SAN JOSE, Calif., Aug. 12 (Reuters) -
                        Financial Results Below
                  Brocade Communications Systems, Inc.
                        Statements of Operations
                 (in thousands, except per share data)
                        Three Months Ended  Nine Months Ended
                           Jul 31, Jul 31,  Jul 31,   Jul 31,
                             1999     1998     1999     1998
               (unaudited) (unaudited)(unaudited) (unaudited)
 Net revenues              $20,051  $4,569  $38,598   $18,839
 Cost of revenues            9,921   4,351   18,679    12,720
     Gross margin           10,130     218   19,919     6,119
                             50.5%    4.8%    51.6%     32.5%
 Operating expenses:
   Research and development  4,148   5,016    9,782    11,311
   Sales and marketing       3,691   1,444    7,777     3,820
   General and administrative
                             1,000   1,979    2,415     3,242
   Amortization of deferred
    stock compensation         280      --    1,657        --
     Total operating expenses
                             9,119   8,439   21,631    18,373
 Income (loss) from operations
                            1,011  (8,221)  (1,712)  (12,254)
 Interest income, net          633     114      669       277
 Income (loss) before
  income taxes              1,644  (8,107)  (1,043)  (11,977)
 Provision for income taxes     33      --       33        --
 Net income (loss)           1,611 (8,107)  (1,076)  (11,977)
 Pro forma net income (loss)
  per share                   0.06  (0.46)   (0.05)    (0.70)
 Shares used in the calculation
  of pro forma net income
  (loss) per share          27,507  17,636   20,312    17,189