----

----

----

----

| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|-----------------------------------------------------------------------------------------|

| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|------------------------------------------------------------------------------------------|

----

----

|                                                           |   |                                 |
|----------------------------------------------------------------|--------|--------------------------------------|
| Delaware                                                       |   | 77-0443568                           |
| (State or other jurisdiction of incorporation or organization) |   | (I.R.S. Employer Identification No.) |
|                                                           |   |                                 |
| 960 Stewart Drive, Sunnyvale, California                       |   | 94085-3913                           |
| (Address of principal executive offices)                       |   | (Zip Code)                           |

----

|                                                                       |   |                        |
|----------------------------------------------------------------------------|--------|-----------------------------|
| Large accelerated filer o                                                  |   | Accelerated filer x         |
|                                                                       |   |                        |
| Non-accelerated filer o (Do not check if a smaller reporting company) |   | Smaller reporting company o |

----

----

----

INDEX

|                          | Page   |
|-------------------------------|--------|
| PART I: Financial Information | 3      |
|                          |   |   |   |
| Item 1                        |   | Financial Statements (Unaudited) | 3 |
|                          |   | Condensed Consolidated Balance Sheets as of March 31, 2011 and June 30, 2010 | 3 |
|                          |   | Condensed Consolidated Statements of Operations for the three months and nine months ended March‎31, 2011 and 2010 | 4 |
|                          |   | Condensed Consolidated Statements of Cash Flows for the nine months ended March 31, 2011 and 2010 | 5 |
|                          |   | Notes to Condensed Consolidated Financial Statements | 6 |
| Item 2                        |   | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 16 |
| Item 3                        |   | Quantitative and Qualitative Disclosures About Market Risk | 27 |
| Item 4                        |   | Controls and Procedures |      27 |
|                          |   |
| PART II: Other information    | 28     |
|                          |   |   |   |
| Item 1                        |   | Legal Proceedings |          28 |
| Item 1A                  |   | Risk Factors |          28 |
| Item 2                        |   | Unregistered Sales of Equity Securities and Use of Proceeds |          29 |
| Item 6                        |   | Exhibits |          29 |
|                          |   | Signatures |          30 |
|                          |   | Exhibit Index |          31 |

----

index

| ITEM 1: | FINANCIAL STATEMENTS (Unaudited) |
|---------|----------------------------------|

CONDENSED CONSOLIDATED BALANCE SHEETS

|                                                                                                                                                                                               |   | March 31,  2011 |     |   | June 30,  2010 |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------|----------|--------|-------------------------------|--------|
| ASSETS                                                                                                                                                                                             |   |                           |     |   |                          |   |
| CURRENT ASSETS:                                                                                                                                                                                    |   |                           |     |   |                          |   |
| Cash and cash equivalents                                                                                                                                                                          |   | $                              | 73,923   |   |                          | $      | 68,426 |   |
| Short-term investments                                                                                                                                                                             |   |                           | 28,708   |   |                          |   | 47,375 |   |
| Accounts receivable, net of allowance of $756 and $876 as of March 31, 2011 and June 30, 2010, respectively                                                                                        |   |                           | 27,076   |   |                          |   | 24,596 |   |
| Inventories                                                                                                                                                                                        |   |                           | 16,459   |   |                          |   | 9,954 |   |
| Prepaid expenses and other current assets                                                                                                                                                          |   |                           | 4,107    |   |                          |   | 8,125 |   |
| Total current assets                                                                                                                                                                               |   |                           | 150,273  |   |                          |   | 158,476 |   |
| PROPERTY AND EQUIPMENT, net                                                                                                                                                                        |   |                           | 8,576    |   |                          |   | 6,019 |   |
| GOODWILL                                                                                                                                                                                           |   |                           | 7,415    |   |                          |   | — |   |
| INTANGIBLE ASSETS, net                                                                                                                                                                             |   |                           | 9,122    |   |                          |   | 5,025 |   |
| OTHER ASSETS                                                                                                                                                                                       |   |                           | 658      |   |                          |   | 1,201 |   |
| TOTAL ASSETS                                                                                                                                                                                       |   | $                              | 176,044  |   |                          | $      | 170,721 |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                                                                         |   |                           |     |   |                          |   |   |   |
| CURRENT LIABILITIES:                                                                                                                                                                               |   |                           |     |   |                          |   |   |   |
| Accounts payable                                                                                                                                                                                   |   | $                              | 8,634    |   |                          | $      | 7,868 |   |
| Accrued expenses and other                                                                                                                                                                         |   |                           | 7,500    |   |                          |   | 10,061 |   |
| Accrued employee compensation                                                                                                                                                                      |   |                           | 9,768    |   |                          |   | 8,261 |   |
| Deferred revenue                                                                                                                                                                                   |   |                           | 22,548   |   |                          |   | 19,450 |   |
| Total current liabilities                                                                                                                                                                          |   |                           | 48,450   |   |                          |   | 45,640 |   |
| LONG-TERM LIABILITIES:                                                                                                                                                                             |   |                           |     |   |                          |   |   |   |
| Long-term deferred revenue                                                                                                                                                                         |   |                           | 10,557   |   |                          |   | 9,269 |   |
| Other long-term liabilities                                                                                                                                                                        |   |                           | 1,395    |   |                          |   | 1,346 |   |
| Total liabilities                                                                                                                                                                                  |   |                           | 60,402   |   |                          |   | 56,255 |   |
| COMMITMENTS AND CONTINGENCIES (Note 12)                                                                                                                                                            |   |                           |     |   |                          |   |   |   |
| STOCKHOLDERS’ EQUITY:                                                                                                                                                                        |   |                           |     |   |                          |   |   |   |
| Preferred stock, $0.001 par value: authorized 5,000; none issued and outstanding                                                                                                                   |   |                           | —  |   |                          |   | — |   |
| Common stock and additional paid-in capital, par value $0.001 per share, authorized 500,000; issued and outstanding, 46,451 and 45,370 shares as of March 31, 2011 and June 30, 2010, respectively |   |                           | 233,495  |   |                          |   | 222,491 |   |
| Accumulated other comprehensive income                                                                                                                                                             |   |                           | 81       |   |                          |   | 191 |   |
| Accumulated deficit                                                                                                                                                                                |   |                           | (117,934 | )      |                          |   | (108,216 | ) |
| Total stockholders’ equity                                                                                                                                                                   |   |                           | 115,642  |   |                          |   | 114,466 |   |
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                                                                   |   | $                              | 176,044  |   |                          | $      | 170,721 |   |

