1. ©2008 Avanex, Inc. All rights reserved.1 Needham & Company Growth Conference Intelligent Photonic Solutions ™ Giovanni Barbarossa President and CEO January 6, 2009

2. ©2008 Avanex, Inc. All rights reserved.2 Safe Harbor This Presentation contains forward-looking statements concerning future events and the future performance of the company. Forward-looking statements are subject to risks and uncertainties and actual results could differ materially from those projected or contemplated by the forward-looking statements. We encourage you to look at the company’s most recent SEC filings. The risk factor section of the company’s most recent Form 10-Q and Form 10-K provides information concerning issues and risks facing the company. Avanex assumes no obligation and does not intend to update any forward-looking statement, including guidance, as a result of new information, future events or otherwise.

3. ©2008 Avanex, Inc. All rights reserved.3 Avanex At a Glance FY’08 Revenue:$208M FY’08 Net Income:$4.7M WW Employees:515 Market:Telecom Optical Components and Subsystems 2008 SAM: $1.5B Headquarters:Fremont, California, USA NASDAQ symbol: AVNX

4. ©2008 Avanex, Inc. All rights reserved.4 Wide Product Portfolio to Enable Next Generation Optical Telecommunications Telecom Subsystems Leader LH DWDM LH DWDM Long Haul Network LH ROADM Add/Drop Metro DWDM Ring Metro DWDM Ring SONET Ring Metro DWDM Ring WSS TRANSMISSION TXP Edge ROADM Edge ROADM REGENERATION WAVELENGTH MANAGEMENT WSS

5. ©2008 Avanex, Inc. All rights reserved.5 Growth in Internet Bandwidth Demand (figures in millions of Terabits/month) Source Cisco ’08-’12 CAGR = 51% Consumer BroadbandMobilityEnterprise IPTVInternet TV3G / LTESocial Networking Mobile Internet Datacenter Consolidation Mobile Workforce Long Term Opportunity

6. ©2008 Avanex, Inc. All rights reserved.6 Why this Slowdown will not Mimic the Telecom Bubble ► Little to no overcapacity in networks today, versus significant overcapacity and overbuilding in the telecom bubble ► Demand for broadband services are a reality today, versus a concept in 2000/01 Optical Component Revenue* for Selected Vendors In millions, *include AVNX, BKHM, EMKR, FNSR, JDSU, OPLK & OPXT, 12/31/08 Estimate Near Term Market Challenges

7. ©2008 Avanex, Inc. All rights reserved.7 Gross Margin Quarterly Revenue Financial Performance

8. ©2008 Avanex, Inc. All rights reserved.8 ► ~$50M in cash and securities as of September 30, 2008 ► No debt ► Low Fixed Cost structure ► About half of employees in low cost regions ► Outsource vast majority of manufacturing to low cost regions ► Responded Quickly to Further Reduce Cost Structure in September 2008 with savings of ~$10M on an annualized basis ► Lowered headcount ► Shutdown one facility in North America ► Management Team Took Voluntary 10% Pay Reduction Positioned to Succeed in Current Economic Climate

9. ©2008 Avanex, Inc. All rights reserved.9 Optical Components & Subsystems Leader Strong Customer Relationship s Focused R&D Investment To Support Smarter Networks Product Leadership Innovative Technology Low Fixed Cost Operating Model Business Strategy

10. ©2008 Avanex, Inc. All rights reserved.10 Close Partnership with Key Global OEM Customers Strong Customer Relationships

11. ©2008 Avanex, Inc. All rights reserved.11 Innovation Centers Innovation Centers Low Cost Resources Low Cost Resources Outsourced Manufacturing Outsourced Manufacturing Worldwide Customers Worldwide Customers Wavelength Management Fremont, CA Wavelength Management Fremont, CA Amplification & Dispersion Comp Horseheads, NY Amplification & Dispersion Comp Horseheads, NY Transmission Components San Donato, Italy Transmission Components San Donato, Italy Transmission Modules Villebon, France Transmission Modules Villebon, France Derivative Development Shanghai, China Derivative Development Shanghai, China Operations Hub Bangkok, Thailand Operations Hub Bangkok, Thailand Contract Manufacturer 1 Thailand Contract Manufacturer 1 Thailand Contract Manufacturer 2 China Contract Manufacturer 2 China.............. Contract Manufacturer Contract Manufacturer OEM 1 OEM 1 OEM 2 OEM 2 OEM OEM.............. Low Fixed Cost Operating Model

12. ©2008 Avanex, Inc. All rights reserved.12 Efficient  Adv. Modulation Formats  Lower Loss  Lower Power Consumpt.  Lower Dispersion  Higher Transmission Speed Physics, Materials Intelligent Electronics, Software  Monitoring  Controlling  Alerting  Managing  Automating Flexible Architecture, Design  Upgradeability  Reconfigurability  Tunability  Pluggability  Bandwidth on Demand Smarter Network - Lower $/bits - Technology Strategy

13. ©2008 Avanex, Inc. All rights reserved.13 Business Segments AMPLIFICATION DISPERSION COMPENSATION WAVELENGTH MANAGEMENT TRANSMISSION SAM Revenue Opportunity* $400M$100M$300M$750M SAM Annual Growth Rate 6%- 8%5% - 7%15% - 17%18%- 20% Avanex Position Leader Leader in Modulators * Source: OVUM-RHK Optical Components Forecast and Avanex analysis Leader in Telecom Optics

14. ©2008 Avanex, Inc. All rights reserved.14 Business Segments AMPLIFICATION DISPERSION COMPENSATION WAVELENGTH MANAGEMENT TRANSMISSION Growth Opportunities Fast Transient Control 40 Gb/s Amplifier Tunable DC + Amplifier Integrated Subsystem 40 Gb/s Tunable Dispersion Compensation Tunable DC for 10Gb/s Submarine Networks ROADM and Amplifier Integrated Subsystem Edge 1x2 Wavelength Selective Switch Module 10 Gb/s modulator for SFF Tunable Transponders 40 and 100 Gb/s DPSK and DQPSK modulators Robust IP: >500 patent families across all segments Focused Investment to Drive Long Term Growth

15. ©2008 Avanex, Inc. All rights reserved.15 Low-Cost Operating Model Optical Components & Subsystems Leader Innovative Products and Technology Investing in Bandwidth Growth Strong Customer Relationships Investment Highlights

16. ©2008 Avanex, Inc. All rights reserved.16 ADVA and the ADVA logo are registered trademarks of ADVA Optical Networking. Alcatel and the Alcatel logo are a registered trademarks of Compagnie Financière Alcatel. CIENA and the CIENA logo are registered trademarks of CIENA Corporation. Cisco and the Cisco logo are registered trademarks of Cisco Systems, Inc. Fujitsu and the Fujitsu logo are registered trademarks of Fujitsu Limited. Huawei and the Huawei logo are registered trademarks of Huawei Technologies Co., Ltd. Lucent and the Lucent logo are registered trademarks of Lucent Technologies, Inc. Marconi and the Marconi logo are registered trademarks of Marconi Corporation plc. Nortel and the Nortel logo are registered trademarks of Nortel Networks Limited. Siemens and the Siemens logo are registered trademarks of Siemens AG. Tellabs and the Tellabs logo are registered trademarks of Tellabs. Zhone and the Zhone logo are registered trademarks of Zhone Technologies. ZTE and the ZTE logo are registered trademarks of ZTE Corporation. Thank You