Zoom Technologies Reports Results for the Third Quarter of 2002

Business Wire, Oct 29, 2002

                       ZOOM TECHNOLOGIES, INC.
                     Consolidated Balance Sheets
                             In thousands

                                               SEPT 30,       DEC 31,
                                                 2002          2001
                                             (Unaudited)     (Audited)
Assets

Current assets:

   Cash                                         $6,990         $5,252
   Accounts receivable, net                      5,460          5,652
   Inventories, net                              7,086         11,083
   Prepaid expenses and other                      974          1,000

     Total current assets                       20,510         22,987

Property and equipment, net                      3,614          4,129

Other non-current assets                             -          2,069

     Total assets                              $24,124        $29,185

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

   Current portion of long-term debt              $190           $139
   Accounts payable                              3,372          2,750
   Accrued expenses                              1,209          1,880

     Total current liabilities                   4,771          4,769

   Long-term debt                                5,390          5,745
   Other non-current liabilities                     -            255

     Total liabilities                          10,161         10,769

Stockholders' equity:

   Common stock                                 28,245         28,245
   Retained earnings (deficit)                 (14,282)        (9,829)

     Total stockholders' equity                 13,963         18,416

     Total liabilities & stockholders'
      equity                                   $24,124        $29,185


                       ZOOM TECHNOLOGIES, INC.
                Consolidated Statements of Operations
                In thousands, except per share amounts
                             (Unaudited)

                                   Three Months         Nine Months
                                     Ending               Ending
                                9/30/02   9/30/01   9/30/02   9/30/01


Net sales                       $10,878   $11,719   $29,059   $31,991
Cost of goods sold                7,707     8,889    22,116    26,855

   Gross profit                   3,171     2,830     6,943     5,136

Operating expenses:
   Selling                        1,423     1,802     4,488     5,838
   General and administrative       825     1,433     2,588     4,571
   Research and development         879     1,335     2,810     4,155
   Total operating expenses       3,127     4,570     9,886    14,564

   Operating profit (loss)           44    (1,740)   (2,943)   (9,428)

Other income (expense), net          48        23        94      (134)

   Income (loss) before income
    taxes                            92    (1,717)   (2,849)   (9,562)

Income tax expense (benefit)          -     3,800     2,013     3,800

   Income (loss) before
    extraordinary gain               92    (5,517)   (4,862)  (13,362)

Extraordinary gain                    -         -       255         -

   Net income (loss)                $92   $(5,517)  $(4,607) $(13,362)

Basic earnings (loss) per share:
   Earnings (loss) per share
    before extraordinary
    gain                          $0.01    $(0.70)   $(0.62)   $(1.70)
   Extraordinary gain                 -         -      0.03         -
   Earnings (loss) per share      $0.01    $(0.70)   $(0.59)   $(1.70)

Diluted earnings (loss) per
 share:
   Earnings (loss) per share
    before extraordinary
    gain                          $0.01    $(0.70)   $(0.62)   $(1.70)
   Extraordinary gain                 -         -      0.03         -
   Earnings (loss) per share      $0.01    $(0.70)   $(0.59)   $(1.70)

Weighted average number of
 shares outstanding:

   Basic                          7,861     7,861     7,861     7,861

   Diluted                        7,862     7,861     7,875     7,861