----

index

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

|                                                                  |   | Three Months Ended‎March 31, |   |   | Nine Months Ended‎March 31, |   |
|-----------------------------------------------------------------------|--------|-----------------------------------------|--------|--------|----------------------------------------|--------|
|                                                                  |   | 2011                                    |   |   | 2010                                   |   |   | 2011 |   |   | 2010 |   |
| REVENUE:                                                              |   |                                    |   |   |                                   |   |   |   |   |   |   |   |
| Product                                                               |   | $                                       | 41,248 |   |                                   | $      | 28,945 |   |   | $ | 114,387 |   |   | $ | 83,685 |   |
| Support and services                                                  |   |                                    | 10,329 |   |                                   |   | 8,089 |   |   |   | 29,198 |   |   |   | 22,556 |   |
| Total revenue                                                         |   |                                    | 51,577 |   |                                   |   | 37,034 |   |   |   | 143,585 |   |   |   | 106,241 |   |
| COST OF REVENUE:                                                      |   |                                    |   |   |                                   |   |   |   |   |   |   |   |   |   |   |   |
| Product (1)                                                           |   |                                    | 12,979 |   |                                   |   | 10,049 |   |   |   | 37,593 |   |   |   | 29,369 |   |
| Support and services (1)                                              |   |                                    | 3,515  |   |                                   |   | 2,933 |   |   |   | 9,616 |   |   |   | 8,323 |   |
| Total cost of revenue                                                 |   |                                    | 16,494 |   |                                   |   | 12,982 |   |   |   | 47,209 |   |   |   | 37,692 |   |
| GROSS PROFIT                                                          |   |                                    | 35,083 |   |                                   |   | 24,052 |   |   |   | 96,376 |   |   |   | 68,549 |   |
| OPERATING EXPENSES:                                                   |   |                                    |   |   |                                   |   |   |   |   |   |   |   |   |   |   |   |
| Research and development (1)                                          |   |                                    | 12,562 |   |                                   |   | 8,634 |   |   |   | 33,396 |   |   |   | 23,666 |   |
| Sales and marketing (1)                                               |   |                                    | 18,920 |   |                                   |   | 14,726 |   |   |   | 54,437 |   |   |   | 39,653 |   |
| General and administrative (1)                                        |   |                                    | 6,377  |   |                                   |   | 5,214 |   |   |   | 19,118 |   |   |   | 14,596 |   |
| Total operating expenses                                              |   |                                    | 37,859 |   |                                   |   | 28,574 |   |   |   | 106,951 |   |   |   | 77,915 |   |
| LOSS FROM OPERATIONS                                                  |   |                                    | (2,776 | )      |                                   |   | (4,522 | ) |   |   | (10,575 | ) |   |   | (9,366 | ) |
| OTHER INCOME (EXPENSE):                                               |   |                                    |   |   |                                   |   |   |   |   |   |   |   |   |   |   |   |
| Interest income                                                       |   |                                    | 105    |   |                                   |   | 100 |   |   |   | 447 |   |   |   | 296 |   |
| Other                                                                 |   |                                    | 61     |   |                                   |   | (220 | ) |   |   | 333 |   |   |   | (128 | ) |
| Total other income (expense)                                          |   |                                    | 166    |   |                                   |   | (120 | ) |   |   | 780 |   |   |   | 168 |   |
| LOSS BEFORE BENEFIT FROM INCOME TAXES                                 |   |                                    | (2,610 | )      |                                   |   | (4,642 | ) |   |   | (9,795 | ) |   |   | (9,198 | ) |
| BENEFIT FROM INCOME TAXES                                             |   |                                    | 228    |   |                                   |   | 153 |   |   |   | 77 |   |   |   | 87 |   |
| NET LOSS                                                              |   | $                                       | (2,382 | )      |                                   | $      | (4,489 | ) |   | $ | (9,718 | ) |   | $ | (9,111 | ) |
| Net loss per share — basic and diluted                          |   | $                                       | (0.05  | )      |                                   | $      | (0.10 | ) |   | $ | (0.21 | ) |   | $ | (0.20 | ) |
| Shares used in computing net loss per share — basic and diluted |   |                                    | 46,249 |   |                                   |   | 44,941 |   |   |   | 45,862 |   |   |   | 44,731 |   |
| ____________                                                          |   |                                    |   |   |                                   |   |   |   |   |   |   |   |   |   |   |   |
| (1) Includes stock-based compensation expense as follows:             |   |                                    |   |   |                                   |   |   |   |   |   |   |   |   |   |   |   |
| Cost of product revenue                                               |   | $                                       | 32     |   |                                   | $      | 34 |   |   | $ | 94 |   |   | $ | 99 |   |
| Cost of support and services revenue                                  |   |                                    | 111    |   |                                   |   | 207 |   |   |   | 472 |   |   |   | 553 |   |
| Research and development                                              |   |                                    | 1,086  |   |                                   |   | 805 |   |   |   | 2,688 |   |   |   | 2,248 |   |
| Sales and marketing                                                   |   |                                    | 459    |   |                                   |   | 911 |   |   |   | 2,212 |   |   |   | 2,528 |   |
| General and administrative                                            |   |                                    | 1,112  |   |                                   |   | 861 |   |   |   | 2,786 |   |   |   | 2,320 |   |
| Total stock-based compensation expense                                |   | $                                       | 2,800  |   |                                   | $      | 2,818 |   |   | $ | 8,252 |   |   | $ | 7,748 |   |

----

index

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                            |   | Nine Months Ended‎March 31, |    |
|---------------------------------------------------------------------------------|--------|----------------------------------------|---------|
|                                                                            |   | 2011                                   |    |   | 2010 |   |
| CASH FLOWS FROM OPERATING ACTIVITIES:                                           |   |                                   |    |   |   |   |
| Net loss                                                                        |   | $                                      | (9,718  | ) |   | $ | (9,111 | ) |
| Adjustments to reconcile net loss to net cash provided by operating activities: |   |                                   |    |   |   |   |   |   |
| Depreciation and amortization                                                   |   |                                   | 3,219   |   |   |   | 2,045 |   |
| Amortization of premium (discount) on investments                               |   |                                   | 500     |   |   |   | 72 |   |
| Stock-based compensation expense                                                |   |                                   | 8,252   |   |   |   | 7,748 |   |
| Loss on disposal of property and equipment                                      |   |                                   | 97      |   |   |   | 155 |   |
| Benefit from doubtful accounts receivable recovered                             |   |                                   | (120    | ) |   |   | (83 | ) |
| Changes in assets and liabilities, net of effect of acquisition:                |   |                                   |    |   |   |   |   |   |
| Accounts receivable                                                             |   |                                   | (2,300  | ) |   |   | 1,920 |   |
| Inventories                                                                     |   |                                   | (6,444  | ) |   |   | (513 | ) |
| Prepaid expenses and other current assets                                       |   |                                   | 4,078   |   |   |   | (3,746 | ) |
| Other assets                                                                    |   |                                   | 578     |   |   |   | 988 |   |
| Accounts payable                                                                |   |                                   | 749     |   |   |   | (273 | ) |
| Accrued expenses and other                                                      |   |                                   | (2,612  | ) |   |   | 5,611 |   |
| Accrued employee compensation                                                   |   |                                   | 1,400   |   |   |   | 1,338 |   |
| Deferred revenue                                                                |   |                                   | 4,291   |   |   |   | 4,082 |   |
| Net cash provided by operating activities                                       |   |                                   | 1,970   |   |   |   | 10,233 |   |
| CASH FLOWS FROM INVESTING ACTIVITIES:                                           |   |                                   |    |   |   |   |   |   |
| Purchases of property and equipment                                             |   |                                   | (5,137  | ) |   |   | (3,518 | ) |
| Purchases of short-term investments                                             |   |                                   | (3,136  | ) |   |   | (19,652 | ) |
| Proceeds from maturities of short-term investments                              |   |                                   | 21,194  |   |   |   | 6,635 |   |
| Cost of acquisition of a business                                               |   |                                   | (11,375 | ) |   |   | — |   |
| Purchases of software license and other                                         |   |                                   | (770    | ) |   |   | (1,200 | ) |
| Net cash provided by (used in) investing activities                             |   |                                   | 776     |   |   |   | (17,735 | ) |
| CASH FLOWS FROM FINANCING ACTIVITIES:                                           |   |                                   |    |   |   |   |   |   |
| Proceeds from issuance of common stock to employees                             |   |                                   | 3,177   |   |   |   | 1,504 |   |
| Taxes paid on vested and released stock awards                                  |   |                                   | (426    | ) |   |   | (118 | ) |
| Net cash provided by financing activities                                       |   |                                   | 2,751   |   |   |   | 1,386 |   |
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                            |   |                                   | 5,497   |   |   |   | (6,116 | ) |
| CASH AND CASH EQUIVALENTS - Beginning of period                                 |   |                                   | 68,426  |   |   |   | 73,819 |   |
| CASH AND CASH EQUIVALENTS - End of period                                       |   | $                                      | 73,923  |   |   | $ | 67,703 |   |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:                              |   |                                   |    |   |   |   |   |   |
| Cash paid (refunded) during the period for income taxes, net                    |   | $                                      | (1,572  | ) |   | $ | — |   |
| NONCASH INVESTING AND FINANCING ACTIVITIES:                                     |   |                                   |    |   |   |   |   |   |
| Vesting of accrued early exercised stock options                                |   | $                                      | — |   |   | $ | 18 |   |
| Purchase of property and equipment included in period-end accounts payable      |   | $                                      | 443     |   |   | $ | 465 |   |

----

index

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

----

index

|   | (i) | provide updated guidance on whether multiple deliverables exist, how the deliverables in an arrangement should be separated, and how the arrangement consideration should be allocated among its elements; |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | require an entity to allocate the revenue using estimated selling prices (ESP) of the deliverables if there is no vendor specific objective evidence (VSOE) or third party evidence of selling price (TPE); and |
|--------|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (iii) | eliminate the use of the residual method and require an entity to allocate revenue using the relative selling price method. |
|--------|-------|-----------------------------------------------------------------------------------------------------------------------------|

