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Sandvine Reports Q3 2009 Results

Waterloo, Canada; October 8, 2009 – Sandvine Corporation, (TSX:SVC; AIM:SAND) a leading provider of intelligent broadband network solutions for DSL, cable, FTTx, fixed wireless and mobile operators, today reported third quarter fiscal 2009 revenue of $16.0 million. Revenue was 5% higher than in Q2 2009 and 22% higher than in Q3 2008.

“We are pleased with the return to growth and believe that our market can support higher revenue levels. We see good opportunities ahead and continue to like our competitive position,” said Dave Caputo, Sandvine’s president and chief executive officer.

Sandvine continues to win business from a variety of broadband access technology markets and sales regions. For the second consecutive quarter, the emerging wireless market generated record revenues and was the largest contributor to total revenues and customer wins. Revenue from Sandvine’s Asia-Pacific region also hit record highs. Total year-to-date revenue is up more than 50% over last year.

“In the first nine months of 2009, we are approaching the same level of revenue as for all of 2008, so our expectation for growth this year has materialized,” added Caputo. “As our customer base has expanded and diversified, any of our access markets, sales regions and sales channels could make the largest revenue contribution in a given quarter.”

Sandvine’s net loss improved during Q3 2009, compared to both Q2 2009 and Q3 2008, due to higher revenue, and lower cash operating expenses (in comparison to Q2 2009). Third quarter 2009 net loss was $4.4 million, or $0.032 per diluted share. On a non-GAAP1 basis, which excludes certain non-cash items, the Company’s net loss was $3.1 million, or $0.023 per diluted share. A reconciliation of GAAP to non-GAAP1 results is included as Table 1. The Company’s cash and marketable securities at August 31, 2009 totaled $87.5 million.

FINANCIAL HIGHLIGHTS (All amounts are in Canadian dollars)

After quarter-end, Sandvine announced the launch of its third-generation Network Policy Control platform, the PTS 24000, the market’s new performance leader. The PTS 24000, the latest in Sandvine’s award-winning policy traffic switch lineup, offers throughput of up to 60 Gbps per box, and clusters to deployments of up to 240 Gbps, for market-leading performance.

“We are making good progress on key strategic initiatives,” added Caputo. “We have been able to continue to strategically invest in research and development and sales and marketing through the past year while other companies in our space were forced to cut back. Our rapid growth in the wireless market, the release of the PTS 24000 and winning new customers validate that strategy.”

Sandvine’s year-to-date revenue was $49.8 million, up 53% from $32.5 million for the comparable period of fiscal 2008. Year-to-date non-GAAP net loss was $8.7 million, or 0.064 per diluted share, (GAAP basis: $14.8 million, or 0.109 per diluted share) compared to $13.6 million, or 0.100 per diluted share (GAAP basis: $17.9 million, or 0.131 per diluted share) for the comparable period of fiscal 2008.

Sandvine is focused on growing its fixed and mobile service provider customer base and the number of broadband subscribers they represent. The Company has over 170 service provider customers in over 70 countries. Together these customers serve more than 80 million fixed line broadband subscribers and a rapidly growing number of mobile data subscribers.

In the third quarter of 2009 Sandvine won 11 new customers.

• By access technology: six wireless operators, three DSL service providers, and two cablecos.
• By geography: five from EMEA, and two each from Caribbean and Latin America, North America, and Asia-Pacific. Sandvine made initial sales to customers in five new countries.
• Large customers: initial orders from three Tier 1 fixed line service providers (greater than 1 million broadband subscribers each) and one new wireless customer that is in the Top 100 worldwide, by voice subscriber count.
• Sales channel: five customers were won through reseller partners, including three that were won through our strategic relationships with global network equipment vendors.

CONFERENCE CALL

The Company will discuss the quarterly results and business outlook on a conference call at 8:30 a.m. Eastern time (1:30 BST) today. A webcast will be available on Sandvine’s website

Date: October 8, 2009
Time: 8:30 a.m. Eastern (1:30 BST)
Local dial-in number: 416 644 3415
Toll-free North America: 800 814 4860
Toll-free United Kingdom: 0800 358 5263

A replay of the call will be available at 416-640-1917 or at 877-289-8525 (passcode 4164074#) from approximately 10:30 a.m. Eastern time on the day of the call through October 15.

To download the complete results in PDF format (~65kb) please click the link below:
[download release]

ABOUT SANDVINE

Sandvine is focused on protecting and improving the quality of experience on the Internet. Our award-winning network equipment and solutions help cable, DSL, FTTx, fixed wireless and mobile operators better serve their subscribers and understand network trends; offer new services; mitigate malicious traffic; manage network congestion; and deliver QoS-prioritized multimedia services. With customers in over 70 countries serving over a hundred million broadband and wireless subscribers, Sandvine is enhancing the Internet experience worldwide. www.sandvine.com

INVESTOR RELATIONS
Rick Wadsworth
Sandvine
+1 519 880 2400 ext. 3503
rwadsworth@sandvine.com

MEDIA CONTACT
Jennifer Ross                          
Sandvine
+1 519 880 2232
jross@sandvine.com

AIM NOMAD
Neil Johnson/Andrew Chubb
Canaccord Adams Limited
+44 0207 050 6500