Milpitas, California, November 2, 2006 – JDSU today reported results for its fiscal 2007 first quarter ended September 30, 2006.   Following the execution of a 1-for-8 reverse stock split on October 16, 2006, all earnings per share calculations are presented on a split-adjusted basis.

Net revenue for the first quarter was $318.1 million and GAAP net loss was $(17.4) million, or $(0.08) per share.   This compares to net revenue of $318.2 million and GAAP net loss of $(45.8) million, or $(0.22) per share, reported for the fourth quarter of fiscal 2006, and to net revenue of $258.3 million and a GAAP net loss of $(67.0) million, or $(0.34) per share, for the first quarter of fiscal 2006.   Fiscal 2006 first quarter results reflect a partial quarter contribution from the Communications Test and Measurement business acquired in August 2005.

On a non-GAAP basis, revenue for the first quarter was $318.2 million and net income was $6.8 million, or $0.03 per share.   This compares to non-GAAP net revenue of $318.6 million and a non-GAAP net loss of $(2.1) million, or $(0.01) per share, for the fourth quarter of fiscal 2006, and to non-GAAP net revenue of $259.2 million and a non-GAAP net loss of $(15.4) million, or $(0.08) per share, for the first quarter of fiscal 2006. 

On a non-GAAP EBITDA basis (non-GAAP Earnings Before Interest, Taxes, Depreciation and Amortization), the Company earned $9.6 million for the quarter ended September 30, 2006, which compares to $5.5 million for the fourth quarter of fiscal 2006, and to a loss of $(4.3) million for the first quarter of fiscal 2006.

“The achievement of positive earnings per share on a non-GAAP basis for the first time in more than five years marks another significant milestone on the company’s journey to sustained profitability” said Kevin Kennedy, JDSU’s Chief Executive Officer.   “Our strong balance sheet, coupled with a firm commitment to innovation, ensures that JDSU will continue to enable the delivery of next generation optical and broadband service technologies.”

Financial Overview – Fiscal 2007 First Quarter Ended September 30, 2006

• Optical Communications net revenue grew 3.8% from the previous quarter, and 37.3% from the same quarter a year ago.   Net revenue of $138.0 million represented 43% of total net revenue. 
• Communications Test and Measurement net revenue of $116.8 million was down 7.5% from last quarter and represented 37% of total net revenue.     
• Advanced Optical Technologies net revenue of $39.3 million was up 7.1% from last quarter, and down 10.9% from the same quarter a year ago.   This segment represented 12% of total net revenue. 
• Reported under the heading of ‘All Other,’ the Commercial Lasers business reported revenue of $24.1 million, up 6.6% sequentially and 25.5% from the same quarter a year ago, representing 8% of total net revenue.  
• Americas’ customers represented 56.9% of net revenue. European and Asia-Pacific customers represented 25.6% and 17.5% of net revenue, respectively.
• GAAP gross margin was 30.8% of net revenue, and non-GAAP gross margin was 34.7% of net revenue.
• GAAP operating expenses were $134.7 million, or 42.4% of net revenue.   Non-GAAP operating expenses were $117.3 million, or 36.9% of net revenue.
• The Company held $1,216.0 million in cash, cash equivalents, short-term investments and restricted cash at the end of the first quarter. 

Business Outlook

For the second quarter of fiscal 2007, ending December 31, 2006, the Company expects net revenue of $332 to $352 million.

Conference Call

The Company will discuss these results and other related matters at 2:30 p.m. Pacific Time on November 2, 2006 in a live webcast, which will also be archived for replay on the Company's website at www.jdsu.com/investors.  This press release is being furnished as a Current Report on Form 8-K with the Securities and Exchange Commission, and will be available at http://www.sec.gov/.

About JDSU

JDSU (NASDAQ: JDSUD; and TSX: JDU) is committed to enabling broadband & optical innovation in the communications, commercial and consumer markets.   JDSU is a leading provider of communications test and measurement solutions and optical products for telecommunications service providers, cable operators, and network equipment manufacturers.  Furthermore, JDSU is a leading provider of innovative optical solutions for medical/environmental instrumentation, semiconductor processing, display, brand authentication, aerospace and defense, and decorative applications.  More information is available at www.jdsu.com.

Following the completion of a 1-for-8 reverse stock split on October 16, 2006, JDSU’s common stock is trading under the temporary trading symbol "JDSUD."   The trading symbol will revert back to "JDSU" on November 14, 2006.       

Forward-Looking Statements

This press release contains, and the discussions in our subsequent conference call will contain, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements include: (i) any anticipation or guidance as to future financial performance, including future revenue, gross margin, operating expense, operating margin, EBITDA and other financial metrics; and (ii) the Company's beliefs regarding the purpose, usefulness and efficacy of non-GAAP results and the measures and items the Company includes in the same, as well as any benefits to investors the Company believes its non-GAAP measures provide.   These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected.   In particular, the Company's ability to predict future financial performance continues to be difficult due to, among other things:  (a) continuing general limited visibility across many of our product lines; (b) the ongoing potential for significant quarter-over-quarter product mix fluctuations, which can materially impact profitability measures due to the broad gross margin range across our portfolio; (c) continuing consolidation affecting our customer base, which, in the shorter term limits demand visibility, and, in the longer term, could reduce our business potential; (d) average selling prices continue to decline across our traditional Communications and Commercial and Consumer product portfolio; (e) we and many of our Optical Communications suppliers continue to experience execution and delivery challenges which limit our revenue and impair our profitability; (f) our Communications Test and Measurement business is notable for a significant level of in-quarter book-and-ship business, further limiting our forecasting abilities; and (g) we are currently engaged in various product and manufacturing transfers, site consolidations and product discontinuances.

For more information on these and other risks affecting the Company's business, please refer to the “Risk Factors” section included in the Company's Annual Report on Form 10-K for the year ended June 30, 2006 filed with the Securities and Exchange Commission, as well as in other filings on Forms 10-Q. The forward-looking statements contained in this news release are made as of the date hereof and the Company does not assume any obligation to update the reasons why actual results could differ materially from those projected in the forward-looking statements.

Contact Information

Investors:   Jacquie Ross, 408-546-4445 or investor.relations@jdsu.com
Press:   Kathleen Greene, 408-546-5852 or mailto:jayme.curtis@jdsu.com

The following financial tables are presented in accordance with GAAP, unless otherwise specified.

-SELECTED FINANCIAL DATA FOLLOWS-