-end networking solutions to build one of the largest educational-service Metropolitan Area Networks in the country.
  • Sun Microsystems selected Foundry's high-performance Layer 3 and Layer 4-7 switches to support Sun One-based messaging Internet data center reference architecture.
  • Foundry introduced the FastIron® Edge Switch™ Series, a new best-in-class intelligent Layer 2/3 switching family.

Conference Call
Foundry Networks will host a conference call today to further discuss these results at 2:00 p.m. PDT. The call can be accessed via a webcast at www.foundrynetworks.com. A Web replay will also be available for approximately 90 days at this same Web address.

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 a statement by Bobby Johnson regarding the Company's order backlog. The forward-looking statements in this press release are subject to a number of risks and uncertainties, including the strength of the overall economy and the high-technology arena in particular, continued demand for Internet related equipment and acceptance of Foundry's current and future products, as well as potential order cancellations. Actual results could differ materially from those projected in our forward-looking statements. Investors should review the risk factors described in more detail in our most recent Annual Report on Form 10-K and most recent Quarterly Report on Form 10-Q available from Foundry or from the SEC at www.sec.gov. 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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