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UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
 Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    July 31,
    2010o

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to    Commission file number:
    001-33347
  Aruba Networks, Inc.
 (Exact name of registrant as
    specified in its charter)
   Delaware(State or other jurisdiction
    of
    incorporation or organization)

02-0579097(I.R.S. Employer
    Identification No.)   1344 Crossman Ave.
    Sunnyvale, California
    94089-1113(408) 227-4500 (Address, including zip
    code, and telephone number,
    including area code, of registrants principal executive
    offices)
   Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Exchange on Which RegisteredCommon Stock, par value $0.0001 per share

The NASDAQ Stock Market LLC
    (NASDAQ Global Market)    Securities
    registered pursuant to 12(g) of the Act:
    None
   þ o
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
  Large
    accelerated
    filer þ
    Accelerated
    filer o
    Non-accelerated
    filer o
    Smaller
    reporting
    company o   Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE
  Form 10-K.




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##### 





TABLE OF
    CONTENTS
   
 PagePART IItem 1.


Business


4Item 1A.


Risk Factors


13Item 1B.


Unresolved Staff Comments


27Item 2.


Properties


27Item 3.


Legal Proceedings


27Item 4.


Reserved


27PART IIItem 5.


Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


28Item 6.


Selected Consolidated Financial Data


30Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


31Item 8.


Consolidated Financial Statements and
    Supplementary Data


49Item 9.


Changes in and Disagreements With Accountants on
    Accounting and Financial Disclosure


82Item 9A.


Controls and Procedures


82Item 9B.


Other Information


82PART IIIItem 10.


Directors, Executive Officers and Corporate
    Governance


83Item 11.


Executive Compensation


83Item 12.


Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


83Item 13.


Certain Relationships and Related Transactions
    and Director Independence


83Item 14.


Principal Accountant Fees and Services


83PART IVItem 15.


Exhibits and Financial Statement Schedule


83Signatures


85Index to Exhibits


86EX-10.7EX-10.9EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1   2




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PART I  In addition to historical information, this report contains
    forward-looking statements within the meaning of
    Section 27A of the Securities Act of 1933 and
    Section 21E of the Securities Exchange Act of 1934. These
    statements include, among other things, statements concerning
    our expectations:
  
    that revenues(and, in particular, product revenues) from our
    indirect channels will continue to constitute a significant
    majority of our future revenues;
    that competition will intensify in the future as other
    companies introduce new products in the same markets we serve or
    intend to enter;
    that our product offerings, in particular our products that
    incorporate 802.11n wireless LAN standard technologies, will
    enable broader networking initiatives by both our current and
    potential customers;   regarding the factors that will affect our
    gross margins;
  
    regarding the growth of our offshore operations and the
    establishment of additional offshore capabilities for certain
    general and administrative functions;
    that, within our indirect channel, sales through our VADs
    will grow, which will negatively impact our gross margins as
    VADs experience a larger net effective discount than our other
    channel partners;
    that international revenues will increase in absolute dollars
    and increase as a percentage of total revenues in future periods
    compared with fiscal 2010;
    that, as our customer base grows over time, the proportion of
    our revenues represented by support revenues will increase;
    that we will continue to hire employees throughout the
    company;
    that we will continue to invest significantly in our research
    and development efforts;
    that research and development expenses for fiscal 2011 will
    increase on an absolute dollar basis and remain consistent or
    decrease as a percentage of revenue compared with fiscal
    2010;
    that we will continue to invest strategically in our sales
    and marketing efforts;
    that sales and marketing expenses for fiscal 2011 will
    continue to be our most significant operating expense and will
    increase on an absolute dollar basis and decrease as a
    percentage of revenue compared with fiscal 2010;
    that general and administrative expenses for fiscal 2011 will
    increase or remain consistent on an absolute dollar basis and
    decrease as a percentage of revenue compared with fiscal
    2010;
    that ratable product and related professional services and
    support revenues will decrease in absolute dollars and as a
    percentage of total revenues in future periods;
    that legal expenses will continue as part of our ongoing
    operations and, depending on the timing and outcome of lawsuits
    and the legal process, could have a significant impact on our
    financial statements;
    regarding the sufficiency of our existing cash, cash
    equivalents, short-term investments and cash generated from
    operations, and
    that we will increase our market penetration and extend our
    geographic reach through our network of channel partners,  as well as other statements regarding our future operations,
    financial condition and prospects and business strategies. These
    forward-looking statements are subject to certain risks and
    uncertainties that could cause our actual results to differ
    materially from those reflected in the forward-looking
    statements. Factors that could cause or contribute to such
    differences include, but are not limited to, those discussed in
    this report, and in particular, the risks discussed under the
    heading Risk Factors in Part I, Item 1A of
    this report and those discussed in other documents we file with
    the Securities and Exchange Commission. We undertake no
    obligation to revise or publicly release the results of any
    revision to these forward-looking statements. Given these risks
    and uncertainties, readers are cautioned not to place undue
    reliance on such forward-looking statements.
 3




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ITEM 1.
    BUSINESS  Overview
               4




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
    product orders that have shipped but where the terms of the
    agreement, typically with our large customers, contain
    acceptance terms and conditions or other terms that require that
    the revenue be deferred until all revenue recognition criteria
    are met;
    product orders shipped to our VADs for which we have not yet
    received persuasive evidence from the VADs of a sale to an end
    customer; and
    customer contracts that we entered into prior to our
    establishment of VSOE of fair value.        Industry
    Background
      
    Enabling both security and
    mobility Radio waves cannot be confined
    within a buildings walls, challenging traditional wired
    network physical security models that depend on an impenetrable
    perimeter. To enable mobility, network access privileges and
    permissions must be clearly defined on a per-user basis to
    enable secure access and the reliable delivery of data, voice,
    video, and other applications to mobile users. Unauthorized
    wireless devices that could potentially circumvent network
    security must be detected and prevented.
    Delivering applications reliably in a mobile
    environment  Without special handling, many
    applications that are intended to be delivered over a fixed
    network may perform
    sub-optimally
    in a mobile environment. This is especially true for
    mission-critical data and latency-sensitive voice and video
    applications. Enabling a network to recognize and adapt to an
    application  so-called application
    awareness  is essential if data, voice and
    video are to be delivered reliably and with full fidelity.
    System integration Enterprise-class
    mobility solutions require more than just wireless access.
    Security, application, network, and radio frequency
    (RF) management services are also necessary,
    potentially increasing the complexity of a system as it grows in
    size and scope. To be effective, a mobility solution must
    minimize deployment and integration complexity, and support
    massive scalability, without requiring expensive upgrades to
    existing networking infrastructure.
    Network and operations management The
    management system is the heart of any secure mobility solution
    because it so profoundly affects up-time,
    ease-of-use,
    IT overhead, and on-going operating costs. 5




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Essential tasks like network
    set-up,
    diagnostics, report generation, maintenance, and software
    upgrades require an efficient centralized management system that
    encompasses wired, wireless, and mobile device networks. To ease
    the transition from legacy to new 802.11n Wi-Fi
    networks  and make the most of existing capital
    investments  it is imperative that the management
    system seamlessly integrate devices from multiple vendors into a
    single management console.  
    Support for emerging mobile applications Secure mobility solutions need to be
    future-proof, ready to support emerging applications such as
    high definition video, unified communications, real-time
    telemetry, wide-area smart grid over resilient mesh, large-scale
    telework, and location-based services such as asset tracking and
    inventory management.  port-centric
  user-centric
  in-the-office
    
    Adaptive wireless Adaptive 802.11a/b/g/n
    wireless LANs enhance productivity and collaboration by
    delivering high performance wireless data, voice, and video
    connections even in environments with densely deployed clients
    and high levels of RF interference. Our solutions scale for
    campus applications yet remain cost-effective for small branch
    deployments. They can be used both indoors and outdoors, and
    incorporate secure enterprise mesh for completely wireless
    networking.
    Identity-based securityIT departments can
    deliver authentication, encryption, and access control services
    to all users via a single integrated, low-power appliance. VPN
    termination appliances and access control firewalls are not
    required, reducing IT overhead and expenses.
    Application-awareness Our user-centric
    network is application-aware  it knows what type of
    applications are running on the network  and will
    dynamically adjust itself to improve the performance of data,
    voice, and video applications. IT managers can define policies
    that prioritize and optimize services based on the specific user
    and/or the
    application being delivered.
    Vendor-agnostic operations
    management Arubas AirWave Wireless
    Management Suite is a multi-vendor network management platform
    that provides business-critical insights into the operation of
    wireless networks made by more than 15 different vendors.
    Whether managing a single vendor network, or a multi- 6




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vendor legacy system in transition to 802.11n, the AirWave
    platform extends the life of existing infrastructure investments
    and lowers IT overhead associated with managing a dynamic
    network.  
    Easy to deploy, easy to use We have
    designed our architecture as a non-disruptive overlay to
    existing enterprise networks, allowing our networks to be
    quickly deployed without replacing existing infrastructure.
    Additionally, we have integrated all of the disparate elements
    of enterprise mobility  security, application,
    network and RF management services  into a single
    architecture, making it easier and less expensive to deploy.
    Cost-effective scalability We believe
    our architecture provides industry-leading scalability through
    its ability to support up to 100,000 concurrent users from a
    single centralized point of control. In addition, our integrated
    solution reduces the amount and type of equipment required to
    enable mobility within a given location. As a result, our
    architecture enhances management efficiency and reduces
    equipment and personnel costs, allowing enterprise IT managers
    to scale enterprise mobility solutions in a cost-effective
    manner.
    Flexible platform supports emerging
    applications  By combining the flexibility of
    modular software with high-performance, programmable hardware,
    customers can rapidly implement updates, upgrades, and new
    features with no or minimal equipment changes.
    Remote networking  Virtual Branch Networking
    extends the benefits of centralized management and secure
    networking to branch offices, teleworkers, and road warriors.
    Simple to deploy, use and maintain  and with the
    option to use 3G cellular broadband connections 
    these remote networking solutions extend the enterprise network
    virtually anywhere.
    Network rightsizing  Network rightsizing
    enables customers to lower operating expenses and reduce their
    carbon footprint by bringing their wired and wireless LAN
    infrastructure in line with actual user demand. Rightsizing is a
    three-step process that involves assessing wired Ethernet LAN
    utilization, consolidating edge switches to meet actual usage,
    and expanding the wireless LAN to meet growing demand. We
    believe that cost savings can result from, among other things,
    fewer switch service contracts, lower electricity consumption,
    and reduced air conditioning loading. Our Return On Investment
    calculators help predict the monetary and carbon savings
    opportunities based on company size and network configuration.  Our
    Strategy
    