----

index

|           |   | Three Months Ended March 31, 2011(Unaudited) |   |   | Nine Months Ended March 31, 2011(Unaudited)                           |   |
|----------------|--------|---------------------------------------------------|--------|--------|----------------------------------------------------------------------------|--------|
| (In thousands) |   | As Reported                                       |   |   | Pro Forma Basis As If The Previous Accounting Guidance Were in Effect |   |   | As Reported |   |   | Pro Forma Basis As If The Previous Accounting Guidance Were in Effect |   |
| Total revenue  |   | $                                                 | 51,577 |   |                                                                       | $      | 51,619 |   |   | $ | 143,585 |   |   | $ | 143,480 |   |

----

index

| Tangible assets     |   | $      | 261    |   |
|---------------------|--------|--------|--------|--------|
| Goodwill            |   |   | 7,415  |   |
| Intangible assets   |   |   | 4,220  |   |
| Liabilities assumed |   |   | (521   | )      |
|                |   | $      | 11,375 |   |

|                                       |   | (Unaudited)Three Months Ended‎ March 31, |   |   | (Unaudited)Nine Months Ended‎ March 31, |   |
|--------------------------------------------|--------|----------------------------------------------------------|--------|--------|----------------------------------------------------|--------|
| (In thousands, except per share ammounts ) |   | 2010                                                     |   |   | 2011                                               |   |   | 2010 |   |
| Total revenue                              |   | $                                                        | 37,284 |   |                                               | $      | 144,028 |   |   | $ | 106,784 |   |
| Net loss                                   |   |                                                     | (6,086 | )      |                                               |   | (11,224 | ) |   |   | (13,827 | ) |
| Basic and diluted earnings per share       |   |                                                     | (0.14  | )      |                                               |   | (0.24 | ) |   |   | (0.31 | ) |

| (In thousands)                                 |   | March 31,‎2011 |   |   | June 30,‎2010 |   |
|------------------------------------------------|--------|---------------------------|--------|--------|--------------------------|--------|
| Inventories:                                   |   |                      |   |   |                     |   |
| Raw materials                                  |   | $                         | 263    |   |                     | $      | 335 |   |
| Work in process                                |   |                      | 295    |   |                     |   | 526 |   |
| Finished goods                                 |   |                      | 15,901 |   |                     |   | 9,093 |   |
| Total inventories                              |   | $                         | 16,459 |   |                     | $      | 9,954 |   |
| Property and equipment, net:                   |   |                      |   |   |                     |   |   |   |
| Computer equipment and tooling                 |   | $                         | 10,541 |   |                     | $      | 9,559 |   |
| Software                                       |   |                      | 2,273  |   |                     |   | 1,354 |   |
| Furniture and fixtures                         |   |                      | 1,768  |   |                     |   | 1,196 |   |
| Leasehold improvements and other               |   |                      | 2,537  |   |                     |   | 583 |   |
| Total property and equipment                   |   | $                         | 17,119 |   |                     | $      | 12,692 |   |
| Less accumulated depreciation and amortization |   |                      | (8,543 | )      |                     |   | (6,673 | ) |
| Total property and equipment, net              |   | $                         | 8,576  |   |                     | $      | 6,019 |   |
| Deferred revenue - current and long-term:      |   |                      |   |   |                     |   |   |   |
| Product                                        |   | $                         | 1,466  |   |                     | $      | 966 |   |
| Support and services                           |   |                      | 31,639 |   |                     |   | 27,753 |   |
| Total deferred revenue                         |   | $                         | 33,105 |   |                     | $      | 28,719 |   |

----

index

|                         |   | March 31, 2011                    |   |   | June 30, 2010                   |   |
|------------------------------|--------|-----------------------------------|--------|--------|---------------------------------|--------|
|                         |   | Gross Carrying ‎Amount |   |   | Accumulated‎ Amortization |   |   | Net Carrying ‎Amount |   |   | Gross Carrying ‎Amount |   |   | Accumulated‎ Amortization |   |   | Net Carrying‎ Amount |   |
| Patents                      |   | $                                 | 2,935  |   |                            | $      | (878 | ) |   | $ | 2,057 |   |   | $ | 2,310 |   |   | $ | (532 | ) |   | $ | 1,778 |   |
| Technology                   |   |                              | 4,130  |   |                            |   | (464 | ) |   |   | 3,666 |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Customer relationships       |   |                              | 300    |   |                            |   | (19 | ) |   |   | 281 |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Intangible assets in process |   |                              | 3,118  |   |                            |   | — |   |   |   | 3,118 |   |   |   | 3,247 |   |   |   | — |   |   |   | 3,247 |   |
| Other intangible assets      |   | $                                 | 10,483 |   |                            | $      | (1,361 | ) |   | $ | 9,122 |   |   | $ | 5,557 |   |   | $ | (532 | ) |   | $ | 5,025 |   |

|                          |   |   |   |
|-------------------------------|--------|--------|--------|
| Years Ending June 30,         |   |   |   |
| 2011 (remaining three months) |   | $      | 441    |   |
| 2012                          |   |   | 1,764  |   |
| 2013                          |   |   | 1,764  |   |
| 2014                          |   |   | 1,459  |   |
| 2015                          |   |   | 458    |   |
| 2016                          |   |   | 62     |   |
| Thereafter                    |   |   | 56     |   |
| Total                         |   | $      | 6,004  |   |

----

index

|                                 |   | Amortized Cost |   |   | Gross Unrealized‎ Gains |   |   | Gross Unrealized ‎Losses |   |   | Fair ‎Value |   |
|--------------------------------------|--------|----------------|--------|--------|-------------------------------|--------|--------|--------------------------------|--------|--------|-------------------|--------|
| As of March 31, 2011                 |   |           |   |   |                          |   |   |                           |   |   |              |   |
| Corporate notes and commercial paper |   | $              | 11,680 |   |                          | $      | 46     |                           |   | $      | —           |   |   | $ | 11,726 |   |
| U.S. Government agency securities    |   |           | 16,947 |   |                          |   | 35     |                           |   |   | —           |   |   |   | 16,982 |   |
| Total short-term investments         |   | $              | 28,627 |   |                          | $      | 81     |                           |   | $      | —           |   |   | $ | 28,708 |   |
| As of June 30, 2010                  |   |           |   |   |                          |   |   |                           |   |   |              |   |   |   |   |   |
| Corporate notes and commercial paper |   | $              | 33,280 |   |                          | $      | 142    |                           |   | $      | (50               | )      |   | $ | 33,372 |   |
| U.S. Government agency securities    |   |           | 13,904 |   |                          |   | 99     |                           |   |   | —           |   |   |   | 14,003 |   |
| Total short-term investments         |   | $              | 47,184 |   |                          | $      | 241    |                           |   | $      | (50               | )      |   | $ | 47,375 |   |

|                 |   | Amortized Cost |    |   | Fair Value |   |
|----------------------|--------|----------------|---------|--------|------------|--------|
| As of March 31, 2011 |   |           |    |   |       |   |
| Less than 1 year     |   | $              | 28,627  |   |       | $      | 28,708 |   |
| Due in 1 to 3 years  |   |           | — |   |       |   | — |   |
| Total                |   | $              | 28,627  |   |       | $      | 28,708 |   |
|                 |   |           |    |   |       |   |   |   |
|                 |   | Amortized Cost |    |   | Fair Value |   |
| As of June 30, 2010  |   |           |    |   |       |   |   |   |
| Less than 1 year     |   | $              | 33,956  |   |       | $      | 34,133 |   |
| Due in 1 to 3 years  |   |           | 13,228  |   |       |   | 13,242 |   |
| Total                |   | $              | 47,184  |   |       | $      | 47,375 |   |

|   | · | Level 1 — Quoted prices in active markets for identical assets or liabilities. |
|--------|--------|--------------------------------------------------------------------------------------|

|   | · | Level 2 — Observable inputs other than quoted prices included within Level 1, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and inputs other than quoted prices that are observable or are derived principally from, or corroborated by, observable market data by correlation or other means. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Level 3 — Unobservable inputs that are supported by little or no market activity, are significant to the fair value of the assets or liabilities, and reflect our own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

index

|                                                                                 |   | As of March 31, 2011 |   |
|--------------------------------------------------------------------------------------|--------|----------------------|--------|
|                                                                                 |   | Fair Value           |   |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |
| Cash and cash equivalents:                                                           |   |                 |   |   |   |   |   |   |   |   |   |   |
| Money market funds                                                                   |   | $                    | 59,739 |   |   | $ | 59,739 |   |   | $ | — |   |   | $ | — |   |
| Short-term investments:                                                              |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Corporate notes and commercial paper                                                 |   |                 | 11,726 |   |   |   | — |   |   |   | 11,726 |   |   |   | — |   |
| U.S. Government agency securities                                                    |   |                 | 16,982 |   |   |   | — |   |   |   | 16,982 |   |   |   | — |   |
| Total financial instruments measured and recorded at fair value as of March 31, 2011 |   | $                    | 88,447 |   |   | $ | 59,739 |   |   | $ | 28,708 |   |   | $ | — |   |

|                                                                                       |   | As at June 30, 2010 |   |
|--------------------------------------------------------------------------------------------|--------|---------------------|--------|
|                                                                                       |   | Fair Value          |   |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |
| Cash and cash equivalents:                                                                 |   |                |   |   |   |   |   |   |   |   |   |   |
| Money market funds                                                                         |   | $                   | 51,660 |   |   | $ | 51,660 |   |   | $ | — |   |   | $ | — |   |
| Short-term investments:                                                                    |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Corporate notes and commercial paper                                                       |   |                | 33,372 |   |   |   | — |   |   |   | 33,372 |   |   |   | — |   |
| U.S. Government agency securities                                                          |   |                | 14,003 |   |   |   | — |   |   |   | 14,003 |   |   |   | — |   |
| Total financial instruments measured and recorded at fair value as of June 30, ‎2010 |   | $                   | 99,035 |   |   | $ | 51,660 |   |   | $ | 47,375 |   |   | $ | — |   |

