<PAGE>

================================================================================

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

         (Mark One)

         [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                  THE SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended December 31, 2001

                                       or

         [_]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                  THE SECURITIES EXCHANGE ACT OF 1934

                  For the transition period from _______ to _______

                        Commission file number 000-31581

                          OPLINK COMMUNICATIONS , INC.
             (Exact name of registrant as specified in its charter)

         Delaware                                   No. 77-0411346
         (State or other jurisdiction of            (I.R.S. Employer
         incorporation or organization)             Identification No.)

                   3469 North First Street, San Jose, CA 95134
               (Address of principal executive offices) (Zip Code)

       Registrant's telephone number, including area code: (408) 433-0606


     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.       Yes   X        No  _____
                                                    -----

     The number of shares of the Registrant's Common Stock outstanding as of
February 4, 2002 was 163,653,991.

================================================================================

<PAGE>

                           OPLINK COMMUNICATIONS, INC.

                                    FORM 10-Q

                                      INDEX

                                                                         Page
                                                                         ----
PART I. FINANCIAL INFORMATION
-----------------------------

Item 1.      Financial Statements (unaudited):

       Condensed Consolidated Balance Sheets -
             December 31, 2001 and June 30, 2001                           3

       Condensed Consolidated Statements of Operations -
             Three and six months ended December 31, 2001 and 2000         4

       Condensed Consolidated Statements of Cash Flows -
             Six months ended December 31, 2001 and 2000                   5

       Notes to Condensed Consolidated Financial Statements                7

Item 2.      Management's Discussion and Analysis of Financial
             Condition and Results of Operations                          11

Item 3.      Quantitative and Qualitative Disclosures About Market Risk   33

PART II. OTHER INFORMATION
--------------------------

Item 1.      Legal Proceedings                                            34

Item 2.      Changes in Securities and Use of Proceeds                    34

Item 3.      Defaults Upon Senior Securities                              34

Item 4.      Submission of Matters to a Vote of Security Holders          34

Item 5.      Other Information                                            35

Item 6.      Exhibits and Reports on Form 8-K                             35

SIGNATURES                                                                36


                                       2

<PAGE>

PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements

                           OPLINK COMMUNICATIONS, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (In thousands)

<TABLE>
<CAPTION>
                                                     December 31,   June 30,
                                                     ------------ ------------
                                                         2001         2001
                                                     ------------ ------------
ASSETS                                               (Unaudited)
<S>                                                  <C>          <C>
Current assets:
   Cash and cash equivalents                          $ 171,284    $ 246,473
   Short-term investments                                61,445           --
   Accounts receivable, net                               9,501       17,178
   Inventories                                            8,427       21,739
   Assets held for sale                                     652           --
   Prepaid expenses                                       4,567        8,501
                                                      ---------    ---------
       Total current assets                             255,876      293,891
Property and equipment, net                              65,583       92,086
Intangible assets                                           583          667
Other assets                                              1,258        1,258
                                                      ---------    ---------
       Total assets                                   $ 323,300    $ 387,902
                                                      =========    =========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
   Accounts payable                                   $   9,287    $  21,596
   Accrued liabilities                                   18,953       18,629
   Current portion of capital lease obligations           4,117        3,534
   Borrowings under the line of credit                    1,208        1,148
                                                      ---------    ---------
       Total current liabilities                         33,565       44,907

Capital lease obligations, non current                    3,761        4,988
                                                      ---------    ---------
       Total liabilities                                 37,326       49,895
                                                      ---------    ---------

Commitments and contingencies (Note 10)

Stockholders' equity:
   Common stock                                             163          161
   Additional paid-in capital                           469,968      472,102
   Notes receivable from stockholders                   (10,417)      (3,889)
   Deferred stock compensation                           (9,213)     (17,554)
   Accumulated other comprehensive income                    57           25
   Accumulated deficit                                 (164,584)    (112,838)
                                                      ---------    ---------
       Total stockholders' equity                       285,974      338,007
                                                      ---------    ---------

         Total liabilities and stockholders' equity   $ 323,300    $ 387,902
                                                      =========    =========
</TABLE>


The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                        3

<PAGE>

                           OPLINK COMMUNICATIONS, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                      (In thousands, except per share data)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                          Three Months Ended          Six Months Ended
                                                              December 31,              December 31,
                                                        ----------------------    ----------------------
                                                           2001         2000         2001         2000
                                                        ---------    ---------    ---------    ---------
<S>                                                     <C>          <C>          <C>          <C>
Revenues                                                $  10,622    $  43,241    $  20,638    $  75,518
                                                        ---------    ---------    ---------    ---------
Cost of revenues:
   Cost of revenues                                        10,101       30,929       32,516       55,516
   Non-cash compensation expense (benefit)                    273        1,536         (153)       2,889
                                                        ---------    ---------    ---------    ---------
     Total cost of revenues                                10,374       32,465       32,363       58,405
                                                        ---------    ---------    ---------    ---------

Gross profit (loss)                                           248       10,776      (11,725)      17,113
                                                        ---------    ---------    ---------    ---------

Operating expenses:
   Research and development:
     Research and development                               3,637        5,016        7,391        8,635
     Non-cash compensation expense                            231        1,349          323        2,754
                                                        ---------    ---------    ---------    ---------
       Total research and development                       3,868        6,365        7,714       11,389
                                                        ---------    ---------    ---------    ---------

   Sales and marketing:
     Sales and marketing                                    2,138       11,989        4,090       14,357
     Non-cash compensation expense (benefit)                 (796)         660         (685)       1,263
                                                        ---------    ---------    ---------    ---------
       Total sales and marketing                            1,342       12,649        3,405       15,620
                                                        ---------    ---------    ---------    ---------

   General and administrative:
     General and administrative                             1,702        3,682        3,898        6,375
     Non-cash compensation expense                          1,078        6,333        1,925       11,703
                                                        ---------    ---------    ---------    ---------
       Total general and administrative                     2,780       10,015        5,823       18,078
                                                        ---------    ---------    ---------    ---------

   Restructuring costs and other special charges               --           --       25,643           --
   Amortization of goodwill and intangible assets              42          983           84        1,966
                                                        ---------    ---------    ---------    ---------
         Total operating expenses                           8,032       30,012       42,669       47,053
                                                        ---------    ---------    ---------    ---------

Loss from operations                                       (7,784)     (19,236)     (54,394)     (29,940)
Interest and other income, net                              1,079        4,138        2,648        4,150
                                                        ---------    ---------    ---------    ---------

Net loss                                                $  (6,705)   $ (15,098)   $ (51,746)   $ (25,790)
                                                        =========    =========    =========    =========

Basic and diluted net loss per share                    $   (0.04)   $   (0.10)   $   (0.32)   $   (0.28)
                                                        =========    =========    =========    =========

Basic and diluted weighted average shares outstanding     161,087      156,339      161,215       91,578
                                                        =========    =========    =========    =========
</TABLE>

The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                        4

