8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 ____________________

FORM 8-K

____________________

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):  February 9, 2015

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AVAYA INC.

(Exact Name of Registrant as Specified in its Charter)

 ____________________

Delaware	001-15951	22-3713430
(State or Other Jurisdiction of	(Commission File Number)	(IRS Employer Identification
Incorporation)		Number)

4655 Great America Parkway
Santa Clara, California	95054
(Address of Principal Executive Office)	(Zip Code)

 Registrant’s telephone number, including area code:  (908) 953-6000

N/A

(Former Name or Former Address, if Changed Since Last Report)

____________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition

On February 9, 2015, Avaya Inc. (the “Company”) issued a press release announcing its financial results for fiscal first quarter 2015 ended December 31, 2014. The full text of the press release is furnished as Exhibit 99.1. As previously announced, the Company will host a conference call to discuss its financial results at 2.00 p.m. PST on February 9, 2015. A copy of the presentation materials to be referenced in the conference call is furnished as Exhibit 99.2 and will be available on the Company’s investor relations website at http://investors.avaya.com.

This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit	Exhibit Name
99.1	Press Release, dated February 9, 2015, entitled “Avaya Reports First Fiscal Quarter 2015 Financial Results”
99.2	Presentation to Investors, dated February 9, 2015 , entitled “Avaya Q1 2015 Earnings Call”

Forward-Looking Statements

This current report on Form 8-K contains “forward-looking statements.” All statements other than statements of historical fact are “forward-looking” statements for purposes of the U.S. federal and state securities laws. These statements may be identified by the use of forward looking terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “should” or “will” or the negative thereof or other variations thereon or comparable terminology. The Company has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While the Company believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond its control. These factors, including those discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2014 may cause its actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. For a further list and description of such risks and uncertainties, please refer to the Company’s filings with the SEC that are available at www.sec.gov. The Company cautions you that the list of important factors included in the Company’s SEC filings may not contain all of the material factors that are important to you. In addition, in light of these risks and uncertainties, the matters referred to in the forward-looking statements contained in this report may not in fact occur. The Company undertakes no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		AVAYA INC.
Date: February 9, 2015	By:	/s/ David Vellequette
	Name:	David Vellequette
	Title:	Chief Financial Officer

EX-99.1

Exhibit 99.1 Media Inquiries: Investor Inquiries: Jeremiah Glodoveza John Nunziati 408-496-3190 408-562-3780 jglodoveza@avaya.com jfnunziati@avaya.com Avaya Reports First Fiscal Quarter 2015 Financial Results • Revenue of $1,079 million • Operating Income of $104 million, Non-GAAP Operating Income(1) of $193 million • Adjusted EBITDA(1) of $239 million, 22.2% of revenue Santa Clara, Calif. — Monday, February 9, 2015 – Avaya reported financial results for the first fiscal quarter ended December 31, 2014. Total revenue for the quarter was $1,079 million, down $47 million compared to the prior quarter. On a year over year basis revenue was down $52 million compared to the first quarter of fiscal 2014. After adjusting for fluctuations in foreign exchange rates, revenue was down 3 percent sequentially and year-over-year, in line with historical quarterly sequential patterns. For the quarter, adjusted EBITDA(1) was $239 million which compares to adjusted EBITDA of $253 million for the prior quarter and $237 million for the first quarter of fiscal 2014. GAAP operating income was $104 million and non-GAAP operating income was $193 million which compares to non-GAAP operating income of $212 million for the prior quarter and $193 million for the first quarter of fiscal 2014. The company was free cash flow positive for the quarter, with cash and cash equivalents totaling $328 million as of December 31, 2014. “Revenue for Avaya’s first fiscal quarter was constrained by the effect of exchange rates, December sales execution and deal timing. Non-GAAP gross margin, non-GAAP operating margin and adjusted EBITDA margin achieved record results for a first fiscal quarter. Our performance demonstrated improved year-over-year operating model efficiency and continued execution of our strategic plan,” said Kevin Kennedy, president and CEO. “Looking ahead, Avaya remains focused on our sales and marketing transformation and enhancing our portfolio of engagement solutions to drive toward increasing our private cloud, networking, and mid- market penetration and gaining share in our existing markets.”

