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eOn Communications Corporation Announces Q4 and FY 2000 Financial Results

Memphis, TN - September 7, 2000 - eOn Communications Corporation(TM) (Nasdaq:EONC), the leading provider of LinuxTM-based unified voice, Web and Internet communications systems, today announced financial results for its fourth fiscal quarter and fiscal year 2000 ended July 31, 2000. The Company reported fourth quarter revenues of $10,772,000 compared to revenues of $15,201,000 for the fourth quarter of fiscal 1999. Net loss for the quarter was $1,390,000 or $(0.11) per fully diluted share, including an extraordinary gain of $97,000 resulting from an income tax benefit related to early retirement of debt in conjunction with the Company's initial public offering of February 4, 2000. This compares to net income of $1,257,000 or $0.13 per diluted share for the fourth quarter of the prior year.

For the fiscal year 2000, revenues were $50,438,000 compared to $42,374,000 for the prior year. Net loss for fiscal 2000 was $2,999,000 or $(0.30) per fully diluted share including an extraordinary loss of $187,000 or $(0.02), compared to net income of $2,155,000 or $0.33 per diluted share for fiscal 1999.

"Our fourth quarter financial results reflect reduced demand for our Millennium® digital switching platform and longer than anticipated sales cycles for our Linux-based eQueue(TM) and eNterprise communications systems," said David S. Lee, chairman and chief executive officer of eOn. "The Millennium competes primarily in the PBX marketplace, which has declined faster than we anticipated. The Millennium remains an important part of our product strategy, and we are taking steps to bring expenses into line with current sales projections.

"The longer than anticipated sales cycle for our eQueue(TM) and eNterprise systems also affected our financial results for the quarter and fiscal year," Lee continued. "The long-term sales outlook for these communications systems remains strong, however, and we made significant progress during the fourth quarter in several areas of importance, including:

• adding new customers and providing new products to our installed base
• growing our sales force
• recruiting VARs (value added resellers) for our indirect distribution channel
• creating a professional services group to provide fee-based services in custom application development, consulting, systems integration, and specialized maintenance and support
• advancing discussions with potential OEM, cross-marketing, and software licensing partners

"We believe these measures will contribute to future revenue growth in our Linux business at a pace consistent with our sales cycle."

Note 1:

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties, including technical and competitive factors, which could cause the Company's results and the timing of certain events to differ materially from those discussed in the forward-looking statements. Such risks are detailed in eOn Communications Corporation's most recent Form 10-Q filing with the Securities and Exchange Commission.

Note 2:

The Company will host a conference call at 4:45 p.m. today, September 7, 2000, to discuss fourth quarter results. To hear the call, go to www.eoncc.com and follow the directions on the home page or dial 800-289-0730 and give the operator confirmation code 663997. A replay will be available no later than Friday morning, September 8 through September 12 via the investor information section of www.eoncc.com or by direct dial at 901-462-1010.

About eOn Communications Corporation

eOn Communications Corporation (www.eoncc.com) designs, develops and markets next-generation Linux-based communications servers and software that integrate and manage voice, e-mail and Internet communications for customer contact centers and general business applications. The Company also offers the Millennium® digital switching platform for small and medium-sized installations. eOn Communications Corporation helps enterprises communicate more effectively with customers, convert inquiries into sales, and increase customer satisfaction and loyalty.

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