<PAGE>

                           OPLINK COMMUNICATIONS, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                    Six Months Ended
                                                                       December 31,
                                                                  ----------------------
                                                                     2001         2000
                                                                  ---------    ---------
<S>                                                               <C>          <C>
Cash flows from operating activities:
   Net loss                                                       $ (51,746)   $ (25,790)
   Adjustments to reconcile net loss to net cash
     used in operating activities:
       Non-cash restructuring costs and other special charges        16,260           --
       Depreciation and amortization of property and equipment        6,572        3,225
       Amortization of goodwill and intangible assets                    84        2,746
       Amortization of deferred compensation                          1,410       18,609
       Provision for excess and obsolete inventory                   10,407           --
       Deferred tax assets                                               --         (682)
       Sales and marketing expense related to the convertible
         note payable to Cisco Systems                                   --        8,824
       Interest expense related to the convertible note
         payable to Cisco Systems                                        --          471
       Other                                                           (460)         100
       Change in assets and liabilities:
         Accounts receivable                                          7,677      (23,176)
         Inventories                                                  2,905      (13,851)
         Prepaid expenses                                             3,934       (3,211)
         Other assets                                                    --         (341)
         Accounts payable                                            (3,305)       7,943
         Accrued liabilities                                            319       11,560
                                                                  ---------    ---------
           Net cash used in operating activities                     (5,943)     (13,573)
                                                                  ---------    ---------

Cash flows from investing activities:
   Purchases of short-term investments                              (70,152)          --
   Maturities of short-term investments                               9,100           --
   Proceeds from sales of assets                                      1,586           --
   Purchases of property and equipment                               (6,397)     (30,234)
                                                                  ---------    ---------
           Net cash used in investing activities                    (65,863)     (30,234)
                                                                  ---------    ---------

Cash flows from financing activities:
   Proceeds from issuance of common stock upon the
     initial public offering                                             --      261,014
   Proceeds from issuance of common stock                               348          518
   Repurchase of common stock                                        (1,895)          --
   Proceeds from issuance of convertible note payable                    --       50,000
   Proceeds from borrowings under line of credit                      1,268        1,010
   Repayment of borrowings under line of credit                      (1,208)          --
   Repayment of capital lease obligations                            (1,896)        (698)
                                                                  ---------    ---------
           Net cash provided by (used for) financing activities      (3,383)     311,844
                                                                  ---------    ---------

Net increase in cash and cash equivalents                           (75,189)     268,037
Cash and cash equivalents, beginning of year                        246,473       26,665
                                                                  ---------    ---------
Cash and cash equivalents, end of year                            $ 171,284    $ 294,702
                                                                  =========    =========
</TABLE>

                            (Continued on next page)

The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                        5

<PAGE>

                           OPLINK COMMUNICATIONS, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                   (Unaudited)

                         (CONTINUED FROM PREVIOUS PAGE)

<TABLE>
<CAPTION>
                                                                  Six Months Ended
                                                                    December 31,
                                                                 ------------------
                                                                  2001       2000
                                                                 -------    -------
<S>                                                              <C>        <C>
Supplemental disclosures of cash flow information:
   Cash paid during the period for interest expense              $   393    $   188
                                                                 =======    =======
   Cash paid during the period for income taxes                  $    --    $ 1,762
                                                                 =======    =======

Supplemental non-cash investing and financing activities:
   Property and equipment acquired under capital lease           $ 1,252    $ 4,730
                                                                 =======    =======
   Forfeiture of common stock option grants                      $(2,844)   $    --
                                                                 =======    =======
   Deferred compensation related to common stock
      option grants to employees                                 $    --    $30,340
                                                                 =======    =======
   Return of property and equipment                              $ 9,004    $    --
                                                                 =======    =======
   Conversion of convertible preferred stock                     $    --    $58,373
                                                                 =======    =======
   Conversion of convertible note payable and
      related interest to Cisco Systems                          $    --    $50,471
                                                                 =======    =======
   Issuance of common stock in connection with note receivable   $ 6,411    $    --
                                                                 =======    =======
</TABLE>

The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                        6

<PAGE>

                           OPLINK COMMUNICATIONS, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.   Description of Business. Oplink Communications, Inc. ("Oplink" or the
     -----------------------
"Company") designs, manufactures and markets fiber optic networking components
and integrated optical subsystems and modules that expand optical bandwidth,
amplify optical signals, monitor and protect wavelength performance and redirect
light signals within an optical network. The Company provides a broad line of
products to communications equipment suppliers to enable bandwidth creation and
management within an optical network. The Company was incorporated in September
1995, reincorporated in Delaware in September 2000 and began shipping its
products for sale in 1996. In April 1999, the Company established manufacturing
operations in China. The Company conducts its business within one operating
segment and has no organizational structure dictated by product, service line,
geography or customer type.

2.   Basis of Presentation. The condensed consolidated financial statements
     ---------------------
included herein have been prepared by the Company pursuant to the rules and
regulations of the Securities and Exchange Commission ("SEC"). Certain
information and footnote disclosures, normally included in financial statements
prepared in accordance with generally accepted accounting principles, have been
condensed or omitted pursuant to such rules and regulations. The financial
statements presented herein have been prepared by management, without audit by
independent accountants who do not express an opinion thereon, and should be
read in conjunction with the audited consolidated financial statements and notes
thereto for the fiscal year ended June 30, 2001 included in the Company's Annual
Report on Form 10-K.

     The Company operates and reports using a fiscal year, which ends on the
Sunday closest to June 30. Interim fiscal quarters end on the Sunday closest to
each calendar quarter end. For presentation purposes, the Company presents each
fiscal year as if it ended on June 30. The Company presents each of the fiscal
quarters as if it ended on the last day of each calendar quarter. Fiscal year
2002 will consist of 52 weeks.

     In the opinion of the management, these unaudited financial statements
contain all adjustments (consisting only of normal recurring adjustments)
necessary to present fairly the financial position of the Company at December
31, 2001, the results of its operations for the three and six-month periods
ended December 31, 2001 and 2000 and its cash flows. The results of operations
for the periods presented are not necessarily indicative of those that may be
expected for the full year.

3.   Net Loss Per Share. The Company computes net loss per share in accordance
     ------------------
with Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings Per
Share," and SEC Staff Accounting Bulletin ("SAB") No. 98. Under the provisions
of SFAS No. 128 and SAB No. 98, basic net loss per share is computed by dividing
the net loss for the period by the weighted average number of shares of common
stock outstanding during the period. Diluted net loss per share is computed by
dividing the net loss for the period by the weighted average number of common
and common equivalent shares outstanding during the period, if dilutive.
Potentially dilutive common equivalent shares are composed of preference shares,
warrants and the incremental common shares issuable upon the exercise of stock
options. The following is a reconciliation of the numerators and denominators of
the Basic and Diluted net loss per share computations for the periods presented
(in thousands, except per share data):

                                        7

<PAGE>

<TABLE>
<CAPTION>
                                                               Three Months Ended          Six Months Ended
                                                                   December 31,               December 31,
                                                                2001         2000          2001         2000
                                                              ---------    ---------    ---------    ---------
<S>                                                           <C>          <C>          <C>          <C>
Numerator:
   Net loss attributable to holders of Common Stock           $  (6,705)   $ (15,098)   $ (51,746)   $ (25,790)
                                                              =========    =========    =========    =========
Denominator:
   Weighted average shares outstanding                          161,087      156,339      161,215       91,578
                                                              ---------    ---------    ---------    ---------
Denominator for basic and diluted calculations                  161,087      156,339      161,215       91,578
                                                              =========    =========    =========    =========

   Basic and diluted net loss per share                       $   (0.04)   $   (0.10)   $   (0.32)   $   (0.28)
                                                              =========    =========    =========    =========

Antidilutive securities including options, warrants,
   preferred shares and shares per convertible note payable
   not included in net loss per share calculation                29,168       22,024       29,168       21,364
                                                              =========    =========    =========    =========
</TABLE>

4.   Short-Term Investments. Short-term investments consist of commercial paper
     ----------------------
and municipal bonds with maturities of less than one year from the balance sheet
date. Oplink's short-term investments are classified as available-for-sale.
These securities are carried at fair value with the unrealized gains and losses,
net of taxes, reported as a component of stockholders' equity.

