iBasis Reports Record Traffic Volume and Revenue For First Quarter 2002

Company Continues to Scale Toward Profitability; Expands Gross Margin, Reduces Operating Expenses, Improves EBITDA

BURLINGTON, MA - April 24, 2002 - iBasis, Inc. (Nasdaq: IBAS), today announced results for the first quarter ended March 31, 2002. First quarter revenue was $47.7 million, an increase of 76% over first quarter 2001 revenue of $27.1 million. For the first quarter 2002, net loss before acquisition-related and non-cash compensation charges, loss on the sale of the messaging business and an extraordinary gain on the early retirement of debt, was $23.8 million, or a net loss of $0.53 per share, based on 45.1 million weighted average shares outstanding. This net loss compares to a first quarter 2001 net loss before acquisition-related and non-cash compensation charges of $26.2 million, or a net loss of $0.69 per share, based on 37.9 million weighted average shares outstanding.

For the first quarter 2002, net loss after extraordinary gain on early retirement of debt of $10.4 million was $18.0 million, or a net loss of $0.40 per share, based on 45.1 million weighted average shares outstanding. This net loss compares to a first quarter 2001 net loss of $53.1 million, or a net loss of $1.40 per share, based on 37.9 million weighted average shares outstanding.

"We had another excellent quarter, with our core Internet telephony business building on the momentum we developed in Q4 of 2001. I am particularly pleased with the strong top-line growth combined with increasing gross margin and reduced expenses, resulting in a 25% sequential improvement in EBITDA," said Ofer Gneezy, president and CEO of iBasis. "This is exactly what we need to continue to do to achieve profitability: scale our business, expand margins and manage our cash aggressively.

"We are excited about our progress with new customers and emerging markets that offer tremendous growth potential. For example, our relationship with VTI, the incumbent carrier in Vietnam, represents a new high volume/high revenue-per-minute opportunity that is one of the top 20 destinations for US-originated voice traffic. We also have business development efforts well underway in India, a newly deregulated market that shows great promise for iBasis. Approximately 80% of the 2 billion minutes of annual voice traffic into that high revenue-per-minute destination originates in the US, UK and Asia, where we have our large Internet Central Office facilities and interconnections with many Tier One carriers."

Highlights of the first quarter include:

_ Revenue increased 22% compared to Q4 2001;

_ Gross margin dollars increased 19% compared to Q4 2001;

_ Operating expenses declined 8% compared to Q4 2001;

_ EBITDA improved 25% compared to Q4 2001

Enhanced Services
The pipeline for sales of our speech applications remains strong, although revenue from our Speech Solutions business declined sequentially as a result of lengthening sales cycles.

In February 2002, we announced the sale of our Messaging business to Call Sciences, a transaction that was completed in March. First quarter results include residual revenue from the Messaging business.

Key Indicators
Minutes of use in the first quarter doubled to 580 million minutes from 291 million minutes carried in the first quarter of 2001, and increased 29% over the 448 million minutes in the fourth quarter of 2001. Average revenue per minute was 7.40 cents per minute compared to 7.64 cents per minute in the fourth quarter of 2001.

During the year, the company continued to increase network capacity in step with demand by expanding capacity at its existing Internet Central Office facilities and adding Points of Presence (PoPs) to The iBasis NetworkTM, ending the year with 32,300 total overseas lines and 620 PoPs. With 66% of iBasis international voice traffic originating in the US, the company believes that overseas lines is a useful measure of its global network's capacity.

Operational Milestones
In the first quarter, iBasis continued to deepen its relationships with its large base of Tier One carrier customers, who generated more than 61% of the revenue and 66% of the voice traffic for the company's core VoIP business.

In April 2002, IP Voice and communications pioneer Pulver.com honored iBasis with their "Billion Minutes Served" award for having carried more than one billion minutes of VoIP traffic in a single year. iBasis carried 1.4 billion minutes of voice traffic in 2001 and its current annualized traffic run rate exceeds 2 billion minutes, placing iBasis among the 15 largest international carriers in the world.

