Zoom Telephonics Reports 20% Sales Increase In First Quarter Ending 3/31/00 - Company Financial Information

Cambridge Telcom Report, May 1, 2000

Zoom Telephonics, Inc. (NASDAQ: ZOOM), a leading manufacturer of modems and other data communications products, Thursday reported sales of $13.6 million for its first quarter ending March 31, 2000, up 20% from $11.4 million in the first quarter of 1999. The increase was primarily due to higher unit sales of dial-up modems with relatively stable average selling prices.

Zoom reported a net loss of $941 thousand or $.12 per share for the first quarter of 2000, versus a net loss of $690 thousand or $.09 per share for the first quarter of 1999.

Zoom ended the quarter with a strong balance sheet, with a current ratio of 8.6, cash and investment securities of $11.4 million or $1.48 per share, and stockholders' equity of $4.91 per share.

"The dial-up modem business remains challenging, as shown by 3Com's recent decision to exit the business," said Frank Manning, Zoom's President and CEO. "Zoom continues to gain market share at retail and among value-added resellers, and our channels will be very important as we introduce new broadband solutions including cable and DSL modems. With reduced competition, the upcoming V.92 standard, and international expansion of our Zoom and Hayes brands, dial-up modems will continue to be an important part of our business. More important, however, is the major progress we've made in broadband and advanced networking. We are close to shipping three different cable modems, including USB, PCI, and Ethernet models, as well as USB and PCI DSL modems. Soon we will also be shipping our 11 Mbps 802.11b wireless LAN product line and our 10 Mbps home phoneline networking products. To tie it all together, we will introduce innovative "gateway" solutions that make it easy to use wireless and home phoneline networking to share broadband access to the Internet. We believe that Zoom is uniquely positioned to offer a full complement of broadband Internet access solutions."

For additional information contact Investor Relations, Zoom Telephonics, 207 South Street, Boston, MA 02111, telephone (617) 423-1072, email investor@zoom.com, or visit Zoom's website at www.zoom.com

                    ZOOM TELEPHONICS, INC.
                  Consolidated Balance Sheets
                           ( 000's )

                                               MARCH     DECEMBER
                                                31,          31,
                                               2000         1999
                                            (Unaudited)  (Audited)
ASSETS

Current assets:

        Cash and investment securities        $11,436     $10,408
        Accounts receivable, net                7,579       7,324
        Inventories                             9,964      12,389
        Deferred income taxes                   4,827       3,969
        Prepaid expenses and other                541         560

                Total current assets           34,347      34,650

Property and equipment, net                     4,157       4,212

Goodwill and other assets                       3,974       4,210

                Total assets                  $42,478     $43,072

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

        Accounts payable                      $ 1,893     $ 2,703
        Accrued expenses                        2,097       2,374

                Total current liabilities       3,990       5,077

Other liabilities                                 454         481

                Total liabilities               4,444       5,558

Stockholders' equity:

        Common stock                           27,233      25,780
        Retained earnings                      10,801      11,734

                Total stockholders' equity     38,034      37,514

                Total liabilities &           $42,478     $43,072
                stockholders' equity

                    ZOOM TELEPHONICS, INC.
               Consolidated Statements of Income
                           ( 000's )
                          (Unaudited)

                                              Three Months Ending
                                              3/31/00     3/31/99

 Net sales                                    $13,618     $11,387
 Cost of goods sold                             9,237       7,326

         Gross profit                           4,381       4,061

     Operating expenses:
         Selling                                2,942       2,499
         General and administrative             1,346       1,375
         Research and development               1,592       1,504

         Total operating expenses               5,880       5,378

         Operating profit (loss)               (1,499)     (1,317)

 Other income, net                                115         278

         Income (loss) before taxes            (1,384)     (1,039)

 Income tax expense (benefit)                    (443)       (349)

         Net income (loss)                    $  (941)    $  (690)

        Earnings (loss) per share:

         Basic                                $ (0.12)    $ (0.09)

         Diluted                              $ (0.12)    $ (0.09)

    Average number of shares outstanding:

         Basic                                  7,640       7,475

         Diluted                                7,640       7,475