5.   Comprehensive Loss. SFAS No. 130 requires disclosure of non-stockholder
     ------------------
changes in equity, which include unrealized gains and losses on securities
classified as available-for-sale under SFAS No. 115 and foreign currency
translation adjustments accounted for under SFAS No. 52.

     The reconciliation of net loss to comprehensive loss for the three and six
months ended December 31, 2001 and 2000 is as follows (in thousands):

<TABLE>
<CAPTION>
                                                           December 31,            December 31,
                                                         2001        2000        2001        2000
                                                       --------    --------    --------    --------
        <S>                                            <C>         <C>         <C>         <C>
        Net loss                                       $ (6,705)   $(15,098)   $(51,746)   $(25,790)
        Unrealized gain (loss) on investments               (15)         --          12          --
        Change in cumulative translation adjustments         (6)         (1)         20         (31)
                                                       --------    --------    --------    --------

           Comprehensive loss                          $ (6,726)   $(15,099)   $(51,714)   $(25,821)
                                                       ========    ========    ========    ========
</TABLE>


6.   Inventories. Inventories are stated at the lower of cost (first-in,
     -----------
first-out) or market. Inventories consist of (in thousands):

<TABLE>
<CAPTION>
                                                               December 31,    June 30,
                                                                 2001            2001
                                                               -----------     --------
       <S>                                                     <C>             <C>
       Inventories:
           Raw materials                                       $ 35,266        $ 24,963
           Work-in-process                                        7,258          16,723
           Finished goods                                         6,496           7,187
                                                               --------        --------
                                                                 49,020          48,873
           Less:  Reserves for excess and obsolete inventory    (40,593)        (27,134)
                                                               --------        --------
                                                               $  8,427        $ 21,739
                                                               ========        ========
</TABLE>

                                        8

<PAGE>

7. Restructuring Costs and Other Special Charges. In September 2001, the Company
   ---------------------------------------------
committed to a plan to restructure its business and realign its resources to
focus on reducing expenses, preserving cash, accelerating its planned move of
manufacturing operations to China and focusing on core opportunities due to the
decline in current business conditions. This restructuring plan includes a
workforce reduction and consolidation of excess facilities. As a result of the
restructuring plan and decline in forecasted revenue, the Company recorded
restructuring costs and other special charges of $25.6 million classified as
operating expenses during the six months ended December 31, 2001. In addition to
the costs related to the restructuring, an excess and obsolete inventory charge
of $10.4 million, classified as cost of sales, was recorded during the six
months ended December 31, 2001. The following paragraphs provide detailed
information relating to the restructuring costs and other special charges and
the excess and obsolete inventory charge, which were recorded during the six
months ended December 31, 2001.


Worldwide workforce reduction

     The worldwide workforce reductions started in the fourth quarter of fiscal
2001 and will be substantially completed by the third quarter of fiscal 2002.
Through December 31, 2001, the restructuring plan resulted in the reduction of
2,197 regular employees, worldwide. The Company recorded a workforce reduction
charge of approximately $2.9 million during the six months ended December 31,
2001 relating primarily to severance and fringe benefits. In addition, the
number of temporary and contract workers employed by the Company has been
reduced.

Excess fixed assets, facilities and other special charges

     The Company recorded a restructuring charge of $16.6 million and $4.3
million relating to excess fixed assets and the consolidation of excess
facilities, respectively. The excess fixed assets charge represents the charge
required to remeasure such assets at the lower of carrying amount or fair value
less cost to sell. While these assets are being actively marketed, the Company
expects the period of disposal to be an additional nine months to one year for
most of the assets. The consolidation of excess facilities includes the closure
of certain manufacturing and research and development facilities. The charge
relates primarily to lease terminations and non-cancelable lease costs. The
Company also recorded other restructuring costs and special charges of $1.8
million relating primarily to payments due to suppliers and vendors to terminate
agreements for the purchase of capital equipment and inventory.

Summary

     A summary of the restructuring costs and other special charges is outlined
as follows (in thousands):

<TABLE>
<CAPTION>
                                  Restructuring                                             Restructuring
                                  Liabilities at                                            Liabilities at
                                     June 30,         Total       Non-cash         Cash      December 31,
                                       2001           Charge       Charge        Payments        2001
                                  --------------   -----------   -----------   -----------  --------------
<S>                               <C>              <C>           <C>           <C>          <C>
Workforce reduction               $          250   $     2,899   $        --   $     1,962  $        1,187
Excess fixed assets                                     16,635        16,260           375              --
Consolidation of excess
    facilities and other charges           4,294         6,109            --         2,410           7,993
                                  --------------   -----------   -----------   -----------  --------------
                                  $        4,544   $    25,643   $    16,260   $     4,747  $        9,180
                                  ==============   ===========   ===========   ===========  ==============
</TABLE>

Provision for inventory

                                        9

<PAGE>

     The Company recorded a provision for excess and obsolete inventory totaling
$10.4 million, which was charged to cost of sales during the six months ended
December 31, 2001. This excess inventory charge was due to a sudden and material
decline in backlog and forecasted revenue and was calculated as the inventory
levels in excess of six-month demand.

8.   Repurchase of Common Stock. On September 26, 2001, the Board of Directors
     --------------------------
authorized a program to repurchase up to an aggregate of $21,200,000 of the
Company's Common Stock. Such repurchases may be made from time to time on the
open market at prevailing market prices or in negotiated transactions off the
market. As of December 31, 2001, repurchases of $1,895,000 have been made under
this program.

9.   Recent Accounting Pronouncements. In July 2001, the Financial Accounting
     --------------------------------
Standards Board ("FASB") FASB issued SFAS No. 141, "Business Combinations." SFAS
No. 141 requires the purchase method of accounting for business combinations
initiated after June 30, 2001 and eliminates the pooling-of-interests method.

     In July 2001, the FASB issued SFAS No. 142, "Goodwill and Other Intangible
Assets," which is effective for fiscal years beginning after March 15, 2001.
SFAS No. 142 requires, among other things, the discontinuance of goodwill
amortization. In addition, the standard includes provisions upon adoption for
the reclassification of certain existing recognized intangibles as goodwill,
reassessment of the useful lives of existing recognized intangibles,
reclassification of certain intangibles out of previously reported goodwill and
the testing for impairment of existing goodwill and other intangibles. The
Company does not believe that the adoption of SFAS No. 142 will have a material
impact on our financial position, results of operations or cash flows.