In its core VoIP business, iBasis continued to increase the percentage of overseas-originated voice traffic it carries, which improves network utilization and generally produces higher margins than US-originated voice traffic. In the first quarter 2002, overseas-originated calls accounted for 45% of revenue and 34% of traffic, up from 42% of revenue and 32% of traffic in the fourth quarter of 2001.

Financial Milestones
Gross margins in the company's core wholesale VoIP business increased more than 50% to $3.8 million or 9.7% of revenue during the first quarter, compared with $2.4 million or 8.0% of revenue in the fourth quarter of 2001. Overall gross margin, including enhanced services, grew 19% sequentially, from $7.5 million to $8.9 million, but declined as a percentage of revenue, from 19.1% to 18.6%.

The company recorded an EBITDA loss of $8.7 million in the first quarter of 2002 compared to EBITDA losses of $11.6 million and $19.1 million in the fourth quarter and first quarter of 2001, respectively.

Operating expenses, comprising research and development, sales and marketing, and general and administrative expenses decreased 8% from $19.1 million for the fourth quarter of 2001 to $17.6 million for the first quarter of 2002.

Excluding cash expended for debt repurchase of $6.4 million, the decrease in cash during the quarter was $27.1 million. The first quarter's decrease in cash comprised capital expenditures of $3.4 million, payment of a semi-annual interest payment on the company's 5.75% Convertible Subordinated Notes of $3.3 million, principal payments on capital leases and other long-term debt of $2.8 million, EBITDA loss (not including bad debt expense, a non-cash charge), and changes in working capital.

Debt Repurchase
During Q1 2002, the company repurchased approximately $16.4 million Face Amount in 5.75% Convertible Subordinated Notes on the open market for aggregate transaction costs of approximately $6.0 million, including a write-down of related deferred financing costs, resulting in an extraordinary gain on the early retirement of debt of approximately $10.4 million. Subsequent to the end of Q1 2002 and through April 19, 2002, the company repurchased approximately an additional $20.5 million Face Amount of the Notes on the open market for aggregate transaction costs of approximately $7.5 million, including a write-down of related deferred financing costs, which will result in an $13.0 million extraordinary gain in Q2 on the early retirement of debt. Since beginning debt repurchases in Q4 2001, the company has repurchased $57.7 million Face Amount of its Convertible Subordinated Notes. Current face amount outstanding on these Notes is $92.3 million, down from its original $150 million.

Guidance
The following statements are forward-looking and actual results may differ materially due to factors noted below, among others. The information provided in this financial outlook is as of April 24, 2002, and supersedes all previous guidance.

iBasis believes that it will achieve positive EBITDA in the second half of 2002. With more than $85 million in cash, cash equivalents and marketable securities as of March 31, 2002, iBasis believes that it continues to have sufficient resources for growth through to EBITDA profitability. The company's overall steady-state gross margin target is 25%-35%. In addition, iBasis expects sequential revenue growth in the range of 10-15% per quarter through 2002.

About iBasis
Founded in 1996, iBasis (Nasdaq: IBAS) is the leader in Internet-based voice communications. iBasis delivers toll quality international voice services and provides the infrastructure for hosted communications solutions, including speech-enabled content, e-commerce and customer service applications. The company's customers include many of the largest carriers and enterprises in the world, including AT&T, Cable & Wireless, China Mobile, China Unicom, ExxonMobil, Gannett, H&R Block, Home Shopping Network, Morgan Stanley, NTT, Telefonica, Telenor, Telstra, Sprint, Western Union, and WorldCom. iBasis' hosted, enhanced service solutions include SpeechPortTM, a scalable, customizable ASP environment for speech-enabled business solutions. The iBasis Network^TM is the world's largest international Cisco Powered Network for Internet Telephony. iBasis is listed in both the Russell 2000® and Russell 3000® Indexes. The company can be reached at its worldwide headquarters in Burlington, Mass., USA at 781-505-7500 or on the Internet at www.ibasis.com .

Assured Quality Routing and iBasis are registered marks, The iBasis Network, Internet Central Office, Internet Branch Office, SpeechPort, IPort and AQR are trademarks of iBasis, Inc. or its subsidiaries. Cisco and Cisco Powered Network are registered trademarks of Cisco Systems, Inc. All other trademarks are the property of their respective owners.

