Proxim Wireless Reports Fourth Quarter and Full Fiscal Year 2008 Financial Results

SILICON VALLEY, CA, Mar 24 (MARKET WIRE) --
Proxim Wireless Corporation (NASDAQ: PRXM), a leading provider of
end-to-end broadband wireless systems that deliver the quadruple play,
today released financial results for the fourth quarter and full fiscal
year ended December 31, 2008.

Financial Highlights

On a GAAP basis, revenues for the quarter ended December 31, 2008 were
$11.6 million, compared to $12.1 million for the quarter ended September
30, 2008, and $13.8 million for the quarter ended December 31, 2007. The
decrease in fourth quarter 2008 versus fourth quarter 2007 was
attributable primarily to the impact of the worldwide economic slowdown
on broadband wireless sales.

In the fourth quarter ended December 31, 2008, gross margins were 38.4%,
compared to 36.3% in the quarter ended September 30, 2008, and 32.1% in
the quarter ended December 31, 2007.

On a GAAP basis, the net loss from continuing operations was $1.7 million,
or $0.07 per diluted share, compared to a net loss from continuing
operations of $4.0 million, or $0.17 per diluted share, for the quarter
ended September 30, 2008, and a net loss of $12.8 million, or $0.52 per
diluted share for the quarter ended December 31, 2007. Discontinued
operations had no impact on current quarter earnings, but resulted in a
$2.3 million favorable impact, or $0.10 per diluted share, in the quarter
ended September 30, 2008, and a loss of $0.2 million, or $0.01 per diluted
share, for the quarter ended December 31, 2007.

The net loss on a non-GAAP basis for the quarter ended December 31, 2008,
which excludes depreciation of fixed assets, amortization of intangible
assets, and stock based compensation, was $1.0 million, or $0.04 per
diluted share, compared to a non-GAAP net loss of $0.8 million or $0.03
per diluted share for the quarter ended September 31, 2008.

For fiscal year 2008, Proxim reported revenue of $49.0 million, net loss
on a GAAP basis of $10.0 million, or $0.43 per diluted share, and a
non-GAAP net loss of $6.0 million, or $0.26 per diluted share. Fiscal
year 2007 had revenue of $61.9 million, net loss on a GAAP basis of $19.1
million, or $0.82 per diluted share, and non-GAAP net loss of $2.5
million, or $0.11 per diluted share.

The financial results above reflect discontinued operations accounting
treatment for a portion of Proxim's consolidated operations. The
discontinued operations consisted of Ricochet Networks discontinued during
the third quarter of 2007, and the Harmonix Division discontinued during
the second quarter of 2008.

2008 Achievements:

Reduced OPEX from $46 million to $33 million

Reinvigorated our extensive channels through increased outreach and
programs for various partners and channels

Introduced innovations across the product line, including new WLAN products
with our 802.11n family and new point-to-multipoint products with our 5054
High Security line

"We had several goals at the beginning of 2008, and we progressed
towards those goals despite the current economic landscape," said Pankaj
Manglik, President and CEO of Proxim Wireless. "In light of the global
economic downturn, we have taken measures to reduce costs while
maintaining our commitment to product development. As a result, we will
be announcing more innovative products across both our WLAN and licensed
and license-free WiMAX product lines in the coming months, which will
help us accelerate revenue out of the downturn."

Highlights of recent press announcements include:

Proxim Wireless introduced the ORiNOCO(R) AP-8000 and AP-800 802.11n
products, the first 802.11n product line to break the 300 Mbps speed
barrier for 802.11n solutions, enabling WLAN networks at half the cost

Within the first week of announcing the ORiNOCO AP-8000 and AP-800, Proxim
received orders for over 1,000 of the 802.11n products

CALTRANS and the CHP deployed Proxim's Tsunami(TM) MP.11 license-free WiMAX
products as the wireless backhaul for large, life-saving traffic safety
network in California's Central Valley

Proxim's Tsunami MP.16 3500 licensed WiMAX radios were deployed as the
wireless backhaul for the largest video surveillance network in Turkey,
securing the port city of Bodrum

The rural town of Elk River, Idaho utilized Proxim's Tsunami MP.11 and
ORiNOCO AP-4000 MR/LR radios to deploy the town's first ever broadband
network. This was accomplished via a federal grant from the USDA's Rural
Development Community Connect Program

Proxim's ORiNOCO Wi-Fi mesh and Tsunami(TM) MP.11 products were deployed by
Radiant Networks to unwire the entire city of Solon, OH.

