Ampex Corporation Reports Third Quarter 2006 Financial Results.

REDWOOD CITY, Calif. -- Ampex Corporation (Nasdaq:AMPX) today reported net income of $1.8 million ($0.47 per diluted share) on revenues of $8.6 million in the third quarter of 2006 compared to a net loss of $0.2 million ($0.05 loss per diluted share) on revenues of $10.7 million in the third quarter of 2005.

Matters affecting the third quarter 2006 financial results included:

* Quarterly running royalties earned on current period shipments by our licensees totaled $3.2 million in the third quarter of 2006 compared to $2.4 million in the third quarter of 2005. The increase was due to Sony's first quarterly payment of running royalties on digital camcorders shipped after April 11, 2006 offset, in part, by the decrease in running royalties on digital still cameras due to the expiration of our Rapid Image Retrieval patent ("121" patent). Total licensing revenue included, in the third quarter of 2005, one-time royalty settlements for prior period shipments and prepayment of license obligations covering future periods totaling $2.8 million. There were no such settlements in 2006.

* Our digital still camera licensees discontinued royalty payments to us on April 11, 2006 upon the expiration of the "121" patent, and we do not expect further payments except to the extent that licensees infringe other digital imaging patents. Presently, our licensing revenue is derived from manufacturers of digital camcorders and DVD recorders which use several other digital imaging patents that are in force through at least 2012.

* Over the past two years, our results of operations have been adversely affected by litigation costs incurred to defend our patents. Litigation costs incurred in connection with the Kodak lawsuit totaled $1.2 million ($0.31 per diluted share) in the three months ended September 30, 2006, compared to $1.9 million ($0.51 per diluted share) in the three months ended September 30, 2005. As previously reported, on October 31, 2006, the U.S. District Court of Delaware granted Kodak's motion of summary judgment of non-infringement of our "121" patent. The Company is currently evaluating the next steps with respect to this action, including a possible appeal. The Court's decision will have no effect on past or future licensing revenues from existing licensees since the "121" patent has expired.

* In the third quarter of 2006, we initiated an internal technical review of our patent portfolio with the goal to identify additional digital imaging patents that may be infringed by manufacturers of digital still cameras and camera equipped cellular telephones. If our review is successful, we would expect to expand our licensing discussions with such manufacturers and to offer a portfolio of patents for license. To date, we have issued claim charts to ten manufacturers of digital still cameras and to two manufacturers of camera equipped cellular telephones alleging infringement of our Feed Forward Quantization patent.

* The Recorders segment earned operating income of $0.4 million ($0.11 per diluted share) in the third quarter of 2006 compared to $ 0.4 million ($0.11 per diluted share) in the third quarter of 2005. Recorders segment revenues decreased to $5.4 million in the third quarter of 2006 from $5.6 million in the third quarter of 2005, as the increase in new product sales did not fully offset the decline in legacy, tape-based products and services. Our backlog of firm orders totaled $8.0 million at September 30, 2006. We have other orders which have cancellation options and have received notification of purchase authorizations that are not included in backlog totaling $8.5 million, reflecting a growing acceptance of our new solid state and disk based instrumentation recorders.

As a result of the foregoing, operating income (loss) for the Company's business segments and unallocated corporate expenses were as follows:

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* Non-operating income included $2.7 million ($0.70 per diluted share) of non-recurring income resulting from fees realized on investment activities and the sale of securities.

As previously announced, the Company will host a conference call on Tuesday, November 7, 2006 at 4:30 p.m. eastern time to discuss its second quarter 2006 financial results. To access the call, please call Genesys Conferencing at [phone] by 4:20 p.m. and reference Conference ID 946843 to access the call. Parties interested in asking questions of management are requested to give the moderator their name and telephone contact information.

A replay of the conference call will be available on the Ampex website www.ampex.com, Investor Relations, "Third Quarter 2006 Earnings Call", for approximately one week shortly after the call has been concluded.

Ampex Corporation, www.ampex.com, headquartered in Redwood City, California, is one of the world's leading innovators and licensors of technologies for the visual information age.

This news release contains predictions, projections and other statements about the future that are intended to be "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of l995 (collectively, "forward-looking statements"). Forward-looking statements relate to various aspects of the Company's operations and strategies, including but not limited to the effects of having recently and in the past experienced losses and the risk that the Company may incur losses in the future; the Company's limited liquidity and significant indebtedness and interest expense; its sales and royalty revenues declining in future periods, and the risk that the Company will not conclude additional royalty-bearing license agreements covering its digital technologies; delays that might be experienced in the receipt of anticipated royalties from license agreements presently in effect; the Company's marketing, product development, acquisition, investment, licensing and other strategies not being successful; possible future issuances of debt or equity securities; the possible incurrence of significant patent litigation expenses or adverse legal determinations finding the Company's patents not be valid or not to have been infringed; new business development and industry trends; the possible need to raise additional capital in order to meet the Company's obligations; reliance on a former affiliate to make contributions to the Company's pension plans which are substantially underfunded and most other statements that are not historical in nature. Important factors that could cause actual results to differ materially from those described in the forward-looking statements are described in cautionary statements included in this news release and/or in the Company's 2005 Annual Report on Form 10-K and its Quarterly Report on Form 10-Q for the first fiscal quarter ended March 31, 2006 and Form 10-Q for the second quarter ended June 30, 2006 which have been filed with the SEC and its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2006, which is expected to be filed with the SEC shortly. In assessing forward-looking statements, readers are urged to consider carefully these cautionary statements. Forward-looking statements speak only as of the date of this news release, and the Company disclaims any obligations to update such statements.

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