First Fiscal Quarter Highlights • Product bookings were up year-over-year, while product book-to-bill was below 1.0, consistent with typical first fiscal quarter patterns • The total future contracted value for private cloud and managed services increased 20 percent from the first quarter of fiscal 2014, ending the quarter at over $800 million dollars. • Revenue of $1,079 million, down by $47 million when compared to the prior quarter, of which $13 million was due to exchange rate fluctuations, and also down by $52 million when compared to the first quarter of fiscal 2014, of which $19 million was due to exchange rate fluctuations • Gross margin 59.1% compared to 58.2% for the prior quarter and 56.6% for the first quarter of fiscal 2014 • Non-GAAP gross margin was 60.1% compared to 59.7% for the prior quarter and 58.1% for the first quarter of fiscal 2014 • Operating income was $104 million which compares to operating income of $62 million for the prior quarter and operating income of $87 million for the first quarter of fiscal 2014 • Non-GAAP operating income was $193 million compared to non-GAAP operating income of $212 million for the prior quarter and $193 million for the first quarter of fiscal 2014 • Adjusted EBITDA was $239 million or 22.2% of revenue compared to $253 million or 22.5% of revenue for the prior quarter and $237 million or 21.0% of revenue for the first quarter of fiscal 2014 • For the first fiscal quarter, percentage of revenue by geography was: ‐ U.S. – 53% - EMEA – 28% ‐ Asia-Pacific – 9% - Americas International – 10% Conference Call and Webcast Avaya will host a conference call to discuss its financial results and Q&A at 2:00 p.m. PST on Monday, February 9, 2015. On the call will be Kevin Kennedy, president and CEO, and Dave Vellequette, CFO. The call will be moderated by John Nunziati, senior director of investor relations. To join the live webcast and view supplementary materials, listeners should access the investor page of Avaya’s website (www.avaya.com/investors). Following the live webcast, a replay will be available at the same web address in the event archives. To access the live webcast by phone, dial 877-876-9176 in the U.S. or Canada and 785-424- 1667 for international callers, using the conference ID: AVQ115. Listeners should access the webcast or the call 10-15 minutes before the start time to ensure they are connected prior to the start time.

A replay of the conference call will be available beginning at 5:00 p.m. PST on February 9 through March 9, 2015, by dialing 800-695-0395 within the United States or 402-220-1388 outside the United States. About Avaya Avaya is a leading provider of solutions that enable customer and team engagement across multiple channels and devices for better customer experience, increased productivity and enhanced financial performance. Its world-class contact center and unified communications technologies and services are available in a wide variety of flexible on-premise and cloud deployment options that seamlessly integrate with non-Avaya applications. The Avaya Engagement Environment enables third parties to create and customize business applications for competitive advantage. Avaya’s fabric-based networking solutions help simplify and accelerate the deployment of business critical applications and services. For more information please visit www.avaya.com. Certain statements contained in this press release may be forward-looking statements. These statements may be identified by the use of forward-looking terminology such as "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "potential," "predict," "should" or "will" or other similar terminology. We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these are reasonable, such forward looking statements involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors may cause our actual results to differ materially from any future results expressed or implied by these forward-looking statements. For a list and description of such risks and uncertainties, please refer to Avaya's filings with the SEC that are available at www.sec.gov. Avaya disclaims any intention or obligation to update or revise any forward-looking statements. 1 Refer to Supplemental Financial Information accompanying this press release for a reconciliation of GAAP to non-GAAP numbers and for reconciliation of adjusted EBITDA for the fourth quarter of fiscal 2014 see our Form 8-K filed with the SEC on November 13, 2014 at www.sec.gov.

2014 2013 REVENUE Products 549$ 574$ Services 530 557 1,079 1,131 COSTS Products: Costs (exclusive of amortization of acquired technology intangible assets) 203 228 Amortization of acquired technology intangible assets 9 14 Services 229 249 441 491 GROSS PROFIT 638 640 OPERATING EXPENSES Selling, general and administrative 374 393 Research and development 88 95 Amortization of acquired intangible assets 57 58 Restructuring charges, net 15 7 534 553 OPERATING INCOME 104 87 Interest expense (112) (119) Other income, net 14 1 INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES 6 (31) Provision for income taxes of continuing operations (3) (26) INCOME (LOSS) FROM CONTINUING OPERATIONS 3 (57) Income from discontinued operations, net of income taxes - 3 NET INCOME (LOSS) 3$ (54)$ Three months ended December 31, Avaya Inc. Consolidated Statements of Operations (Unaudited; in millions)

