Crosswave Reports Q3

TOKYO and NEW YORK -- Crosswave Communications Inc. (NASDAQ: CWCI) ("Crosswave"), a pioneer in broadband data communications in Japan, today announced its financial results for the third quarter of the fiscal year ending March 31, 2003 ("fiscal 2002").All figures are unaudited and prepared in accordance with accounting principles generally accepted in the United States for interim financial information. On February 12, 2003 at 9 a.m. (EST), Crosswave's President, Koichi Suzuki, CEO Akio Onishi, and CFO Yasuharu Fushimi will host a conference call to discuss the financial results. The conference call will be simultaneously webcast at www.vcall.com and the replay will be available at Crosswave's URL: www.cwc.co.jp/en/.

"Although Japan's general economy remains weak, the corporate sector has been very active in renewing IT systems and networks," said Koichi Suzuki, President of Crosswave. "Continued growth in broadband access penetration is rapidly expanding the borders of the corporate data communications market. Alternative network solutions and outsourcing will be the key to growth in such a market, as we expect the outsourcing market to continue to grow significantly. In order to access this new market, it is critical to have the ability to provide not only the space but also the network, facilities and engineering resources to satisfy corporate outsourcing needs. Crosswave recently opened two major data center facilities in Japan which are designed and constructed for the complete relocation of corporate IT functions to data centers on our backbone network. These new data centers offer corporate customers full scale outsourcing for their network operations based on our strategy for systems and network operation. We strongly believe that they will contribute to sustainable growth for Crosswave.""The potential market for Crosswave is enormous," said Akio Onishi, CEO of Crosswave. "The corporate data communications market has rapidly expanded to include mid-size and small-size corporations, who are now starting to use Wide-Area Networks and systems outsourcing services. In addition, traditional services such as frame-relay services have been replaced by platform-type services like the Wide-area Ethernet Platform services. We plan to increase the size of our customer base by combining the provision of our own network infrastructure with various high-end value-added services. Crosswave launched a series of value-added options improving the manageability, quality and usability of our Platform type Network services during the second half of 2002. We expanded the service line-up of our Wide-area IP Platform Service, with the most recent service additions implemented in 3Q02. As a result, the size of our customer base has expanded in line with our expectations in 3Q02. We are confident that our business strategy is solid and will enhance our performance going forward.""Crosswave continued to improve its financial performance in 3Q02 despite the fact that sales growth was lower than expected as a result of the current difficult business environment," said Yasuharu Fushimi, CFO of Crosswave. "3Q02 revenues increased compared to 3Q01 and 2Q02 due to the expansion of usage by existing customers and acquisition of new customers. Our cost structure also improved, and our operating loss steadily decreased as a result. We maintain our target that adjusted EBITDA will turn positive in Fiscal Year 2003."Crosswave Communications Inc.