----

index

| Reserved under stock option plans           |   |   | 14,281 |   |
|---------------------------------------------|--------|--------|--------|--------|
| Reserved under employee stock purchase plan |   |   | 860    |   |
| Total                                       |   |   | 15,141 |   |

|                                   |   | Nine Months Ended‎March 31, |      |
|----------------------------------------|--------|----------------------------------------|-----------|
| Employee Incentive Plans               |   | 2011                                   |      |   | 2010 |   |
| Expected life of option (in years)     |   |                                   | 5.75-6.26 |   |   |   | 6.08-6.50 |   |
| Expected life of ESPP right (in years) |   |                                   | 0.50      |   |   |   | 0.50 |   |
| Risk-free interest rate for option     |   |                                   | 1.43-2.12 | % |   |   | 2.3-2.47 | % |
| Risk-free interest rate for ESPP right |   |                                   | 0.18-0.20 | % |   |   | 0.16-0.27 | % |
| Volatility for option                  |   |                                   | 57        | % |   |   | 57-58 | % |
| Volatility for ESPP right              |   |                                   | 46-51     | % |   |   | 59-138 | % |
| Dividend yield                         |   |                                   | 0         | % |   |   | 0 | % |

----

index

|                                                                                                      |   |                              |    |   | Options Outstanding     |   |
|-----------------------------------------------------------------------------------------------------------|--------|-----------------------------------|---------|--------|-------------------------|--------|
| (In thousands, except per share data and contractual term)                                                |   | Shares Available‎ for Grant |    |   | Number of‎ Shares |   |   | Weighted‎ Average Exercise‎ Price |   |   | Weighted‎ Average‎ Remaining‎ Contractual‎ Term‎ (in Years) |   |   | Aggregate ‎Intrinsic‎ Value |   |
| Balance at July 1, 2010                                                                                   |   |                              | 4,510   |   |                    |   | 7,492 |   |   | $ | 4.59 |   |   |   |   |   |   |   |
| Shares authorized                                                                                         |   |                              | 2,305   |   |                    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Termination of remaining shares available for grant under the 1997 Option Plan and other non-plan options |   |                              | (7      | )      |                    |   | — |   |   |   | — |   |   |   |   |   |   |   |
| Granted                                                                                                   |   |                              | (2,185  | )      |                    |   | 2,185 |   |   |   | 6.63 |   |   |   |   |   |   |   |
| Exercised                                                                                                 |   |                              | — |   |                    |   | (657 | ) |   |   | 2.68 |   |   |   |   |   |   |   |
| Cancelled, forfeited or expired                                                                           |   |                              | 738     |   |                    |   | (738 | ) |   |   | 5.35 |   |   |   |   |   |   |   |
| Restricted stock units granted (see Note 11)                                                              |   |                              | (849    | )      |                    |   | — |   |   |   | — |   |   |   |   |   |   |   |
| Restricted stock units cancelled                                                                          |   |                              | 289     |   |                    |   | — |   |   |   | — |   |   |   |   |   |   |   |
| Balance at March 31, 2011                                                                                 |   |                              | 4,801   |   |                    |   | 8,282 |   |   | $ | 5.21 |   |   |   | 6.9 |   |   | $ | 26,318 |   |
| Vested and expected to vest at March 31, ‎2011                                                      |   |                              |    |   |                    |   | 7,575 |   |   | $ | 5.13 |   |   |   | 6.7 |   |   | $ | 24,696 |   |
| Exercisable and vested at March 31, 2011                                                                  |   |                              |    |   |                    |   | 3,791 |   |   | $ | 4.37 |   |   |   | 5.7 |   |   | $ | 15,231 |   |

|              |   | Nine Months Ended March 31, 2011 |   |   | Nine Months Ended‎March 31, 2010 |   |
|-------------------|--------|---------------------------------------|--------|--------|---------------------------------------------|--------|
| Beginning balance |   |                                  | 809    |   |                                        |   | 507 |   |
| Awarded           |   |                                  | 849    |   |                                        |   | 359 |   |
| Released          |   |                                  | (253   | )      |                                        |   | (88 | ) |
| Forfeited         |   |                                  | (207   | )      |                                        |   | (27 | ) |
| Ending balance    |   |                                  | 1,198  |   |                                        |   | 751 |   |

----

index

|                               |   | Number of Shares (thousands) |   | Weighted Average‎ Remaining‎ Contractual Lives |                                                                                                                                                       | Aggregate Intrinsic ‎Value (thousands) |   |
|------------------------------------|--------|------------------------------|--------|------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------|--------|
| Shares outstanding                 |   |                         | 1,198  |                                                       |                         1.79 years |                                         | $      | 9,857 |   |
| Shares vested and expected to vest |   |                         | 951    |                                                       |                         1.66 years |                                         |   | 7,828 |   |

| Years Ending June 30,         |   |   |   |
|-------------------------------|--------|--------|--------|
| 2011 (remaining three months) |   | $      | 347    |   |
| 2012                          |   |   | 1,627  |   |
| 2013                          |   |   | 2,035  |   |
| 2014                          |   |   | 1,930  |   |
| 2015                          |   |   | 1,122  |   |
| 2016                          |   |   | 866    |   |
| Thereafter                    |   |   | 1,571  |   |
| Total                         |   | $      | 9,498  |   |

----

index

|           |   | Three Months Ended‎March 31, |   |   | Nine Months Ended‎March 31, |   |
|----------------|--------|------------------------------------|--------|--------|-----------------------------------|--------|
|           |   | 2011                               |   |   | 2010                              |   |   | 2011 |   |   | 2010 |   |
| United States  |   | $                                  | 45,634 |   |                              | $      | 33,473 |   |   | $ | 127,255 |   |   | $ | 96,160 |   |
| International  |   |                               | 5,943  |   |                              |   | 3,561 |   |   |   | 16,330 |   |   |   | 10,081 |   |
| Total revenues |   | $                                  | 51,577 |   |                              | $      | 37,034 |   |   | $ | 143,585 |   |   | $ | 106,241 |   |

| ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
|---------|---------------------------------------------------------------------------------------------|