December 31, 2014 September 30, 2014 ASSETS Current assets: Cash and cash equivalents 328$ 322$ Accounts receivable, net 704 745 Inventory 192 197 Deferred income taxes, net 21 24 Other current assets 238 224 TOTAL CURRENT ASSETS 1,483 1,512 Property, plant and equipment, net 279 281 Deferred income taxes, net 46 52 Acquired intangible assets, net 1,157 1,224 Goodwill 4,047 4,047 Other assets 136 141 TOTAL ASSETS 7,148$ 7,257$ LIABILITIES Current liabilities: Debt maturing within one year 32$ 32$ Accounts payable 406 416 Payroll and benefit obligations 208 228 Deferred revenue 669 668 Business restructuring reserve, current portion 86 86 Other current liabilities 260 254 TOTAL CURRENT LIABILITIES 1,661 1,684 Long-term debt 5,973 5,991 Pension obligations 1,493 1,535 Other postretirement obligations 267 273 Deferred income taxes, net 254 249 Business restructuring reserve, non-current portion 111 119 Other liabilities 421 475 TOTAL NON-CURRENT LIABILITIES 8,519 8,642 Commitments and contingencies STOCKHOLDER'S DEFICIENCY Common stock - - Additional paid-in capital 2,969 2,962 Accumulated deficit (4,828) (4,831) Accumulated other comprehensive loss (1,173) (1,200) TOTAL STOCKHOLDER'S DEFICIENCY (3,032) (3,069) TOTAL LIABILITIES AND STOCKHOLDER'S DEFICIENCY 7,148$ 7,257$ Avaya Inc. (Unaudited; in millions) Consolidated Balance Sheets

2014 2013 Net cash provided by (used for): Net income (loss) 3$ (54)$ Income from discontinued operations, net of income taxes - 3 Income (loss) from continuing operations 3 (57) Adjustments to income (loss) from continuing operations for non-cash items 86 120 Changes in operating assets and liabilities (25) (6) Continuing operating activities 64 57 Discontinued operating activities - 7 Operating activities 64 64 Investing activities (26) (43) Financing activities (22) (10) Effect of exchange rate changes on cash and cash equivalents (10) 1 Net increase in cash and cash equivalents 6 12 Cash and cash equivalents at beginning of period 322 288 Cash and cash equivalents at end of period 328$ 300$ Avaya Inc. Condensed Statements of Cash Flows (Unaudited; in millions) Three months ended December 31,

Avaya Inc. Supplemental Schedules of Revenue (Unaudited; in millions) Mar. 31, 2014 June 30, 2014 Sept. 30, 2014 2014 2013 2014 2013 Amount Pct. Pct., net of FX impact Revenue by Segment 476$ 450$ 520$ GCS 481$ 507$ 45% 45% (26)$ -5% -4% 56 61 59 Networking 68 67 6% 6% 1 1% 3% 532 511 579 Total ECS product revenue 549 574 51% 51% (25) -4% -3% 528 543 547 AGS 530 557 49% 49% (27) -5% -3% 1,060$ 1,054$ 1,126$ Total revenue 1,079$ 1,131$ 100% 100% (52)$ -5% -3% Revenue by Geography 532$ 543$ 588$ U.S. 572$ 604$ 53% 53% (32)$ -5% -5% International: 313 297 321 EMEA 301 303 28% 27% (2) -1% 3% 112 108 111 APAC - Asia Pacific 101 114 9% 10% (13) -11% -11% 103 106 106 105 110 10% 10% (5) -5% 2% 528 511 538 Total International 507 527 47% 47% (20) -4% 0% 1,060$ 1,054$ 1,126$ Total revenue 1,079$ 1,131$ 100% 100% (52)$ -5% -3% Three Months Ended Mix Americas International - Canada and Latin America Revenues Change Three Months Ended December 31,