    Drive adoption across the
    enterprise Many enterprises initially
    deploy our solutions at corporate headquarters or main campus
    locations. Our objective is to penetrate remote locations and
    gain adoption by mobile users across primary campuses, as well
    as in satellite, branch, and home offices. We intend to do so by
    emphasizing the productivity enhancements and cost-efficiency of
    our approach. Network rightsizing and Virtual Branch Networking
    are two pillars of this strategy, helping users to enhance
    mobility, obtain a uniform network experience for all users, and
    lower both operating and capital expenditures.
    Maintain and extend our software
    offerings We believe that the integrated
    encryption, authentication, and network access technology
    embedded in the ArubaOS operating system are key competitive
    differentiators. We intend to continue enhancing the ArubaOS
    operating system and our centralized mobility architecture to
    maintain our position as a technology innovator. We also intend
    to extend the functionality and performance of the ArubaOS
    operating system with additional software modules such as
    unified communications,
    video-over-IP,
    and location-based services. Finally, we intend to continue
    enhancing the capabilities of our multi-vendor AirWave Wireless
    Management Suite to support additional competitive products and
    enhance the underlying features of this market-leading platform.
    Utilize channel partners to expand our global market
    penetration We intend to increase our
    market penetration and extend our geographic reach through the
    expansion of our network of channel partners. We 7




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plan to expand our growing channel footprint and will tailor
    training and support programs to help drive this expansion.  
    Realize increased operating
    efficiencies We currently outsource our
    hardware manufacturing to overseas contract manufacturers such
    as Flextronics Manufacturing Singapore Pte. Ltd.
    (Flextronics), Sercomm Corporation
    (Sercomm) and Accton Corporation
    (Accton) and have established offshore research and
    development and customer support capabilities. We plan to
    continue to realize increased operating efficiencies by growing
    these offshore operations, and by establishing additional
    offshore capabilities for certain general and administrative
    functions.
    Expand our base of technology
    partners We will continue expanding our
    network of technology partners to enhance and complement our
    unified mobility solutions with security solutions, management
    tools, connectivity devices, and mobility applications.  Products
    ArubaOS
    Software
    Modules for ArubaOS
    
    Policy enforcement firewall Delivers
    user and group policy enforcement. Policies can be centrally
    defined and enforced on a per-user or per-group basis, following
    users as they move throughout the enterprise network.
    Wireless intrusion protection Identifies
    and protects against malicious attacks on wireless networks, as
    well as vulnerabilities caused by unauthorized access points and
    client devices.
    xSec Provides wired and wireless Federal
    Information Processing Standard (FIPS)
    140-2
    validated encryption technology designed for high-security
    networks.  Mobility
    Controllers
     8




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Access
    Points
    Virtual
    Branching Networking Solutions
    plug-and-play
    Management
    Analytics and Threat Prevention
    AirWave
    Wireless Management Suite
    side-by-side,
  best-in-class
 9




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tm tm
    Customers
    United States

EMEA

Asia Pacific and OtherCalifornia State University

BAA

LawsonBoston Medical Center

Norwegian Ministry of Foreign Affairs

Samsung Medical CenterHess Corporation

Saudi Aramco

New South Wales DETMicrosoft

The London Business School

Santos-Brasil SAFederal Deposit Insurance Corporation

KPMG Netherlands

Export-Import Bank of ThailandUnited States Air Force

Southampton University Hospitals NHS Trust

University of Tokyo     Sales and
    Marketing
    
    Our sales force We have a sales force in
    each of the following regions: the Americas, Europe, Middle East
    and Africa (EMEA), Asia Pacific (APAC)
    and throughout the rest of the world. Each sales force is
    responsible for managing all direct as well as channel business
    within its designated geographic territory.
    VARs, VADs and OEMs Our VARs, VADs and
    OEMs market, sell, and deploy our solutions to a broad array of
    organizations. Some of these VARs also purchase our solutions
    and offer them to their end customers as a managed service.       10




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Backlog
    Customer
    Service, Support and Training
  when-and-if back-up
  on-site
  Research
    and Development
    Manufacturing
       11




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Competition
          Intellectual
    Property
       12




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Corporate
    Information
  94089-1113, (408) 227-4500. www.arubanetworks.com
  Employees
    Website
    Posting of SEC Filings
  Form 10-K, Form 10-Q, Form 8-K Form 10-K 1-800-SEC-0330. www.sec.gov.
  ITEM 1A.
    RISK
    FACTORS  Risks
    Related to Our Business and Industry
  Our
    business, operating results and growth rates may be adversely
    affected by unfavorable economic and market
    conditions.
   13




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We
    compete in new and rapidly evolving markets and have a limited
    operating history, which makes it difficult to predict our
    future operating results.
      Our
    operating results may fluctuate significantly, which makes our
    future results difficult to predict and could cause our
    operating results to fall below expectations.
        
    the impact of unfavorable worldwide economic and market
    conditions, including the restricted credit environment
    impacting the credit of our channel partners and end user
    customers;
    our ability to develop and maintain our relationship with our
    VARs, VADs, OEMs and other partners;  
  
    reductions in customers budgets for information technology
    purchases and delays in their purchasing cycles;
    the sale of our products in the timeframes we anticipate,
    including the number and size of orders in each quarter;
    our ability to develop, introduce and ship in a timely manner,
    new products and product enhancements that meet customer
    requirements;
    our dependence on several large vertical markets, including the
    government, healthcare and education vertical markets;  
 14




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
    any significant changes in the competitive dynamics of our
    markets, including new entrants, or further consolidation;
    our ability to control costs, including our operating expenses,
    and the costs of the components we purchase;
    product mix and average selling prices, as well as increased
    discounting of products by us and our competitors;  
  
    our ability to maintain volume manufacturing pricing from our
    contract manufacturers, and our component suppliers;
    our contract manufacturers and component suppliers ability to
    meet our product demand forecasts;
    the potential need to record incremental inventory reserves for
    products that may become obsolete due to our new product
    introductions;
    growth in our headcount and other related costs incurred in our
    customer support organization;
    the timing of revenue recognition in any given quarter as a
    result of revenue recognition rules;  
  
    seasonal demand for our products, some of which may not be
    currently evident due to our revenue growth during fiscal 2010.    We
    have a history of losses and may not sustain profitability in
    the future.
    Our
    sales cycles can be long and unpredictable, and our sales
    efforts require considerable time and expense. As a result, our
    sales are difficult to predict and may vary substantially from
    quarter to quarter, which may cause our operating results to
    fluctuate significantly.
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The
    market in which we compete is highly competitive, and
    competitive pressures from existing and new companies may have a
    material adverse effect on our business, revenues, growth rates
    and market share.
    
    comprehensiveness of the solution;
    performance of software and hardware products;
    ability to deploy easily into existing networks;
    interoperability with other devices;
    scalability of solution;
    ability to provide secure mobile access to the network;
    speed of mobile connectivity offering;
    return on investment;
    ability to allow centralized management of products; and
    ability to obtain regulatory and other industry certifications.       16




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We
    sell a majority of our products through VADs, VARs, and OEMs. If
    these channel partners on which we rely do not perform their
    services adequately or efficiently, or if they exit the industry
    or have financial difficulties, there could be a material
    adverse effect on our revenues and our cash flow.
    Years Ended July 31,2010

2009

2008Partner A


17.1
%


*



*Partner B


16.6
%


10.1
%


*Partner C


10.4
%


14.5
%


11.1
%        17




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We
    depend upon the development of new products and enhancements to
    our existing products. If we fail to predict and respond to
    emerging technological trends and our customers changing
    needs, we may not be able to remain competitive.
          We may
    engage in future acquisitions that could disrupt our business,
    cause dilution to our stockholders and harm our business,
    operating results and financial condition.
   18




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day-to-day
  As a
    result of the fact that we outsource the manufacturing of our
    products to contract manufacturers, we do not have the ability
    to ensure quality control over the manufacturing process.
    Furthermore, if there are significant changes in the financial
    or business condition of our contract manufacturers, our ability
    to supply quality products to our customers may be
    disrupted.
        Our
    contract manufacturers purchase some components, subassemblies
    and products from a single supplier or a limited number of
    suppliers, and with respect to some of these suppliers, we have
    entered into license agreements that allow us to use their
    components in our products. The loss of any of these suppliers
    or the termination of any of these license agreements may cause
    us to incur additional
    set-up
    costs, result in delays in manufacturing and delivering our
    products, or cause us to carry excess or obsolete
    inventory.
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Our
    international sales and operations subject us to additional
    risks that may adversely affect our operating
    results.
    
    the difficulty of managing and staffing international offices
    and the increased travel, infrastructure and legal compliance
    costs associated with multiple international locations;
    difficulties in enforcing contracts and collecting accounts
    receivable, and longer payment cycles, especially in emerging
    markets;  
  
    tariffs and trade barriers, export regulations and other
    regulatory or contractual limitations on our ability to sell or
    develop our products in certain foreign markets;  
  
  
    If we
    are unable to protect our intellectual property rights, our
    competitive position could be harmed or we could be required to
    incur significant expenses to enforce our rights.
   20