Proxim's ORiNOCO Wi-Fi mesh and Tsunami(TM) MP.11 products were used to
provide point-to-multipoint and Wi-Fi connectivity for over 1,300 athletes
across 15 locations at the third annual Commonwealth Youth Games in India.

Proxim's ORiNOCO AP-4000 access points were selected as the WLAN of choice
for Microsoft's TechEd conference for the seventh consecutive year.

Conference Call Information

Proxim will host a conference call to discuss the release, financial
results, and related developments at the company today, Tuesday, March 24,
2009, starting at 5:00 P.M. Eastern Time. The discussion may include
forward-looking information.

To participate in this conference call, please dial 877-857-6173 (or +1
719-325-4831 for international callers), confirmation code 1541018, at
least ten minutes before the starting time. The conference call will also
be broadcast live over the Internet. Investors and others are invited to
visit Proxim's website at http://ir.proxim.com/events.cfm to access this
broadcast. Replays will be available telephonically for approximately one
week by dialing 888-203-1112 for domestic callers and +1 719-457-0820 for
international callers, confirmation code 1541018 for all callers, and over
the Internet for approximately 90 days at Proxim's website at
http://ir.proxim.com/events.cfm.

To view the corresponding financial tables for this announcement, please
view the release on Proxim's site at: http://ir.proxim.com/releases.cfm.

About Proxim Wireless

Proxim Wireless Corporation (NASDAQ: PRXM) is a leading provider of
end-to-end broadband wireless systems that deliver the quadruple play of
voice, video, data and mobility to all organizations today. Our systems
enable a variety of wireless applications including security and
surveillance, VoIP, last mile access, enterprise LAN connectivity, and
Point-to-Point backhaul. We have shipped more than 1.8 million wireless
devices to more than 235,000 customers in over 65 countries worldwide.
Proxim is ISO-9001 certified. Information about Proxim can be found at
www.proxim.com. For investor relations information, e-mail ir@proxim.com
or call +1-413-584-1425.

Use of Non-GAAP Financial Information

To supplement Proxim Wireless' condensed consolidated financial statements
presented in accordance with GAAP, Proxim uses certain measures of
financial performance that are non-GAAP financial measures within the
meaning of Regulation G promulgated by the Securities and Exchange
Commission. These non-GAAP measures may include gross margin, net income
(loss), and net income (loss) per share data that are adjusted from
results based on GAAP to exclude certain expenses, gains, and losses.
These non-GAAP measures are provided to enhance investors' overall
understanding of Proxim's current financial performance and Proxim's
prospects for the future. Specifically, Proxim believes the non-GAAP
measures provide useful information to both management and investors by
excluding certain expenses that may not be indicative of its core
operating results. These measures should be considered in addition to
results prepared in accordance with GAAP, but should not be considered a
substitute for, or superior to, GAAP results. These non-GAAP measures
included in this press release have been reconciled to the GAAP results
in the attached tables.

Safe Harbor Statement

Statements in this press release that are not statements of historical
facts are forward-looking statements that involve risks, uncertainties,
and assumptions. Proxim Wireless' actual results may differ materially
from the results anticipated in these forward-looking statements. The
forward-looking statements involve risks and uncertainties that could
contribute to such differences including those relating to and arising
from the significant uncertainty and volatility in the telecommunications
industry and larger economy; our ability to increase our sales in the
Americas and elsewhere; our limited capital resources and recent history
of significant losses; the intense competition in our industries and
resulting impacts on our pricing, gross margins, and general financial
performance; significant uncertainties relating to the listing of the
company's stock on the Nasdaq Capital Market, including whether our stock
will be delisted, whether we will qualify for and receive additional time
to cure our current deficiencies, and whether the trading of our stock
will be transferred to the Over-The-Counter Bulletin Board or Pink
Sheets; time and costs associated with developing and launching new
products; uncertainty about market acceptance of products we introduce;
potential long sales cycles for new products such that there may be
extended periods of time before new products contribute positively to our
financial results; decisions we may make to delay or discontinue efforts
to develop and introduce certain new products; time, costs, political
considerations, typical multitude of constituencies, and other factors
involved in evaluating, equipping, installing, and operating municipal
networks; difficulties or delays in developing and supplying new products
with the contemplated or desired features, performance, compliances,
certifications, cost, price, and other characteristics and at the times
and in the quantities contemplated or desired; commitments we may make to
our suppliers relating to orders that may end up getting cancelled; the
difficulties in predicting Proxim's future financial performance; and the
impacts and effects of any other strategic transactions Proxim may
evaluate or consummate, including any outcome of the current exploration
of strategic options. Further information on these and other factors that
could affect Proxim's actual results is and will be included in filings
made by Proxim from time to time with the Securities and Exchange
Commission and in its other public
statements.

