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OPTICS CORPORATION ANNOUNCES

QUARTERLY REVENUE IN 8 QUARTERS

Precision Optics Corporation, Inc. (Nasdaq: POCI) today announced operating

results on an unaudited basis for the first quarter of fiscal year 2006 ended

the past 2 years the Company has devoted significant resources towards the

development of new products and substantial redesigns of a number of existing

products. A major effort has been underway to develop proprietary, patent

pending micro-precision technologies for use in fabricating cost effective

micro-optics - lens, prisms, and optical assemblies - with superior optical

performance and dimensions extending down to sub millimeter sizes. The Company

has also been engaged in a major redesign of its line of endoscopes centered

around patent pending lenslock technology which achieves significantly lower

manufacturing and repair costs of endoscopes while retaining state-of-the-art

image quality. Efforts in these areas as well as other new product releases

begun to show initial results in the first quarter of FY2006:

Quarter Operating Results

the quarter ended September 30, 2005, revenues were $419,582 compared to

$263,810 for the same period last year, an increase of 59%. Revenues in the

quarter increased 16% from the preceding quarter ended June 30,

the quarter ended September 30, 2005, net loss was $559,871or $0.08 per share,

decrease of $373,587 from the net loss of $933,458 or $0.16 per share, for

same period last year. A gain of $165,700, resulting from the sale of equipment

previously used in the Company's discontinued telecommunication business, is

included in results for the quarter ended September 30, 2005. The weighted

average common shares outstanding for the quarters ended June 30, 2005 and

were 7,008,212 and 5,979,832, respectively.

quarter ended September 30, 2005, cash and cash equivalents decreased by

$539,375 compared to a decrease of $866,229 for the previous quarter ended

30, 2005. Cash receipts during the quarter ended September 30, 2005 included

$162,000 received from the sale of equipment previously used in the Company's

discontinued telecommunication business.

quarter ended September 30, 2005, research and development expenses were

$208,111 down 42% from $356,406 a year earlier. The level of future quarterly

R&D expenses will ultimately depend on the Company's assessment of new

product opportunities and available cash resources.

Selling, general and administrative expenses decreased by approximately $73,000,

or 14.6% for the quarter ended September 30, 2005 compared to the same period

last year. Savings were achieved through reduced professional fees, changing

CFO role to part-time, and through reduced premiums from changing the Company's

general insurance provider.

Company has continued development of its new line of endoscopes based on unique,

patent pending lenslock technology. This has resulted in the recent completion

of a number of prototype instruments. The Company has received first production

orders for these newly redesigned scopes and is now initiating discussions

leading companies in the endoscopy market.

Company is now manufacturing ultra-small lenses, prisms, and assemblies with

sizes ranging from 0.2 mm to 1 mm, for a number of customers. The Company is

also in discussions with several customers regarding manufacturing of prototypes

of similar products. These optical components and instruments utilize a variety

of innovative techniques including the Company's patent-pending

Company has also completed a partnership effort for the proprietary development

of a new class of night vision lenses including a new patent-pending eyepiece

lens. With prototypes completed, the product incorporating the Company's new

night vision lenses is currently being evaluated for need and use, including

field testing. The partnership agreement ensures that Precision Optics

Corporation will either be contracted to manufacture the new lenses or will

receive royalties on lenses manufactured by any other company.

Company expects its recent pattern of quarter-to-quarter revenue fluctuations

continue, due to the uncertain timing of orders from customers and their size

relation to total revenues. The Company continues to move forward with new

products and technical innovations, in particular, the development of a new

generation (patent pending) of its world-class product line of 3-D endoscopes,

the extension of lenslock technology (patent pending) to its entire line of

endoscopes, and new instruments utilizing the Company's

technology (patent pending) for optical components, assemblies and endoscopes

under 1 mm. The Company continues to explore potential applications of

single-molecule technology and nanotechnology.

the stockholders' equity is below the minimum required for continued listing

under the Nasdaq Marketplace Rules. As a result, the Company will likely

receive a letter from the Nasdaq Stock Market, stating that its securities

be subject to delisting from the Nasdaq Capital Market. The Company

work with Nasdaq to regain compliance, but if we are unable to remedy

situation in accordance with the relevant procedures and within the timeframe

set forth by Nasdaq, the securities of the company may be delisted from the

Nasdaq Capital Market. In the event our shares are delisted from Nasdaq,

management believes that the Company's shares will continue to be tradable on

the Over the Counter Bulletin Board.

Optics Corporation, a leading developer and manufacturer of advanced optical

instruments since 1982, designs and produces high-quality optical thin film

coatings, medical instruments, and other advanced optical systems. The Company's

medical instrumentation line includes laparoscopes, arthroscopes and

endocouplers and a world-class product line of 3-D endoscopes for use in

minimally invasive surgical procedures.

Company is currently developing specialty instruments incorporating its

patent-pending lenslock technology which ensures lower cost, easier

repairability and enhanced durability. The Company is aggressively pursuing

ultra-small instruments (some with lenses less than one millimeter in diameter)

utilizing patent pending micro-precisionTM

technology. The Company is also exploring new initiatives in single molecule

technology and nanotechnology for biomedical and other applications.

Optics Corporation is certified to the ISO 9001 Quality Standard, and complies

with the FDA Good Manufacturing Practices and the European Union Medical Device

Directive for CE Marking of its medical products. The Company's Internet Website

OPTICS CORPORATION, INC. AND SUBSIDIARIES

STATEMENTS OF OPERATIONS

THE THREE MONTHS ENDED

30, 2005 AND SEPTEMBER 30, 2004

OPTICS CORPORATION, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE