AFOP Reports Consecutive Record Annual Sales and Profits in 2013. Guidance for Year-Over-Year Increase in Revenues of 86% in

AFOP Reports Consecutive Record Annual Sales and Profits in 2013. Guidance for
Year-Over-Year Increase in Revenues of 86% in First Quarter 2014

SUNNYVALE, Calif., Feb. 3, 2014 (GLOBE NEWSWIRE) -- Alliance Fiber Optic
Products, Inc. (Nasdaq:AFOP), an innovative supplier of fiber optic
components, subsystems and integrated modules for the optical network
equipment market, today reported its financial results for the fourth quarter
and year ended December 31, 2013.

Revenues for the fourth quarter of 2013 totaled $21,804,000, a 79% increase
from revenues of $12,159,000 reported in the fourth quarter of 2012, and a
5.5% decrease from revenues of $23,074,000 reported in the previous quarter.
The Company recorded net income for the fourth quarter of 2013 of $4,720,000,
or $0.26 per share based on 18.4 million shares outstanding, compared to
$5,597,000, or $0.32 per share based on 17.5 million shares outstanding for
the fourth quarter of 2012. This compares to net income for the third quarter
of 2013 of $5,621,000, or $0.31 per share based on 18.1 million shares
outstanding. Included in net income for the fourth quarter of 2012 was a
one-time tax benefit of $3.7 million. Excluding this tax benefit, earnings
were $0.11 per share.

Revenues for the year ended December 31, 2013 were $76,070,000, a 63% increase
from revenues of $46,611,000 reported in the previous fiscal year. Operating
income for the year ended December 31, 2013 was $17,101,000, compared with
$5,729,000 for the year ended December 31, 2012. The Company recorded a net
profit for the year ended December 31, 2013 of $16,473,000, or $0.93 per share
based on 17.8 million shares outstanding. This compares with a net profit of
$9,641,000, or $0.55 per share for the year ended December 31, 2012. Included
in net income for the year ended December 31, 2012 was a one-time tax benefit
of $3.7 million. Excluding this tax benefit, earnings were $0.34 per share.

Included in expenses were stock-based compensation charges of $663,000 for the
quarter ended December 31, 2013, $563,000 for the quarter ended September 30,
2013 and $280,000 for the quarter ended December 31, 2012. Included in
expenses for the year ended December 31, 2013 was $1,917,000 of stock-based
compensation charges, compared with $1,066,000 of stock-based compensation
charges for the year ended December 31, 2012.

"Fiscal year 2013 represented an exciting year of growth for AFOP," commented
Peter Chang, President and Chief Executive Officer. "With the strong quarterly
sales in the last three quarters of 2013, overall annual revenues grew 63% to
a new record level. With our operational efficiency, quarterly gross margins
continued improving throughout the year, which resulted in the improved annual
gross margin, from 34% in 2012 to over 38% this year. More importantly, our
operating profits almost tripled in 2013. In addition, with the declaration of
the increased annual dividend, AFOP shareholder value has improved, while our
cash and short-term and long-term investments grew stronger."

"While we are pleased with delivering record financial performance for 2013,
we are excited with the business prospects in this coming year with the
progress we have made with customers and new products, and the continuous
strong demand in Datacom markets. Based on our current bookings, we expect
revenues in the quarter to be higher than $22.5M, which would represent at
least 85% growth on a year over year basis," concluded Mr. Chang.

Conference Call

Management will host a conference call at 1:30 p.m. (Pacific) on February 3,
2014 to discuss AFOP's fourth quarter and fiscal year 2013 financial results.
Please call 877-675-3572 at least ten minutes prior to the call in order for
the operator to connect you. The confirmation number for the call is 33935556.
AFOP will also provide a live webcast of its fourth quarter and fiscal year
2013 conference call at AFOP's website: www.afop.com. The webcast replay will
be available on AFOP's website 90 minutes after the live conference call.

About AFOP

Founded in 1995, Alliance Fiber Optic Products, Inc. designs, manufactures and
markets a broad range of high performance fiber optic components and
integrated modules. AFOP's products are used by leading and emerging
communications equipment manufacturers to deliver optical networking systems
to the long-haul, enterprise, data center, metropolitan and last mile access
segments of the communications network. AFOP offers a broad product line of
passive optical components including interconnect systems, splitters, thin
film CWDM and DWDM components and modules, and optical attenuators. AFOP is
headquartered in Sunnyvale, California, with manufacturing and product
development capabilities in the United States, Taiwan and China. AFOP's
website is located at http://www.afop.com.