----

index

----

index

----

index

|                                                                                                                                                   |   | (Unaudited)Three Months Ended‎March 31, |   |   | (Unaudited)Nine Months Ended‎March 31, |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------|--------|--------|----------------------------------------------|--------|
|                                                                                                                                                   |   | 2011                                          |   |   | 2010                                         |   |   | 2011 |   |   | 2010 |   |
| REVENUE:                                                                                                                                               |   |                                          |   |   |                                         |   |   |   |   |   |   |   |
| Product                                                                                                                                                |   | $                                             | 41,248 |   |                                         | $      | 28,945 |   |   | $ | 114,387 |   |   | $ | 83,685 |   |
| Support and services                                                                                                                                   |   |                                          | 10,329 |   |                                         |   | 8,089 |   |   |   | 29,198 |   |   |   | 22,556 |   |
| Total revenue                                                                                                                                          |   |                                          | 51,577 |   |                                         |   | 37,034 |   |   |   | 143,585 |   |   |   | 106,241 |   |
| COST OF REVENUE:                                                                                                                                       |   |                                          |   |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
| Product (1)                                                                                                                                            |   |                                          | 12,979 |   |                                         |   | 10,049 |   |   |   | 37,593 |   |   |   | 29,369 |   |
| Support and services (1)                                                                                                                               |   |                                          | 3,515  |   |                                         |   | 2,933 |   |   |   | 9,616 |   |   |   | 8,323 |   |
| Total cost of revenue                                                                                                                                  |   |                                          | 16,494 |   |                                         |   | 12,982 |   |   |   | 47,209 |   |   |   | 37,692 |   |
| GROSS PROFIT                                                                                                                                           |   |                                          | 35,083 |   |                                         |   | 24,052 |   |   |   | 96,376 |   |   |   | 68,549 |   |
| OPERATING EXPENSES:                                                                                                                                    |   |                                          |   |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
| Research and development (1)                                                                                                                           |   |                                          | 12,562 |   |                                         |   | 8,634 |   |   |   | 33,396 |   |   |   | 23,666 |   |
| Sales and marketing (1)                                                                                                                                |   |                                          | 18,920 |   |                                         |   | 14,726 |   |   |   | 54,437 |   |   |   | 39,653 |   |
| General and administrative (1)                                                                                                                         |   |                                          | 6,377  |   |                                         |   | 5,214 |   |   |   | 19,118 |   |   |   | 14,596 |   |
| Total operating expenses                                                                                                                               |   |                                          | 37,859 |   |                                         |   | 28,574 |   |   |   | 106,951 |   |   |   | 77,915 |   |
| LOSS FROM OPERATIONS                                                                                                                                   |   |                                          | (2,776 | )      |                                         |   | (4,522 | ) |   |   | (10,575 | ) |   |   | (9,366 | ) |
| OTHER INCOME (EXPENSE):                                                                                                                                |   |                                          |   |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
| Interest income                                                                                                                                        |   |                                          | 105    |   |                                         |   | 100 |   |   |   | 447 |   |   |   | 296 |   |
| Other                                                                                                                                                  |   |                                          | 61     |   |                                         |   | (220 | ) |   |   | 333 |   |   |   | (128 | ) |
| Total other income (expense)                                                                                                                           |   |                                          | 166    |   |                                         |   | (120 | ) |   |   | 780 |   |   |   | 168 |   |
| LOSS BEFORE BENEFIT FROM  INCOME TAXES                                                                                                       |   |                                          | (2,610 | )      |                                         |   | (4,642 | ) |   |   | (9,795 | ) |   |   | (9,198 | ) |
| BENEFIT FROM INCOME TAXES                                                                                                                              |   |                                          | 228    |   |                                         |   | 153 |   |   |   | 77 |   |   |   | 87 |   |
| NET LOSS                                                                                                                                               |   | $                                             | (2,382 | )      |                                         | $      | (4,489 | ) |   | $ | (9,718 | ) |   | $ | (9,111 | ) |
| Net loss per share — basic and diluted  (2)                                                                                            |   | $                                             | (0.05  | )      |                                         | $      | (0.10 | ) |   | $ | (0.21 | ) |   | $ | (0.20 | ) |
| Shares used in computing net loss per share—basic and diluted  (2)                                                                     |   |                                          | 46,249 |   |                                         |   | 44,941 |   |   |   | 45,862 |   |   |   | 44,731 |   |
| ______________                                                                                                                                         |   |                                          |   |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
| (1) Includes stock-based compensation expense as follows:                                                                                              |   |                                          |   |   |                                         |   |   |   |   |   |   |   |   |   |   |   |
| Cost of product revenue                                                                                                                                |   | $                                             | 32     |   |                                         | $      | 34 |   |   | $ | 94 |   |   | $ | 99 |   |
| Cost of support and services revenue                                                                                                                   |   |                                          | 111    |   |                                         |   | 207 |   |   |   | 472 |   |   |   | 553 |   |
| Research and development                                                                                                                               |   |                                          | 1,086  |   |                                         |   | 805 |   |   |   | 2,688 |   |   |   | 2,248 |   |
| Sales and marketing                                                                                                                                    |   |                                          | 459    |   |                                         |   | 911 |   |   |   | 2,212 |   |   |   | 2,528 |   |
| General and administrative                                                                                                                             |   |                                          | 1,112  |   |                                         |   | 861 |   |   |   | 2,786 |   |   |   | 2,320 |   |
| Total stock-based compensation expense                                                                                                                 |   | $                                             | 2,800  |   |                                         | $      | 2,818 |   |   | $ | 8,252 |   |   | $ | 7,748 |   |
| (2) Potentially dilutive securities were not included in the computation of diluted net loss per share because to do so would have been anti-dilutive. |   |                                          |   |   |                                         |   |   |   |   |   |   |   |   |   |   |   |

----

index

|                                  |   | (Unaudited)Three Months Ended ‎March 31, |   |   | (Unaudited)Nine Months Ended‎ March 31, |   |
|---------------------------------------|--------|------------------------------------------------|--------|--------|-----------------------------------------------|--------|
|                                  |   | 2011                                           |   |   | 2010                                          |   |   | 2011 |   |   | 2010 |   |
| REVENUE:                              |   |                                           |   |   |                                          |   |   |   |   |   |   |   |
| Product                               |   |                                           | 80     | %      |                                          |   | 78 | % |   |   | 80 | % |   |   | 79 | % |
| Support and services                  |   |                                           | 20     | %      |                                          |   | 22 | % |   |   | 20 | % |   |   | 21 | % |
| Total revenue                         |   |                                           | 100    | %      |                                          |   | 100 | % |   |   | 100 | % |   |   | 100 | % |
| COST OF REVENUE:                      |   |                                           |   |   |                                          |   |   |   |   |   |   |   |   |   |   |   |
| Product                               |   |                                           | 25     | %      |                                          |   | 27 | % |   |   | 26 | % |   |   | 28 | % |
| Support and services                  |   |                                           | 7      | %      |                                          |   | 8 | % |   |   | 7 | % |   |   | 8 | % |
| Total cost of revenue                 |   |                                           | 32     | %      |                                          |   | 35 | % |   |   | 33 | % |   |   | 36 | % |
| GROSS PROFIT                          |   |                                           | 68     | %      |                                          |   | 65 | % |   |   | 67 | % |   |   | 64 | % |
| Operating expenses:                   |   |                                           |   |   |                                          |   |   |   |   |   |   |   |   |   |   |   |
| Research and development              |   |                                           | 24     | %      |                                          |   | 23 | % |   |   | 23 | % |   |   | 22 | % |
| Sales and marketing                   |   |                                           | 37     | %      |                                          |   | 40 | % |   |   | 38 | % |   |   | 37 | % |
| General and administrative            |   |                                           | 12     | %      |                                          |   | 14 | % |   |   | 14 | % |   |   | 14 | % |
| Total operating expenses              |   |                                           | 73     | %      |                                          |   | 77 | % |   |   | 75 | % |   |   | 73 | % |
| LOSS FROM OPERATIONS                  |   |                                           | (5     | )%     |                                          |   | (12 | )% |   |   | (8 | )% |   |   | (9 | )% |
| OTHER INCOME, net                     |   |                                           | 0      | %      |                                          |   | 0% | % |   |   | 1 | % |   |   | 0 | % |
| LOSS BEFORE BENEFIT FROM INCOME TAXES |   |                                           | (5     | )%     |                                          |   | (12 | )% |   |   | (7 | )% |   |   | (9 | )% |
| BENEFIT FROM INCOME TAXES             |   |                                           | 0      | %      |                                          |   | 0% | % |   |   | 0 | % |   |   | 0 | % |
| NET LOSS                              |   |                                           | (5     | )%     |                                          |   | (12 | )% |   |   | (7 | )% |   |   | (9 | )% |