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and/or
  Claims
    by others that we infringe their proprietary technology could
    harm our business.
    Impairment
    of our goodwill or other assets would negatively affect our
    results of operations.
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If we
    lose members of our senior management or are unable to recruit
    and retain key employees on a cost-effective basis, we may not
    be able to successfully grow our business. If we fail to
    effectively integrate new officers into our organization, our
    business could be harmed.
      If we
    fail to manage future growth effectively, our business would be
    harmed.
    Our
    ability to sell our products is highly dependent on the quality
    of our support and services offerings, and our failure to offer
    high quality support and services would have a material adverse
    effect on our sales and results of operations.
    Enterprises
    are increasingly concerned with the security of their data, and
    to the extent they elect to encrypt data between the end user
    and the server, our products will become less
    effective.
   22




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Our
    products are highly technical and may contain undetected
    hardware errors or software bugs, which could cause harm to our
    reputation and adversely affect our business.
    Our
    use of open source software could impose limitations on our
    ability to commercialize our products.
    We
    rely on the availability of third-party licenses.
    Enterprises
    may have slow WAN connections between some of their locations
    that may cause our products to become less
    effective.
  dial-up.
  New
    safety regulations or changes in existing safety regulations
    related to our products may result in unanticipated costs or
    liabilities, which could have a material adverse effect on our
    business, results of operations and future sales, and could
    place additional burdens on the operations of our
    business.
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Compliance
    with environmental matters and worker health and safety laws
    could be costly, and noncompliance with these laws could have a
    material adverse effect on our results of operations, expenses
    and financial condition.
  and/or
  We are
    subject to governmental export and import controls that could
    subject us to liability or impair our ability to compete in
    international markets.
    Our
    business is subject to the risks of earthquakes, fire, floods
    and other natural catastrophic events, and to interruption by
    manmade problems such as computer viruses or
    terrorism.
   24




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Risks
    Related to Ownership of our Common Stock
  Our
    stock price may be volatile.
    
    variations in our operating results;
    announcements of technological innovations, new products or
    product enhancements, strategic alliances or significant
    agreements by us or by our competitors;
    the gain or loss of significant customers;
    recruitment or departure of key personnel;
    the impact of unfavorable worldwide economic and market
    conditions;
    falling short of guidance on our financial results;
    changes in estimates of our operating results or changes in
    recommendations by any securities analysts who follow our common
    stock;
    significant sales, or announcement of significant sales, of our
    common stock by us or our stockholders; and
    adoption or modification of regulations, policies, procedures or
    programs applicable to our business.    If
    securities or industry analysts do not publish research or
    reports about our business, or if they issue an adverse or
    misleading opinion regarding our stock, our stock price and
    trading volume could decline.
    Insiders
    have substantial control over us and will be able to influence
    corporate matters.
    We may
    choose to raise additional capital. Such capital may not be
    available, or may be available on unfavorable terms, which would
    adversely affect our ability to operate our
    business.
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Provisions
    in our charter documents, Delaware law, employment arrangements
    with certain of our executive officers, and our OEM supply
    agreement with Alcatel-Lucent could discourage a takeover that
    stockholders may consider favorable.
    
    our board of directors has the right to elect directors to fill
    a vacancy created by the expansion of the board of directors or
    the resignation, death or removal of a director, which prevents
    stockholders from being able to fill vacancies on our board of
    directors;
    our stockholders may not act by written consent or call special
    stockholders meetings; as a result, a holder, or holders,
    controlling a majority of our capital stock would not be able to
    take certain actions other than at annual stockholders
    meetings or special stockholders meetings called by the
    board of directors, the chairman of the board, the Chief
    Executive Officer or the president;
    our certificate of incorporation prohibits cumulative voting in
    the election of directors, which limits the ability of minority
    stockholders to elect director candidates;
    stockholders must provide advance notice and additional
    disclosures in order to nominate individuals for election to the
    board of directors or to propose matters that can be acted upon
    at a stockholders meeting, which may discourage or deter a
    potential acquiror from conducting a solicitation of proxies to
    elect the acquirors own slate of directors or otherwise
    attempting to obtain control of our company; and
    our board of directors may issue, without stockholder approval,
    shares of undesignated preferred stock; the ability to issue
    undesignated preferred stock makes it possible for our board of
    directors to issue preferred stock with voting or other rights
    or preferences that could impede the success of any attempt to
    acquire us.        We
    have incurred and will continue to incur significant increased
    costs as a result of operating as a public company, and our
    management will be required to devote substantial time to new
    compliance initiatives.
   26




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##### Table of Contents



Form 10-K
  ITEM 1B.
    UNRESOLVED
    STAFF COMMENTS    ITEM 2.
    PROPERTIES      ITEM 3.
    LEGAL
    PROCEEDINGS    ITEM 4.
    RESERVED 27




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##### Table of Contents



PART II  ITEM 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER REPURCHASES OF EQUITY SECURITIES  intra-day
  High

LowFiscal 2009First Quarter

$
6.55


$
2.73Second Quarter

$
3.15


$
1.95Third Quarter

$
4.71


$
2.60Fourth Quarter

$
9.11


$
4.39Fiscal 2010First Quarter

$
9.48


$
7.75Second Quarter

$
11.59


$
7.59Third Quarter

$
13.89


$
9.92Fourth Quarter

$
18.18


$
10.80      28




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##### Table of Contents



COMPARISON
    OF 40 MONTH CUMULATIVE TOTAL RETURN*
    Among Aruba Networks Inc, The NASDAQ Composite Index
    And The NASDAQ Computer Index
  
    (*)
    
    $100 invested on 3/27/07 in stock or 2/28/07 in index, including
    reinvestment of dividends.
    Fiscal year ending July 31.  Dividend
    Policy
    Repurchases
    of Equity Securities by the Issuer and Affiliated
    Purchasers
   29




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##### Table of Contents



ITEM 6.
    SELECTED
    CONSOLIDATED FINANCIAL DATA  Form 10-K. Form 10-K.
  Years Ended July 31,2010


2009


2008


2007


2006(In thousands)Consolidated Statements of Operations Data:Revenues:Product

$
221,474


$
161,927


$
148,550


$
107,939


$
43,171Professional services and support


44,323



35,946



26,244



12,847



2,985Ratable product and related professional services and support


737



1,386



3,466



6,713



26,347Total revenues


266,534



199,259



178,260



127,499



72,503Cost of revenues(1):Product


77,070



59,917



48,126



36,035



16,904Professional services and support


8,775



7,437



7,761



4,863



2,409Ratable product and related professional services and support


229



483



1,228



2,470



10,572Total cost of revenues


86,074



67,837



57,115



43,368



29,885Gross profit


180,460



131,422



121,145



84,131



42,618Operating expenses:Research and development(1)


51,619



40,293



37,393



25,654



14,130Sales and marketing(1)


109,393



90,241



86,008



60,115



33,765General and administrative(1)


30,953



23,198



17,740



14,600



5,963In-process research and development














632



Acquisition related severance expense










197







Restructuring expenses






1,447











Litigation reserves


21,900















Total operating expenses


213,865



155,179



141,338



101,001



53,858Operating loss


(33,405
)


(23,757
)


(20,193
)


(16,870
)


(11,240
)Other income (expense), net


135



1,132



4,036



(7,137
)


(529
)Loss before provision for income taxes and cumulative effect of
    change in accounting principle


(33,270
)


(22,625
)


(16,157
)


(24,007
)


(11,769
)Provision for income taxes


728



788



967



375



306Loss before cumulative effect of change in accounting principle


(33,998
)


(23,413
)


(17,124
)


(24,382
)


(12,075
)Cumulative effect of change in accounting principle


















66Net loss

$
(33,998
)

$
(23,413
)

$
(17,124
)

$
(24,382
)

$
(12,009
)Net loss per common share; basic and diluted

$
(0.38
)

$
(0.28
)

$
(0.22
)

$
(0.70
)

$
(1.07
)Shares used in computing basic and diluted net loss per common
    share, basic and diluted


89,978



84,612



79,467



34,808



11,211  30




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##### Table of Contents



(1)
    
    Includes stock-based compensation as follows:  Years Ended July 31,2010

2009

2008

2007(2)

2006(In thousands)Cost of revenues

$
1,397


$
1,018


$
704


$
327


$
34Research and development


10,716



7,577



6,200



2,925



259Sales and marketing


14,205



10,520



8,953



4,362



749General and administrative

$
9,763


$
5,464


$
3,421


$
5,103


$
213   (2)
    
    Beginning on August 1, 2006, we adopted the GAAP guidance
    for accounting for stock-based compensation which requires the
    measurement and recognition of compensation expense based on
    estimated fair values for all share-based payment awards made to
    employees and directors.  As of July 31,2010

2009

2008

2007

2006(In thousands)Consolidated Balance Sheet Data:Cash and cash equivalents

$
31,254


$
41,298


$
37,602


$
42,570


$
9,263Short-term investments


124,167



81,839



64,130



62,430



Working capital (deficit)


133,927



115,639



103,097



109,496



(10,472
)Total assets


250,707



203,054



188,801



152,133



38,017Equipment loans payable


















613Deposit for Series D redeemable convertible preferred stock


















19,329Redeemable convertible preferred stock


















58,009Common stock and additional
    paid-in-capital


326,187



279,035



249,139



213,553



6,077Total stockholders equity (deficit)

$
150,655


$
137,585


$
130,875


$
112,487


$
(73,000
)   ITEM 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS    Overview
       31




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##### Table of Contents




    product orders that have shipped but where the terms of the
    agreement, typically with our large customers, contain
    acceptance terms and conditions or other terms that require that
    the revenue be deferred until all revenue recognition criteria
    are met;
    product orders shipped to our VADs for which we have not yet
    received persuasive evidence from the VADs of a sale to an end
    customer; and
    customer contracts that we entered into prior to our
    establishment of VSOE of fair value.       32




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##### Table of Contents



Revenues,
    Cost of Revenues and Operating Expenses
  Revenues
  when-and-if
      Cost
    of Revenues
      Gross
    Margin
    
    the proportion of our products that are sold through direct
    versus indirect channels;
    product mix and average selling prices;
    new product introductions, such as our new value-priced, high
    performance 802.11n access point, and enhancements both by us
    and by our competitors;
    pressure to discount our products in response to our
    competitors discounting practices;
    demand for our products and services; 33