Except for the historical information contained herein, the matters set forth
in this press release, including statements as to our expectations regarding
future revenue levels and the time periods thereof, our business prospects,
and demand for our products and sources of demand, are forward looking
statements within the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking statements are
subject to risks and uncertainties that may cause actual results to differ
materially, including, but not limited to general economic conditions and
trends, trends in demand for bandwidth, the impact of competitive products and
pricing, timely introduction of new technologies, timely design acceptance by
our customers, the acceptance of new products and technologies by our
customers, customer demand for our products, the timing of customer orders,
loss of key customers, our ability to ramp new products into volume
production, the mix of products sold and product pricing, the costs associated
with running our operations, industry-wide shifts in supply and demand for
optical components and modules, industry overcapacity and demand for
bandwidth, the success of cost control initiatives, our ability to obtain and
maintain operational efficiencies, financial stability in foreign markets, and
other risks detailed from time to time in our SEC reports, including AFOP's
quarterly report on Form 10-Q for the quarter ended September 30, 2013. These
forward-looking statements speak only as of the date hereof. AFOP disclaims
any intention or obligation to update or revise any forward-looking
statements.

ALLIANCE FIBER OPTIC PRODUCTS, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited)
                                                       
                                              Dec. 31,  Dec. 31,
                                              2013      2012
ASSETS                                                  
Current assets:                                         
Cash and short-term investments                $46,679 $33,275
Accounts receivable, net                       11,566   8,046
Inventories                                    10,630   6,933
Deferred tax asset                             3,701    1,234
Other current assets                           1,745    1,166
Total current assets                           74,321   50,654
                                                       
Long-term investments                          10,453   10,274
Property and equipment, net                    13,258   7,708
Deferred tax asset                             --      2,468
Other assets                                   198      249
Total assets                                   $98,230 $71,353
                                                       
LIABILITIES AND STOCKHOLDERS' EQUITY                    
Current liabilities:                                    
Accounts payable                               $11,657 $6,591
Accrued expenses and other current liabilities 7,134    4,115
Total current liabilities                      18,791   10,706
                                                       
Long-term liabilities                          600      616
Total liabilities                              19,391   11,322
                                                       
Stockholders' equity                           78,839   60,031
Total liabilities and stockholders' equity     $98,230 $71,353


ALLIANCE FIBER OPTIC PRODUCTS, INC.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
                                                                
                            Three Months Ended            Twelve Months Ended
                            Dec. 31,  Sept. 30, Dec. 31,  Dec. 31,  Dec. 31,
                            2013      2013      2012      2013      2012
                                                                
Revenues                     $21,804 $23,074 $12,159 $76,070 $46,611
                                                                
Cost of revenues             13,230   14,218   7,929    46,952   30,617
Gross profit                 8,574    8,856    4,230    29,118   15,994
                                                                
Operating expenses:                                              
Research and development     1,006    1,024    831      3,702    3,298
Selling, marketing and       2,337    2,174    1,737    8,315    6,967
administrative
Total operating expenses     3,343    3,198    2,568    12,017   10,265
                                                                
Income from operations       5,231    5,658    1,662    17,101   5,729
Interest and other income,   239      173      223      708      727
net
Income before benefit        $5,470  $5,831  $1,885  $17,809 $6,456
(provision) for income taxes
Benefit (provision) for      (750)    (210)    3,712    (1,336)  3,185
income taxes
Net income                  $4,720  $5,621  $5,597  $16,473 $9,641
                                                                
Net income per share                                             
Basic                       $0.26   $0.31   $0.32   $0.93   $0.55
Diluted                     $0.25   $0.30   $0.31   $0.89   $0.54
                                                                
Weighted average shares                                          
outstanding
Basic                       18,382   18,056   17,472   17,785   17,596
Diluted                     19,198   18,754   17,870   18,481   17,861
                                                                
Included in costs and                                            
expenses above:
Stock based compensation                                         
charges
Cost of revenue              $158    $116    $33     $373    $119
Research and development     83       71       33       232      125
Selling, marketing and       422      376      214      1,312    822
administrative
Total                        $663    $563    $280    $1,917  $1,066

CONTACT: Anita Ho
         Acting Chief Financial Officer
         Alliance Fiber Optic Products, Inc.
         Phone: 408-736-6900 x168

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