----

index

|                                                                                                                                                                                                                                                                                                                                                                                                                             |   | Three Months Ended |   |   | Nine Months Ended |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   | March 31, 2011     |   |   | March 31, 2011    |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   | GAAP               |   |   | Excludes          |   |   | Non-GAAP |   |   | GAAP |   |   | Excludes |   |   | Non-GAAP |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Revenue:                                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Product                                                                                                                                                                                                                                                                                                                                                                                                                          |   | $                  | 41,248 |   |              | $      | - |   |   | $ | 41,248 |   |   | $ | 114,387 |   |   | $ | - |   |   | $ | 114,387 |   |
| Support and services                                                                                                                                                                                                                                                                                                                                                                                                             |   |               | 10,329 |   |              |   | - |   |   |   | 10,329 |   |   |   | 29,198 |   |   |   | - |   |   |   | 29,198 |   |
| Total revenues                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               | 51,577 |   |              |   | - |   |   |   | 51,577 |   |   |   | 143,585 |   |   |   | - |   |   |   | 143,585 |   |
| Cost of revenue                                                                                                                                                                                                                                                                                                                                                                                                                  |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Product                                                                                                                                                                                                                                                                                                                                                                                                                          |   |               | 12,979 |   |              |   | (207 | )  (a),(c) |   |   | 12,772 |   |   |   | 37,593 |   |   |   | (410 | )(a),(c) |   |   | 37,183 |   |
| Support and services                                                                                                                                                                                                                                                                                                                                                                                                             |   |               | 3,515  |   |              |   | (111 | )  (a) |   |   | 3,404 |   |   |   | 9,616 |   |   |   | (472 | )(a) |   |   | 9,144 |   |
| Total cost of revenue                                                                                                                                                                                                                                                                                                                                                                                                            |   |               | 16,494 |   |              |   | (318 | ) |   |   | 16,176 |   |   |   | 47,209 |   |   |   | (882 | ) |   |   | 46,327 |   |
| Gross profit                                                                                                                                                                                                                                                                                                                                                                                                                     |   |               | 35,083 |   |              |   | 318 |   |   |   | 35,401 |   |   |   | 96,376 |   |   |   | 882 |   |   |   | 97,258 |   |
| Gross profit %                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               | 68.0   | %      |              |   |   |   |   |   | 68.6 | % |   |   | 67.1 | % |   |   |   |   |   |   | 67.7 | % |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating expenses:                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Research and development                                                                                                                                                                                                                                                                                                                                                                                                         |   |               | 12,562 |   |              |   | (1,086 | )  (a) |   |   | 11,476 |   |   |   | 33,396 |   |   |   | (2,688 | )(a) |   |   | 30,708 |   |
| Sales and marketing                                                                                                                                                                                                                                                                                                                                                                                                              |   |               | 18,920 |   |              |   | (469 | )  (a),(c) |   |   | 18,451 |   |   |   | 54,437 |   |   |   | (2,231 | )(a),(c) |   |   | 52,206 |   |
| General and administrative                                                                                                                                                                                                                                                                                                                                                                                                       |   |               | 6,377  |   |              |   | (1,112 | )  (a) |   |   | 5,265 |   |   |   | 19,118 |   |   |   | (3,311 | )(a),(b) |   |   | 15,807 |   |
| Total operating expenses                                                                                                                                                                                                                                                                                                                                                                                                         |   |               | 37,859 |   |              |   | (2,667 | ) |   |   | 35,192 |   |   |   | 106,951 |   |   |   | (8,230 | ) |   |   | 98,721 |   |
| Income (Loss) from operations                                                                                                                                                                                                                                                                                                                                                                                                    |   |               | (2,776 | )      |              |   | 2,985 |   |   |   | 209 |   |   |   | (10,575 | ) |   |   | 9,112 |   |   |   | (1,463 | ) |
| Other income, net                                                                                                                                                                                                                                                                                                                                                                                                                |   |               | 166    |   |              |   | - |   |   |   | 166 |   |   |   | 780 |   |   |   | - |   |   |   | 780 |   |
| Income (Loss) before provision for income taxes                                                                                                                                                                                                                                                                                                                                                                                  |   |               | (2,610 | )      |              |   | 2,985 |   |   |   | 375 |   |   |   | (9,795 | ) |   |   | 9,112 |   |   |   | (683 | ) |
| Benefit from income taxes                                                                                                                                                                                                                                                                                                                                                                                                        |   |               | 228    |   |              |   | (1 | )  (d) |   |   | 227 |   |   |   | 77 |   |   |   | (1 | )(d) |   |   | 76 |   |
| Net income (loss)                                                                                                                                                                                                                                                                                                                                                                                                                |   | $                  | (2,382 | )      |              | $      | 2,984 |   |   | $ | 602 |   |   | $ | (9,718 | ) |   | $ | 9,111 |   |   | $ | (607 | ) |
| Net income (loss) per share:                                                                                                                                                                                                                                                                                                                                                                                                     |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                                                                                                                                                                                                                                                                                                                                                                            |   | $                  | (0.05  | )      |              | $      | 0.06 |   |   | $ | 0.01 |   |   | $ | (0.21 | ) |   | $ | 0.20 |   |   | $ | (0.01 | ) |
| Diluted (e)                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $                  | (0.05  | )      |              | $      | 0.06 |   |   | $ | 0.01 |   |   | $ | (0.21 | ) |   | $ | 0.20 |   |   | $ | (0.01 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Shares used in computing net loss per share:                                                                                                                                                                                                                                                                                                                                                                                     |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                                                                                                                                                                                                                                                                                                                                                                            |   |               | 46,249 |   |              |   |   |   |   |   | 46,249 |   |   |   | 45,862 |   |   |   |   |   |   |   | 45,862 |   |
| Diluted (e)                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               | 46,249 |   |              |   |   |   |   |   | 48,209 |   |   |   | 45,862 |   |   |   |   |   |   |   | 45,862 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (a)   Excludes stock-based compensation as follows:                                                                                                                                                                                                                                                                                                                                                                    |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cost of product revenue                                                                                                                                                                                                                                                                                                                                                                                                          |   |               |   |   |              | $      | 32 |   |   |   |   |   |   |   |   |   |   | $ | 94 |   |   |   |   |   |
| Cost of support and services revenue                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              |   | 111 |   |   |   |   |   |   |   |   |   |   |   | 472 |   |   |   |   |   |
| Research and development                                                                                                                                                                                                                                                                                                                                                                                                         |   |               |   |   |              |   | 1,086 |   |   |   |   |   |   |   |   |   |   |   | 2,688 |   |   |   |   |   |
| Sales and marketing                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   | 459 |   |   |   |   |   |   |   |   |   |   |   | 2,212 |   |   |   |   |   |
| General and administrative                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              |   | 1,112 |   |   |   |   |   |   |   |   |   |   |   | 2,786 |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              | $      | 2,800 |   |   |   |   |   |   |   |   |   |   | $ | 8,252 |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (b)   Excludes severance for former Chief Executive Officer:                                                                                                                                                                                                                                                                                                                                                           |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| General and administration                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              | $      | - |   |   |   |   |   |   |   |   |   |   | $ | 525 |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              | $      | - |   |   |   |   |   |   |   |   |   |   | $ | 525 |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (c)   Excludes amortization of acquisition-related intangibles:                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cost of product revenue                                                                                                                                                                                                                                                                                                                                                                                                          |   |               |   |   |              | $      | 175 |   |   |   |   |   |   |   |   |   |   | $ | 316 |   |   |   |   |   |
| Sales and marketing                                                                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   | 10 |   |   |   |   |   |   |   |   |   |   |   | 19 |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              | $      | 185 |   |   |   |   |   |   |   |   |   |   | $ | 335 |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (d)   Excludes the tax impact of the items which are excluded in (a) to (c) above.                                                                                                                                                                                                                                                                                                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (e)    Diluted net income per share and share count reflect the weighted average number of common shares used in the basic net income per share calculation plus the effects of all potentially dilutive securities. Potentially dilutive securities were not included in the calculation of diluted net loss per share for the periods which had a net loss because to do so would have been anti-dilutive. |   |

