DZS: Completes Acquisition of Service Assurance and Consumer Experience, Software Portfolio from ASSIA – Form 8-K

DZS Completes Acquisition of Service Assurance and Consumer Experience, ASSIA’s Software Portfolio

Creates an industry-leading cloud-based, end-to-end network orchestration, automation, service assurance, and customer experience management software platform that works in multi-vendor service provider environments

Dallas, May 31, 2022 – DZS (Nasdaq: DZSI), a global leader in access network infrastructure, service assurance and customer experience solutions, today announced that it has completed the acquisition of specific core assets of Adaptive Spectrum and Signal Alignment, Inc. (ASSIA®), an industry pioneer in broadband access QoE software solutions. As part of the transaction, DZS has acquired an elite team of engineers, architects and business leaders highly qualified in the fields of cloud and artificial intelligence, as well as solutions award-winning Expresse® Service Assurance and CloudCheck® Wi-Fi Experience Management deployed by leading Tier 1 carriers globally. The acquired assets also include patents and patents pending related to the CloudCheck software portfolio. These software solutions add powerful data analysis and network intelligence capabilities to DZS Cloud, including cloud-managed WiFi solutions, access network optimization, and intelligent automation tools.

“We welcome ASSIA’s team of engineers, sales, support and professionals, as well as Expresse and CloudCheck branded customers, including Bouygues Telecom, Deutsche Telekom, Liberty Latin America, Lumen, TalkTalk Group, Telefonica and TELUS,” said Charlie Vogt, President and CEO of DZS. “DZS is now deployed at 30 of the top 50 global service providers. Our vision, strategy and disruptive approach to innovation spanning access networks and communication software platforms enables us to uniquely offer service providers the industry’s most comprehensive portfolio of broadband and network-aware connectivity and consumer-focused software solutions.With approximately 150 million homes connected, we are poised to compete in an era of broadband services essential and resilient in the market.

As ultra-high bandwidth, experience-rich applications continue to emerge, traditional ISPs will transform into experience providers: high-value service enablers supporting the emerging metaverse, online sports/gaming, telehealth, remote offices, smart home management, virtual education and other services. There are very few companies that offer even a subset of what is included in DZS Cloud, and most are closed and proprietary. DZS Cloud offers communications service providers an end-to-end, open, cloud-native software platform that is interoperable with core optical and access infrastructure and over 150 unique residential gateways and WiFi devices from a wide range of equipment suppliers. DZS gives service providers complete control and visibility across the entire spectrum of services, from network orchestration to service assurance and home experience management.

“Broadband marketing has shifted from focusing on top speed to overall customer experience, and this requires not only investments in access and backbone networks, but also in the Wi-Fi connected home” , Michael Philpott, director of research, Service Provider Consumer, told Omdia. “Failure to invest leads to increased customer dissatisfaction and service complaints, and therefore ultimately increased operating costs. However, active investment has been shown to bring optimization of services, higher overall net-promoter scores, reduced customer churn and new revenue opportunities, making the connected home a top investment priority is now critical to the future success of broadband services in meeting the needs of the world’s billion broadband-connected homes. To achieve this, service providers must move to a single, cloud-based, software-based management across the entire footprint that can dynamically optimize the performance of the home broadband gateway. Deploying such a platform on what has become a complex, multi-vendor, multi-generational CPE ecosystem is not t however not easy. Standardization can help by simplifying interoperability efforts, enabling rapid time to market. »

Newly acquired homes monitored and managed by Expresse and CloudCheck, combined with existing DZS broadband and WiFi connected homes, create a footprint of approximately 150 million homes. Customer reaction to the transaction has been very positive (previous press release announcing this acquisition), opening up a broader opportunity to collaborate with DZS’ market-leading cloud-native and access network software solutions.

“As a service provider that sets itself apart by delivering superior broadband experiences to our customers, we at Hosted America are looking for a best-in-class software platform that can take our subscriber experience to the next level with the network. and home Wi-Fi service guarantee,” said Phillip Watkins, CEO of Hosted America. “The newly expanded DZS Xperience solution, complemented by DZS Xtreme’s network orchestration and new broadband connectivity infrastructure generation of DZS, provides a complete end-to-end view of subscriber broadband service that can position us to be a leader in our markets. and allow us to cultivate loyal and satisfied customers. The fact that these solutions have a rich history of deploying scalability and multi-vendor support also gives us confidence that these solutions can scale to meet our rapid growth plans.

This all-cash acquisition expands DZS Cloud Platform’s recurring Software as a Service (SaaS) revenue and will accelerate DZS’ previously stated target margin expansion schedule. The acquisition is accretive to DZS’ adjusted gross margin, adjusted EBITDA margin and non-GAAP EPS. DZS will host a special investor and analyst briefing today, Tuesday, May 31, 2022 at 3:30 p.m. CST, to further review the details of this transaction and provide a financial outlook update. from DZS.

Conference call details:

Date: Tuesday, May 31, 2022

Time: 4:30 p.m. Eastern Time (3:30 p.m. Central Time)

US call number: 877-742-9182

International number: +1 602-563-8857

Conference ID: 1372096

Webcast link: https://edge.media-server.com/mmc/p/zxhbsykq

Toll-free replay number: 855-859-2056

International replay number: +1 404-537-3406

Replay ID: 1372096

About DZS

DZS Inc. (NSDQ: DZSI) is a global leader in access network infrastructure, service assurance and customer experience solutions.

DZS, the DZS logo and all DZS product names are trademarks of DZS Inc. Other brand and product names are trademarks of their respective holders. Specifications, products and/or product names are all subject to change.

This press release contains forward-looking statements regarding future events and our future results that are subject to the safe harbors created under the Private Securities Litigation Reform Act of 1995. These statements reflect the beliefs and assumptions of the Company’s management. on the date hereof. Words such as “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “expect”, “aim”, “intend”, “may”, “plan”, “project”, “seek”, “should”, “target”, “shall”, “would”, variations of these words and similar expressions are intended to identify forward-looking statements. Readers are cautioned that such forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. The actual results of the Company could differ materially and adversely from those expressed or contemplated by the forward-looking statements. cause actual results to differ include, but are not limited to, the risk factors contained in the Company’s filings with the SEC available at www.sec.gov, including, without limitation, the Company’s annual report on Form 10-K, the reports quarterly ports on Form 10-Q and subsequent filings. In addition, additional or unforeseen effects of the COVID-19 pandemic and the global economic climate may create or amplify many of these risks. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made. DZS assumes no obligation to update or revise any forward-looking statements for any reason.

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Contact with Investor Relations:

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Telephone: +1 608.234.7338

Email: [email protected]

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