ARC Wireless Solutions reports increases in first quarter revenue and net income

Wheat Ridge, Colorado May 14, 2004 – ARC Wireless Solutions, Inc. (OTC BB:ARCS) reported first quarter net income of $81,000 as compared with a loss of  $389,000 for the same period a year ago.   Net revenues totaled $7,233,000, up 18% from $6,115,000.  These results reflected growth in all three of the Company’s operating divisions:  Wireless Communications Solutions Division, Winncom Technologies Corp. and Starworks Wireless Inc. 

Winncom Technologies Corp.: Winncom reported a 12% increase in revenues to $5.6 million and a 1% increase in gross profit margin to13%, driven primarily by an increase in international sales and new products, respectively.  Due to improved cash flow, Winncom was able to take advantage of vendor early payment discounts of $78,000 as compared with $5,000 for the same period last year.  

Wireless Communications Solutions Division:  The antenna division reported a 35% increase in revenues to $1.5 million and a 5% increase in gross profit margin to 42%.  All aspects of the antenna division’s business increased as compared with last year, led by Wi-Fi panel antenna and Freedom Antenna® sales.

Starworks Wireless Inc:  In an effort to increase the exposure to new product markets, the Company has successfully taken the initial steps in introducing several styles and types of cable, resulting in revenues of $77,000 as compared with $2,000 for the first quarter of 2003.   

“Winncom began aggressively pursuing international business in the first quarter of 2003 and is actively offering new products to many Eastern European customers,” stated Gregory E. Raskin, CEO and President of Winncom.  “We are developing the first Wi-Fi Hotspot in Kazakhstan and have expanded our sales operations in Russia along with Central and Eastern Europe,” Mr. Raskin added.

   Randall P. Marx, Chief Executive Officer, stated, “We are very pleased with our results for the first quarter of 2004.  These results demonstrate the success and momentum of our diversified product line-up.   We are in a strong new product development mode and the efficiencies of our operational infrastructure are evident in the decrease in operating costs and increase in revenues and earnings.” 

About ARC Wireless Solutions, Inc.

ARC Wireless Solutions, Inc. is involved in selective design, manufacturing and marketing, as well as distributing and servicing, 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 Solutions 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 Solutions 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.