     In October 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." SFAS No. 144 supercedes SFAS No.
121 and applies to all long-lived assets (including discontinued operations) and
consequently amends Accounting Principles Board Opinion No. 30 (APB 30),
"Reporting Results of Operations Reporting the Effects of Disposal of a Segment
of a Business." SFAS No. 144 develops one accounting model (based on the model
in SFAS No. 121) for long-lived assets that are to be disposed of by sale, as
well as addresses the principal implementation issues. SFAS No. 144 requires
that long-lived assets that are to be disposed of by sale be measured at the
lower of book value or fair value less cost to sell. That requirement eliminates
APB 30's requirement that discontinued operations be measured at net realizable
value or that entities include under "discontinued operations" in the financial
statements amounts for operating losses that have not yet occurred.
Additionally, SFAS No. 144 expands the scope of discontinued operations to
include all components of an entity with operations that (1) can be
distinguished from the rest of the entity and (2) will be eliminated from the
ongoing operations of the entity in a disposal transaction. We do not believe
that the adoption of SFAS No. 144 will have a material impact on our financial
position, results of operations or cash flows.

10.  Contingencies. In June 2000, Chorum Technologies, LP filed a lawsuit in the
     -------------
United States District Court for the Northern District of Texas against the
Company and Telelight Communication Inc., a wholly owned subsidiary of the
Company, alleging patent infringement and trademark claims relating to the
manufacture of and offer to sell fiber optic interleaver products. On May 7,
2001, the Company filed a lawsuit against Chorum in the United States District
Court for the District of Delaware, alleging, among other matters, that Chorum
infringes one of the Company's patents relating to fiber optic couplers based on
Chorum's manufacture and sale of DWDM products.

     In October 2001, the Company reached an agreement with Chorum and its
affiliates to dismiss the patent infringement and trademark litigation between
the companies without prejudice.

                                       10

<PAGE>

     In November 2001, the Company and certain of its officers and directors, as
well as certain of the underwriters from the Company's initial public offering
("IPO"), were named as defendants in a class action shareholder complaint filed
in the United States District Court for the Southern District of New York and
captioned Harward v. Oplink Communications, Inc., et al., Case No. 01-CV-9904.
In the complaint, the plaintiffs allege that the Company, certain of its
officers and directors and its IPO underwriters violated the federal securities
laws because the Company's IPO registration statement and prospectus contained
untrue statements of material fact or omitted material facts regarding the
compensation to be received by, and the stock allocation practices of, the IPO
underwriters. The plaintiffs seek unspecified monetary damages and other relief.
Similar complaints were filed in the same court against numerous public
companies that conducted IPOs of their common stock since the mid-1990s
(together with Harward v. Oplink Communications, Inc., et al., the "IPO
Lawsuits").

     On August 8, 2001, the IPO Lawsuits were consolidated for pretrial purposes
before United States Judge Shira Scheindlin of the Southern District of New
York. Judge Scheindlin held an initial case management conference on September
7, 2001, at which time she ordered, among other things, that the time for all
defendants to respond to any complaint be postponed until further order of the
court. Thus, the Company has not been required to answer any of the complaints,
and no discovery has been served on the Company.

     At a further status conference on January 7, 2002, Judge Scheindlin stated
that she would appoint lead plaintiffs counsel in the IPO Lawsuits in February
2002, and would require the appointed lead plaintiffs counsel to file amended,
consolidated complaints in the IPO Lawsuits by the end of March 2002. Judge
Scheindlin further stated that she did not expect the defendants to file motions
to dismiss the amended, consolidated complaints until the summer of 2002. The
Company, with the assistance of its legal counsel, intends to defend its
position in this matter vigorously.

Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations

     This report contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, including, without limitation, statements regarding the
Company's expectations, beliefs, intentions, or future strategies that are
signified by the words "expects," "anticipates," "intends," "believes," or
similar language. All forward-looking statements included in this document are
based on information available to the Company on the date hereof, and the
Company assumes no obligation to update any such forward-looking statements.
Actual results could differ materially from those projected in the
forward-looking statements. In evaluating the Company's business, prospective
investors should carefully consider the information set forth below under the
caption "Risk Factors" in addition to the other information set forth herein.
The Company cautions investors that its business and financial performance are
subject to substantial risks and uncertainties.

     The following discussion and analysis of our financial condition and
results of operations should be read in conjunction with our condensed
consolidated financial statements and related notes in this report, and
Management's Discussion and Analysis of Financial Condition and Results of
Operations and related financial information contained in the Company's Form
10-K (File No. 000-31581) as filed with the SEC on September 28, 2001.

Overview

     We design and manufacture fiber optic networking components and integrated
optical subsystems and modules that expand optical bandwidth, amplify optical
signals, monitor and protect wavelength

                                       11

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performance and redirect light signals within an optical network. We market our
broad line of products worldwide to communications equipment suppliers. Our
bandwidth creation products increase the performance and capacity of fiber optic
networks. Our bandwidth management products provide communications service
providers with the ability to monitor and manage optical signals to enhance
network performance. We produce components, subsystems and modules for
next-generation, all-optical dense wavelength division multiplexing (DWDM),
optical amplification, switching and routing, and ultra-high reliability
undersea use. We were incorporated in September 1995 and reincorporated in
Delaware in September 2000. We began shipping product for sale in the second
half of 1996. In April 1999, we established manufacturing operations in China.

     We generate revenues from the sale of fiber optic components and integrated
optical subsystems and modules. To date, we have developed over 100 standard
products that are sold or integrated into customized solutions for our
customers. Our products are generally categorized into the following major
groups: our bandwidth creation products which include wavelength expansion and
optical amplification products; and our bandwidth management products which
include wavelength performance monitoring and protection, and optical switching
products. A majority of our revenues are derived from our wavelength expansion
products, in particular, DWDMs and multiplexers used primarily in optical
amplification and amplification products.

     We depend upon a small number of customers for a substantial portion of our
revenues. Our top five customers together accounted for 68.7% and 54.8% of our
revenues in the three months and six months ended December 31, 2001,
respectively. Lucent Technologies and Siemens each accounted for revenues
greater than 10% for the three months ended December 31, 2001. Lucent
Technologies, Siemens and Marubun Corporation each accounted for revenues
greater than 10% for the six months ended December 31, 2001. We expect that we
will continue to depend upon a small number of customers, although most likely
not the same customers, for a substantial portion of our revenues.

Results of Operations

     Revenues. Revenues decreased $32.6 million, or 75%, from $43.2 million for
the three months ended December 31, 2000 to $10.6 million for the three months
ended December 31, 2001. Revenues decreased $54.9 million, or 73%, from $75.5
million for the six months ended December 31, 2000 to $20.6 million for the six
months ended December 31, 2001. These decreases were primarily due to decreased
shipments of our existing wavelength expansion products, optical amplification
products and optical switching products to existing and new customers. These
decreases in shipments were primarily due to the slowdown in telecommunications
equipment spending. We expect our revenues for the third quarter of fiscal 2002
to remain flat compared to revenues achieved during the second quarter of fiscal
2002.