Use of non-GAAP (Adjusted) Financial Measures The information furnished in this release includes non-GAAP financial measures that differ from measures calculated in accordance with generally accepted accounting principles in the United States (GAAP), including adjusted EBITDA, non-GAAP gross margin as a percentage of revenue, and non-GAAP operating income. EBITDA is defined as net income (loss) before income taxes, interest expense, interest income and depreciation and amortization and excludes the results of discontinued operations for all periods presented. Adjusted EBITDA is EBITDA further adjusted to exclude certain charges and other adjustments permitted in calculating covenant compliance under our debt agreements as further described in our SEC filings. We believe that including supplementary information concerning Adjusted EBITDA is appropriate to provide additional information to investors to demonstrate compliance with our debt agreements and because it serves as a basis for determining management compensation. In addition, we believe Adjusted EBITDA provides more comparability between our historical results and results that reflect purchase accounting and our current capital structure. Accordingly, Adjusted EBITDA measures our financial performance based on operational factors that management can impact in the short-term, namely the Company’s pricing strategies, volume, costs and expenses of the organization. Adjusted EBITDA has limitations as an analytical tool. Adjusted EBITDA does not represent net income (loss) or cash flow from operations as those terms are defined by GAAP and does not necessarily indicate whether cash flows will be sufficient to fund cash needs. While adjusted EBITDA and similar measures are frequently used as measures of operations and the ability to meet debt service requirements, these terms are not necessarily comparable to other similarly titled captions of other companies due to the potential inconsistencies in the method of calculation. Adjusted EBITDA does not reflect the impact of earnings or charges resulting from matters that we consider not to be indicative of our ongoing operations. In particular, based on our debt agreements the definition of Adjusted EBITDA allows us to add back certain non-cash charges that are deducted in calculating net income (loss). Our debt agreements also allow us to add back restructuring charges, certain fees payable to our private equity sponsors and other specific cash costs and expenses as defined in the agreements and that portion of our pension costs, other post-employment benefits costs, and non-retirement post-employment benefits costs representing the amortization of pension service costs and actuarial gain or loss associated with these employment benefits. However, these are expenses that may recur, may vary and are difficult to predict. Further, our debt agreements require that Adjusted EBITDA be calculated for the most recent four fiscal quarters. As a result, the measure can be disproportionately affected by a particularly strong or weak quarter. Further, it may not be comparable to the measure for any subsequent four-quarter period or any complete fiscal year. Non-GAAP gross margin excludes the amortization of acquired technology intangible assets, share based compensation, impairment of long lived assets and purchase accounting adjustments. We have included non-GAAP gross margin because we believe it provides additional useful information to investors regarding our operations by excluding those charges that management does not believe are reflective of the Company’s ongoing operating results when assessing the performance of the business. Non-GAAP operating income excludes the amortization of technology intangible assets, restructuring and impairment charges, acquisition and integration related costs, share based compensation, impairment of long lived assets and purchase accounting adjustments. We have included non-GAAP operating income because we believe it provides additional useful information to investors regarding our operations by excluding those charges that management does not

believe are reflective of the company’s ongoing operating results when assessing the performance of the business. These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and have limitations as analytical tools in that they do not reflect all of the amounts associated with Avaya’s results of operations as determined in accordance with GAAP. As such, these measures should only be used to evaluate Avaya's results of operations in conjunction with the corresponding GAAP measures. The following tables reconcile GAAP measures to non-GAAP measures: 2014 2013 Income (loss) from continuing operations 3$ (57)$ Interest expense 112 119 Provision for income taxes 3 26 Depreciation and amortization 94 119 212 207 Restructuring charges, net 15 7 Sponsors’ fees 2 2 Integration-related costs 1 2 Non-cash share-based compensation 7 6 Change in certain tax indemnifications (9) - Gain on foreign currency transactions (6) (2) Pension/OPEB/nonretirement postemployment benefits and long- term disability costs 17 13 Other - 2 Adjusted EBITDA 239$ 237$ EBITDA Three months ended December 31, Avaya Inc. Supplemental Schedule of Non-GAAP Adjusted EBITDA (Unaudited; in millions)

Dec. 31, Mar. 31, June 30, Sept. 30, Dec. 31, 2013 2014 2014 2014 2014 Gross Profit - Adjusted for discontinued operations 640$ 597$ 607$ 655$ 638$ Gross Margin - Adjusted for discontinued operations 56.6% 56.3% 57.6% 58.2% 59.1% Items excluded: Amortization of acquired technology intangible assets 14 14 14 14 9 Share-based compensation 3 4 3 3 2 Incremental accelerated depreciation associated with vacating a facility - 6 - - - Non-GAAP Gross Profit - Adjusted for discontinued operations 657$ 621$ 624$ 672$ 649$ Non-GAAP Gross Margin - Adjusted for discontinued operations 58.1% 58.6% 59.2% 59.7% 60.1% Reconciliation of Non-GAAP Operating Income Operating Income - Adjusted for discontinued operations 87$ -$ 48$ 62$ 104$ Percentage of Revenue 7.7% 0.0% 4.6% 5.5% 9.6% Items excluded: Amortization of acquired intangible assets 72 71 70 70 66 Restructuring and impairment charges, net 7 42 45 71 15 Integration-related costs 3 2 1 3 1 Divestiture-related costs - - 2 - - Share-based compensation 6 8 6 5 7 Incremental accelerated depreciation associated with vacating certain facilities 16 19 - - - Resolution of certain legal matters - - 8 - - Other 2 - - 1 - Non-GAAP Operating Income - Adjusted for discontinued operations 193$ 142$ 180$ 212$ 193$ Non-GAAP Operating Margin - Adjusted for discontinued operations 17.1% 13.4% 17.1% 18.8% 17.9% Reconciliation of Non-GAAP Gross Profit and Non-GAAP Gross Margin Avaya Inc. Supplemental Schedules of Non-GAAP Reconciliations (Unaudited; in millions) Three Months Ended

