NEWARK, N.J. - December 6, 2001 - IDT Corporation (NYSE: IDT, IDT.B) today reported record revenues of $339.2 million for the first quarter of its Fiscal Year 2002, the three months ended October 31, 2001. Revenue for the first quarter was up 2.5% from the fourth quarter of Fiscal Year 2001 and increased 22.6% over the revenues recorded during the first quarter of Fiscal Year 2001. As presented in this report, per share figures for all periods have been adjusted to take into account the Company's Class B common stock dividend, which was distributed in May 2001.

The net loss for the quarter was $158.3 million, or $2.22 per share. This compares with a net loss of $171.8 million, or $2.44 per share, in the fourth quarter of Fiscal Year 2001, and net income of $869.6 million, or $11.27 per diluted share, in last year's first quarter. Results for the first quarter included a non-cash, after-tax charge of $147.0 million, or $2.06 per share, related to an impairment of goodwill and assembled workforce, in connection with the adoption of SFAS No. 142, as of August 1, 2001, as previously discussed in our Annual Report on Form 10K for the fiscal year ended July 31, 2001. Excluding the effect of this accounting change, the net loss for the first quarter of Fiscal 2002 amounted to $11.3 million, or $0.16 per share.

In addition, three items account for $22.0 million (on both a pre- and post-tax basis) of net loss this quarter, including:

• A charge of approximately $14.0 million relating to the formation of an LLC with AT&T Corp. and Liberty Media Corp. to purchase a controlling interest in Net2Phone, Inc. on October 23, 2001, included as an "Other income (expense)" item.
• An impairment charge of approximately $2.8 million primarily resulting from the write-down of certain decommissioned European telecommunications switch equipment.
• A $5.2 million charge reflecting the Company's pro rata share of Net2Phone's losses under the equity method. Excluding these four items, the Company recorded net income of $10.7 million, or $0.14 per share. By way of comparison, in the first quarter of Fiscal 2001, after excluding certain after-tax, non-operating income, the Company experienced a net loss of $22.3 million, or $0.58 per share.

"A remarkable story is unfolding here, against the backdrop of an industry plagued by troubles; and that is the story of a company that, during the industry's darkest days, is strengthening its core businesses and approaching operational profitability," said Jim Courter, Vice Chairman and CEO of IDT Corporation. "It's an exciting story, but of course, a story that is far from complete. We are well aware that this exciting quarter is merely a start, and we remain focused on increasing profitability and shareholder value in the coming quarters."

RESULTS OF OPERATIONS

Excluding the equipment impairment charge listed above, the Company recorded a loss from operations for the first quarter of Fiscal 2002 of $9.8 million, compared to an operating loss of $74.4 million in the fourth quarter of Fiscal 2001 (excluding impairment charges). The Company's overall gross margins grew to 21.4%, up from 16.1% in the previous quarter.

EBITDA (Earnings Before Interest, Taxes and Depreciation and Amortization, and excluding minority interests and impairment charges) in the first quarter of Fiscal 2002 amounted to a gain of $5.5 million, versus a loss of $56.9 million in the fourth quarter of 2001 and $45.4 million in the same quarter last year.

Telecommunications

IDT's core telecommunications business reported revenues of $333.5 million for the first quarter of Fiscal 2002, up 24.5% from the same period last year, and 2.8% from last quarter. Gross margins for the Company's core telecommunications business amounted to 20.2%, up from 14.7% in the fourth quarter of 2001. The Telecom gross margins recorded in the first quarter of Fiscal 2002 represented the best Telecom gross margin performance since the first quarter of Fiscal 1999.

The improvement in Telecom gross margins reflected higher gross margins across all business lines, reflecting continued operating efficiency gains, as well as a continued shift in revenue mix towards higher-margin retail business lines.

EBITDA in the first quarter for the telecommunications business amounted to a gain of $16.2 million, versus a loss of $16.0 million in the fourth quarter of 2001 and $22.5 million in the same quarter last year.

"IDT Telecom has come into its own, with a positive EBITDA swing of over $32 million in just one quarter," stated CEO Motti Lichtenstein. "Of course, we view this as only the beginning. We will continue our razor-sharp focus on improving our operating processes. In addition, by partnering with the world's largest telecom companies and expanding our operations in Europe and Latin America, we will build a global telecom powerhouse."

RETAIL

IDT's retail division posted $265.3 million in revenues for the first quarter, up 8.7% from the previous quarter, and 69% more than the retail revenues recorded during the same quarter last year.

Prepaid Calling Cards

Prepaid calling card revenues amounted to $242.4 million for the first quarter, up 8.5% from the previous quarter, and 65.3% more than the prepaid calling card revenues of the first quarter of Fiscal 2001.

The strong year-to-year growth in prepaid calling card revenues was fueled primarily by market share gains at the expense of competitors who left the industry, or significantly scaled back their operations. We also benefited from the continued geographic expansion of our debit card distribution operations into areas outside our traditional northeast U.S. strongholds.