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##### Table of Contents




    our ability to attain volume manufacturing pricing from our
    contract manufacturers and our component suppliers;
    losses associated with excess and obsolete inventory;
    growth in our headcount and other related costs incurred in our
    customer support organization;
    costs associated with manufacturing overhead; and
    amortization expense from our purchased intangible assets.    Operating
    Expenses
             34




---



##### Table of Contents



Stock-Based
    Compensation
    Other
    Income (Expense), net
  non-U.S. dollar
  Critical
    Accounting Policies
    Revenue
    Recognition and Sales Returns
  when-and-if
  and/or
   35




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##### Table of Contents



point-of-sale
      Stock-Based
    Compensation
    Goodwill
    and Intangibles
   36




---



##### Table of Contents




    significant underperformance relative to estimated results;
    significant changes in the manner of our use of the acquired
    assets or the strategy for our overall business; and
    significant negative industry or economic trends.      Inventory
    Valuation
  first-in,
  Allowances
    for Doubtful Accounts
    Income
    Taxes
   37




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##### Table of Contents



Recent
    Accounting Pronouncements
    Results
    of Operations
    Years Ended July 31,2010


2009


2008Revenues:Product


83.1
%


81.3
%


83.3
%Professional services and support


16.6
%


18.0
%


14.7
%Ratable product and related professional services and support


0.3
%


0.7
%


2.0
%Total revenues


100.0
%


100.0
%


100.0
%Cost of revenues:Product


28.9
%


30.1
%


27.0
%Professional services and support


3.3
%


3.7
%


4.4
%Ratable product and related professional services and support


0.1
%


0.2
%


0.6
%Gross margin


67.7
%


66.0
%


68.0
%Operating expenses:Research and development


19.4
%


20.3
%


21.0
%Sales and marketing


41.0
%


45.3
%


48.2
%General and administrative


11.6
%


11.6
%


10.0
%Acquisition related expenses


0.0
%


0.0
%


0.1
%Restructuring expenses


0.0
%


0.7
%


0.0
%Litigation reserves


8.2
%


0.0
%


0.0
%Operating margin


(12.5
)%


(11.9
)%


(11.3
)%Other income (expense), net


0.0
%


0.5
%


2.2
%Loss before income taxes


(12.5
)%


(11.4
)%


(9.1
)%Provision for income taxes


0.3
%


0.4
%


0.5
%Net loss


(12.8
)%


(11.8
)%


(9.6
)%  38




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##### Table of Contents



Revenues
  Years Ended July 31,2010


2009


2008(In thousands)Total revenues

$
266,534


$
199,259


$
178,260Type of revenues:Product


221,474



161,927



148,550Professional services and support


44,323



35,946



26,244Ratable product and related professional services and support


737



1,386



3,466Total revenues

$
266,534


$
199,259


$
178,260Revenues by geography:United States


166,584



129,991



118,647Europe, the Middle East and Africa


38,140



34,178



31,149Asia Pacific


51,110



27,023



20,231Rest of World (including Japan)


10,700



8,067



8,233Total revenues

$
266,534


$
199,259


$
178,260              39




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##### Table of Contents



Cost
    of Revenues and Gross Margin
  Years Ended July 31,2010


2009


2008(In thousands)Total revenues

$
266,534


$
199,259


$
178,260Cost of product


77,070



59,917



48,126Cost of professional services and support


8,775



7,437



7,761Cost of ratable product and related professional services and
    support


229



483



1,228Total cost of revenues


86,074



67,837



57,115Gross profit

$
180,460


$
131,422


$
121,145Gross margin


67.7
%


66.0
%


68.0
%                40




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##### Table of Contents



Research
    and Development Expenses
  Years Ended July 31,2010

2009

2008(In thousands)Research and development expenses

$
51,619


$
40,293


$
37,393Percent of total revenues


19.4
%


20.3
%


21.0
%       Sales
    and Marketing Expenses
  Years Ended July 31,2010

2009

2008(In thousands)Sales and marketing expenses

$
109,393


$
90,241


$
86,008Percent of total revenues


41.0
%


45.3
%


48.2
%      41




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##### Table of Contents



General
    and Administrative Expenses
  Years Ended July 31,2010

2009

2008(In thousands)General and administrative expenses

$
30,953


$
23,198


$
17,740Percent of total revenues


11.6
%


11.6
%


10.0
%       Acquisition
    Related Severance Expenses
    Restructuring
    Expenses
    Litigation
    Reserves
      
    jointly execute and file dismissals of patent infringement
    actions brought in the United States District Court for the
    District of Delaware involving U.S. Patent Nos. 7,173,922;
    7,173,923; 6,973,622; 6,625,454; 7,359,676; 7,295,524 and
    7,376,113;
    release one another of all claims;
    provide one another with seven year licenses to each of our
    respective 802.11 Wireless LAN patent portfolios; and 42




---



##### Table of Contents




    provide one another a covenant not to assert any patent claims
    against one anothers current products and commercially
    reasonable extensions thereof for four years.    Other
    Income (Expense), net
    Years Ended July 31,2010


2009


2008(In thousands)Interest income

$
834


$
1,837


$
4,083Other income (expense), net


(699
)


(705
)


(47
)Total other income (expense), net

$
135


$
1,132


$
4,036   yield-to-maturity
    Provision
    for Income Taxes
     43




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##### Table of Contents



Quarterly
    Fluctuations in Operating Results
    For the Three Months Ended2010

July 31,


April 30,


January 31,


October 31,(In thousands, except per share data)RevenuesProduct

$
65,564


$
56,634


$
52,078


$
47,198Professional services and support


11,651



12,167



10,362



10,143Ratable product and related professional services and support


111



156



215



255Total revenues


77,326



68,957



62,655



57,596Cost of revenuesProduct


22,624



19,911



18,103



16,432Professional services and support


2,338



2,201



2,157



2,079Ratable product and related professional services and support


29



46



68



86Total cost of revenues


24,991



22,158



20,328



18,597Gross profit


52,335



46,799



42,327



38,999Operating expensesResearch and development


13,907



13,874



12,042



11,796Sales and marketing


30,380



27,697



26,576



24,740General and administrative


7,353



8,840



7,628



7,132Litigation reserves






1,650



500



19,750Total operating expenses


51,640



52,061



46,746



63,418Operating income (loss)


695



(5,262
)


(4,419
)


(24,419
)Other income (expense), net


(48
)


29



39



115Income (loss) before provision for income taxes


647



(5,233
)


(4,380
)


(24,304
)Provision for income taxes


224



85



47



372Net income (loss)

$
423


$
(5,318
)

$
(4,427
)

$
(24,676
)Shares used in computing net income (loss) per common share,
    basic


92,977



90,874



88,572



87,489Net income (loss) per common share, basic

$
0.00


$
(0.06
)

$
(0.05
)

$
(0.28
)Shares used in computing net income (loss) per common share,
    diluted


108,814



90,874



88,572



87,489Net income (loss) per common share, diluted

$
0.00


$
(0.06
)

$
(0.05
)

$
(0.28
)   44




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##### Table of Contents



For the Three Months Ended2009

July 31,


April 30,


January 31,


October 31,(In thousands, except per share data)RevenuesProduct

$
43,366


$
35,822


$
38,871


$
43,868Professional services and support


9,675



9,666



8,468



8,137Ratable product and related professional services and support


285



318



342



441Total revenues


53,326



45,806



47,681



52,446Cost of revenuesProduct


15,939



14,005



13,368



16,605Professional services and support


1,852



1,814



1,838



1,933Ratable product and related professional services and support


98



110



120



155Total cost of revenues


17,889



15,929



15,326



18,693Gross profit


35,437



29,877



32,355



33,753Operating expensesResearch and development


9,886



9,734



10,250



10,423Sales and marketing


23,722



20,251



21,607



24,661General and administrative


6,044



5,854



6,015



5,285Restructuring expenses










1,447



Total operating expenses


39,652



35,839



39,319



40,369Operating loss


(4,215
)


(5,962
)


(6,964
)


(6,616
)Other income (expense), net


(2
)


414



388



332Loss before provision for income taxes


(4,217
)


(5,548
)


(6,576
)


(6,284
)Provision for income taxes


281



213



201



93Net loss

$
(4,498
)

$
(5,761
)

$
(6,777
)

$
(6,377
)Shares used in computing net loss per common share, basic and
    diluted


86,315



85,200



83,860



83,071Net loss per common share, basic and diluted

$
(0.05
)

$
(0.07
)

$
(0.08
)

$
(0.08
)   period-to-period
  Liquidity
    and Capital Resources
  July 31,

July 31,2010

2009(In thousands)Working capital

$
133,927


$
115,639Cash and cash equivalents


31,254



41,298Short-term investments

$
124,167


$
81,839   45




---



##### Table of Contents



Years Ended July 31,2010

2009

2008(In thousands)Cash provided by operating activities

$
25,834


$
20,592


$
8,317Cash used in investing activities


(48,581
)


(21,754
)


(21,760
)Cash provided by financing activities

$
12,702


$
4,858


$
8,470     Cash
    Flows from Operating Activities
        Cash
    Flows from Investing Activities
     46




---



##### Table of Contents



Cash
    Flows from Financing Activities
        Other
    Uses of Cash
    Contractual
    Obligations
    MoreLess Than


1  3


3  5


ThanTotal


1 Year


Years


Years


5 Years(In thousands)Operating leases

$
15,392


$
2,902


$
5,095


$
5,192


$
2,203Non-cancellable inventory purchase commitments(1)


20,324



20,324











Total contractual obligations

$
35,716


$
23,226


$
5,095


$
5,192


$
2,203     (1)
    
