Digital Power Reports Financial Results for the Fourth Quarter

and the Year Ended December 31, 2009


FREMONT, Calif., March 11, 2010, Digital Power Corporation (NYSE Amex: DPW - News) today announced its financial results for the fourth quarter and for the year ended December 31, 2009.

Digital Power reported revenue of $2,435,000 for the quarter ended December 31, 2009, an increase of 43% from $1,708,000 in revenue for the prior quarter, and a decrease of 6% from $2,586,000 in revenue for the same quarter last year.

Digital Power reported gross margins of 35% for the quarter ended December 31, 2009, an increase of 5% from the gross margins of 30% reported for last quarter and for the same quarter last year. The increase in gross margins from those reported last quarter resulted primarily from an increase in revenue while maintaining a similar level of fixed cost structure.

Digital Power reported an operating profit of $6,000 for the quarter ended December 31, 2009, compared to an operating loss of $231,000 in the prior quarter and an operating profit of $49,000 in the same quarter last year. Moving from an operating loss in the third quarter to an operating profit in this quarter is primarily the result of a significant increase in revenue.

Commenting on the results, Amos Kohn, President and CEO, stated, “Our fourth quarter’s significant revenue increase, as compared to our third quarter, is a result of large shipments to our customers.  Our gross margin increase from last quarter mainly resulted from an increase in our revenue while maintaining a similar level of fixed cost structure.  With very close management, we were able to start production of some of our unique custom design products to satisfy our customers’ aggressive delivery plan.”

About Digital Power:
Digital Power Corporation designs, develops, manufactures, and sells custom and standard high-grade power system solutions to the telecom/datacom, industrial, medical and military/defense industries.  Digital Power's headquarters are located at 41324 Christy Street, Fremont, California, 94538-3158

Phone number 510-657-2635
Website: www.digipwr.com.



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