Sandvine Reports Q2 2008 Revenue of $11.1 Million and Diluted Loss Per Share of $0.034

Sandvine Corporation, (TSX: SVC)(AIM: SAND) a leading provider of intelligent broadband network solutions for DSL, cable, FTTx, fixed wireless and mobile operators, today reported second quarter revenue of $11.1 million. Net loss was $4.6 million, or $0.034 per diluted share, which includes $1.2 million attributable to non-cash, acquisition-related expenses and stock-based compensation.

Sandvine won 12 new customers in the second quarter - matching a record for the Company.

Dave Caputo, Sandvine's President and Chief Executive Officer, said, "This was a positive quarter for Sandvine in many respects. It was our best quarter in terms of revenue from the DSL market, and for the first time one of Sandvine's major global reseller partners contributed over 10 percent of total revenue. Also, the EMEA region had its strongest revenue quarter ever."

However, delays in certain opportunities impacted the results for the quarter and the Company's ability to rely upon the material assumptions underlying its 2008 annual revenue guidance of $80 to $85 million, introduced March 6th. Most notably, given the time remaining in the current fiscal year, Sandvine no longer believes that it can rely upon the assumptions that it would earn at least $40 million in revenue from existing customers and $40 million in revenue from new customers. Consequently, the Company has withdrawn its annual revenue guidance.

The timing of customer decisions has become increasingly difficult to forecast due to a variety of factors, including the effect of the network neutrality debate on Sandvine's North American installed base, the reduced predictability associated with expansion into new markets, such as Sandvine's entrance into the Tier-one DSL and wireless markets, and the increasing number of opportunities being pursued through the indirect sales channel.

Caputo added, "While we haven't lost any meaningful business and we believe that the delayed opportunities are still available to be won, the decision dates have proven to be unpredictable and may not fall within our fiscal year. As a result, we think it is prudent to withdraw guidance at this time."

FINANCIAL HIGHLIGHTS
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Millions of dollars, except per       Q2 2008 Q2 2007 Change Q1 2008 Change
 share data and where
 otherwise indicated
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Revenue                                  11.1    20.0    -45%    8.3     34%
Gross Margin percent                       77%     81% -4 pp      75%  2 pp
R&D, SG&A                                12.2     8.8     38%   12.5     -3%
Other Operating Expenses                  2.0     0.9    132%    1.8      9%
Net (Loss) Income(i)                     (4.6)   10.3           (7.0)
Diluted (Loss) Earnings Per Share      (0.034)  0.079         (0.051)
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(i) Includes $1.2 million attributable to non-cash, acquisition-related
expenses and stock-based compensation (Q2 2007: $0.2 million; Q1 2008:
$1.1 million).

The above comments constitute forward-looking information. See "Caution Regarding Forward-Looking Information" below. All amounts are in Canadian dollars unless otherwise specified.

STRATEGIC UPDATE

Sandvine is focused on increasing its market penetration, in terms of number of customers and the number of broadband subscribers they represent. The Company has over 100 customers serving over 60 million broadband subscribers, in over 40 countries. Eighteen of the top 100 broadband service providers around the world have selected Sandvine's solutions. Since the last quarterly results news release, Sandvine has made significant progress on some of its core strategies.

Sales and Marketing. Sandvine believes that diversifying its customer base by access technology (DSL, cable, wireless and FTTx) and geography, winning large network operators, increasing penetration of its market-leading 10 GE solution, and increasing traction through its strategic reseller partners are key to its growth strategy.

Sandvine won 12 new customers in the second quarter, as follows.

- By access technology: eight DSL, three cable and one wireless customer.

- By geography: seven from North America, four from EMEA, and one from Asia Pacific.

- Large customers: initial orders from two new DSL customers that have over one million broadband subscribers each.

- 10GE product: a record 12 customers in the quarter bought the PTS 14000 for the first time. In total, over 40 customers have purchased the PTS 14000.

- Strategic partners: won two customers through a global reseller.

Research and Development. Sandvine is focused on extending its technological lead in the market for Intelligent Broadband Network solutions. In May, the Company launched Sandvine FairShare(TM) to enhance its suite of Traffic Optimization solutions. Sandvine FairShare enables service providers to ensure equitable allocation of network resources during periods of congestion, through a wide range of policy options including a fully application-agnostic approach.