----

index

|                                                                                                                                                                                                                                                                                                                                                                                                                       |   | Three Months Ended |   |   | Nine Months Ended |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   | March 31, 2010     |   |   | March 31, 2010    |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   | GAAP               |   |   | Excludes          |   |   | Non-GAAP |   |   | GAAP |   |   | Excludes |   |   | Non-GAAP |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Revenue:                                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Product                                                                                                                                                                                                                                                                                                                                                                                                                    |   | $                  | 28,945 |   |              | $      | - |   |   | $ | 28,945 |   |   | $ | 83,685 |   |   | $ | - |   |   | $ | 83,685 |   |
| Support and services                                                                                                                                                                                                                                                                                                                                                                                                       |   |               | 8,089  |   |              |   | - |   |   |   | 8,089 |   |   |   | 22,556 |   |   |   | - |   |   |   | 22,556 |   |
| Total revenues                                                                                                                                                                                                                                                                                                                                                                                                             |   |               | 37,034 |   |              |   | - |   |   |   | 37,034 |   |   |   | 106,241 |   |   |   | - |   |   |   | 106,241 |   |
| Cost of revenue                                                                                                                                                                                                                                                                                                                                                                                                            |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Product                                                                                                                                                                                                                                                                                                                                                                                                                    |   |               | 10,049 |   |              |   | (34 | )(a) |   |   | 10,015 |   |   |   | 29,369 |   |   |   | (99 | )(a) |   |   | 29,270 |   |
| Support and services                                                                                                                                                                                                                                                                                                                                                                                                       |   |               | 2,933  |   |              |   | (207 | )(a) |   |   | 2,726 |   |   |   | 8,323 |   |   |   | (553 | )(a) |   |   | 7,770 |   |
| Total cost of revenue                                                                                                                                                                                                                                                                                                                                                                                                      |   |               | 12,982 |   |              |   | (241 | ) |   |   | 12,741 |   |   |   | 37,692 |   |   |   | (652 | ) |   |   | 37,040 |   |
| Gross profit                                                                                                                                                                                                                                                                                                                                                                                                               |   |               | 24,052 |   |              |   | 241 |   |   |   | 24,293 |   |   |   | 68,549 |   |   |   | 652 |   |   |   | 69,201 |   |
| Gross profit %                                                                                                                                                                                                                                                                                                                                                                                                             |   |               | 64.9   | %      |              |   |   |   |   |   | 65.6 | % |   |   | 64.5 | % |   |   |   |   |   |   | 65.1 | % |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating expenses:                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Research and development                                                                                                                                                                                                                                                                                                                                                                                                   |   |               | 8,634  |   |              |   | (805 | )(a) |   |   | 7,829 |   |   |   | 23,666 |   |   |   | (2,248 | )(a) |   |   | 21,418 |   |
| Sales and marketing                                                                                                                                                                                                                                                                                                                                                                                                        |   |               | 14,726 |   |              |   | (911 | )(a) |   |   | 13,815 |   |   |   | 39,653 |   |   |   | (2,501 | )(a),(b) |   |   | 37,152 |   |
| General and administrative                                                                                                                                                                                                                                                                                                                                                                                                 |   |               | 5,214  |   |              |   | (861 | )(a) |   |   | 4,353 |   |   |   | 14,596 |   |   |   | (2,320 | )(a) |   |   | 12,276 |   |
| Total operating expenses                                                                                                                                                                                                                                                                                                                                                                                                   |   |               | 28,574 |   |              |   | (2,577 | ) |   |   | 25,997 |   |   |   | 77,915 |   |   |   | (7,069 | ) |   |   | 70,846 |   |
| Income (Loss) from operations                                                                                                                                                                                                                                                                                                                                                                                              |   |               | (4,522 | )      |              |   | 2,818 |   |   |   | (1,704 | ) |   |   | (9,366 | ) |   |   | 7,721 |   |   |   | (1,645 | ) |
| Other income, net                                                                                                                                                                                                                                                                                                                                                                                                          |   |               | (120   | )      |              |   | - |   |   |   | (120 | ) |   |   | 168 |   |   |   | - |   |   |   | 168 |   |
| Income (Loss) before provision for income taxes                                                                                                                                                                                                                                                                                                                                                                            |   |               | (4,642 | )      |              |   | 2,818 |   |   |   | (1,824 | ) |   |   | (9,198 | ) |   |   | 7,721 |   |   |   | (1,477 | ) |
| Benefit from (Provision for) income taxes                                                                                                                                                                                                                                                                                                                                                                                  |   |               | 153    |   |              |   | 4 | (c) |   |   | 157 |   |   |   | 87 |   |   |   | (28 | )(c) |   |   | 59 |   |
| Net income (loss)                                                                                                                                                                                                                                                                                                                                                                                                          |   | $                  | (4,489 | )      |              | $      | 2,822 |   |   | $ | (1,667 | ) |   | $ | (9,111 | ) |   | $ | 7,693 |   |   | $ | (1,418 | ) |
| Net income (loss) per share:                                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $                  | (0.10  | )      |              | $      | 0.06 |   |   | $ | (0.04 | ) |   | $ | (0.20 | ) |   | $ | 0.17 |   |   | $ | (0.03 | ) |
| Diluted (d)                                                                                                                                                                                                                                                                                                                                                                                                                |   | $                  | (0.10  | )      |              | $      | 0.06 |   |   | $ | (0.04 | ) |   | $ | (0.20 | ) |   | $ | 0.17 |   |   | $ | (0.03 | ) |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Shares used in computing net loss per share:                                                                                                                                                                                                                                                                                                                                                                               |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                                                                                                                                                                                                                                                                                                                                                                      |   |               | 44,941 |   |              |   |   |   |   |   | 44,941 |   |   |   | 44,731 |   |   |   |   |   |   |   | 44,731 |   |
| Diluted (d)                                                                                                                                                                                                                                                                                                                                                                                                                |   |               | 44,941 |   |              |   |   |   |   |   | 44,941 |   |   |   | 44,731 |   |   |   |   |   |   |   | 44,731 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (a)   Excludes stock-based compensation as follows:                                                                                                                                                                                                                                                                                                                                                              |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cost of product revenue                                                                                                                                                                                                                                                                                                                                                                                                    |   |               |   |   |              | $      | 34 |   |   |   |   |   |   |   |   |   |   | $ | 99 |   |   |   |   |   |
| Cost of support and services revenue                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              |   | 207 |   |   |   |   |   |   |   |   |   |   |   | 553 |   |   |   |   |   |
| Research and development                                                                                                                                                                                                                                                                                                                                                                                                   |   |               |   |   |              |   | 805 |   |   |   |   |   |   |   |   |   |   |   | 2,248 |   |   |   |   |   |
| Sales and marketing                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              |   | 911 |   |   |   |   |   |   |   |   |   |   |   | 2,528 |   |   |   |   |   |
| General and administrative                                                                                                                                                                                                                                                                                                                                                                                                 |   |               |   |   |              |   | 861 |   |   |   |   |   |   |   |   |   |   |   | 2,320 |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              | $      | 2,818 |   |   |   |   |   |   |   |   |   |   | $ | 7,748 |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (b)    Excludes restructuring benefit as follows:                                                                                                                                                                                                                                                                                                                                                           |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Sales and marketing                                                                                                                                                                                                                                                                                                                                                                                                        |   |               |   |   |              | $      | - |   |   |   |   |   |   |   |   |   |   | $ | (27 | ) |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              | $      | - |   |   |   |   |   |   |   |   |   |   | $ | (27 | ) |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (c)   Excludes the tax impact of the items which are excluded in (a) and (b) above.                                                                                                                                                                                                                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                                                       |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (d)   Diluted net income per share and share count reflect the weighted average number of common shares used in the basic net income per share calculation plus the effects of all potentially dilutive securities. Potentially dilutive securities were not included in the calculation of diluted net loss per share for the periods which had a net loss because to do so would have been anti-dilutive. |   |

----

index

|                   |   | Three Months Ended‎March 31, |   |
|------------------------|--------|------------------------------------|--------|
| (Dollars in thousands) |   | 2011                               |   |   | 2010 |   |   | Dollar ‎Variance |   |   | Percent‎ Variance |   |
| Total revenue          |   | $                                  | 51,577 |   |   | $ | 37,034 |   |   | $ | 14,543 |   |   |   | 39 | % |

|                   |   | Three Months Ended‎March 31, |   |
|------------------------|--------|------------------------------------|--------|
| (Dollars in thousands) |   | 2011                               |   |   | 2010 |   |   | Dollar‎Variance |   |   | Percent‎Variance |   |
| Cost of revenue        |   | $                                  | 16,494 |   |   | $ | 12,982 |   |   | $ | 3,512 |   |   |   | 27 | % |
| Gross profit           |   |                               | 35,083 |   |   |   | 24,052 |   |   |   | 11,031 |   |   |   | 46 | % |
| Gross margins          |   |                               | 68.0   | % |   |   | 64.9 | % |   |   |   |   |   |   |   |   |

|                       |   |                               |   |   |   |   |   |                  |   |   |                   |   |
|----------------------------|--------|------------------------------------|--------|--------|--------|--------|--------|-----------------------|--------|--------|------------------------|--------|
|                       |   | Three Months Ended‎March 31, |   |
| (Dollars in thousands)     |   | 2011                               |   |   | 2010   |   |   | Dollar‎Variance |   |   | Percent‎Variance |   |
| Research and development   |   | $                                  | 12,562 |   |   | $      | 8,634  |                  |   | $      | 3,928                  |   |   |   | 45 | % |
| Sales and marketing        |   |                               | 18,920 |   |   |   | 14,726 |                  |   |   | 4,194                  |   |   |   | 28 | % |
| General and administrative |   |                               | 6,377  |   |   |   | 5,214  |                  |   |   | 1,163                  |   |   |   | 22 | % |