PROXIM WIRELESS CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)

December 31, December 31,
2008 2007
----------- -----------
Assets (unaudited)
Current assets:
Cash and cash equivalents $ 5,092 $ 6,329
Accounts receivable, net 4,084 9,326
Inventory 3,947 5,753
Prepaid expenses 1,613 1,029
Assets held for sale - 2,085
----------- -----------

Total current assets 14,736 24,522

Property and equipment, net 2,658 2,532
Other Assets:
Restricted cash 77 76
Intangible assets, net 6,479 8,542
Deposits and prepaid expenses 387 239
----------- -----------

Total other assets 6,943 8,857
----------- -----------

Assets held for sale - 499
----------- -----------
Total assets $ 24,337 $ 36,410
=========== ===========

Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses $ 8,100 $ 12,752
Line of Credit Payable 1,500 --
Deferred revenue 1,649 3,687
License agreement payable -
current maturities 1,023 1,065
----------- -----------

Total current liabilities 12,272 17,504

License agreement payable, net of
current maturities - 1,023

Deferred revenue, net of current 474 314

Notes payable, net of discount 2,616 -

Other long term liabilities 305 -

Liabilities-Assets held for sale - 232

Total liabilities $ 15,667 $ 19,073
=========== ===========
Commitments and contingencies

Stockholders' Equity
Preferred stock, $0.01 par value;
authorized 4,500,000, none issued at
December 31, 2008 and December 31, 2007 -- --
Common stock, $0.01 par value,
100,000,000 shares authorized,
23,519,069 issued and outstanding at
December 31, 2008 and December 31, 2007 235 235
Additional paid-in capital 64,829 63,451
Accumulated deficit (56,394) (46,349)
----------- -----------

Total stockholders' equity 8,670 17,337
----------- -----------
Total liabilities and
stockholders' equity $ 24,337 $ 36,410
=========== ===========

PROXIM WIRELESS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)

Three Months Ended Twelve Months Ended
December 31, December 31,
-------------------- --------------------
2008 2007 2008 2007
--------- --------- --------- ---------
Revenues $ 11,610 $ 13,764 $ 49,007 $ 61,945

Cost of goods sold 7,146 6,878 28,582 32,664

Restructuring provision for
excess and obsolete inventory - 2,467 - 2,467
--------- --------- --------- ---------

Gross profit 4,464 4,419 20,425 26,814
Operating expenses:
Selling costs 3,022 5,019 17,031 20,152

Goodwill - 8,142 - 8,143
Restructuring Charges - - - 91
General and administrative 2,221 3,405 11,746 12,133
Research and development 647 752 3,793 5,939
--------- --------- --------- ---------
Total operating expenses 5,890 17,318 32,570 46,458
--------- --------- --------- ---------
Operating loss (1,426) (12,899) (12,145) (19,644)

Other income (expenses):
Interest income 8 47 37 208
Interest expense (193) (28) (493) (126)
Other income (expense) (15) 105 (165) 271
Gain on sale of assets -- -- 545 2,461
--------- --------- --------- ---------
Total other
income (expenses) (200) 124 (76) 2,814
--------- --------- --------- ---------
Loss from continuing
operations before income tax (1,626) (12,775) (12,221) (16,830)
Benefit (Provision) for
income taxes (56) (58) (208) (184)
--------- --------- --------- ---------
Loss from continuing operations $ (1,682) $ (12,833) $ (12,429) $ (17,014)

