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OPLINK COMMUNICATIONS REPORTS FINANCIAL RESULTS FOR THE SECOND QUARTER OF FISCAL 2003

San Jose, Calif., January 21, 2003 -- Oplink Communications, Inc. (Nasdaq: OPLK) a leading designer and manufacturer of optical components and integrated modules, and a provider of contract Optical Manufacturing Services (OMS), today reported financial results for the second quarter of fiscal 2003 and the six-months ended December 31, 2002.

For the second quarter of fiscal 2003, Oplink reported revenues of $5.1 million and a net loss of $14.4 million, or $0.09 per share. Net loss includes $9.1 million in charges as outlined in the footnotes to the attached non-GAAP financial table. Excluding these charges, Oplink reported a non-GAAP net loss of $5.2 million, or $0.03 per share. Results for the second quarter of fiscal 2003 include revenue associated with the unexpected utilization of approximately $530,000 of fully-reserved inventory.

These results compare to revenues of $6.0 million and a net loss of $8.7 million, or $0.05 per share, reported in the previous quarter, and revenues of $10.6 million and a net loss of $6.7 million, or $0.04 per share, reported in the second quarter of the prior fiscal year. Net losses include charges of $1.9 million in the previous quarter and $828,000 in the second quarter of the prior fiscal year, as outlined in the footnotes to the attached non-GAAP financial table. Excluding these charges, Oplink reported a non-GAAP net loss of $6.8 million, or $0.04 per share, in the previous quarter and $5.9 million, or $0.04 per share, in the second quarter of the prior fiscal year.

For the six-month period ended December 31, 2002, Oplink reported revenues of $11.1 million and a net loss of $ 23.1 million, or $0.14 per share. This compares to revenues of $20.6 million and a net loss of $51.7 million, or $0.32 per share reported for the six-month period ended December 31, 2001. Net loss includes charges of $11.0 million in the six-months ended December 31, 2002 and $37.5 million in the six-months ended December 31, 2001, as outlined in the footnotes to the attached non-GAAP financial table.

In the second quarter of fiscal 2003, the Company continued to carefully manage its cash and operating expenses, closing the quarter with $211 million in cash, cash equivalents and short-term investments. In addition, the Company completed the transfer of substantially all of its research and development functions to China and enhanced its capabilities in Optical Manufacturing Services (OMS).

"Despite continued softness in the market for optical communications, we are satisfied with our performance in the second quarter and believe that we made good progress in managing cash, reducing costs and improving efficiencies throughout our global operations," commented Joe Liu, President and CEO of Oplink.

"We are also enthusiastic about the progress that we made in continuing to expand our OMS contract manufacturing offerings, to better serve customers' demand for a higher level of integrated services including optics, electronics, software, firmware, mechanical, and testing capabilities. In addition, we successfully completed the transfer of substantially all of our engineering capabilities to Zhuhai, China in the second quarter, thereby reducing operating costs and awarding us a strong competitive advantage. As we look ahead, we expect to continue to aggressively seek new business opportunities and emphasize cost management to help maintain our competitive position," concluded Liu.

Conference Call Information

The Company will host a conference call and live Webcast at 2:00 p.m. Pacific Time today, January 21, 2003. The Webcast will be available live on the Company's 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 4:00 p.m. Pacific Time on January 21, by dialing 800-405-2236 and entering pass code 519720.

About Oplink

Oplink designs, manufactures and markets fiber optic components and modules that expand optical bandwidth, amplify optical signals, monitor and protect wavelength performance and redirect light signals within an optical network. Oplink also provides Optical Manufacturing Services (OMS) to its worldwide customer base, manufacturing highly integrated optical subsystems and turn-key solutions that increase the performance of optical networks and enable service providers and optical system manufacturers to provide flexible and scalable bandwidth to support the increase of data traffic on the Internet and other public and private networks. The Company markets its products worldwide to telecommunications equipment providers.

Oplink was incorporated in 1995 and is headquartered in San Jose, California. The Company's primary manufacturing facility is in Zhuhai, China

To learn more about Oplink, visit its web site at: http://www.oplink.com/.

This news release contains forward-looking statements, including statements regarding our market opportunities, and our ability to realize operating efficiencies through the transfer of our research and development efforts to China, effectively restructure our business, manage costs and enhance our engineering and research and development capabilities, and achieve market acceptance with respect to new products, that involve risks and uncertainties. These risks include, but are not limited to, the impact of personnel changes on Oplink's employees and customers, the widespread downturns in the overall economy in the United States and other parts of the world and the telecommunications industry, possible continued reductions in customer orders, the challenge to effectively manage our inventory levels and operating expenses during periods of weakening demand, the impact of reductions in work force and other restructuring on financial results and 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, the need to retain and motivate key personnel, the possibility of delisting of Oplink's common stock from the Nasdaq National Market, 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 annual report filed on Form 10-K for the fiscal year ended June 30, 2002, and Form 10-Q for the quarter ended September 30, 2002.

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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