----

index

|                   |   | Three Months Ended‎March 31, |   |
|------------------------|--------|------------------------------------|--------|
| (Dollars in thousands) |   | 2011                               |   |   | 2010 |   |   | Dollar‎ Variance |   |   | Percent ‎Variance |   |
| Other income, net      |   | $                                  | 166    |   |   | $ | (120 | ) |   | $ | 286 |   |   |   | 238 | % |

|                         |   | Three Months Ended‎March 31, |   |
|------------------------------|--------|------------------------------------|--------|
|  (Dollars in thousands) |   | 2011                               |   |   | 2010 |   |   | Dollar‎ Variance |   |   | Percent‎ Variance |   |
| Tax benefit                  |   | $                                  | 228    |   |   | $ | 153 |   |   | $ | 75 |   |   |   | 49 | % |

|                   |   | Nine Months Ended‎March 31, |    |
|------------------------|--------|-----------------------------------|---------|
| (Dollars in thousands) |   | 2011                              |    |   | 2010 |   |   | Dollar‎ Variance |   |   | Percent ‎Variance |   |
| Total revenue          |   | $                                 | 143,585 |   |   | $ | 106,241 |   |   | $ | 37,344 |   |   |   | 35 | % |

|                   |   | Nine Months Ended‎March 31, |   |
|------------------------|--------|-----------------------------------|--------|
| (Dollars in thousands) |   | 2011                              |   |   | 2010 |   |   | Dollar‎ Variance |   |   | Percent‎ Variance |   |
| Cost of revenue        |   | $                                 | 47,209 |   |   | $ | 37,692 |   |   | $ | 9,517 |   |   |   | 25 | % |
| Gross profit           |   |                              | 96,376 |   |   |   | 68,549 |   |   |   | 27,827 |   |   |   | 41 | % |
| Gross margins          |   |                              | 67.1   | % |   |   | 64.5 | % |   |   |   |   |   |   |   |   |

----

index

|                       |   | Nine Months Ended‎March 31, |   |
|----------------------------|--------|-----------------------------------|--------|
| (Dollars in thousands)     |   | 2011                              |   |   | 2010 |   |   | Dollar‎ Variance |   |   | Percent‎ Variance |   |
| Research and development   |   | $                                 | 33,396 |   |   | $ | 23,666 |   |   | $ | 9,730 |   |   |   | 41 | % |
| Sales and marketing        |   |                              | 54,437 |   |   |   | 39,653 |   |   |   | 14,784 |   |   |   | 37 | % |
| General and administrative |   |                              | 19,118 |   |   |   | 14,596 |   |   |   | 4,522 |   |   |   | 31 | % |

|                   |   | Nine Months Ended‎March 31, |   |
|------------------------|--------|-----------------------------------|--------|
| (Dollars in thousands) |   | 2011                              |   |   | 2010 |   |   | Dollar ‎Variance |   |   | Percent‎Variance |   |
| Other income, net      |   | $                                 | 780    |   |   | $ | 168 |   |   | $ | 612 |   |   |   | 364 | % |

|                         |   | Nine Months Ended‎March 31, |   |
|------------------------------|--------|-----------------------------------|--------|
|  (Dollars in thousands) |   | 2011                              |   |   | 2010 |   |   | Dollar‎Variance |   |   | Percent‎Variance |   |
| Tax benefit                  |   | $                                 | 77     |   |   | $ | 87 |   |   | $ | (10 | ) |   |   | (11 | )% |

----

index

|                                               |   | March 31,‎ 2011 |    |   | June 30,‎ 2010 |   |    | Increase/‎(Decrease) |   |
|----------------------------------------------------|--------|-----------------------|---------|--------|----------------------|--------|---------|----------------------------|--------|
| Cash, cash equivalents and short-term investments: |   |                  |    |   |                 |   |    |                       |   |
| Cash and cash equivalents                          |   | $                     | 73,923  |   |                 | $      | 68,426  |                       |   | $ | 5,497 |   |
| Short-term investments                             |   |                  | 28,708  |   |                 |   | 47,375  |                       |   |   | (18,667 | ) |
| Total                                              |   | $                     | 102,631 |   |                 | $      | 115,801 |                       |   | $ | (13,170 | ) |

|                                                 |   | Nine Months Ended    |   |
|------------------------------------------------------|--------|----------------------|--------|
| (In thousands)                                       |   | March 31,‎2011 |   |   | March 31,‎2010 |   |
| Net cash flow provided by (used in):                 |   |                 |   |   |   |   |
| Operating activities                                 |   | $                    | 1,970  |   |   | $ | 10,233 |   |
| Investing activities                                 |   |                 | 776    |   |   |   | (17,735 | ) |
| Financing activities                                 |   |                 | 2,751  |   |   |   | 1,386 |   |
| Net increase (decrease) in cash and cash equivalents |   | $                    | 5,497  |   |   | $ | (6,116 | ) |

----

index

|                   |   | Payments Due By Period |   |
|------------------------|--------|------------------------|--------|
| (Dollars in thousands) |   | Less than 1‎Year |   |   | 1 - 3 Years |   |   | 3 - 5 Years |   |   | 5 years and after |   |   | Total |   |
| Operating leases       |   | $                      | 1,436  |   |   | $ | 5,410 |   |   | $ | 1,744 |   |   | $ | 908 |   |   | $ | 9,498 |   |
| Purchase obligations   |   |                   | 24,742 |   |   |   | 250 |   |   |   | 250 |   |   |   | 250 |   |   |   | 25,492 |   |
| Total                  |   | $                      | 26,178 |   |   | $ | 5,660 |   |   | $ | 1,994 |   |   | $ | 1,158 |   |   | $ | 34,990 |   |

| ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
|---------|------------------------------------------------------------|

| ITEM  4. | CONTROLS AND PROCEDURES |
|--------------------|-------------------------|

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index

| ITEM  1. | LEGAL PROCEEDINGS |
|--------------------|-------------------|

| ITEM  1A. | RISK FACTORS |
|---------------------|--------------|

|   | · | unanticipated costs or liabilities associated with the acquisition; |
|--------|--------|---------------------------------------------------------------------|

|   | · | diversion of management’s attention from other business concerns; |
|--------|--------|-------------------------------------------------------------------------|

|   | · | harm to our existing business relationships with business partners and customers as a result of the acquisition; |
|--------|--------|------------------------------------------------------------------------------------------------------------------|

|   | · | the potential loss of key employees; |
|--------|--------|--------------------------------------|

|   | · | use of resources that are need in other parts of our business; and |
|--------|--------|--------------------------------------------------------------------|

|   | · | use of substantial portions of our available cash to consummate the acquisition. |
|--------|--------|----------------------------------------------------------------------------------|

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index

| ITEM  2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
|--------------------|-------------------------------------------------------------|

| ITEM  6. | EXHIBITS |
|--------------------|----------|

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index

SIGNATURES

| Date: May 9, 2011 |           |                                    |
|-------------------|----------------|-----------------------------------------|
|              | ShoreTel, Inc. |
|              |           |                                    |
|              | By:            | /s/ Michael E. Healy                    |
|              |           | Michael E. HealyChief Financial Officer |

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index

EXHIBIT INDEX

|           |   |                                                                       |
|----------------|--------|----------------------------------------------------------------------------|
| Exhibit Number |   | Exhibit Title                                                              |
|           |   |                                                                       |
| 10.1+          |   | Executive Employment Agreement with Peter Blackmore dated December 9, 2010 |
|           |   |                                                                       |
| 10.2+          |   | Form of "Tier 2" Retention Incentive Agreement                             |
|           |   |                                                                       |
| 10.3+          |   | Form of "Tier 3" Retention Incentive Agreement                             |
|           |   |                                                                       |
| 31.1(1)        |   | Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.         |
|           |   |                                                                       |
| 31.2(1)        |   | Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.         |
|           |   |                                                                       |
| 32.1(1)        |   | Section 1350 Certification of Chief Executive Officer.                     |
|           |   |                                                                       |
| 32.2(1)        |   | Section 1350 Certification of Chief Financial Officer.                     |

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| (1) | This certification accompanying this report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of the Company under the Securities Act of 1933 or the Securities Exchange Act of 1934 (whether made before or after the date of the Report), irrespective of any general incorporation language contained in such filing. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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