Solutions for Intelligent Bandwidth

2 Forward-looking statements in this presentation involve a number of risks and uncertainties which are detailed in IDT’s SEC filings. Actual results may differ materially from the Company’s projections.

3 IDT is… A global semiconductor solutions provider to leading-edge communications companies Generating approximately 75% of revenues from communications and SAN markets Financially strong and well-positioned as the market stabilizes and begins to grow

4 Prepared for Growth Resized the organization Dramatic reduction in discretionary spending Capital spending reduced Manufacturing consolidation announced - $6-8 million savings per quarter RESULTS: 50% gross margin at $90 million in revenue Pro forma break-even at $90 million in revenue Cash flow break-even at $80 million in revenue High fall-through to profits with revenue growth

5 Serving The Communications Infrastructure Communications Enterprise/Carrier-Class Wireless/Mobile Broadband Access Storage Area Networks Personal Computing Miscellaneous 46% 18% 6% 3% 19% 8% Revenue Across All Products Calendar Q4 2001

6 Leading Communications Customers Alcatel Cisco EMC Ericsson Fujitsu IBM Lucent Motorola NEC Nokia Nortel Siemens

7 EDGE Entridia Metro Core Metro Transport SAN Fibre Channel Metro Transport ATM Voice Metro Transport Edge Router ATM Core Switch OC-48c / 192c / 768 OC-48c / 192c Edge Router Metro Transport Metro Router Core Router Edge Aggregation Core Routing Web Switch ATM The Changing Global Network Wireless Broadband Access Broadband Access Enterprise IP

8 Key Growth Segments Application SegmentGrowth Rate Wireless Broadband AccessHigh Core RoutersModerate Metro Edge RoutersModerate Multi-Service Access SwitchesVery High LAN Switch PortsModerate VPN EquipmentModerate Web SwitchesModerate Fibre Channel SANHigh Source: Gartner Dataquest & IDT, December 2001

9 Intelligent Bandwidth Throughput Classification 10 Mbit Layer 3Layer 3-7 OC Gbps Major performance increase needed to service wire-speed throughput and deeper classification

10 Key Market Drivers Faster, more intelligent packet processing The convergence of data and voice Distributed intelligence throughout the network

11 IDT’s Increasing Integration Integrated Technology Integration of Memory & Logic Blocks of Intellectual Property System Development Platforms

12 Strengthening Solutions Focus Residential gateway reference designs Alcatel, Wind River (high-end), Jungo (low-end) Managed LAN switch reference design Broadcom, Wind River Voice access solution Intersil High performance packet processing/classification AMCC – integrated interface to NPU Solidum – classification processing solution Xelerated Packet Devices – joint solution

13 Products for Communications SRAMs FIFOsMulti-Ports Communications ASSPs Clock Management Digital Logic Telecom Products IP Co-Processors Integrated Processors

14 Product Execution 2001 – Most prolific year for new products in IDT history Continued to deliver leadership products in traditional businesses New business opportunities represent over $1 billion in new TAM Strong design activity mitigated by: –Timing of new system ramps –Competing/cancelled projects

15 Our Communications Foundation #1 Market Share – FIFOs #1 Market Share – Multi-ports #1 Market Share – FCT Digital Logic #1 Market Share – Bus Switches #2 Market share – ALVC/LVC Digital Logic A growing portfolio of clock generators, clock distribution and clock buffering products. These products represent more than 60% of IDT’s revenues Source: Insite/Onsite & IDT estimates

16 IP Co-Processors Faster, more intelligent packet processing required for >OC-48 emerging market segment Accelerates deep packet classification and high- speed packet forwarding, working with ASICs or NPUs Integration of CAM (content addressable memory) with high-performance logic – core competence of IDT

17 IP Co-Processor Benefits High performance –Portfolio of 2 Mbit to 18 Mbit devices –Up to 4 million entries at 200 MSPS* –Wide-width searches - up to 576 bits Advanced database support –Multiple databases allowing for integration of services Significant power savings –Up to 60% savings over traditional approaches Quick time to market –Software driver support –Pin-compatible family (2 Mbit - 9 Mbit) Strategic partnerships for easier integration * MSPS – millions of searches per second

18 IP Co-Processor Update Cisco-specific IP co-processor ramping –Inventory depleted –New programs beginning to ramp Major announcements for commercial products –Shipping fastest, full-featured products in production –Roadmap to 200 MSPS, 1 million entry – 2 nd half CY02 –Roadmap to integrated IP co-processors for major NPUs – summer CY02 Current design activity will drive late CY02 revenue for commercial products

19 Telecom Products Address the convergence of data and voice Industry-leading position in TSI switching, voice processing, transport, roadmap to HDLC control –The addition of mixed-signal/voice expertise complements IDT competencies in data systems –June introduced the industry’s first octal CODEC, capable of 8 voice channels –November introduced octal T1/E1/J1 line interface unit (LIU) and octal T1/E1/J1 framer IDT’s goal is to be the broadest provider of telecom semiconductors in the market by 2005

20 Integrated Processors Provide distributed intelligence across network Blend industry-standard IP modules with differentiated, value-added proprietary IP Utilize MIPS architecture CPU core Partner to supply complementary hardware and software technology for complete solutions to specific applications 3 out of top 5 managed LAN switch vendors use IDT RC32332 integrated processor

Financials

22 Revenue From Operations $ Millions

23 Earnings Per Share (Excludes special items)

24 * Excludes equity investments Cash and Investments* Net of Debt

25 Gross Margin Leverage* * Includes closure of the Salinas Fab

26 Pre Tax Margin Leverage* * Includes closure of the Salinas Fab

27 IDT Delivers Value IDT delivers innovative communications IC solutions to maximize the use of bandwidth in the converging global network –A strong foundation of products for communications –A growing portfolio of leadership products for Packet classification – IP co-processors Voice/data convergence – telecom products Distributed Intelligence – integrated processors IDT has held costs in check while continuing to execute new products during the downturn IDT has a business model that is poised to perform well as the market recovers

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