FREMONT, CA — Oplink Communications, Inc. (Nasdaq:OPLK), a leading provider of photonic components, intelligent modules, and subsystem solutions, today reported its financial results for its third quarter of fiscal 2008, ended March 31, 2008.

For the third quarter of fiscal 2008, Oplink reported consolidated revenues of $40.8 million, an increase of 47.8% over $27.6 million reported for the third quarter of 2007 (which did not include results from Optical Communication Products, Inc. ("OCP"), a 100% owned subsidiary of Oplink since October 31, 2007). Consolidated net loss for the third quarter of fiscal 2008, calculated in accordance with accounting principles generally accepted in the United States ("GAAP"), was $3.9 million, or ($0.19) per basic and diluted share. This compares to a GAAP net income of $4.3 million, or $0.19 per diluted share, reported for the third quarter of fiscal 2007.

Consolidated non-GAAP net income for the third quarter of fiscal 2008, which excludes approximately $6.4 million in provision for excess and obsolete inventory, $547,000 in transitional costs for contract manufacturing, $69,000 for impairment charge and other costs, a benefit of $371,000 adjustment for merger fees, $1.3 million in stock-based compensation expense, $976,000 in amortization of intangible assets, as well as a $2.4 million gain on sale of assets, was $2.5 million, or $0.12 per diluted share. This compares to non-GAAP net income of $5.3 million, or $0.23 per diluted share, reported for the third quarter of fiscal 2007, which excluded $995,000 in stock-based compensation expense and $35,000 in amortization of intangible assets.

The Company closed the third quarter with cash, cash equivalents and investments of $138.3 million, which is up from $117.3 million held at the close of the second quarter of fiscal 2008. During the quarter, the Company completed its sale of OCP's facility at Woodland Hills and sold the wafer fab equipment from OCP Asia in Taiwan, realizing a net of $26.2 million in cash.

"We continued to make significant progress transitioning OCP's business to Oplink's model," commented Joe Liu, president and CEO of Oplink. "Transferring OCP's production to China and other measures we have taken to reduce OCP's cost structure contributed to our sequentially higher gross margins. Revenue in the quarter decreased from the previous quarter due to reduced ROADM sales, softness in orders from Europe and the transfer of OCP's manufacturing to China. We believe that these factors will continue to affect our revenue for the June quarter. However, we remain optimistic about our broader product portfolio and long-term opportunities once we complete the transition and release new product designs in the coming quarters."

Business Outlook

For the quarter ending June 30, 2008, the Company expects to report consolidated revenues of between $33.0 and $37.0 million, primarily due to a further decrease in ROADM sales, and consolidated net income per diluted share of approximately ($0.03) to $0.01 on a GAAP basis. On a non-GAAP basis, excluding stock-based compensation expense, charges related to Oplink's acquisition and integration of OCP, amortization of intangible assets, and other non-recurring charges, if any, the Company expects consolidated earnings per diluted share for the quarter ending June 30, 2008 of approximately $0.08 to $0.12.

Source: Oplink