     Gross Profit (Loss). Gross profit, excluding non-cash compensation expense,
decreased $11.8 million, or 96%, from $12.3 million for the three months ended
December 31, 2000 to $521,000 for the three months ended December 31, 2001. This
resulted in a decrease in gross margin from 28.5% to 5.0%. Gross profit (loss),
excluding the $10.4 million excess inventory charge and $153,000 non-cash
compensation benefit for the six months ended December 31, 2001 and $2.9 million
non-cash compensation expense for the six months ended December 31, 2000,
decreased $21.5 million, or 107%, from a gross profit of $20.0 million for the
six months ended December 31, 2000 to a gross loss of $1.5 million for the six
months ended December 31, 2001. This resulted in a decrease in gross margin from
26.5% to (7.1)%. These decreases in our gross margin were primarily due to
higher manufacturing costs relative to our production volume, manufacturing
inefficiencies associated with the transfer of our manufacturing capacity to
China and lower yields in our manufacturing facilities in China due to the rapid
manufacturing transfer. These decreases were partially offset by the cost
benefits of manufacturing in China. During the three months ended December 31,

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2001 we recorded $2.0 million in revenues in connection with a program with a
significant customer, which included principally the acceptance of certain
inventory that had previously been written off. For the three months ended
December 31, 2001, excluding the $2 million of revenues and non-cash
compensation expense, our gross loss would have been $1.5 million, or (17.2%),
compared to a gross profit of $12.3 million for the three months ended December
31, 2000. For the six months ended December 31, 2001, excluding the $2 million
of revenues and $153,000 non-cash compensation benefit and including the $10.4
million excess inventory charge, our gross loss would have been $13.9 million,
or (74.5%), compared to a gross profit, excluding $2.9 million non-cash
compensation, of $20.0 million for the six months ended December 31, 2000.
Manufacturing overhead costs, excluding the excess inventory charge and non-cash
compensation benefit or expense, decreased $1.1 million and increased $945,000
for the three months and six months ended December 31, 2001, respectively,
compared to the same periods in the prior fiscal year. Gross profit, including
non-cash compensation expense, decreased $10.5 million, or 98%, from $10.8
million for the three months ended December 31, 2000 to $248,000 for the three
months ended December 31, 2001. This resulted in a decrease in gross margin from
24.9% to 2.3%. Gross profit (loss), including the $10.4 million excess inventory
charge and $153,000 non-cash compensation benefit for the six months ended
December 31, 2001 and $2.9 million non-cash compensation expense for the six
months ended December 31, 2000, decreased $28.8 million, or 169%, from gross
profit of $17.1 million for the six months ended December 31, 2000 to a gross
loss of $11.7 million for the six months ended December 31, 2001. This resulted
in a decrease in gross margin from 22.7% to (56.8)%. The excess inventory charge
reflects the recent significant downturn in customer demand. In response to this
downturn, we focused on completing the transition of substantially all of our
manufacturing to China. We cannot assure you that this transition will result in
improved gross margins due to the cost benefits of manufacturing in China. We
are continuing to implement programs to further improve production yields of our
products. We cannot assure you, however, that these programs will be successful
in increasing our gross margin. We expect our gross margin, excluding the excess
inventory charge and non-cash compensation expense, to be 7% to 9% as a
percentage of revenues, for the next fiscal quarter.

     Research and Development. Research and development expenses, excluding
non-cash compensation expense, decreased $1.4 million, or 27%, from $5.0 million
for the three months ended December 31, 2000 to $3.6 million for the three
months ended December 31, 2001. Research and development expenses, excluding
non-cash compensation expense, decreased $1.2 million, or 14%, from $8.6 million
for the six months ended December 31, 2000 to $7.4 million for the six months
ended December 31, 2001. The decreases in research and development expenses were
primarily due to personnel and personnel-related costs. Research and development
expenses, including non-cash compensation expense, decreased $2.5 million, or
39%, from $6.4 million for the three months ended December 31, 2000 to $3.9
million for the three months ended December 31, 2001. Research and development
expenses, including non-cash compensation expense, decreased $3.7 million, or
32%, from $11.4 million for the six months ended December 31, 2000 to $7.7
million for the six months ended December 31, 2001. We expect our research and
development expenses to remain relatively flat in dollar amount and as a
percentage of revenues for the next fiscal quarter.

     Sales and Marketing. Sales and marketing expenses, excluding non-cash
compensation benefit for the three months ended December 31, 2001 and a one-time
charge of $8.8 million related to the discount feature of the convertible note
payable to Cisco Systems and non-cash compensation expense for the three months
ended December 31, 2000, decreased $1.0 million, or 32%, from $3.2 million for
the three months ended December 31, 2000 to $2.1 million for the three months
ended December 31, 2001. Sales and marketing expenses, excluding non-cash
compensation benefit for the six months ended December 31, 2001 and the Cisco
Systems conversion charge and non-cash compensation expense for the six months
ended December 31, 2000, decreased $1.4 million, or 26%, from $5.5 million for
the six months ended December 31, 2000 to

                                       13

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$4.1 million for the six months ended December 31, 2001. The decreases in sales
and marketing expenses were primarily due to lower commissions to our internal
and external sales representatives associated with decreased revenues partially
offset by an increase in sales and marketing personnel and personnel-related
costs and occupancy costs. Sales and marketing expenses, including non-cash
compensation benefit for the three months ended December 31, 2001 and the Cisco
Systems conversion charge and non-cash compensation expense for the three months
ended December 31, 2000, decreased $11.3 million, or 89%, from $12.6 million for
the three months ended December 31, 2000 to $1.3 million for the three months
ended December 31, 2001. Sales and marketing expenses, including non-cash
compensation benefit for the six months ended December 31, 2001 and the Cisco
Systems conversion charge and non-cash compensation expense for the six months
ended December 31, 2000, decreased $12.2 million, or 78%, from $15.6 million for
the six months ended December 31, 2000 to $3.4 million for the six months ended
December 31, 2001. We expect our sales and marketing expenses to remain
relatively flat in dollar amount and as a percentage of revenues for the next
fiscal quarter.

     General and Administrative. General and administrative expenses, excluding
non-cash compensation expense, decreased $2.0 million, or 54%, from $3.7 million
for the three months ended December 31, 2000 to $1.7 million for the three
months ended December 31, 2001. General and administrative expenses, excluding
non-cash compensation expense, decreased $2.5 million, or 39%, from $6.4 million
for the six months ended December 31, 2000 to $3.9 million for the six months
ended December 31, 2001. The decreases in general and administrative expenses
were primarily due to lower costs associated with personnel and
personnel-related costs and legal fees. General and administrative expenses,
including non-cash compensation expense, decreased $7.2 million, or 72%, from
$10.0 million for the three months ended December 31, 2000 to $2.8 million for
the three months ended December 31, 2001. General and administrative expenses,
including non-cash compensation expense, decreased $12.3 million, or 68%, from
$18.1 million for the six months ended December 31, 2000 to $5.8 million for the
six months ended December 31, 2001. We expect our general and administrative
expenses to decrease slightly in dollar amount and as a percentage of revenues
for the next fiscal quarter as a result of our cost-cutting efforts.

