6 March 2023

ETHERNITY NETWORKS LTD.

("Ethernity" or the "Company")

Fibre controller contracts progress

Ethernity Networks (AIM: ENET.L; OTCQB: ENETF), a leading supplier of data processing semiconductor technology for networking appliances, is pleased to provide an update on the fulfilment of its contracts with its Asian broadband network OEM customer (the "Customer").

$3 million contract (announced 18 October 2021)

The Company has successfully completed the integration of its XGS-PON Optical Line Termination (OLT) fibre access controller onto the Customer's board and has completed interoperability with three 3^rd party Optical Networking Units (ONUs) servicing the end user network. The Company has commenced shipment of its ENET5200 Quad XGS-PON System-on-chip (SoC) controller device to the Customer in line with the contract term and remains on track to record the majority of the revenues under this contract during the course of 2023.

$4.6 million contract (announced 20 September 2022)

The Customer completed manufacturing of the first units of its Fibre-to-the-Room (FTTR) gateway to enable the start of the integration process, similar to the one completed for the XGS-PON platform. Following on from an initial order that was shipped this quarter, Ethernity has now received the second order for devices from the Customer under the $4.6 million contract, for 5,000 units of its Gigabit PON OLT fibre controller SoC devices for use in FTTR deployments. It is anticipated that these devices will be ready for shipment to the Customer in Q3 2023. The Company anticipates that the revenues under this contract will be recorded during 2023 and 2024.

Further fibre controller business progress

Ethernity has seen growing interest from multiple OEMs for its PON fibre controller devices and PON systems over and above the current signed contracts. As a result, the Company will target sales of licensing fees for its PON fibre controller SoC and sales of its PON fibre controller OLT system in various configurations. Our newly introduced state-of-the-art UEP3808 PON system resulted from the partnership with the Customer, based on the Customer's existing XGS-PON OLT described above. It has already captured the interest of certain OEMs, as they cited our ability to deliver the PON system at the right price so as to allow OEMs to take an off-the-shelf platform to the market, reducing time-to-revenue.

David Levi, CEO of Ethernity Networks, commented: "We're pleased to be progressing our work with this important Customer, including working with them to identify potential new revenue streams. As a result, we are excited about the opportunities ahead for the Company. With the business we have in-hand and the potential for multiple follow-on contract wins, we are excited with these opportunities that have the potential to bring the Company to new heights."

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About Ethernity ( www.ethernitynet.com )

Ethernity Networks (AIM: ENET.L OTCQB: ENETF) provides innovative, comprehensive networking and security solutions on programmable hardware that increase telco/cloud network infrastructure capacity. Ethernity's semiconductor logic offers data processing functionality for different networking applications, innovative patented wireless access technology, and fibre access media controllers, all equipped with control software with a rich set of networking features. Ethernity's solutions quickly adapt to customers' changing needs, improving time-to-market, and facilitating the deployment of 5G over wireless and fibre infrastructure.