Dec. 31, Mar. 31, June 30, Sept. 30, Dec. 31, 2013 2014 2014 2014 2014 Revenue 574$ 532$ 511$ 579$ 549$ Costs (exclusive of amortization of acquired technology intangible assets) 228 206 199 221 203 Amortization of acquired technology intangible assets 14 14 14 14 9 GAAP Gross Profit 332 312 298 344 337 GAAP Gross Margin 57.8% 58.6% 58.3% 59.4% 61.4% Items excluded: Amortization of acquired technology intangible assets 14 14 14 14 9 Incremental accelerated depreciation associated with vacating a facility - 3 - - - Non-GAAP Gross Profit 346$ 329$ 312$ 358$ 346$ Non-GAAP Gross Margin 60.3% 61.8% 61.1% 61.8% 63.0% Revenue 557$ 528$ 543$ 547$ 530$ Costs 249 243 234 236 229 GAAP Gross Profit 308 285 309 311 301 GAAP Gross Margin 55.3% 54.0% 56.9% 56.9% 56.8% Items excluded: Share-based compensation 3 4 3 3 2 Incremental accelerated depreciation associated with vacating a facility - 3 - - - Non-GAAP Gross Profit 311$ 292$ 312$ 314$ 303$ Non-GAAP Gross Margin 55.8% 55.3% 57.5% 57.4% 57.2% Reconciliation of Non-GAAP Gross Profit and Non-GAAP Gross Margin - Services Avaya Inc. Supplemental Schedules of Non-GAAP Reconciliation of Gross Profit and Gross Margin by Portfolio (Unaudited; in millions) Reconciliation of Non-GAAP Gross Profit and Non-GAAP Gross Margin - Products Three Months Ended

EX-99.2

February 9, 2015 Avaya Q1 2015 Earnings Call

© 2015 Avaya 2 Forward - Looking Statements Certain statements contained in this presentation are forward-looking statements, including statements regarding our future financial and operating performance, as well as statements regarding our future growth plans and drivers. These statements may be identified by the use of forward-looking terminology such as "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "potential," "predict," "should" or "will" or other similar terminology. We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. For a list and description of such risks and uncertainties, please refer to our filings with the SEC that are available at www.sec.gov and in particular, our 2014 Form 10-K filed with the SEC on November 26, 2014. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. This presentation should be read in conjunction with our Form 8-K filed with the SEC on February 9, 2015. Within this presentation, we refer to certain non‐GAAP financial measures that involve adjustments to GAAP measures. Reconciliations between our non-GAAP financial measures and GAAP financial measures are included on the last three slides of this presentation. These slides, as well as current and historical financial data are available on our web site at www.avaya.com/investors . None of the information included on the website is incorporated by reference in this presentation. Historical amounts presented reflect the sale of ITPS.

© 2015 Avaya 3 Fiscal Q1 2015 Financial Highlights (Amounts are non-GAAP)  Revenue of $1,079 million down $47 million from the prior quarter In constant currency, down 3% sequentially and year-over-year In line with low end of historical sequential pattern – Private cloud and managed services business and our leading edge contact center solutions grew both sequentially and year-over-year – Revenue from products focused on the midmarket was up 5% sequentially and up 2% year-over-year – Networking product revenues grew 15% sequentially and 2% year-over year – In constant currency, EMEA revenue was up 3% year-over-year and AI was up 2% – Product bookings were up year-over-year, while product book-to-bill was below 1.0  Gross margin reached new record of 60.1% – Increased 40 basis points sequentially and 200 basis points year-over-year  Operating income of $193 million and 17.9% operating margin  Adjusted EBITDA of $239 million and 22.2% of revenue  Cash increased sequentially and year-over-year to $328 million – Reflects $19.5M debt reduction from $10M paid against Cash Flow revolver and $9.5M in term loan principal – Free Cash Flow positive for the quarter NOTE: Historical amounts presented reflect the sale of ITPS