    We outsource the production of our hardware to third-party
    manufacturing suppliers. We enter into various inventory related
    purchase agreements with these suppliers. Generally, under these
    agreements, 40% of the order quantities can be rescheduled or
    are cancelable by giving notice 60 days prior to the
    expected shipment date, and 20% of the order quantities can be
    rescheduled or are cancelable by giving notice 30 days
    prior to the expected shipment date. Orders are not cancelable
    within 30 days prior to the expected shipment date.   47




---



##### Table of Contents



Off-Balance
    Sheet Arrangements
    ITEM 7A.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  Foreign
    Currency Risk
    Interest
    Rate Sensitivity
  available-for-sale
 48




---



##### 



ITEM 8.
    CONSOLIDATED
    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA  Index to
    Consolidated Financial Statements
   
 PageReport on Managements Assessment of
    Internal Control Over Financial Reporting


50Report of Independent Registered Public
    Accounting Firm


51Consolidated Balance Sheets


52Consolidated Statements of Operations


53Consolidated Statements of Stockholders
    Equity


54Consolidated Statements of Cash Flows


55Notes to Consolidated Financial Statements


56   49




---



##### Table of Contents



REPORT ON
    MANAGEMENTS ASSESSMENT OF

INTERNAL CONTROL OVER FINANCIAL REPORTING  Rules 13a-15(f)
  
    pertain to the maintenance of records that, in reasonable
    detail, accurately and fairly reflect the transactions and
    dispositions of the assets of our Company;
    provide reasonable assurance that transactions are recorded as
    necessary to permit preparation of financial statements in
    accordance with generally accepted accounting principles, and
    that receipts and expenditures of the Company are being made
    only in accordance with authorizations of management and
    directors of our Company; and
    provide reasonable assurance regarding prevention or timely
    detection of unauthorized acquisition, use or disposition of our
    Companys assets that could have a material effect on the
    financial statements.        /s/  Dominic
    P. Orr

/s/  Steffan
    TomlinsonDominic P. Orr
    President, Chief Executive Officer and Chairman of the Board

Steffan Tomlinson
    Chief Financial Officer  50




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM     Internal
    Control  Integrated Framework
      
    51




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  CONSOLIDATED BALANCE SHEETS
  July 31,


July 31,2010


2009(In thousands, except per share data)ASSETSCurrent assetsCash and cash equivalents

$
31,254


$
41,298Short-term investments


124,167



81,839Accounts receivable, net


41,269



33,466Inventory


15,159



8,450Deferred costs


5,451



5,152Prepaids and other


5,108



2,350Total current assets


222,408



172,555Property and equipment, net


9,919



7,426Goodwill


7,656



7,656Intangible assets, net


9,287



14,091Other assets


1,437



1,326Total assets

$
250,707


$
203,054LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilitiesAccounts payable

$
8,082


$
930Accrued liabilities


36,458



20,722Income taxes payable


519



610Deferred revenue, current


43,422



34,654Total current liabilities


88,481



56,916Deferred revenue, long-term


10,976



8,524Other long-term liabilities


595



29Total liabilities


100,052



65,469Commitments and contingencies (Note 11)Stockholders equityCommon stock: $0.0001 par value; 350,000 shares
    authorized at July 31, 2010 and 2009, respectively; 93,606
    and 86,744 shares issued and outstanding at July 31,
    2010 and 2009, respectively


9



9Additional paid-in capital


326,178



279,026Accumulated other comprehensive income


98



182Accumulated deficit


(175,630
)


(141,632
)Total stockholders equity


150,655



137,585Total liabilities and stockholders equity

$
250,707


$
203,054    52




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  CONSOLIDATED
    STATEMENTS OF OPERATIONS
  Year Ended July 31,2010


2009


2008(In thousands, except per share data)RevenuesProduct

$
221,474


$
161,927


$
148,550Professional services and support


44,323



35,946



26,244Ratable product and related professional services and support


737



1,386



3,466Total revenues


266,534



199,259



178,260Cost of revenuesProduct


77,070



59,917



48,126Professional services and support


8,775



7,437



7,761Ratable product and related professional services and support


229



483



1,228Total cost of revenues


86,074



67,837



57,115Gross profit


180,460



131,422



121,145Operating expensesResearch and development


51,619



40,293



37,393Sales and marketing


109,393



90,241



86,008General and administrative


30,953



23,198



17,740Acquisition related severance expenses










197Restructuring expense






1,447



Litigation reserves


21,900







Total operating expenses


213,865



155,179



141,338Operating loss


(33,405
)


(23,757
)


(20,193
)Other income (expense), netInterest income


834



1,837



4,083Other income (expense), net


(699
)


(705
)


(47
)Total other income (expense), net


135



1,132



4,036Loss before provision for income taxes


(33,270
)


(22,625
)


(16,157
)Provision for income taxes


728



788



967Net loss

$
(33,998
)

$
(23,413
)

$
(17,124
)Net loss per common share, basic and diluted

$
(0.38
)

$
(0.28
)

$
(0.22
)Shares used in computing basic and diluted net loss per common
    share


89,978



84,612



79,467Stock-based compensation expense included in above:Cost of revenues

$
1,397


$
1,018


$
704Research and development


10,716



7,577



6,200Sales and marketing


14,205



10,520



8,953General and administrative

$
9,763


$
5,464


$
3,421    53




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  CONSOLIDATED
    STATEMENT OF
 STOCKHOLDERS
    EQUITY
  AccumulatedAdditional


OtherCommon Stock


Paid-in


Comprehensive


AccumulatedShares


Amount


Capital


Income (Loss)


Deficit


TotalBalance at July 31, 2007


76,927


$
8


$
213,545


$
29


$
(101,095
)

$
112,487Comprehensive loss:Unrealized loss on short-term investments














(74
)






(74
)Net loss


















(17,124
)


(17,124
)Total comprehensive loss






















(17,198
)Fair value of shares issued to non-employees


68







408











408Fair value of stock options issued to non-employees










(279
)










(279
)Exercise of common stock options


3,280







6,330











6,330Shares purchased under employee stock purchase plan


781







4,827











4,827Exercise of warrants


519



















Change in carrying value of preferred stock warrants










(715
)










(715
)Repurchase of common stock


(66
)






(46
)










(46
)Stock-based compensation expense related to stock options and
    awards issued to employees


215







19,149











19,149Common stock issued in purchase acquisition


1,519







8,002











8,002Repurchase of common stock under stock repurchase program


(407
)






(2,142
)










(2,142
)Excess tax benefit associated with stock based compensation










52











52Balance at July 31, 2008


82,836


$
8


$
249,131


$
(45
)

$
(118,219
)

$
130,875Comprehensive loss:Unrealized gain on short-term investments














227







227Net loss


















(23,413
)


(23,413
)Total comprehensive loss






















(23,186
)Fair value of shares issued to non-employees


69







392











392Fair value of stock options issued to non-employees










37











37Exercise of common stock options


1,436







1,943











1,943Shares purchased under employee stock purchase plan


1,114







3,827











3,827Repurchase of common stock


(18
)






449











449Stock-based compensation expense related to stock options and
    awards issued to employees


1,498



1



24,150











24,151Repurchase of common stock under stock repurchase program


(191
)






(991
)










(991
)Excess tax benefit associated with stock based compensation










88











88Balance at July 31, 2009


86,744


$
9


$
279,026


$
182


$
(141,632
)

$
137,585Comprehensive loss:Unrealized loss on short-term investments, net of taxes














(84
)






(84
)Net loss


















(33,998
)


(33,998
)Total comprehensive loss






















(34,082
)Fair value of shares issued to non-employees


199







2,385











2,385Fair value of stock options issued to non-employees










32











32Exercise of common stock options


2,974







8,116











8,116Shares purchased under employee stock purchase plan


1,808







4,515











4,515Repurchase of common stock


(16
)






314











314Stock-based compensation expense related to stock options and
    awards issued to employees


1,897







31,683











31,683Excess tax benefit associated with stock based compensation










107











107Balance at July 31, 2010


93,606


$
9


$
326,178


$
98


$
(175,630
)

$
150,655    54




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  CONSOLIDATED STATEMENTS OF CASH
    FLOWS
  Years Ended July 31,2010


2009


2008(In thousands)Cash flows from operating activitiesNet loss

$
(33,998
)

$
(23,413
)

$
(17,124
)Adjustments to reconcile net loss to net cash provided by
    operating activities:Depreciation and amortization


10,091



9,686



5,640Provision for doubtful accounts


265



138



283Write downs for excess and obsolete inventory


2,949



3,397



1,209Compensation related to stock options and share awards


36,081



24,579



19,278Accretion/ (amortization) of purchase discounts on short-term
    investments


837



(271
)


(1,381
)Change in carrying value of preferred stock warrants










(715
)Loss/ (gain) on disposal of fixed assets


(3
)


(15
)


51Excess tax benefit associated with stock-based compensation


(107
)


(88
)


(52
)Changes in operating assets and liabilities:Accounts receivable


(8,069
)


(924
)


(8,352
)Inventory


(10,653
)


(766
)


(5,092
)Prepaids and other


(2,757
)


847



(660
)Deferred costs


(290
)


(606
)


(617
)Other assets


50



(50
)


(773
)Accounts payable


5,937



(4,926
)


3,394Deferred revenue


11,220



8,698



10,957Other current and noncurrent liabilities


14,360



4,184



1,924Income taxes payable


(79
)


122



347Net cash provided by operating activities


25,834



20,592



8,317Cash flows from investing activitiesPurchases of short-term investments


(122,750
)


(101,088
)


(119,856
)Proceeds from sales and maturities of short-term investments


79,279



83,746



119,556Net realized (gain) /loss on short-term investments


147



(7
)


(22
)Purchases of property and equipment


(5,299
)


(4,405
)


(5,408
)Proceeds from sales of property and equipment


42







Cash paid in purchase acquisitions, net of cash acquired










(16,030
)Net cash used in investing activities


(48,581
)


(21,754
)


(21,760
)Cash flows from financing activitiesProceeds from issuance of common stock


12,631



5,761



10,560Repurchase of unvested common stock


(36
)