     Non-Cash Compensation Expense. From July 1, 1998 through December 31, 2001,
we recorded an aggregate of $58.9 million in deferred non-cash compensation, net
of stock option cancellations. Non-cash compensation expense decreased $9.1
million, or 92%, from $9.9 million for the three months ended December 31, 2000
to $786,000 for the three months ended December 31, 2001. Non-cash compensation
expense decreased $17.2 million, or 92%, from $18.6 million for the six months
ended December 31, 2000 to $1.4 million for the six months ended December 31,
2001. The decreases in deferred non-cash compensation were primarily due to the
method under which the deferred non-cash compensation is amortized, as set out
in FASB Interpretation No. 28, and stock option cancellations.

     Restructuring Costs and Other Special Charges. We, like many of our peers
in the communications industry, continue to be affected by the slowdown in
telecommunications equipment spending. Our revenues decreased from $43.2 million
in the fiscal quarter ended December 31, 2000 to $36.0 million in the fiscal
quarter ended March 31, 2001, to $20.3 million in the fiscal quarter ended June
30, 2001, to $10.0 million in the fiscal quarter ended September 30, 2001 and to
$10.6 million in the fiscal quarter ended December 31, 2001. Due to the
continued weakness in the general economy, and the telecom sector in particular,
year-over-year revenue growth is expected to be negative compared to the fiscal
year ended June 30, 2001, putting downward pressure on margins and profits. Due
to this decline in current business conditions, we began implementing our plan
to restructure our business during the quarters ended September 30, 2001 and
June 30, 2001 and realigned resources to focus on monitoring costs, preserving
cash, accelerating our planned move of manufacturing operations to China and
focusing on core opportunities. A restructuring charge of $25.6 million was
recorded for excess fixed assets, non-cancelable purchase obligations,

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<PAGE>

worldwide workforce reduction and consolidation of excess facilities in the six
months ended December 31, 2001. Additionally, the Company recorded a provision
for excess inventory totaling $10.4 million, which was charged to cost of sales
during the six months ended December 31, 2001.

     Interest and Other Income, Net. Interest and other income, net, decreased
$3.1 million from $4.1 million for the three months ended December 31, 2000 to
$1.1 million for the three months ended December 31, 2001. Interest and other
income, net decreased $1.5 million from $4.2 million for the six months ended
December 31, 2000 to $2.6 million for the six months ended December 31, 2001.
The decreases in interest and other income, net were primarily due to lower
yields on our cash investments and interest expense on the convertible note
payable to Cisco Systems during the three months and six months ended December
31, 2000.

     Provision for Income Taxes. We have deferred tax assets of $18.0 million as
of December 31, 2001 and a corresponding valuation allowance that reduces the
gross deferred tax assets to zero, an amount that management believes will more
likely than not be realized. In assessing the realizability of deferred tax
assets, management recorded a valuation allowance to the extent the Company does
not have a carryback right. Based on the Company's history of losses and
uncertainty of generating future taxable income, the realizable portion of the
deferred tax assets is equal only to the amount of income tax expense expected
to be paid during fiscal 2002, which is zero, and represents the amount that
management believes will more likely than not be realizable based on current
available objective evidence.

Liquidity and Capital Resources

     Since our inception, we have financed our operations primarily through
issuances of equity securities, which resulted in approximately $319.4 million
in aggregate net proceeds, and proceeds from exercise of stock options, employee
stock purchase plan and warrants which totaled approximately $2.5 million
through December 31, 2001, partially offset by $1.9 million of repurchases of
our common stock. In August 2000, we received $50.0 million in connection with
the issuance to Cisco Systems of a convertible promissory note, which
automatically converted into 3,298,773 shares of common stock upon the closing
of our initial public offering in October 2000. Our initial public offering
resulted in net proceeds of approximately $263.7 million, before offering
expenses of approximately $2.7 million. As of December 31, 2001, we had cash,
cash equivalents and short-term investments of $232.7 million and working
capital of $222.3 million.

     Our operating activities used cash of $5.9 million in the six months ended
December 31, 2001. Cash used in operating activities was primarily attributable
to a net loss incurred during the six months ended December 31, 2001 of $51.7
million and a decrease in accounts payable of $3.3 million. These amounts were
partially offset by decreases in accounts receivable of $7.7 million,
inventories of $2.9 million and prepaid expenses of $3.9 million, an increase in
accrued liabilities of $319,000, a provision for excess and obsolete inventory
of $10.4 million, restructuring costs and other special charges of $16.3
million, depreciation and amortization expense of $6.7 million and non-cash
compensation expense of $1.4 million.

     Our investing activities used cash of $65.9 million in the six months ended
December 31, 2001 primarily due to the purchases of short-term investments of
$70.2 million and property and equipment of $6.4 million partially offset by
maturities of short-term investments of $9.1 million and proceeds from sales of
assets of $1.6 million. During the remaining six months of fiscal 2002, we
expect to use approximately $4.0 million for the purchase of property and
equipment worldwide. We expect to use cash generated from our initial public
offering for these expenditures.

                                       15

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    Our financing activities used cash of $3.4 million in the six months ended
December 31, 2001 primarily due to our repurchase of common stock of $1.9
million and repayment of capital lease obligations of $1.9 million partially
offset by proceeds from the issuance of common stock of $348,000 and net
borrowings under our line of credit of $60,000.

    Our principal source of liquidity at December 31, 2001 consisted of $232.7
million in cash, cash equivalents and short-term investments. We believe that
our current cash, cash equivalents and short-term investments balance and any
cash generated from operations, will be sufficient to meet our operating and
capital requirements for at least the next 12 months. We may use cash, cash
equivalents and short-term investments from time to time to fund our acquisition
of businesses and technologies. We may be required to raise funds through public
or private financings, strategic relationships or other arrangements. We cannot
assure you that such funding, if needed, will be available on terms attractive
to us, or at all. Furthermore, any additional equity financing may be dilutive
to stockholders, and debt financing, if available, may involve restrictive
covenants. Our failure to raise capital when needed could harm our ability to
pursue our business strategy and achieve and maintain profitability.

Recent Accounting Pronouncements

    In July 2001, the FASB issued SFAS No. 141, "Business Combinations." SFAS
No. 141 requires the purchase method of accounting for business combinations
initiated after June 30, 2001 and eliminates the pooling-of-interests method.

    In July 2001, the FASB issued SFAS No. 142, "Goodwill and Other Intangible
Assets," which is effective for fiscal years beginning after March 15, 2001.
SFAS No. 142 requires, among other things, the discontinuance of goodwill
amortization. In addition, the standard includes provisions upon adoption for
the reclassification of certain existing recognized intangibles as goodwill,
reassessment of the useful lives of existing recognized intangibles,
reclassification of certain intangibles out of previously reported goodwill and
the testing for impairment of existing goodwill and other intangibles. The
Company does not believe that the adoption of SFAS No. 142 will have a material
impact on our financial position, results of operations or cash flows.

