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ARC Wireless Solutions Reports 3rd Quarter Results

Date: 11/14/2002

WHEAT RIDGE, Colo.--(BUSINESS WIRE)--Nov. 14, 2002--ARC Wireless Solutions, Inc. (OTCBB:ARCS - News) today reported financial results for the three and nine month periods ended September 30, 2002. Net sales for the period increased to $8,500,000 as compared with $7,300,000 for the same period last year. The 16% increase in sales is attributable to an 11% increase in revenues at the Company's Winncom Technologies subsidiary and a 107% increase from its Wireless Communications Products Division. The Company had a net loss of $294,000 for the three months ended September 2002 compared with a net loss of $464,000 for the three months ended September 30, 2001. As a result of product mix sales at Winncom, gross profit margins decreased to 14.3% from 17.4% for the same period of the prior year.

Net sales for the nine month period ended September 30, 2002, increased to $24,489,000 as compared with $23,361,000 for the same period last year. Net income for the nine months ended September 30, 2002, was $313,000 as compared with a loss of $1,337,000 for the same period last year. The increase in net income for the nine month period ended September 30, 2002, is primarily due to the following: increased revenues in the Wireless Communications Products Division: increased gross profit margins in the Wireless Communication Products Division, a portion of which are from the sale of certain inventory purchased at below market costs as part of the base station antenna asset acquisition in 2001; a reduction in general and administrative expenses; gain from debt cancellation of $226,000; and the termination of amortization of goodwill effective January 1, 2002, which was $760,000 for the nine months ended September 30, 2001.

"Given the current state of the wireless marketplace, we are pleased that we have achieved such a solid performance to date for 2002," stated Randall P. Marx, Chief Executive Officer of the Company. "Looking forward, our Wireless Communications Products Division has started the fourth quarter with its largest backlog in history resulting partially from delayed orders of base station antennas in the third quarter. The Division also gained traction in the retail marketplace with the new Freedom Antenna(TM) introduced earlier this year and continues to increase sales of its Wi-Fi antenna offerings. Winncom continues to experience significantly higher unit sales of its Wi-Fi products, but at lower prices, thereby reducing revenues and gross profits. Winncom's third quarter gross profit margins were additionally affected by a product mix that included large sales of its lower margin components in September. Winncom continues to expand its product portfolio and international business," Mr. Marx added.

About ARC Wireless Solutions, Inc.

ARC Wireless Solutions, Inc. is involved in marketing, distributing and servicing, as well as selective design and manufacturing, of a broad range of wireless components and network products and accessories. The Company develops, manufactures and markets proprietary products, including base station antennas (for cellphone towers) and other antennas, through its Wireless Communications Products Division; it is a value added distributor of Wi-Fi and other wireless networking products through its Winncom Technologies Corp. subsidiary; and it designs, manufactures and distributes cable assemblies for cable, satellite and other markets through its Starworks Wireless, Inc. subsidiary. The Company's products and systems are marketed through the Company's internal sales force, OEMs, numerous reseller distribution channels, retail, and the Internet. ARC Wireless Solutions, Inc., together with its Wireless Communications Products Division and its Starworks Wireless subsidiary, is headquartered in Wheat Ridge, Colorado. The Company's Winncom Technologies Corp. subsidiary is located in Solon, Ohio. For more information about the Company and its products, please visit our web sites at www.arcwireless.net, www.antennas.com, www.winncom.com and www.starworkswireless.com.

This is not a solicitation to buy or sell securities and does not purport to be an analysis of the Company's financial position. This Release contains forward-looking statements within the meaning of the Securities Exchange Act of 1934. Although the Company believes that the expectations reflected in the forward-looking statements and assumptions upon which forward-looking statements are based are reasonable, it can give no assurance that such expectations and assumptions will prove to have been correct. See the Company's most recent Quarterly Report on Form 10-QSB and Annual Report on Form 10-KSB for additional statements concerning important factors, such as demand for products, manufacturing costs, and competition, that could cause actual results to differ materially from the Company's expectations.


Contact:
     ARC Wireless Solutions, Inc.
     Randall Marx or Richard Anderson, 303/421-4063
     Fax 303/424-5085
     randall.marx@arcwireless.net
     richard.anderson@arcwireless.net
     www.arcwireless.net

 



Source: ARC Wireless Solutions, Inc.

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