Exhibit 99.1

www.avanex.com

Avanex Announces Record Revenue and Gross Margin for Q2 2007

Revenue Increases 54 Percent Year-over-Year

FREMONT, Calif. – Feb. 6, 2007 – Avanex Corporation (NASDAQ: AVNX), a pioneer of intelligent photonic solutions that enable next-generation optical networks, today reported financial results for the second quarter of fiscal 2007 ended Dec. 31, 2006.

Net revenue in the second quarter of fiscal 2007 was a record $55.6 million, a 9 percent increase over the prior quarter revenue of $50.9 million and a 54 percent increase over revenue of $36.1 million in the second quarter of the previous year.

“The second quarter was exceptionally strong and we are very pleased to report the highest revenue and gross margin in the history of Avanex,” said Jo Major, chairman, president and chief executive officer of Avanex. “Our team generated solid revenue growth while significantly improving the financial performance of the company.”

“In the metro and long haul markets we expect flat market demand in the first half of 2007, due to the delay of certain capacity expansion projects and we anticipate the market to return to growth in the second half of the year,” said Major.

The company reported a net loss of $8.6 million or a loss of $0.04 per share in the second quarter of fiscal 2007, compared with a net loss of $9.7 million or a loss of $0.05 per share in the prior quarter and a net loss of $18.5 million or a loss of $0.13 per share in the second quarter of the prior year.

Non-GAAP net loss in the second quarter of fiscal 2007 decreased by 50 percent to $3.5 million or a loss of $0.02 per share, compared with a non-GAAP net loss of $7.1 million or a loss of $0.03 per share in the prior quarter and a non-GAAP net loss of $9.9 million or a loss of $0.07 per share in the second quarter of the prior year. Non-GAAP net loss excludes share-based payments, amortization of intangibles, restructuring charges, and gains (loss) on the disposal of property and equipment. Non-GAAP net loss in the second quarter of fiscal 2006 also excludes a loss on debt refinancing. Non-GAAP net loss in the second quarter of fiscal 2007 also excludes legal, accounting and consulting expenses related to transactions that were not completed.*

Gross margin in the second quarter of fiscal 2007 increased to 19 percent, compared with 10 percent in the previous quarter and 8 percent in the second quarter of fiscal 2006.

Marla Sanchez, senior vice president and chief financial officer said, “We are pleased with the significant improvement in gross margin due to the programs we implemented two quarters ago aimed at reducing inventory charges, improving our supply chain, increasing manufacturing yields and managing our product portfolio. Execution of these programs significantly expanded our gross margin and we expect to realize further improvements in our cost structure.”

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Q3 FY 2007 Outlook

The company expects revenue in the third quarter of fiscal 2007 to be between $54.0 million and $57.0 million and expects gross margin to be between 17 percent and 21 percent.

Conference Call

Avanex will host a conference call today, Feb. 6 at 1:30 p.m. Pacific time; 4:30 p.m. Eastern time. The number for the conference call is 706-679-9682, and the password is “Avanex.” A live webcast of the conference call will be available on the Investors section on the company’s web site at www.avanex.com. An audio replay of the conference call will be available until Feb. 13 at 11:59 p.m. Pacific time. To access the audio replay, please dial 706-645-9291.

About Avanex

Avanex Corporation is a leading global provider of Intelligent Photonic Solutions^(TM) to meet the needs of fiber optic communications networks for greater capacity, longer distance transmissions, improved connectivity, higher speeds and lower costs. These solutions enable or enhance optical wavelength multiplexing, dispersion compensation, switching and routing, transmission, amplification, and include network-managed subsystems. Avanex was incorporated in 1997 and is headquartered in Fremont, Calif. Avanex also maintains facilities in Horseheads, N.Y.; Shanghai; Nozay, France; San Donato, Italy; and Bangkok. To learn more about Avanex, visit our Web site at: www.avanex.com.

Forward-looking Statements

This press release contains forward-looking statements including forward-looking statements regarding expected third quarter of fiscal 2007 outlook and operating results, market trends for the metro and long haul markets and the realization of improvements in our cost structure. Actual results could differ materially from those projected in or contemplated by the forward-looking statements. Factors that could cause actual results to differ include general economic conditions, the pace of spending and timing of economic recovery in the telecommunications industry and in particular the optical networks industry, the company’s inability to sufficiently anticipate market needs and develop products and product enhancements that achieve market acceptance, problems or delays in reducing the cost structure of the company, the company’s inability to effect its restructuring goals or to successfully transfer operations to lower cost regions, any slowdown or deferral of new orders for products, higher than anticipated expenses the company may incur in future quarters or the inability to identify expenses which can be eliminated.

Finally, please refer to the risk factors contained in the company’s SEC filings including the company’s Annual Report on Form 10-K filed with the SEC on Sept. 28, 2006, Quarterly Report filed on Form 10-Q on Nov. 9, 2006 and subsequent filings with the SEC.

Avanex assumes no obligation and does not intend to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information

Maria Riley

Director of Communications

510-897-4188

maria_riley@avanex.com

Avanex Corporation

CONSOLIDATED BALANCE SHEET

In thousands, except for per share data

(Unaudited)

Avanex Corporation

CONSOLIDATED STATEMENTS OF OPERATIONS

In thousands, except for per share data

(Unaudited)

Avanex Corporation

RECONCILIATION OF GAAP NET LOSS TO NON-GAAP NET LOSS

In thousands, except for per share data

(Unaudited)