Discontinued Operations

Income (loss) from
operations of
discontinued component-
net of income tax -- (170) (37) (1,469)

Gain (loss) of sale of
discontinued component-
net of income tax. -- -- 2,421 (581)

Income (loss) from discontinued
operations, net of income tax -- (170) 2,384 (2,050)
--------- --------- --------- ---------

Net Income (loss) $ (1,682) $ (13,003) $ (10,045) $ (19,064)

Weighted average number of
shares - basic and diluted
used in computing net earnings
(loss) per share 23,519 25,169 23,519 23,278
========= ========= ========= =========

Basic and diluted net earnings
(loss) per share: ========= ========= ========= =========

Continuing operations $ (0.07) $ (0.51) $ (0.53) $ (0.73)
========= ========= ========= =========

Discontinued operations $ - $ (0.01) $ 0.10 $ (0.09)
========= ========= ========= =========

Total $ (0.07) $ (0.52) $ (0.43) $ (0.82)
========= ========= ========= =========

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS

Three Months Ended Three Months Ended
December 31, 2008 September 30, 2008
----------------------------- ---------------------------
GAAP Adjustments Non-GAAP GAAP Adjustments Non-GAAP
-------- ---------- -------- -------- -------- --------
Revenues $ 11,610 $ $ 11,610 $ 12,067 $ 12,067

(92)(a) (52)(a)

Cost of
goods sold 7,146 (102)(c) 6,952 7,685 (116)(c) 7,517
-------- ---------- -------- -------- -------- --------

Gross profit 4,464 194 4,658 4,382 168 4,550

Operating
expenses:
(21)(a) (5)(a)
Selling costs 3,022 (140)(c) 3,141 3,845 (23)(c) 3,817
(46)(a)
(511)(b)
General and
administrative 2,221 (40)(a) 1,672 3,101 (69)(c) 2,475
(462)(b)
(47)(c) (58)(a)
Research and
development 647 (29)(a) 613 1,019 (28)(c) 933

(5)(c)
-------- ---------- -------- -------- -------- --------
Total
operating
expenses 5,890 (464) 5,426 7,965 (740) 7,225
-------- ---------- -------- -------- -------- --------

Operating profit
(loss) (1,426) 658 (768) (3,583) 908 (2,675)

Other income
(expenses):

Interest income 8 8 9 9

Interest
expense (193) (193) (186) (186)

Other income
(loss) (15) (15) (211) (211)
-------- ---------- -------- -------- -------- --------

Total other
income
(expenses) (200) (200) (388) (388)
-------- ---------- -------- -------- -------- --------

Loss before
income taxes (1,626) 658 (968) (3,971) 908 (3,063)

Benefit
(provision) for
income taxes (56) (56) (39) (39)
-------- ---------- -------- -------- -------- --------

Loss from
continuing
operations $ (1,682)$ 658 $ (1,024) $ (4,010)$ 908 $ (3,102)
-------- ---------- -------- -------- -------- --------

Income (loss)
from operations
of discontinued
component-net
of income tax $ - $ - $ - $ 41 $ 9(a&b) $ 50

Gain (loss) on
sale of
discontinued
component-net
of income tax $ 2,241 $ 2,241

Income(loss)from
discontinued
operations net
of income tax -- -- -- $ 2,282 9 $ 2,291
-------- ---------- -------- -------- -------- --------

Net Income
(loss) $ (1,682)$ 658 $ (1,024) $ (1,728)$ 917 $ (811)

Weighted average
number of
shares - basic
and diluted
used in
computing net
earnings (loss)
per share 23,519 23,519 23,519 23,519
======== ========== ======== ======== ======== ========

Basic net
earnings (loss)
per share: ======== ========== ======== ======== ======== ========

Continuing
operations $ (0.07)$ $ (0.04) $ (0.17) $ (0.13)
======== ========== ======== ======== ======== ========

Discontinued
operations $ - $ $ - $ 0.10 $ 0.10
======== ========== ======== ======== ======== ========

Total $ (0.07)$ $ (0.04) $ (0.07) $ (0.03)