    In October 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." SFAS No. 144 supercedes SFAS No.
121 and applies to all long-lived assets (including discontinued operations) and
consequently amends Accounting Principles Board Opinion No. 30 (APB 30),
"Reporting Results of Operations Reporting the Effects of Disposal of a Segment
of a Business." SFAS No. 144 develops one accounting model (based on the model
in SFAS No. 121) for long-lived assets that are to be disposed of by sale, as
well as addresses the principal implementation issues. SFAS No. 144 requires
that long-lived assets that are to be disposed of by sale be measured at the
lower of book value or fair value less cost to sell. That requirement eliminates
APB 30's requirement that discontinued operations be measured at net realizable
value or that entities include under "discontinued operations" in the financial
statements amounts for operating losses that have not yet occurred.
Additionally, SFAS No. 144 expands the scope of discontinued operations to
include all components of an entity with operations that (1) can be
distinguished from the rest of the entity and (2) will be eliminated from the
ongoing operations of the entity in a disposal transaction. We do not believe
that the adoption of SFAS No. 144 will have a material impact on our financial
position, results of operations or cash flows.

RISK FACTORS

                                       16

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WE HAVE INCURRED SIGNIFICANT LOSSES, AND OUR FAILURE TO INCREASE OUR REVENUES
COULD PREVENT US FROM ACHIEVING PROFITABILITY.

    We have incurred significant losses since our inception in 1995 and expect
to incur losses in the future. We incurred net losses of $6.7 million and $45.0
million for the fiscal quarters ended December 31, 2001 and September 30, 2001,
respectively, and $80.4 million, $24.9 million and $3.5 million for the fiscal
years ended June 30, 2001, 2000 and 1999, respectively. We have not achieved
profitability on a quarterly basis. As of December 31, 2001, we had an
accumulated deficit of $164.6 million. We will need to generate significantly
greater revenues while containing costs and operating expenses to achieve
profitability. Our revenues may not grow in future quarters, and we may never
generate sufficient revenues to achieve profitability.

WE DEPEND UPON A SMALL NUMBER OF CUSTOMERS FOR A SUBSTANTIAL PORTION OF OUR
REVENUES, AND ANY DECREASE IN REVENUES FROM, OR LOSS OF, THESE CUSTOMERS WITHOUT
A CORRESPONDING INCREASE IN REVENUES FROM OTHER CUSTOMERS WOULD HARM OUR
OPERATING RESULTS.

    We depend upon a small number of customers for a substantial portion of our
revenues. Our top five customers together accounted for 68.7% and 54.8% of our
revenues in the three months and six months ended December 31, 2001,
respectively. Lucent Technologies and Siemens each accounted for revenues
greater than 10% for the three months ended December 31, 2001. Lucent
Technologies, Siemens and Marubun Corporation each accounted for revenues
greater than 10% for the six months ended December 31, 2001. We expect that we
will continue to depend upon a small number of customers, although most likely
not the same customers, for a substantial portion of our revenues.

    Our revenues generated from these customers, individually or in the
aggregate, may not reach or exceed historic levels in any future period. For
example, we may not be the sole source of supply to our customers, and they may
choose to purchase products from other vendors. Furthermore, the businesses of
our existing customers are experiencing a downturn, which is resulting, in some
instances, in significantly decreased sales to these customers and harming our
results of operations. Loss or cancellations of orders from, or any further
downturn in the business of, any of our customers could harm our business. Our
dependence on a small number of customers may increase if the optical components
industry and our target markets continue to consolidate.

BECAUSE WE DID NOT COMMENCE SALES OF OUR PRODUCTS UNTIL LATE 1996 AND ONLY
RECENTLY BEGAN SELLING OUR PRODUCTS IN LARGE VOLUME, WE MAY BE UNABLE TO
ACCURATELY FORECAST OUR REVENUES, AND OUR QUARTERLY REVENUES AND OPERATING
RESULTS MAY CONTINUE TO FLUCTUATE SIGNIFICANTLY FROM QUARTER TO QUARTER.

    We did not commence sales of our products until late 1996 and only recently
began selling our products in large volume. As a result, it is difficult to
forecast our revenues accurately. Moreover, our revenues, expenses and operating
results have varied significantly from quarter to quarter in the past and may
continue to fluctuate significantly in the future. The factors, many of which
are more fully discussed in other risk factors, that are likely to cause these
variations include, among others:

    - economic downturn of the fiber optic industry;

                                       17

<PAGE>

    - economic conditions specific to the communications and related industries
      and the development and size of the markets for our products;

    - fluctuations in demand for, and sales of, our products;

    - cancellations of orders and shipment rescheduling;

    - the availability of raw materials used in our products and increases in
      the price of these raw materials;

    - the ability of our manufacturing operations in China to timely produce and
      deliver products and components in the quantity and of the quality we
      require;

    - our ability to achieve acceptable production yields;

    - the practice of communication equipment suppliers to sporadically place
      large orders with short lead times;

    - the mix of products and the average selling prices of the products we
      sell;

    - competitive factors, including introductions of new products and product
      enhancements by competitors, entry of new competitors into the optical
      networking components market and pricing pressures;

    - our ability to develop, introduce, manufacture and ship new and enhanced
      optical networking products in a timely manner without defects; and

    - costs associated with and the outcomes of any intellectual property or
      other litigation to which we are, or may become, a party.

    Due to the factors noted above and other risks discussed in this section, we
believe that quarter-to-quarter comparisons of our operating results will not be
meaningful. You should not rely on our results for one quarter as any indication
of our future performance. Quarterly variations in our operations have resulted
in significant volatility in our stock price and the market price for our common
stock might fall. It is likely that, in future quarters, our operating results
may be below the expectations of securities analysts or investors. If this
occurs, the price of our common stock is likely to continue to decrease.

BECAUSE A HIGH PERCENTAGE OF OUR EXPENSES IS FIXED IN THE SHORT TERM, OUR
OPERATING RESULTS ARE LIKELY TO BE HARMED IF WE EXPERIENCE FURTHER DELAYS IN
GENERATING AND RECOGNIZING REVENUES.

    A high percentage of our expenses, including those related to manufacturing,
engineering, research and development, sales and marketing and general and
administrative functions, are fixed in the short term. As a result, if we
experience further delays in generating and recognizing revenues, our quarterly
operating results are likely to be harmed. For example, during the four quarters
ended December 31, 2001, we experienced such delays. In the third and fourth
quarter of fiscal 2001 and the first and second quarter of fiscal 2002, our loss
from operations was $25.2 million, $29.4 million, $45.0 million and $6.7
million, respectively. As we improve our manufacturing processes as of result of
our recent move to China, we will incur expenses in one quarter relating to the
recent move that may not result in off-setting

                                       18

<PAGE>

revenues until a subsequent quarter. New product introductions can also result
in a mismatching of research and development expenses and sales and marketing
expenses that are incurred in one quarter with revenues that are not recognized
until a subsequent quarter when the new product is introduced. If growth in our
revenues does not exceed the increase in our expenses, our results of operations
will be harmed.

IF WE FAIL TO EFFECTIVELY MONITOR OUR MANUFACTURING CAPACITY, WE MAY NOT BE ABLE
TO DELIVER SUFFICIENT QUANTITIES OF PRODUCTS TO OUR CUSTOMERS IN A TIMELY
MANNER, WHICH WOULD HARM OUR OPERATING RESULTS.

