BigBand Networks Announces Third Quarter Results and Restructuring Plan

REDWOOD CITY, Calif., October 30, 2007–BigBand Networks, Inc., (NASDAQ: BBND) today announced financial results for the three and nine months ended September 30, 2007.

Revenues for the third quarter of 2007 were $38.5 million, a decrease of 10% from the third quarter of 2006. GAAP net loss for the third quarter of 2007 was $12.2 million, or $(0.21) per diluted share compared to GAAP net income of $1.6 million, or $0.03 per diluted share, in the third quarter of 2006. GAAP gross margins for the third quarter of 2007 were 36% compared to 52% in the third quarter of 2006. In the third quarter of 2007, the Company’s GAAP operating loss was $12.9 million, compared to an operating profit of $2.9 million in the third quarter of 2006.

GAAP results for the third quarter of 2007 include $3.2 million in stock-based compensation expense, $143,000 in amortization of intangibles, and $5.8 million in fixed assets and inventory charges associated with the retirement of the Cuda CMTS platform. In the third quarter of 2006, the Company incurred $0.6 million in stock-based compensation expense, $143,000 in amortization of intangibles and $1.2 million in preferred stock warrant expense. Non-GAAP results exclude such elements. A reconciliation of GAAP and non-GAAP results is included as part of this release as well as on the investor relations section of the Company’s website.

On a non-GAAP basis, the Company had a net loss of $2.7 million, or $0.05 per diluted share, in the third quarter of 2007, compared to net income of $3.5 million, or $0.06 per diluted share in the third quarter of 2006. Non-GAAP gross margins were 51.1% for the third quarter of 2007 compared to 52.0% in the third quarter of 2006. Non-GAAP operating loss for the third quarter of 2007 was $3.8 million as compared to a profit of $3.6 million in the third quarter of 2006.

In addition, BigBand announced a restructuring plan designed to realign resources and significantly increase its efforts on video networking. As part of this plan, the Company will reduce its workforce by 15% and retire its Cuda CMTS platform.

As part of the Company’s restructuring efforts, David Heard has been appointed chief operating officer. Heard was previously general manager of product operations and will now assume combined responsibility for research & development, marketing, sales, services and operations. Heard joined BigBand earlier in 2007, bringing with him experience in leadership positions at a number of data and telecom companies, including Tekelec, Lucent, AT&T and Somera Communications.