EXFO's Triple-Play AXS-200/635 Tester Selected by Tier-1 European Network Operator

    - Deal could reach US$10 million over several years with an initial order
      of US$2 million
    - Automated test routines, workflow integration and multi-layer test
      capabilities allow the most efficient deployment of triple-play
      services over VDSL2

QUEBEC CITY, Jan. 7 /PRNewswire-FirstCall/ - EXFO Electro-Optical Engineering Inc. (NASDAQ: EXFO, TSX: EXF) announced today that its AXS-200/635 Triple-Play Test Set has been selected by a tier-1 European network operator to support the deployment of its next-generation FTTC/VDSL2 services and applications. EXFO received an initial order of US$2 million , but the deal could reach US$10 million over several years.

This network operator recognized the need for a next-generation, automated and easy-to-use handheld test set for its field technicians and advanced field engineers capable of operating and troubleshooting on bare wire loops, ADSL and especially newer VDSL2 circuits up to the wideband frequencies used for triple-play and IP-video service deployments.

The AXS-200/635 is the ideal choice for saving time and eliminating truck rolls through its intuitive graphical user interface (GUI), fast and fully automated test routines, reliable laptop and workflow integration via Bluetooth, integrated ADSL/VDSL2 wideband testing from application layers all the way down to copper pairs, and support for optical testing to fully validate broadband deployments as well as proven IP analysis over DSL and Ethernet links.

The AXS-200/635 is a complete, multi-layer test solution, part of the AXS-200 product line used in the deployment, troubleshooting and repair of voice, ADSL2+, VDSL2, Ethernet, TDM, optical, and triple-play services such as IPTV and VoIP. The AXS-200/635 has been designed to be easily integrated into existing outside plant workflow practices with full support for northbound results transfer and southbound work order downloads directly from the test set. This level of workflow integration, along with the comprehensive feature set of the AXS-200/635, provides time savings and efficiencies that translate into significant capital expenditure reductions.

"This leading and very demanding customer has confirmed that the AXS-200/635 is the ideal tool to efficiently roll out next-generation circuits, and the wide field acceptance and time saved will provide them with an excellent return on their investment," said Etienne Gagnon , EXFO's Vice-President of Product Management and Marketing. "The AXS-200/635's ease-of-use, including customized auto-testing with plain-language results, and full integration capabilities with our customer's management systems provide a unique value proposition that supports efficiency when deploying new access technologies."

For further information on the AXS-200/635 Triple-Play Test Set, please visit www.EXFO.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, and we intend that such forward-looking statements be subject to the safe harbors created thereby. Forward-looking statements are statements other than historical information or statements of current condition. Words such as may, will, expect, believe, anticipate, intend, could, estimate, continue, or the negative or comparable terminology are intended to identify forward-looking statements. In addition, any statements that refer to expectations, projections or other characterizations of future events and circumstances are considered forward-looking statements. They are not guarantees of future performance and involve risks and uncertainties. Actual results may differ materially from those in forward-looking statements due to various factors including the effect of the worldwide recession and the timing of the expected recovery on the telecom market for our customers and suppliers; fluctuating exchange rates and our ability to execute in these uncertain conditions; consolidation in the global telecommunications test, measurement and service assurance industry; capital spending levels in the telecommunications, life sciences and high-precision assembly sectors; concentration of sales; the effects of the additional actions we have taken in response to such economic uncertainty (including our ability to quickly adapt cost structures with anticipated levels of business, ability to manage inventory levels with market demand); market acceptance of our new products and other upcoming products; limited visibility with regards to customer orders and the timing of such orders; our ability to successfully integrate our acquired and to-be-acquired businesses; our ability to successfully expand international operations; the retention of key technical and management personnel; and future economic, competitive, financial and market condition .Assumptions relating to the foregoing involve judgments and risks, all of which are difficult or impossible to predict and many of which are beyond our control. Other risk factors that may affect our future performance and operations are detailed in our Annual Report, on Form 20-F, and our other filings with the U.S. Securities and Exchange Commission and the Canadian securities commissions. We believe that the expectations reflected in the forward-looking statements are reasonable based on information currently available to us, but we cannot assure you that the expectations will prove to have been correct. Accordingly, you should not place undue reliance on these forward-looking statements. These statements speak only as of the date of this document. Unless required by law or applicable regulations, we undertake no obligation to revise or update any of them to reflect events or circumstances that occur after the date of this document.

About EXFO

EXFO is a leading provider of test and service assurance solutions for network operators and equipment manufacturers in the global telecommunications industry. The Telecom Division, which accounts for almost 90% of the company's revenues, offers a wide range of innovative solutions to assess optical networks, from the core to access, as well as next-generation IP infrastructures and related triple-play services. The Life Sciences and Industrial Division offers solutions in medical device and opto-electronics assembly, fluorescence microscopy and other life science sectors. For more information, visit www.EXFO.com.

SOURCE EXFO ELECTRO-OPTICAL ENGINEERING INC.