Except for historical information, all of the expectations, projections and assumptions contained in the foregoing press release, including those relating to the company's current expectations regarding revenue growth, sources of revenue, margin improvement and future capital expenditures constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties. Important factors that could cause actual results to differ materially from such forward-looking statements include, but are not limited to, (i) the extent of adoption of the company's services and the timing and amount of revenue generated by these services; (ii) fluctuations in the market for and pricing of these services; and (iii) the other considerations described as "Risk Factors" in iBasis' Annual Report on Form 10-K for its fiscal year ended December 31, 2001, and the company's other SEC filings. We have no current intention to update any forward-looking statements.

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- Tables to Follow -

iBasis, Inc.
Consolidated Statements of Operations
(Unaudited)
		Three Months Ended March 31,
		2002		2001
Net revenue:
Data communications and telecommunications		$ 45,776,661		$ 26,020,320
Professional services		1,950,228		1,032,914
Total net revenue		47,726,889		27,053,234
Operating expenses:
Data communications and telecommunications		37,719,682		23,798,163
Professional services		1,119,184		393,343
Research and development		7,105,222		5,477,523
Selling and marketing		4,312,590		6,083,229
General and administrative		6,150,517		10,436,638
Depreciation and amortization		11,337,248		6,939,475
Total operating expenses		67,744,443		53,128,371
Loss from operations		(20,017,554)		(26,075,137)
Interest income		376,415		4,013,001
Interest expense		(4,072,101)		(3,893,323)
Other expenses, net		(93,110)		(198,174)
Net loss before acquisition-related charges, non-cash compensation, loss on sale of messaging business and extraordinary gain		(23,806,350)		(26,153,633)
Write-off of acquired in-process research and development costs		--		(24,431,466)
Amortization of goodwill		--		(639,089)
Amortization of other acquired intangible assets		(2,035,955)		(1,725,541)
Non-cash compensation		(334,265)		(196,960)
Loss on sale of messaging business		(2,180,540)		--
Net loss before extraordinary gain		(28,357,110)		(53,146,689)
Extraordinary gain on early retirement of debt		10,394,431		--
Net loss		$ (17,962,679)		$ (53,146,689)
Net loss per share before acquisition-related charges, non-cash compensation, loss on sale of messaging business, and extraordinary gain:		$ (0.53)		$ (0.69)
Net loss per share, before extraordinary gain		$ (0.63)		$ (1.40)
Extraordinary gain on early retirement of debt		0.23		--
Net loss per share		$ (0.40)		$ (1.40)
Weighted average common shares outstanding		45,121,759		37,866,350

iBasis, Inc.
Consolidated Balance Sheets
(Unaudited)
		March 31,		December 31,
		2002		2001
Assets
Cash, cash equivalents and marketable securities ($8.5 million as of March 31, 2002 and $8.9 million as of December 31, 2001, restricted as to use)		$ 85,224,112		$118,690,494
Accounts receivable, net		38,821,404		31,348,307
Prepaid expenses and other current assets		7,315,754		8,111,208
Property and equipment, net		87,353,093		97,696,715
Goodwill and other intangible assets, net		61,057,829		63,093,785
Long term investment in non-marketable security		5,000,000		5,000,000
Deferred debt financing costs, net		2,320,579		2,859,814
Other assets		1,889,044		2,024,757
Total assets		$288,981,815		$ 328,825,080
Liabilities and stockholders' equity
Accounts payable		$ 17,058,865		$12,708,773
Accrued expenses		22,536,661		30,129,795
Deferred revenue		698,728		801,471
Current portion of long term debt		29,264,214		26,498,285
Long term debt, net of current portion		150,007,358		171,970,134
Total liabilities		219,565,826		242,108,458
Stockholders' equity:
Common stock		45,569		45,271
Additional paid-in capital		370,019,675		369,692,193
Deferred stock-based compensation		(1,890,808)		(2,225,074)
Accumulated deficit		(298,758,447)		(280,795,768)
Total stockholders' equity		69,415,989		86,716,622
		$ 288,981,815		$ 328,825,080

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