FREMONT, Calif. -- Avanex Corporation (Nasdaq: AVNX), pioneer of photonic processors that accelerate the deployment of the next generation optical networks, today reported third quarter results for its fiscal year 2001, which ended March 31, 2001.

Avanex Chairman and Chief Executive Officer Walter Alessandrini said, "It's clear that the telecommunications retrenchment has affected everyone in this industry. We have addressed this by restructuring our operations. Our strategy has been to maximize our flexibility while increasing our technology advantage and lowering our imbedded costs. We therefore continue to invest strongly in research and development, application engineering and product marketing so that we can take full advantage of the upswing in the industry when it takes place."

The Avanex Chairman pointed out that March quarter revenues increased $19.8 million compared to the same quarter of last year. "We successfully added several new customers and increased our product offerings during this past quarter. Our March quarter revenue from next generation products, which include PowerMux(TM) and PowerExchanger(TM), grew significantly, and we expect further success this year for these products," said Alessandrini.

Alessandrini added that the company reduced its workforce by 350 in the March quarter, mostly in manufacturing, "to assure that our production capacity is aligned with our current market expectations."

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