Qualstar Announces 2Q

SIMI VALLEY, Calif. -- Qualstar Corporation (Nasdaq:QBAK), a manufacturer of automated tape storage solutions, today announced that preliminary net revenues for the second quarter of fiscal 2007, ended December 31, 2006, were in the range of $5.25 to $5.35 million. On a sequential basis, this is an improvement over the net revenues of $4.66 million reported by the Company for the first quarter of fiscal 2007, ended September 30, 2006.

Commenting on the preliminary second quarter results, William Gervais, president and chief executive officer of Qualstar Corporation, stated, "Contributing to the strong second quarter results were sequential improvements in XLS revenue, power supplies, service and media. Of particular interest, momentum in our enterprise-class library seems to be building, with unit shipments increasing from three units in the first fiscal quarter to five units in the second fiscal quarter. We believe that the quarter was also aided by recent compliance-driven record retention regulations that went into effect at the end of the calendar year. Additionally, initial shipments of AIT-5-based automation products commenced earlier than we had originally anticipated.”

Qualstar Corp.