© 2015 Avaya 4 Quarterly Income Statement (All amounts non-GAAP and dollars in millions) FQ1 2015 FQ4 2014 FQ1 2014 Revenue: Product $549 $579 $574 Services $530 $547 $557 Total Revenue $1,079 $1,126 $1,131 Gross Margin: Product 63.0% 61.8% 60.3% Services 57.2% 57.4% 55.8% Total Gross Margin 60.1% 59.7% 58.1% Operating Margin 17.9% 18.8% 17.1% Adjusted EBITDA $239 $253 $237 Adjusted EBITDA % 22.2% 22.5% 21.0% NOTE: Historical amounts presented reflect the sale of ITPS For a reconciliation of non-GAAP to GAAP financial information, please see the appendix.

© 2015 Avaya 5 Quarterly Income Statement – Constant Currency Comparison (All amounts non-GAAP and dollars in millions) As Reported FQ1 2015 FQ4 2014 FQ1 2014 Revenue: Product $549 $575 $567 Services $530 $538 $545 Total Revenue $1,079 $1,113 $1,112 Gross Margin: Product 63.0% 61.7% 60.2% Services 57.2% 57.3% 56.5% Total Gross Margin 60.1% 59.8% 58.4% Operating Margin 17.9% 19.4% 18.0% Adjusted EBITDA $239 $257 $243 Adjusted EBITDA % 22.2% 23.1% 21.9% NOTE: Historical amounts presented reflect the sale of ITPS For a reconciliation of non-GAAP to GAAP financial information, please see the appendix. In Constant Currency

© 2015 Avaya 6 Quarterly Revenue by Geographic Region (All amounts non-GAAP and dollars in millions) FQ1 2015 FQ4 2014 FQ1 2014 Revenue U.S. $572 $588 $604 EMEA $301 $321 $303 APAC $101 $111 $114 AI $105 $106 $110 Total $1,079 $1,126 $1,131 % of Total Revenue U.S. 53% 52% 53% EMEA 28% 29% 27% APAC 9% 10% 10% AI 10% 9% 10% Total 100% 100% 100% NOTE: Historical amounts presented reflect the sale of ITPS

© 2015 Avaya 7 Balance Sheet and Operating Metrics (Dollars in millions, Balance sheet items as of the end of the period indicated) FQ1 2015 FQ4 2014 FQ1 2014 Total Cash and Cash Equivalents $328 $322 $300 Cash from Operations $64 $15 $57 Capital Expenditures and Capitalized Software $33 $40 $32 Days Sales Outstanding 59 60 54 Inventory Turns 9.2 9.6 8.7 Headcount (as of the end of the period indicated) 12,572 13,036 13,648 Annualized Quarterly Revenue ($K) / Headcount (as of the end of the period indicated) $343 $346 $331 NOTE: Historical amounts presented reflect the sale of ITPS

© 2015 Avaya 8 Financial Summary ($M) Non-GAAP 4Q14 Actual 1Q15 Actual Business Model Revenue $1,126 $1,079 $1,100 – $1,150 Gross Margin % 59.7% 60.1% 58.5% – 59.5% Oper Expense % 40.9% 42.3% 38.5% – 39.5% Oper Income % 18.8% 17.9% 19% – 20.5% Adj EBITDA $ $253 $239 $250 – $275 Adj EBITDA % 22.5% 22.2% 22.7% – 23.9% Q1 Revenue: $1,079M; down $47M sequentially – $13M currency impact – $19M due to sales execution – Private cloud & managed services up 7% YoY – Networking product revenue up YoY Gross Margin 60.1% Operating Income 17.9% Adjusted EBITDA 22.2% of revenue – All 3 are fiscal Q1 record levels on an as reported basis For a reconciliation of non-GAAP to GAAP financial information, please see our most recent SEC filings and the tables at the end of this presentation FY 11 FY 12 FY 13 FY 14 1QF14 4QF14 1QF15 Flagship 32% 35% 39% 43% 43% 44% 45% Core 48% 49% 47% 45% 45% 47% 45% Products & Services* (% of Total Avaya Revenue) For a reconciliation of non-GAAP to GAAP financial information, please see www.avaya.com/investors . NOTE: Historical amounts presented reflect the sale of ITPS We have structured our model such that, assuming quarterly revenue between $1.1 billion and $1.15 billion dollars, our operational performance should generate adjusted EBITDA in the range of $250 and $275 million * Flagship includes Video, Avaya Aura®, IP Office, leading edge Contact Center, Wireless LAN, SBC, Ethernet/fabric switching, Avaya professional services, Avaya cloud and Avaya managed services Core includes phones, gateways, servers, core contact center, and other managed and maintenance support services Legacy includes legacy Nortel and Tenovis, excluding Networking