Repurchase of common stock under stock repurchase program






(991
)


(2,142
)Excess tax benefit associated with stock-based compensation


107



88



52Net cash provided by financing activities


12,702



4,858



8,470Effect of exchange rate changes on cash and cash equivalents


1







5Net (decrease) increase in cash and cash equivalents


(10,044
)


3,696



(4,968
)Cash and cash equivalents, beginning of period


41,298



37,602



42,570Cash and cash equivalents, end of period

$
31,254


$
41,298


$
37,602Supplemental disclosure of cash flow informationIncome taxes paid

$
899


$
673


$
652Supplemental disclosure of non-cash investing and
    financing activitiesCommon stock issued in purchase acquisition

$



$



$
7,852    55




---



##### Table of Contents



ARUBA
    NETWORKS, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  1.
    The
    Company and its Significant Accounting Policies  The
    Company
    Significant
    Accounting Policies
  Basis of
    Presentation
    Principles
    of Consolidation
    Use of
    Estimates
   56




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Foreign
    Currency Accounting
    Risks and
    Uncertainties
    Fair
    Value of Financial Instruments
    Cash and
    Cash Equivalents
    Short-Term
    Investments
  available-for-sale.
   57




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  other-than-temporarily
  Concentrations
    of Credit Risk
      Provision
    for Doubtful Accounts
      Inventory
  first-in,
  Deferred
    Costs
   58




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Property
    and Equipment, net
      Impairment
    of Long-lived Assets
    Goodwill
    Revenue
    Recognition and Sales Returns
    and/or
 59




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        point-of-sale
        Research
    and Development Expenses
   60




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Stock-Based
    Compensation
    Income
    Taxes
      Comprehensive
    Income (Loss)
  available-for-sale
 61




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Recent
    Accounting Pronouncements
  No. 2009-14, Certain Revenue Arrangements That Include Software
    Elements No. 2009-14 ASC 985-605, Software Revenue ASC 985-605:
  
    Tangible products that contain software elements and
    non-software elements that function together to deliver the
    tangible products essential functionality.
    Undelivered elements that are essential to the above described
    tangible products functionality.  No. 2009-13, Revenue Recognition Multiple Deliverable
    Revenue Arrangements No. 2009-13 ASC 605-25, Revenue Recognition  Multiple-Element Arrangements EITF 00-21). No. 2009-13
  No. 2009-13 No. 2009-14 No. 2009-13 No. 2009-14
  No. 2009-13 No. 2009-14
   62




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  2.
    Intangible
    Assets    Estimated

Gross


Accumulated


NetUseful Lives

Value


Amortization


Value(In thousands)As of July 31, 2010Existing Technology

4 years

$
9,283


$
(5,914
)

$
3,369Patents/Core Technology

4 years


3,046



(1,940
)


1,106Customer Contracts

6 to 7 years


5,083



(2,020
)


3,063Support Agreements

5 to 6 years


2,717



(1,284
)


1,433Tradenames/Trademarks

5 years


600



(284
)


316Non-Compete Agreements

2 years


712



(712
)


Total



$
21,441


$
(12,154
)

$
9,287   Estimated

Gross


Accumulated


NetUseful Lives

Value


Amortization


Value(In thousands)As of July 31, 2009Existing Technology

4 years

$
9,283


$
(3,593
)

$
5,690Patents/Core Technology

4 years


3,046



(1,178
)


1,868Customer Contracts

6 to 7 years


5,083



(1,185
)


3,898Support Agreements

5 to 6 years


2,717



(741
)


1,976Tradenames/Trademarks

5 years


600



(164
)


436Non-Compete Agreements

2 years


712



(489
)


223Total



$
21,441


$
(7,350
)

$
14,091     Years Ended July 31,2010


2009


2008(In thousands)Cost of product revenues

$
3,082


$
3,082


$
1,663Cost of professional services and support revenues


540



540



196Sales and marketing


1,182



1,315



526Total amortization expense

$
4,804


$
4,937


$
2,385  63




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Amount(In thousands)Years ending July 31,2011

$
4,5552012


2,9172013


1,2592014


556Total

$
9,287   3.
    Net Loss
    Per Common Share    Years Ended July 31,2010


2009


2008(In thousands, except per share data)Net loss

$
(33,998
)

$
(23,413
)

$
(17,124
)Weighted-average common shares outstanding net of
    weighted-average common shares subject to repurchase


89,978



84,612



79,467Basic and diluted net loss per common share

$
(0.38
)

$
(0.28
)

$
(0.22
)       Years Ended July 31,2010

2009

2008(In thousands)Options to purchase common stock


23,641



21,542



19,518Common stock subject to repurchase


1



156



430Restricted stock awards


2,256



2,859



3,365  64




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  4.
    Short-Term
    Investments    Gross


GrossCost


Unrealized


Unrealized


FairBasis


Gains


Losses


Value(In thousands)As of July 31, 2010Corporate bonds and notes

$
23,802


$
69


$
(4
)

$
23,867U.S. government agency securities


80,683



78



(9
)


80,752U.S. treasury bills


12,816



57







12,873Commercial paper


4,495











4,495Certificates of deposit


2,179



1







2,180Total short-term investments

$
123,975


$
205


$
(13
)

$
124,167   Gross


GrossCost


Unrealized


Unrealized


FairBasis


Gains


Losses


Value(In thousands)As of July 31, 2009Corporate bonds and notes

$
10,667


$
41


$



$
10,708U.S. government agency securities


63,720



144



(6
)


63,858U.S. treasury bills


995



1







996Commercial paper


6,275



3



(1
)


6,277Total short-term investments

$
81,657


$
189


$
(7
)

$
81,839     Cost


FairBasis


Value(In thousands)As of July 31, 2010One year or less

$
93,597


$
93,700One to two years


30,378



30,467Total short-term investments

$
123,975


$
124,167   Cost


FairBasis


Value(In thousands)As of July 31, 2009One year or less

$
55,634


$
55,781One to two years


26,023



26,058Total short-term investments

$
81,657


$
81,839    65




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Less Than 12 MonthsFair


UnrealizedValue


Loss(In thousands)As of July 31, 2010Corporate bonds and notes

$
7,400


$
(4
)U.S. government agency securities


15,245



(9
)$
22,645


$
(13
)   Less Than 12 MonthsFair


UnrealizedValue


Loss(In thousands)As of July 31, 2009Commercial paper

$
6,277


$
(1
)U.S. government agency securities


63,858



(6
)$
70,135


$
(7
)     Fair
    Value of Financial Instruments
     66




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Total


Level 1


Level 2(In thousands)Corporate bonds and notes

$
23,867


$



$
23,867U.S. government agency securities


80,752







80,752U.S. treasury bills


12,873







12,873Commercial paper


4,495







4,495Money market funds


9,895



9,895



Total cash equivalents and short-term investments


131,882


$
9,895


$
121,987Certificates of deposit


2,180Cash deposits with third-party financial institutions


21,359Total cash, cash equivalents and short-term investments

$
155,421     5.
    Balance
    Sheet Components    July 31,


July 31,2010


2009(In thousands)Accounts Receivable, netTrade accounts receivable

$
41,731


$
33,856Less: Allowance for doubtful accounts


(462
)


(390
)Total

$
41,269


$
33,466   July 31,


July 31,2010


2009(In thousands)InventoryRaw materials

$
294


$
486Finished goods


14,865



7,964Total

$
15,159


$
8,450   July 31,


July 31,2010


2009(In thousands)Accrued LiabilitiesCompensation and benefits

$
11,363


$
6,777Inventory


9,381



5,145Marketing


7,176



2,434Other


8,538



6,366Total

$
36,458


$
20,722  67




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  6.
    Property
    and Equipment, Net    Estimated


July 31,


July 31,Useful Lives


2010


2009(In thousands)Computer equipment


2 years


$
7,993


$
7,220Computer software


2- 5 years



4,558



4,175Machinery and equipment


2 years



10,441



7,160Furniture and fixtures


5 years



2,397



1,765Leasehold improvements


2-6 years



2,174



637Total property and equipment, gross






27,563



20,957Less: Accumulated depreciation and amortization






(17,644
)


(13,531
)Total property and equipment, net





$
9,919


$
7,426     7.
    Deferred
    Revenue    July 31,


July 31,2010


2009(In thousands)Product

$
16,087


$
10,911Professional services and support


27,298



23,006Ratable product and related services and support


37



737Total deferred revenue, current


43,422



34,654Professional services and support, long-term


10,976



8,487Ratable product and related services and support, long-term






37Total deferred revenue, long-term


10,976



8,524Total deferred revenue

$
54,398


$
43,178        68




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  8.
    Income
    Taxes    Years Ended July 31,2010


2009


2008(In thousands)Domestic

$
(36,628
)

$
(24,762
)

$
(17,804
)International


3,358



2,137



1,647Loss before provision for income taxes

$
(33,270
)

$
(22,625
)

$
(16,157
)     Years Ended July 31,2010


2009


2008(In thousands)CurrentFederal

$
(283
)

$
15


$
State


231



260



281Foreign


874



513



686Total current provision for income taxes


822



788



967DeferredFederal


(85
)






State


(9
)






Total deferred provision for income taxes


(94
)






Total provision for income taxes

$
728


$
788


$
967   available-for-sales
 69




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    As of July 31,2010


2009(In thousands)Deferred tax assetsNet operating loss carryforwards

$
18,504


$
18,863Capital loss


77



Research and development credits


11,653



9,988Depreciation and amortization


345



Accruals and reserves


37,087



28,215Total deferred tax assets


67,666



57,066Valuation allowance


(67,572
)


(54,879
)Net deferred tax assets


94



2,187Deferred tax liabilitiesDepreciation and amortization






(2,187
)Unrealized loss in other comprehensive income


(94
)


Total deferred tax liabilities


(94
)


(2,187
)Net deferred tax asset (liability)