Looking to the coming quarters of Fiscal 2002, we expect prepaid calling card revenues to continue to grow, albeit at a slower pace than we experienced this quarter. In particular, we anticipate that increased calling card sales in Europe and Latin America will be the primary drivers behind the expected growth in calling card sales in Fiscal 2002 and beyond.

Consumer Long Distance

Consumer long distance revenues for the quarter were up 12.2% from the previous quarter, and up 155% from the same quarter in Fiscal 2001, as the Company's $0.05 per minute long distance plan continues to attract new customers. We currently have over 340,000 active long distance customers.

During the first quarter, gross margins for the consumer long distance business improved significantly, compared to both the previous quarter and the prior year period, continuing to benefit from increased scale. In addition, our customer acquisition costs remain well below industry averages, allowing us to grow our consumer long distance business in a disciplined manner. We anticipate that the consumer long distance business will continue its strong growth, as we continue to add customers, and as we continue to roll out new, aggressively priced regional and international calling plans.

WHOLESALE

IDT's wholesale carrier business reported revenues of $68.2 million, down 15.1% from the fourth quarter of Fiscal 2001, and a 38.5% decrease from the first quarter of Fiscal 2001.

The continued decline in wholesale carrier revenues reflects continued efforts by the Company to limit exposure in the wholesale carrier business by continuing to reduce or discontinue sales to customers that we have labeled as overly risky. We continue to develop long-term relationships with stable "Tier 1" carriers, which now account for a larger proportion of overall wholesale revenues. Additionally, we seek to augment carrier revenue through implementing new service packages, offering customized solutions to the world's largest telecommunications carriers.

IDT Ventures

The IDT Ventures division recorded an operating loss of $6.5 million on revenues of $5.7 million in the first quarter. This compares to a $10.5 million operating loss (excluding impairment charges), on revenues of $6.6 million, in the fourth quarter of Fiscal 2001. The reduction in operating losses reflects a shift from highly speculative ventures to more stable, entrepreneurial businesses. Charles Garner, CEO of IDT Ventures, sees good reason to be enthusiastic. "We have a unique opportunity to nurture a select group of businesses from a variety of growth stages. Some of our ventures will remain niche businesses with modest revenue but hefty profit margins; other business lines bear the potential to offer significant revenue streams."

GUIDANCE ON FUTURE OPERATIONS

Looking to the remainder of Fiscal 2002, we anticipate that Telecom revenues and in the second quarter of Fiscal 2002 will be in-line with those of the first quarter, with increases in the second half of Fiscal 2002, fueled primarily by higher retail revenues. Wholesale carrier revenues are expected to decline from the level attained in Fiscal 2001, but are expected to bottom out in the first half of the year, with some sequential gains anticipated in the second half of Fiscal 2002. We anticipate sustaining gross margins at their current, significantly improved levels for our major Telecom lines of business, with an overall benefit expected as a result of a continued shift in revenue mix toward higher-margin retail revenues.

Within our Ventures division, we anticipate improved operating results, primarily reflecting the recent implementation of stricter management controls over operating expenses, and the recent restructuring of our business portfolio, with a shift in focus towards more stable businesses. We also expect higher Ventures revenues in Fiscal 2002. However, given the early-stage nature of several of our Ventures businesses, the timing and magnitude of future revenues are often difficult to predict.

CONFERENCE CALL INFORMATION

In connection with this release of quarterly and annual results, the Company will be hosting a conference call today for analysts, investors and the general public, at 4:30 PM EST.

To access the call from the U.S., dial 1-800-775-2298. For international callers, the dial-in number is 1-706-679-3357. No passcode is required. A replay of the teleconference will be available for one week after the conference call at 1-800-642-1687, passcode #2561305 for domestic callers, or 1-706-645-9291, passcode #2561305 for international callers.

Alternatively, interested participants may access a webcast of the conference call by visiting the IDT Corp. website, at http://www.idt.net. A direct link to the call will be found on the website. Listening to the webcast of the call will require Real Audio software. Please allow at least 15 minutes to download the necessary audio software prior to the call. An archived copy of the call will we available at the IDT website in the Investor Relations section's Audio Archives.

IDT CORPORATION

IDT is a leading facilities-based, multinational carrier that provides a broad range of telecommunications services to its retail and wholesale customers worldwide. Through its own national telecommunications backbone and fiber optic network infrastructure, IDT provides its customers with integrated and competitively priced international and consumer long distance telephony, and prepaid and rechargeable calling cards. The Company's Ventures division is developing several innovative telecom, Internet and media-related businesses. Through its IDT Investments subsidiary, IDT has equity interests in several telecom and Internet-related companies.

Investors
Mary Jennings
Manager, Investor Relations
973-438-3113