(a) The effect of depreciation of fixed assets
(b) The effect of amortization of intangible assets
(c) The effect of stock based compensation. The company adopted the
provisions of Statement of Financial Accounting Standards No. 123(R),
"Share-Based Payment" on January 1, 2006 using the modified-prospective
transition method.
(d) The effect of restructuring reserve

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS

Twelve Months Ended Twelve Months Ended
December 31, 2008 December 31, 2007
----------------------------- ---------------------------
GAAP Adjustments Non-GAAP GAAP Adjustments Non-GAAP
-------- ---------- -------- -------- -------- --------
Revenues $ 49,007 $ $ 49,007 $ 61,945 $ 61,945

(431)(a) (661)(a)

Cost of
goods sold 28,582 (482)(c) 27,669 32,664 (625)(c) 31,378

Restructuring
Provision for
excess &
obsolete
inventory - 2,467 (2,467)(d) -
-------- ---------- -------- -------- -------- --------

Gross profit 20,425 913 21,338 26,814 3,753 30,567

Operating
expenses:

(45)(a) (35)(a)
Selling costs 17,031 (49)(c) 16,937 20,152 (431)(c) 19,686
Restructuring
Charges - 91 (91)(d) -

Restructuring
charges for
impairment of
intangible
assets and
goodwill 8,143 (8,143)(d) -
(466)(a)
(2001)(b)

General and
administrative 11,746 (268)(a) 9,213 12,133 (720)(c) 8,946
(1964)(b)
(301)(c)

Research and
development 3,793 (322)(a) 3,371 5,939 (560)(a) 5,162

(100)(c) (217)(c)
-------- ---------- -------- -------- -------- --------

Total
operating
expenses 32,570 (3,049) 29,521 46,458 (12,664) 33,794
-------- ---------- -------- -------- -------- --------

Operating profit
(loss) (12,145) 3,962 (8,183) (19,644) 16,417 (3,227)

Other income
(expenses):

Interest income 37 37 208 208

Interest
expense (493) (493) (126) (126)

Other income
(loss) (165) (165) 271 271

Gain on Sale
of Assets 545 545 2,461 2,461
-------- ---------- -------- -------- -------- --------

Total other
income
(expenses) (76) (76) 2,814 2,814
-------- ---------- -------- -------- -------- --------

Loss before
income taxes (12,221) 3,962 (8,259) (16,830) 16,417 (413)

Benefit
(provision) for
income taxes (208) (208) (184) (184)
-------- ---------- -------- -------- -------- --------

Loss from
continuing
operations $(12,429)$ 3,962 $ (8,467) $(17,014) $ 16,417 $ (597)
-------- ---------- -------- -------- -------- --------

Income (loss)
from operations
of discontinued
component-net
of income tax $ (37)$ 85 (a&b) $ 48 $ (1,469) $ 165(a&b)$(1,304)

Gain (loss) on
sale of
discontinued
component-net
of income tax 2,421 2,421 (581) (581)

Income (loss)
from
discontinued
operations net
of income tax $ 2,384 $ 85 2,469 $ (2,050)$ 165 $ (1,885)
-------- ---------- -------- -------- -------- --------

Net Income
(loss) $(10,045)$ 4,047 $ (5,998) $(19,064) $ 16,582 $(2,482)

Weighted average
number of
shares - basic
and diluted
used in
computing net
earnings (loss)
per share 23,519 23,519 23,278 23,278
======== ========= ======== ======== ========= =======

Basic net
earnings (loss)
per share: ======== ========= ======== ======== ========= =======

Continuing
operations $ (0.53)$ $ (0.36) $ (0.73) $ (0.03)
======== ========= ======== ======== ========= =======

Discontinued
operations $ 0.10 $ $ 0.10 $ (0.09) $ (0.08)
======== ========= ======== ======== ========= =======

Total $ (0.43)$ $ (0.26) $ (0.82) $ (0.11)

(a) The effect of depreciation of fixed assets
(b) The effect of amortization of intangible assets
(c) The effect of stock based compensation. The company adopted the
provisions of Statement of Financial Accounting Standards No. 123(R),
"Share-Based Payment" on January 1, 2006 using the modified-prospective
transition method.
(d) The effect of restructuring reserve

For Further Information Contact:
Dave Renauld
Vice President, Corporate Affairs
Proxim Wireless
(413) 584-1425
ir@proxim.com

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