3Com Slashes Staff3Com Slashes Staff

MARLBOROUGH, Mass. -- 3Com Corporation (Nasdaq:COMS - News) today announced that it plans to outsource all of its manufacturing and realign its product development and supply chain capabilities as part of its ongoing efforts to further improve efficiency and reduce cost. "These actions further enhance 3Com's ability to bring competitive and comprehensive networking solutions to the enterprise market," said Bruce Claflin, president and CEO, 3Com Corporation.

Over the next six months, 3Com will complete the outsourcing of all of its direct manufacturing, distribution and related activities for its enterprise networking products between two partners, Flextronics, Singapore (NasdaqNM:FLEX) and Jabil Circuit, St. Petersburg, Florida. Flextronics will also assume responsibility for 3Com's global distribution from its regional hubs.

3Com also announced it has established a Taiwan Design Center (TDC) which will be responsible for the continued design and manufacture of low-end, standardized volume products and will be staffed by 3Com employees and Original Design Manufacturer (ODM) partner employees. The company expects the TDC to be operational in its fiscal Q2, ending in November 2003, and fully staffed by the end of its fiscal Q4, ending in May 2004.

"We will focus 3Com's internal engineering on high value-add innovation such as VoIP, ASICs, XRN(TM) architecture and security, while leveraging partners around the world to complement our internal resources," said Claflin. "Today's announcement is a continuation of 3Com's corporate strategy to offer a broad range of innovative products and solutions, competitively priced to meet the needs of the enterprise customer."

Today's actions will result in a global reduction in force affecting manufacturing, product development and supply chain operations, including the closure of 3Com's Dublin, Ireland manufacturing facility, which is expected to occur by the end of February 2004.

Approximately 1,000 3Com employees are affected globally; however, the majority is associated with the company's manufacturing and supply chain operations. Notifications begin today and are subject to appropriate legal and consultation processes in the respective countries in which they occur.

3Com Corp.