© 2015 Avaya 9 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 2015 2016 2017 2018 2019 2020 2021 Avaya Debt Maturity Profile ($ in Billions, by calendar year) $0.12 $2.0 $1.1 $1.3 $1.4 Overall Average Portfolio Interest Rate 6.9% Today 2/9/15  Reduced debt by $19.5M in Q1 FY ’15 – $10M against Cash Flow revolver and $9.5M in term loan principal  Additional liquidity available through Asset-Backed & Cash Flow revolvers  Annual cash needs for Pension, Interest, Restructuring, CapEx, and Cash taxes expected to be below $900M in FY 15  Long Term Debt (net of $0.3B cash) totals $5.6B NOTE: Amounts shown are expected balances at maturity date; 2017 & 2018 are net of principal payments which total approximately $9.5M quarterly

© 2015 Avaya 10 Fiscal Q2 2015 Financial Outlook (As Delivered 2/9/15)  In the past three years, the sequential change in revenue from the first fiscal quarter to the second fiscal quarter has been a decrease in the range of 6% to 10%  Given our current visibility, we believe fiscal second quarter revenue will sequentially decline between 2 and 5 percent from the constant currency adjusted Q1 FY’15 revenue of $1,063 million  We expect cash restructuring requirements for the second fiscal quarter to be between $20 million and $25 million NOTE: Avaya does not reiterate guidance or provide any form of mid-quarter update ($M) As Reported In Constant Currency Q2 FY ’14 $1,060 $1,030 Q1 FY ’15 $1,079 $1,063 Revenue Adjusted for Constant Currency As of 2/6/15

© 2015 Avaya 11 Upcoming Events (See www.avaya.com/investors for additional details)  Tuesday, February 24, 2015 – JP Morgan High Yield & Leveraged Finance Investor Conference – Miami, FL – Presenter: Dave Vellequette, CFO – Presentation Time: 7:20 AM Pacific / 10:20 AM Eastern  Wednesday, March 11, 2015 – Goldman Sachs TMT Leveraged Finance Conference – NYC, NY – Presenter: Dave Vellequette, CFO – Presentation Time: (will be posted to www.avaya.com/investors when available) Webcast links and details with supporting slides will be available for each of these events. See the investor pages of our website www.avaya.com/investors

© 2015 Avaya 12 Pension & Other Post-Retirement Benefits Trend ($M)  Cash payments are made either in compliance with applicable law and regulations where required, or to directly pay benefits where appropriate.  P&L Expense is recognized as retirement benefits are earned during the participants’ years of employment. (1) Data source: Refer to “Benefit Obligations” section of Avaya’s 10-Q and 10-K for the applicable periods See slide 12 for amounts used in Adjusted EBITDA calculation (to reflect amortization of prior service costs and associated gains/losses) Cash Effect (1) FY’13 Q1’14 Q2’14 Q3’14 Q4’14 FY’14 Q1’15 US Pension 108 23 24 59 54 160 15 Non-US Pension 25 5 15 4 3 27 4 OPEB 52 10 11 12 12 45 9 Total Cash Contributions 185 38 50 75 69 232 28 P&L Effect (1) FY’13 Q1’14 Q2’14 Q3’14 Q4’14 FY’14 Q1’15 US Pension 104 16 16 17 16 65 15 Non-US Pension 31 8 8 7 7 30 7 OPEB (5) 1 1 1 1 4 1 Total P&L Expenses 130 25 25 25 24 99 23