$



$
         Years Ended July 31,2010


2009


2008Federal income tax benefit


(34.0
)%


(34.0
)%


(34.0
)%State income tax (benefit), net of federal benefit


(3.5
)%


0.0
%


(3.7
)%Foreign taxes


(0.9
)%


(1.2
)%


0.6
%Stock compensation and warrant expense


6.0
%


10.6
%


7.7
%Non-deductible expenses


3.0
%


(5.3
)%


1.5
%Research and developments credits


(6.5
)%


(8.6
)%


(15.0
)%Change in valuation allowance


38.1
%


41.9
%


48.9
%Total provision for income taxes


2.2
%


3.4
%


6.0
%    70




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      non-U.S. subsidiaries
    Amount(In thousands)Balance at July 31, 2007

$
1,903Additions for tax positions related to current year


1,763Balance at July 31, 2008


3,666Additions for tax positions related to current year


1,458Balance at July 31, 2009


5,124Additions for tax positions related to current year


1,212Reductions for tax positions related to prior year


(16
)Balance at July 31, 2010

$
6,320      71




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  9.
    Common
    Stock and Equity Incentive Plans  2002
    Stock Plan
      2007
    Equity Incentive Plan
      
    all shares of the Companys common stock reserved under the
    2002 Plan which have been reserved but not issued or subject to
    outstanding grants, up to a maximum of
    7,000,000 shares; and
    any shares of the Companys common stock issued under the
    2002 Plan that are returned to the 2002 Plan as a result of the
    termination of options or that are repurchased by the Company
    pursuant to the terms of the plan, up to a maximum of
    10,000,000 shares.    
    5% of the outstanding shares of the Companys common stock
    on the last day of the immediately preceding fiscal year; or
    15,000,000 shares.       72




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Bonus
    Pltan
   73




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Stock
    Option Activity
    Options OutstandingWeighted





WeightedAverage


Weighted


AverageShares





Exercise


Average


Remaining


AggregateAvailable for


Number of


Price


Fair Value


Contractual


IntrinsicGrant


Shares


per Share


per Share


Term (Years)


Value(1)Balance at July 31, 2007


3,358,925



21,917,611


$
3.66Shares reserved for issuance


3,846,366



Restricted stock awards granted


(3,671,208
)


Restricted stock awards cancelled


293,255



Options granted


(2,994,860
)


2,994,860



8.35


$
3.71Options granted in purchase acquisition






155,409



0.72



4.63Options exercised






(3,279,536
)


1.76










$
39,772,972Options repurchased


66,646







0.74Options cancelled


2,270,342



(2,270,342
)


5.97Balance at July 31, 2008


3,169,466



19,518,002



4.41







7.4



44,913,703Shares reserved for issuance


4,141,807



Restricted stock awards granted


(1,626,631
)


Restricted stock awards cancelled


565,582



Options granted


(10,491,975
)


10,491,975



3.82



1.55Options exercised






(1,436,068
)


1.35











4,874,878Options repurchased


18,333







0.49Options cancelled


7,031,994



(7,031,994
)


7.48As of July 31, 2009


2,808,576



21,541,915



3.32







6.7



120,621,047Shares reserved for issuance


4,337,195



Restricted stock awards granted


(1,733,374
)


Restricted stock awards cancelled


280,683



Options granted


(5,771,745
)


5,771,745



10.11


$
5.60Options exercised






(2,974,218
)


2.73











28,722,784Options repurchased


15,624







2.33Options cancelled


698,918



(698,918
)


5.11As of July 31, 2010


635,877



23,640,524


$
5.00







5.9


$
283,285,534Options vested and expected to vest as of July 31, 2010(2)






22,676,363


$
4.85







5.8


$
275,125,427Options exercisable as of July 31, 2010






11,957,091


$
3.06







5.7


$
166,566,234   (1)
    
    The aggregate intrinsic value is calculated as the difference
    between the exercise price of the underlying stock option awards
    and the fair value of the Companys common stock on the
    date of each option exercise.(2)
    
    Options expected to vest are the result of applying the
    pre-vesting forfeiture rate assumption to total outstanding
    options. 74




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##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
       Restricted
    Stock Award Activity
    Weighted AverageGrant DateFair ValueShares


per ShareAs of July 31, 2007


270,700


$
17.43Awards granted


3,671,208



6.78Awards vested


(283,703
)


12.31Awards cancelled


(293,255
)


10.92As of July 31, 2008


3,364,950



6.81Awards granted


1,626,631



4.67Awards vested


(1,566,715
)


5.86Awards cancelled


(565,582
)


6.31As of July 31, 2009


2,859,284



6.21Awards granted


1,733,374



11.51Awards vested


(2,096,043
)


6.81Awards cancelled


(280,683
)


6.56As of July 31, 2010


2,215,932


$
9.74     Awards
    Granted to Non-Employees
     75




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##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Employee
    Stock Purchase Plan
      Purchase date


September 1, 2009Shares issued


851,949Weighted average purchase price per share

$
2.34Purchase date


March 1, 2010Shares issued


955,801Weighted average purchase price per share

$
2.64         Fair
    Value Disclosures
    Employee
    Stock Options
  Years Ended July 31,2010


2009


2008Risk-free interest rate


1.8
%


2.0
%


3.2
%Expected term (in years)


4.3



4.2



4.3Dividend yield


0



0



0Volatility


71
%


66
%


51
%  76




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##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Employee
    Stock Purchase Plan
  Years Ended July 31,2010

2009

2008Risk-free interest rate


0.2% to 1.0%



0.5% to 2.3%



1.5% to 4.2%Expected term (in years)


0.5 to 2.0



0.5 to 2.0



0.5 to 2.0Dividend yield


0



0



0Volatility


43% to 81%



53% to 101%



43% to 65%     Stock-based
    Expenses
    Stock
    Repurchase Program
    401(k)
    Defined Contribution Plan
    10.
    Segment
    Information and Significant Customers     77




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##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        Years Ended July 31,2010


2009


2008(In thousands)United States

$
166,584


$
129,991


$
118,647Europe, Middle East and Africa


38,140



34,178



31,149Asia Pacific


51,110



27,023



20,231Rest of World (including Japan)


10,700



8,067



8,233Total

$
266,534


$
199,259


$
178,260     Years Ended July 31,2010


2009


2008Partner A


17.1
%


*



*Partner B


16.6
%


10.1
%


*Partner C


10.4
%


14.5
%


11.1
%   11.
    Commitments
    and Contingencies  Legal
    Matters
    
    jointly execute and file dismissals of patent infringement
    actions brought in the United States District Court for the
    District of Delaware involving U.S. Patent Nos. 7,173,922;
    7,173,923; 6,973,622; 6,625,454; 7,359,676; 7,295,524 and
    7,376,113; 78




---



##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   
    release one another of all claims;
    provide one another with seven year licenses to each of their
    respective 802.11 Wireless LAN patent portfolios; and
    provide one another a covenant not to assert any patent claims
    against one anothers current products and commercially
    reasonable extensions thereof for four years.          Lease
    Obligations
   79




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##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    OperatingLeases(In thousands)Year Ending July 31,2011


2,9022012


2,5172013


2,5782014


2,6092015


2,583Thereafter


2,203Total minimum payments

$
15,392   Employee
    Agreements
    Warranties
  12-15 months
   80




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##### Table of Contents



ARUBA
    NETWORKS, INC.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    WarrantyAmount(In thousands)As of July 31, 2007

$
85Provision


60Obligations fulfilled during period


(20
)As of July 31, 2008


125Provision


256Obligations fulfilled during period


(223
)As of July 31, 2009


158Provision


266Obligations fulfilled during period


(214
)As of July 31, 2010

$
210   Non-Cancelable
    Purchase Commitments
    Indemnification
    12.
    Subsequent
    Events   81




---



##### Table of Contents



ITEM 9.
    CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE    ITEM 9A.
    CONTROLS
    AND PROCEDURES  Evaluation
    of Disclosure Controls and Procedures
  Rule 13a-15
    Managements
    Report on Internal Control Over Financial Reporting
  Report on Managements Assessment of Internal
    Control Over Financial Reporting Form 10-K.
  Changes
    in Internal Control over Financial Reporting
    Inherent
    Limitations of Internal Controls
    ITEM 9B.
    OTHER
    INFORMATION   82




---



##### Table of Contents



PART III  ITEM 10.
    DIRECTORS,
    EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE    ITEM 11.
    EXECUTIVE
    COMPENSATION    ITEM 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS    ITEM 13.
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
    INDEPENDENCE    ITEM 14
    PRINCIPAL
    ACCOUNTANT FEES AND SERVICES   PART IV  ITEM 15.
    EXHIBITS AND
    FINANCIAL STATEMENT SCHEDULES  Financial Statements
             83




---



##### Table of Contents



Financial Schedules Valuation and Qualifying Accounts
  Balance at





Balance atBeginning





End ofof Year

Additions

Deductions

Year(In thousands)Fiscal year ended July 31, 2008Allowance for doubtful accounts

$
507


$
283


$
(232
)

$
558Sales returns


294



473



(420
)


347Fiscal year ended July 31, 2009Allowance for doubtful accounts


558



138



(306
)


390Sales returns


347



972



(799
)


520Fiscal year ended July 31, 2010Allowance for doubtful accounts


390



265



(193
)


462Sales returns

$
520


$
166


$
(461
)

$
225     Exhibits.
 84




---



##### Table of Contents



SIGNATURES    ARUBA NETWORKS, INC.
  
