News and Events

eOn Communications Reports Record Fourth Quarter and
Fiscal Year Profitability with 50% Increase in Cash

ATLANTA (October 23, 2006)-eOn Communications Corporation™ (NASDAQ: EONC), a leading provider of telecommunications solutions, today reported both record fourth quarter and fiscal 2006 year results. The results for the fourth quarter represent the third consecutive record quarterly results delivered by the company. The company also posted record results for its fiscal year 2006, representing the best ever recorded and the first profitable yearly performance in its history.

Net income for the fiscal year was $1,637,000, or $0.12 per common share, compared to a net loss of $1,951,000, or ($0.15) per common share for the fiscal year ended July 31, 2005. Income from continuing operations was $861,000 or $0.06 per common share compared to a loss from continuing operations of $2,140,000 or ($0.16) per common share in the fiscal year ended July 31, 2005. Net income for the fiscal year ended July 31, 2006 included $256,000 from discontinued operations, $303,000 gain on disposal of discontinued operations and an extraordinary gain on the purchase of Cortelco Shanghai of $217,000. Net income for the fiscal year ended July 31, 2005 included $189,000 from discontinued operations. Revenues from continuing operations were $12,014,000, a decrease of 5% compared with $12,603,000 for the previous fiscal year.

Net income for the quarter was $231,000, or $0.02 per common share, compared to a net loss of $825,000, or ($0.06) per common share in the quarter ended July 31, 2005. Net loss in the quarter ended July 31, 2005 included income from discontinued operations of $104,000 related to Cortelco Shanghai. Revenue for the quarter was $2,831,000, an increase of 12% compared to $2,537,000 for the quarter ended July 31, 2005.

Cash and cash equivalents and short-term marketable securities increased 50% to $6,684,000 from $4,470,000 as of July 31, 2005.

“Our stated goals entering this fiscal year were to return to profitability, strengthen our financial position, increase our engineering and product development resources and to position the company to leverage rapidly expanding markets. Our ability to successfully achieve these goals has directly led to our improved financial performance,” stated David Lee, eOn’s chairman and chief executive officer. “In the coming year our focus will be on sustaining this positive momentum and on identifying and executing the steps necessary to significantly expand our business and to further increase shareholder value.”

Conference Call

The Company will host a conference call at 4:45 p.m. ET, October 23, 2006, to discuss fourth quarter and fiscal year results. To hear the call, dial 800-289-0468 or visit our investor relations web site at investor.eoncc.com. A replay of the call will be posted to our investor relations web site shortly following the call.

About eOn Communications

eOn Communications Corporation™ is a global provider of innovative communications solutions. Backed by over 20 years of telecommunications engineering expertise, our solutions enable our customers to easily leverage advanced technologies in order to communicate more effectively. To find more information about eOn Communications and its solutions, visit the World Wide Web at www.eoncommunications.com, or call 800-955-5321.

Note:

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.

eOn Communications Corporation, the mark eOn, and eQueue are trademarks of eOn Communications Corporation.