Digital Power Corporation Reports Financial Results for the First Quarter

Ended March 31, 2012

FREMONT, Calif., May 14, 2011, Digital Power Corporation (NYSE Amex: DPW - News) today announced its financial results for the first quarter ended March 31, 2012. Digital Power’s revenues for the first quarter ended March 31, 2012 were $2,240,000, a decrease of 33% from revenue of $2,978,000 for the same quarter ended March 31, 2011.  Net income for the quarter ended on March 31, 2012 was $75,000 a decrease of 126% from the profit of $170,000 in the quarter ended on March 31, 2011. Gross margin in the first quarter ended March 31, 2012 was 41%, an increase from 37% reported in March 31, 2011. Lastly, operating income for the first quarter ended March 31, 2012 was $116,000, a decrease of 69% for the same quarter ended March 31, 2011.

Commenting on the results, President and CEO, Amos Kohn, stated: “Although we experienced a reduction in our results for the first quarter, domestic revenues remains fairly strong. Our European operations experienced a disappointment in the slowdown of shipments primarily due to the credit crisis in the Euro-zone and the accompanying economic environment. We continue executing our strategy of developing full custom power solutions and simultaneously enhancing our standard product offering with innovative, high density switchers at ever increasing power levels. This focus on solution driven applications are well received by our major vertical markets including telecom, medical, military and the industrial segments.

About Digital Power:
Digital Power Corporation is a solution-driven organization that designs, develops, manufactures and sells high-grade customized and flexible power system solutions for the most demanding applications in the medical, military, telecom and industrial markets. We are highly focused on high-grade and custom product designs for both the commercial and military/defense markets, where customers demand high density, high efficiency and ruggedized products to meet the harshest and/or military mission critical operating conditions. We are a California corporation originally formed in 1969, and our common stock trades on the NYSE Amex under the symbol "DPW". Digital Power's headquarters is located at 41324 Christy Street, Fremont, California, 94538-3158.

Contact: Leo Yen, Investor Relations, 510-657-2635

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