  Dominic P. Orr
 President and Chief Executive Officer
   POWER OF
    ATTORNEY
  Form 10-K
    Signature

Title

Date/s/  Dominic
    P. OrrDominic
    P. Orr

President, Chief Executive Officer, and Chairman of the Board of
    Directors (Principal Executive Officer)

September 24, 2010/s/  Steffan
    TomlinsonSteffan
    Tomlinson

Chief Financial Officer (Principal Accounting and Financial
    Officer)

September 24, 2010/s/  Keerti
    MelkoteKeerti
    Melkote

Co-Founder, Chief Technology Officer and Director

September 24, 2010/s/  Bernard
    GuidonBernard
    Guidon

Director

September 24, 2010/s/  Emmanuel
    HernandezEmmanuel
    Hernandez

Director

September 24, 2010/s/  Michael
    R. KoureyMichael
    R. Kourey

Director

September 24, 2010/s/  Doug
    LeoneDoug
    Leone

Director

September 24, 2010/s/  Willem
    P. RoelandtsWillem
    P. Roelandts

Director

September 24, 2010/s/  Shirish
    S. SathayeShirish
    S. Sathaye

Director

September 24, 2010/s/  Daniel
    WarmenhovenDaniel
    Warmenhoven

Director

September 24, 2010  85




---



##### Table of Contents



EXHIBIT INDEX  Exhibit



Incorporated by Reference HereinNumber

Description

Form

Date2
.1*

Agreement and Plan of Reorganization, dated as of
    January 4, 2008

Current Report on Form 8-K (File No. 001-33347)

January 9, 20082
.2*

Arrangement Agreement dated May 7, 2010 by and among
    Registrant, Azalea Networks, Felix Zhao, Frank Wang, Fang Wu,
    Hans Tai and Samuel Chen, as Principal Shareholders, and with
    respect to Articles VII, VIII and IX only, Hans Tai as
    Shareholder Representative and U.S. Bank National Association as
    Escrow Agent

Current Report on Form 8-K (File No. 001-33347)

May 10, 20102
.3*

Scheme of Arrangement between Azalea Networks, Registrant, the
    Scheme Shareholders (as defined therein) and the Bridge
    Noteholders (as defined therein)

Current Report on Form 8-K (File No. 001-33347)

September 3, 20103
.1*

Restated Certificate of Incorporation of Registrant

Current Report on Form 8-K (File No. 001-33347)

April 5, 20073
.2*

Amended and Restated Bylaws of Registrant

Current Report on Form 8-K (File No. 001-33347)

February 17, 20094
.1*

Specimen common stock certificate

Registration Statement on Form S-l, as amended (File No.
    333-139419)

March 7, 200710
.1*

Form of Indemnification Agreement

Registration Statement on Form S-l, as amended (File No.
    333-139419)

March 7, 200710
.2*

AirWave Wireless, Inc. 2000 Stock Plan

Registration Statement on Form S-8 (File No. 333-149945)

March 28, 200810
.3*

2002 Stock Plan of Registrant, as amended

Registration Statement on Form S-l, as amended (File No.
    333-139419)

January 24, 200710
.4*

Forms of Stock Option Agreements under the 2002 Stock Plan

Registration Statement on Form S-l, as amended (File No.
    333-139419)

December 15, 200710
.5*

2007 Equity Incentive Plan of Registrant as amended

Quarterly Report on Form 10-Q for the quarterly period ended
    October 31, 2008 (File No. 001-33347)

December 10, 200810
.6*

Forms of Stock Option Agreements under the 2007 Equity Incentive
    Plan

Registration Statement on Form S-l, as amended (File No.
    333-139419)

January 24, 200710
.7

2007 Equity Incentive Plan Form of Stock Option Agreement for
    Participants Outside the U.S.10
.8*

Form of Restricted Stock Unit Agreement under the 2007 Equity
    Incentive Plan

Quarterly Report on Form 10-Q for the quarterly period ended
    October 31, 2008 (File No. 001-33347)

December 10, 200810
.9

2007 Equity Incentive Plan Form of Restricted Stock Unit
    Agreement for Recipients Outside the U.S. 86




---



##### Table of Contents



Exhibit



Incorporated by Reference HereinNumber

Description

Form

Date10
.10*

Employee Stock Purchase Plan, amended and restated
    December 16, 2009

Quarterly Report on Form 10-Q for the quarterly period ended
    January 31, 2010 (File No. 001-33347)

March 3, 201010
.11*

Form of Subscription Agreement under the Employee Stock Purchase
    Plan

Registration Statement on Form S-l, as amended (File No.
    333-139419)

January 24, 200710
.12*

Executive Officer Bonus Plan

Current Report on Form 8-K (File No. 001-33347)

December 22, 200910
.13*

Executive Employment Agreement, dated April 4, 2006,
    between Registrant and Dominic P. Orr

Registration Statement on Form S-l, as amended (File No.
    333-139419)

December 15, 200610
.14*

Amendment to Executive Employment Agreement, dated December
    2008, between Registrant and Dominic P. Orr

Annual Report on Form 10-K for the fiscal year ended July 31,
    2009 (File No. 001-33347)

October 6, 200910
.15*

Employment offer letter, dated April 12, 2002, between
    Registrant and Keerti Melkote

Registration Statement on Form S-l, as amended (File No.
    333-139419)

December 15, 200610
.16*

Employment offer letter, dated July 18, 2006, between
    Registrant and Sriram Ramachandran

Registration Statement on Form S-l, as amended (File No.
    333-139419)

December 15, 200610
.17*

Amendment to Offer Letter, dated December 2008, between
    Registrant and Sriram Ramachandran

Annual Report on Form 10-K for the fiscal year ended July 31,
    2009 (File No. 001-33347)

October 6, 200910
.18*

Employment offer letter, dated July 14, 2005, between
    Registrant and Steffan Tomlinson

Registration Statement on Form S-l, as amended (File No.
    333-139419)

December 15, 200610
.19*

Amendment to Offer Letter, dated December 2008, between
    Registrant and Steffan Tomlinson

Annual Report on Form 10-K for the fiscal year ended July 31,
    2009 (File No. 001-33347)

October 6, 200910
.20*

Offer Letter to Hitesh Sheth, dated July 16, 2009

Current Report on Form 8-K (File No. 001-33347)

August 17, 200910
.21*

Description of amendments to change of control arrangements with
    certain executive officers

Current Report on Form 8-K (File No. 001-33347)

March 9, 201010
.22*

Standard Office Lease, dated as of November 30, 2007, for
    1344 Crossman Ave., Sunnyvale, California

Current Report on Form 8-K (File No. 001-33347)

December 6, 200710
.23*

First Amendment to Lease, dated as of August 12, 2009, for
    1344 Crossman Ave., Sunnyvale, California

Annual Report on Form 10-K for the fiscal year ended July 31,
    2009 (File No. 001-33347)

October 6, 200910
.24*

Sublease Agreement, dated September 10, 2004, for 1322
    Crossman Ave., Sunnyvale, California

Registration Statement on Form S-l, as amended (File No.
    333-139419)

December 15, 2006 87




---



##### Table of Contents



Exhibit



Incorporated by Reference HereinNumber

Description

Form

Date10
.25*

Lease Agreement dated as of September 22, 2009, for 1322
    Crossman Ave., Sunnyvale, California

Annual Report on Form 10-K for the fiscal year ended July 31,
    2009 (File No. 001-33347)

October 6, 200910
.26*

Flextronics Manufacturing Services Agreement, dated
    January 1, 2005

Registration Statement on Form S-l, as amended (File No.
    333-139419)

January 24, 200710
.27*

Technology License Agreement, dated October 20, 2005,
    between Registrant and Atheros Communications, Inc.

Registration Statement on Form S-l, as amended (File No.
    333-139419)

March 20, 200710
.28*

Software License Agreement, dated January 11, 2006, between
    Registrant and Broadcom Corporation

Registration Statement on Form S-l, as amended (File No.
    333-139419)

January 24, 200710
.29*

OEM Supply Agreement, dated March 18, 2005, between
    Registrant and Alcatel USA Sourcing, Inc. (fka Alcatel
    Internetworking, Inc.)

Registration Statement on Form S-l, as amended (File No.
    333-139419)

March 26, 200710
.30*

Amendment No. 1 to OEM Supply Agreement, dated
    August 31, 2006, between Registrant and Alcatel USA
    Sourcing, Inc

Registration Statement on Form S-l, as amended (File No.
    333-139419)

March 26, 200710
.31*

Amendment #2 to OEM Supply Agreement, dated February 22,
    2007, between Registrant and Alcatel USA Sourcing, Inc.

Quarterly Report on Form 10-Q for the quarterly period ended
    October 31, 2009 (File No. 001-33347)

December 4, 200910
.32*

Master Purchase Agreement, dated as of January 16, 2006,
    between Registrant and Raza Microelectronics, Inc.
    (RMI)

Quarterly Report on Form 10-Q for the quarterly period ended
    January 31, 2009 (File No. 001-33347)

March 12, 200910
.33*

First Amendment to Master Purchase Agreement, dated as of
    February 26, 2007, by and between Registrant and RMI

Quarterly Report on Form 10-Q for the quarterly period ended
    January 31, 2009 (File No. 001-33347)

March 12, 200910
.34*

Patent Cross License and Settlement Agreement dated
    November 4, 2009

Current Report on Form 8-K (File No. 001-33347)

November 6, 200910
.35*

Letter Agreement dated November 4, 2009

Current Report on Form 8-K (File No. 001-33347)

November 6, 200921
.1

List of subsidiaries of Registrant23
.1

Consent of PricewaterhouseCoopers LLP, Independent Registered
    Public Accounting Firm24
.1

Power of Attorney (incorporated by reference to the signature
    page of this Annual Report on
    Form 10-K)31
.1

Certification of Chief Executive Officer pursuant to Exchange
    Act
    Rules 13a-14(a)
    and 15d-14(a), as adopted pursuant to Section 302 of the
    Sarbanes-Oxley Act 88




---



##### Table of Contents



Exhibit



Incorporated by Reference HereinNumber

Description

Form

Date31
.2

Certification of Chief Financial Officer pursuant to Exchange
    Act
    Rules 13a-14(a)
    and 15d-14(a), as adopted pursuant to Section 302 of the
    Sarbanes-Oxley Act32
.1

Certifications of Chief Executive Officer and Chief Financial
    Officer pursuant to 18 U.S.C. Section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act     *
    
    Previously filed.
    
    Confidential treatment has been requested for portions of this
    exhibit.
    
    Indicates management compensatory plan, contract or arrangement. 89