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Company Maintains Strong Cash Balance and Reduces Operating Expenses

SAN JOSE, Calif., October 23, 2001- Oplink Communications, Inc. (NASDAQ: OPLK), designer and manufacturer of innovative optical components and integrated subsystems, today announced financial results for the first fiscal quarter ended September 30, 2001.

For the first quarter, Oplink reported revenues of $10.0 million and a pro forma net loss of $8.3 million, or $0.05 per share, which is slightly better than preliminary results of a loss of $0.06-$0.07 per share announced on October 2, 2001. This compares to revenues of $20.3 million and a pro forma net loss of $6.7 million, or $0.04 per share, reported in the immediately preceding quarter.

In the first quarter, the Company reduced operating expenses to $7.9 million, from $9.4 million and $12.6 million reported in the quarters ended June 30, 2001 and March 31, 2001, respectively. The Company closed the first quarter with $239.5 million in cash and short-term investments.

"While this continues to be a challenging market, we have focused on managing our resources and positioning Oplink for the future," commented Fred Fromm, Oplink's president. "We have improved the overall cost structure of the business and expect to realize additional efficiencies in the coming quarters as a result of cost-cutting efforts and the transfer of manufacturing operations offshore. Meanwhile, we remain committed to positioning ourselves for the future with new products and aggressive outreach to customers, aimed at gaining market share and near-term design and prototype wins."

"As we enter the second fiscal quarter, we feel comfortable that we have stabilized our business at what we believe to be a sustainable revenue level. Our cash position is strong and we have undertaken a stock buy back program in order to increase overall return and enhance shareholder value. We believe that now is the time to better position ourselves to address the needs of a changing marketplace, through the continued accumulation of products and technology. When network spending begins to show growth, we believe that this positioning will help Oplink emerge as a stronger player in the marketplace."

Pro forma results for the quarter ended September 30, 2001 exclude $36.7 million in non-cash and restructuring costs and other special charges. Restructuring costs and other special charges include charges related to excess fixed assets, consolidation of facilities, non-cancelable purchase obligations, workforce reductions, and a $10.4 million provision for excess inventory taken as a result of the recent substantial and unexpected drop in customer demand.

Conference Call Information

The Company will host a corresponding conference call and live Webcast at 2:00 p.m. Pacific Time on October 23, 2001. The Webcast will be available live on the Company's corporate website at www.oplink.com and via replay beginning two hours after the completion of the call. An audio replay of the call will also be available to investors beginning at 5:00 p.m. PT on October 23, 2001 by dialing 719-457-0820 and entering pass code 716259.

About Oplink Communications

Oplink designs, manufactures and markets fiber optic networking components and integrated optical subsystems that expand optical bandwidth, amplify optical signals, monitor and protect wavelength performance and redirect light signals within an optical network. Oplink offers a broad line of products that increase the performance of optical networks and enable service providers and optical system manufacturers to provide flexible and scalable bandwidth to support the exponential increase of data traffic on the Internet. The Company supplies products worldwide to telecommunications equipment providers. Oplink is online at www.oplink.com.

This news release contains forward-looking statements regarding our business activities, developments in the economy and our markets and expected financial results and other matters that involve risks and uncertainties. These risks could cause actual results to differ materially from those referred to in the forward-looking statements and include, but are not limited to, the appointment of a new Chief Executive Officer and the related transitions associated therewith, the effects of the stock repurchase program on the Company's stock price and cash reserves, the need to attract and retain key personnel, the widespread downturns in the overall economy in the United States and other parts of the world and in the telecommunications and fiber optic industry, sudden reductions in customer orders, potential delays, product quality issues and other difficulties associated with transitioning our manufacturing operations to China and conducting manufacturing operations in China, the challenge to effectively manage our inventory levels and operating expenses during periods of weakening demand and the impact of potential inventory write-offs, the impact of reductions in workforce and other restructuring on financial results, the impact of reductions in workforce on productivity and expected product manufacturing and other plans, our reliance upon third parties to supply our raw materials and equipment, intense competition in our target markets and potential pricing pressure that may arise from changing supply-demand conditions in the industry, risks associated with the protection of our, and possible infringement of others', intellectual property, and other risks detailed from time to time in our SEC filings, including our report on Form10-K for the fiscal year ended June 30, 2001.

The foregoing information represents Oplink's outlook only as of the date of this press release, and Oplink undertakes no obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.

Financial Tables

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