Redback Networks Third Quarter Operating Results Redback Networks Inc. (http://www.redback.com), a leading provider of next generation broadband networking systems, generated US$4.5 million in cash in the third quarter of 2006, boosting its overall cash total to US$176 million. The company also added 18 new customers in the third quarter for its SmartEdge family of multi-service edge routers, including a top 20 carrier worldwide. In less than two years, Redback has won more than 200 SmartEdge customers worldwide, including 12 of the largest 20 carriers. Redback has more than 500 SmartEdge and SMS customers worldwide, including 15 of the 20 largest carriers. With the adoption of Statement of Financial Accounting Standards No. 123R as of January 1, 2006, Redback Networks is reporting stock-based compensation expense in its generally accepted accounting principles (GAAP) results. GAAP net loss for the third quarter of 2006 was US$2.4 million or US$0.03 per share attributable to common stockholders compared to a GAAP net loss of US$8.4 million or US$0.15 per share in the third quarter of 2005. Non-GAAP net income was US$9.1 million or US$0.12 per share, compared to a non-GAAP net loss of US$4.2 million or US$0.08 per share for the third quarter of 2005. Excluded from the non-GAAP results for the third quarter of 2006 were charges relating to amortization of intangible assets, stock-based compensation, amortization of the fair value of warrants issued in connection with a lease agreement, certain federal and state income taxes, and accretion of a dividend payable to preferred stockholders which was in the second quarter of 2006 and the previous quarters. For comparative purposes, GAAP pretax income excluding stock-based compensation for the third quarter of 2006 was US$6.4 million, compared with a GAAP pre-tax loss excluding stock-based compensation of US$7.3 million for the third quarter of 2005. Redback Networks Inc. manages 50 million broadband connections for 15 of the top 20 carriers worldwide. Redback's multi-service routing platform delivers next generation broadband services such as VoIP, IPTV, Video-on-Demand and on-line gaming. Redback Networks has more than 500 carrier customers worldwide and is based in San Jose, CA. In 2006 Redback marks its 10 year anniversary, celebrating ten years of broadband innovation.