Exhibit 99.1

FOR IMMEDIATE RELEASE                                            August 12, 1999

CONTACT:
Donald L. Rich, President & CEO                                   (408) 496-0474


                    Castelle announces second quarter results


SANTA CLARA, Calif.,  August 12, 1999 - CASTELLE (Nasdaq:  CSTL) today announced
financial  results for the second fiscal  quarter ended July 2, 1999.  Net sales
were $3.7 million for the three months ended July 2, 1999 versus $6.1 million in
the same period of 1998. The Company  reported a net loss of $1,460,000 or $0.31
per share  compared  to a net loss of  $925,000 or $0.20 per share in the second
quarter of 1998.

Net sales for the first six months of 1999 were $8.2 million compared with $12.7
million  for the same  period of 1998.  Net loss for the  six-month  period  was
$2,871,000  or $0.64 per share  compared  to a net loss of $742,000 or $0.16 per
share for the 1998  period.  The net loss for the  period  was a result of a 64%
reduction in print server sales and a 21% reduction in fax server product sales.

The net losses reflect the continuing  decline in print server sales,  primarily
due to the business  conditions in the Asia Pacific  region,  and the decline in
shipments to  distributors to support the Company's  continued  effort to manage
down inventory levels in the distribution channel.

Founded in 1987,  Castelle is an industry  leader and pioneer of network fax and
print  servers that increase  productivity  in  workgroups  and the  enterprise.
Castelle  products are available through a worldwide network of distributors and
Value Added Resellers.  Castelle is headquartered in Santa Clara, Calif. and can
be reached at 1-800-289-7555; (408) 496-0474; or www.castelle.com.

This press release  contains  forward-looking  statements that involve risks and
uncertainties,  relating to the future events,  including the Company's strategy
to  operate  more  efficiently  in the print  server  market  and the  effect of
improved  business  conditions in the Asia Pacific  Region on the results of the
print server sales. Actual events or the Company's results may differ materially
from the events or results  discussed in the  forward-looking  statements  for a
number  of  reasons  including,  without  limitation,  the  timely  development,
acceptance  and pricing of new products and the general  economic  conditions as
they affect the Company's customers. The Company assumes no obligation to update
the forward-looking  information.  Investors are referred to the full discussion
of risks and uncertainties associated with forward-looking  statements contained
in the Company's 10-K for the fiscal year ended December 31, 1998.

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