© 2015 Avaya 13 Non-GAAP Reconciliation Adjusted EBITDA * For reconciliation of adjusted EBITDA for the fourth quarter of 2014 see our Form 10-K filed with the SEC on November 26,2014 at www.sec.gov. . 2014 2013 Income (loss) from continuing operations 3$ (57)$ Interest expense 112 119 Provision for income taxes 3 26 Depreciation and amortization 94 119 212 207 Restructuring charges, net 15 7 Sponsors’ fees 2 2 Integration-related costs 1 2 Non-cash share-based compensation 7 6 Change in certain tax indemnifications (9) - Gain on foreign currency transactions (6) (2) Pension/OPEB/nonretirement postemployment benefits and long- term disability costs 17 13 Other - 2 Adjusted EBITDA 239$ 237$ EBITDA Three months ended December 31, Avaya Inc. Supplemental Schedule of Non-GAAP Adjusted EBITDA (Unaudited; in millions)

© 2015 Avaya 14 Non-GAAP Reconciliation Gross Margin and Operating Income Dec. 31, Mar. 31, June 30, Sept. 30, Dec. 31, 2013 2014 2014 2014 2014 Gross Profit - Adjusted for discontinued operations 640$ 597$ 607$ 655$ 638$ Gross Margin - Adjusted for discontinued operations 56.6% 56.3% 57.6% 58.2% 59.1% Items excluded: Amortization of acquired technology intangible assets 14 14 14 14 9 Share-based compensation 3 4 3 3 2 Incremental accelerated depreciation associated with vacating a facility - 6 - - - Non-GAAP Gross Profit - Adjusted for discontinued operations 657$ 621$ 624$ 672$ 649$ Non-GAAP Gross Margin - Adjusted for discontinued operations 58.1% 58.6% 59.2% 59.7% 60.1% Reconciliation of Non-GAAP Operating Income Operating Income - Adjusted for discontinued operations 87$ -$ 48$ 62$ 104$ Percentage of Revenue 7.7% 0.0% 4.6% 5.5% 9.6% Items excluded: Amortization of acquired intangible assets 72 71 70 70 66 Restructuring and impairment charges, net 7 42 45 71 15 Integration-related costs 3 2 1 3 1 Divestiture-related costs - - 2 - - Share-based compensation 6 8 6 5 7 Incr mental accelerated depreciation associated with vacating certain facilities 16 19 - - - Resolution of certain legal matters - - 8 - - Other 2 - - 1 - Non-GAAP Operating Income - Adjusted for discontinued operations 193$ 142$ 180$ 212$ 193$ Non-GAAP Operating Margin - Adjusted for discontinued operations 17.1% 13.4% 17.1% 18.8% 17.9% Reconciliation of Non-GAAP Gross Profit and Non-GAAP Gross Margin Avaya Inc. Supplemental Schedules of Non-GAAP Reconciliations (Unaudited; in millions) Three Months Ended

© 2015 Avaya 15 Non-GAAP Reconciliation Product and Services Gross Margins Dec. 31, Mar. 31, June 30, Sept. 30, Dec. 31, 2013 2014 2014 2014 2014 Revenue 574$ 532$ 511$ 579$ 549$ Costs (exclusive of amortization of technology intangible assets)ts (exclusive of amortization of acquired technology intangible assets) 228 206 199 221 203 Amortization of technology intangible assetsortiz tion of acquired technology intangible a sets 14 14 14 14 9 GAAP Gross Profit 332 312 298 344 337 GAAP Gross Margin 57.8% 58.6% 58.3% 59.4% 61.4% Items excluded: Amortization of acquired technology intangible assets 14 14 14 14 9 Incremental accelerated depreciation associated with vacating a facility - 3 - - - Non-GAAP Gross Profit 346$ 329$ 312$ 358$ 346$ Non-GAAP Gross Margin 60.3% 61.8% 61.1% 61.8% 63.0% Revenue 557$ 528$ 543$ 547$ 530$ Costs 249 243 234 236 229 GAAP Gross Profit 308 285 309 311 301 GAAP Gross Margin 55.3% 54.0% 56.9% 56.9% 56.8% Items excluded: Share-based compensation 3 4 3 3 2 Incremental accelerated depreciation associated with vacating a facility - 3 - - - Non-GAAP Gross Profit 311$ 292$ 312$ 314$ 303$ Non-GAAP Gross Margin 55.8% 55.3% 57.5% 57.4% 57.2% Reconciliation of Non-GAAP Gross Profit and Non-GAAP Gross Margin - Services Avaya Inc. Supplemental Schedules of Non-GAAP Reconciliation of Gross Profit and Gross Margin by Portfolio (Unaudited; in millions) Reconciliation of Non-GAAP Gross Profit and Non-GAAP Gross Margin - Products Three Months Ended