    We manufacture all of our products in our facilities in San Jose,
California and Shanghai and Zhuhai, China and have moved substantially all of
our manufacturing capacity to our Zhuhai facility. Our facilities in Beijing,
Chengdu and Fuzhou are idle and will be closed in accordance with our
restructuring plans. We must still devote significant resources to the
transition of our manufacturing capacity to China, and such transition will be
expensive, will require management's time and may disrupt our operations.
Additional risks associated with the recent move of our manufacturing capacity
include:

    - a lack of availability of qualified management and manufacturing
      personnel;

    - difficulties in achieving adequate yields from new manufacturing lines;

    - inability to quickly implement an adequate set of financial controls to
      track levels of inventory; and

    - our inability to procure the necessary raw materials and equipment.

    Communications equipment suppliers typically require that their vendors
commit to provide specified quantities of products over a given period of time.
We could be unable to pursue many large orders if we do not have sufficient
manufacturing capacity to enable us to commit to provide customers with
specified quantities of products. If we are unable to commit to deliver
sufficient quantities of our products to satisfy a customer's anticipated needs,
we will lose the order and the opportunity for significant sales to that
customer for a lengthy period of time. Furthermore, if we fail to fulfill orders
to which we have committed, we will lose revenue opportunities and our customer
relationships may be harmed.

IF WE FAIL TO EFFECTIVELY MANAGE OUR OPERATIONS, INCLUDING ANY REDUCTIONS OR
INCREASES IN THE NUMBER OF OUR EMPLOYEES, OUR OPERATING RESULTS COULD BE HARMED.

    Primarily as a result of the economic downturn and slowdown in capital
spending, particularly in the communications industry, we recently implemented a
number of cost-cutting measures, including reductions in our workforce. The
impact of these cost-cutting measures, combined with the challenges of managing
our geographically-dispersed operations, has placed, and will continue to place,
a significant strain on our management systems and resources. In addition, our
ability to effectively manage our operations will be challenged to the extent
that we begin expanding our workforce. We expect that we will need to continue
to improve our financial and managerial controls, reporting systems and
procedures, and will need to continue to train and manage our workforce
worldwide. Any failure to effectively manage our operations could harm our
operating results.

                                       19

<PAGE>

IF WE FAIL TO EFFECTIVELY MANAGE OUR INVENTORY LEVELS, OUR OPERATING RESULTS
COULD BE HARMED.

    Because we experience long lead times for raw materials and are often
required to purchase significant amounts of raw materials far in advance of
product shipments, we may not effectively manage our inventory levels, which
could harm our operating results. For example, in the six months ended December
31, 2001 and the fiscal year ended June 30, 2001, we recorded a $10.4 million
and a $30.6 million, respectively, provision for excess and obsolete inventory
due to the downturn in the fiber optics industry and our gross margin, excluding
non-cash compensation expense, decreased to 5.0% and (57.6)% for the three
months and six months ended December 31, 2001 from 8.3% for the fiscal year
ended June 30, 2001. If we underestimate our requirements, we may have
inadequate inventory, which could result in delays in shipments and loss of
customers. If we purchase raw materials in anticipation of orders that do not
materialize, we will have to carry or write off excess inventory and our gross
margins will decline. Even if we receive these orders, the additional
manufacturing capacity that we add to meet customer requirements may be
underutilized in a subsequent quarter. We have recently implemented an automated
manufacturing management system to replace our previous system that tracked most
of our data, including some inventory levels, manually. The conversion from our
previous systems used in San Jose occurred in the fourth quarter of fiscal 2001,
and the conversion in China just occurred in December 2001. Failure to
effectively complete the transition to this new system in China could harm our
results and increase the risk that we may fail to effectively manage our
inventory. In this regard, we experienced significant increases in provisions
for excess and obsolete inventory, which harmed our gross margins, through the
six months ended December 31, 2001 and the fiscal year ended June 30, 2001.

BECAUSE WE DEPEND ON THIRD PARTIES TO SUPPLY SOME OF OUR RAW MATERIALS AND
EQUIPMENT, WE MAY NOT BE ABLE TO OBTAIN SUFFICIENT QUANTITIES OF THESE MATERIALS
AND EQUIPMENT, WHICH COULD LIMIT OUR ABILITY TO FILL CUSTOMER ORDERS AND HARM
OUR OPERATING RESULTS.

    We depend on third parties to supply the raw materials and equipment we use
to manufacture our products. To be competitive, we must obtain from our
suppliers, on a timely basis, sufficient quantities of raw materials at
acceptable prices. We obtain most of our critical raw materials from a single or
limited number of suppliers and generally do not have long-term supply contracts
with them. As a result, our suppliers could terminate the supply of a particular
material at any time without penalty. Difficulties in obtaining raw materials in
the future may limit our product shipments.

    Some of our raw material suppliers are single sources, and finding
alternative sources may involve significant expense and delay, if these sources
can be found at all. For example, all of our GRIN lenses, which are incorporated
into substantially all of our products, are obtained from Nippon Sheet Glass,
the sole supplier worldwide of GRIN lenses. Our failure to obtain these
materials or other single or limited-source raw materials could delay or reduce
our product shipments, which could result in lost orders, increase our costs,
reduce our control over quality and delivery schedules and require us to
redesign our products. If a significant supplier became unable or unwilling to
continue to manufacture or ship materials in required volumes, we would have to
identify and qualify an acceptable replacement. A material delay or reduction in
shipments, any need to identify and qualify replacement suppliers or any
significant increase in our need for raw materials that cannot be met on
acceptable terms could harm our business.

    We also depend on a limited number of manufacturers and vendors that make
and sell the complex equipment we use in our manufacturing process. In periods
of high market demand, the lead times from

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<PAGE>

order to delivery of this equipment could be as long as six months. Delays in
the delivery of this equipment or increases in the cost of this equipment could
harm our operating results.

OUR MARKETS ARE HIGHLY COMPETITIVE, AND IF WE ARE UNABLE TO COMPETE SUCCESSFULLY
OUR REVENUES COULD DECLINE, WHICH WOULD HARM OUR OPERATING RESULTS.

    The market for fiber optic components is intensely competitive. We believe
that our principal competitors are the major manufacturers of optical components
and subsystems and modules, including vendors selling to third parties and
business divisions within communications equipment suppliers. Our principal
competitors in the components market include Avanex Corporation, Corning, DiCon
Fiberoptics, Furukawa Electrical, New Focus, Nortel, Sumitomo, Tyco Electronics
and JDS Uniphase. We believe that we primarily compete with diversified
suppliers, such as Corning, JDS Uniphase and Nortel, for the majority of our
product line and to a lesser extent with niche players that offer more limited
product lines. Competitors in any portion of our business may also rapidly
become competitors in other portions of our business. In addition, our industry
has recently experienced significant consolidation, and we anticipate that
further consolidation will occur. This consolidation has further increased
competition.

    Many of our current and potential competitors have significantly greater
financial, technical, marketing, purchasing, manufacturing and other resources
than we do. As a result, these competitors may be able to respond more quickly
to new or emerging technologies and to changes in customer requirements, to
devote greater resources to the development, promotion and sale of products, or
to deliver competitive products at lower prices.

    Several of our existing and potential customers are also current and
potential competitors of ours. These companies may develop or acquire additional
competitive products or technologies in the future and thereby reduce or cease
their purchases from us. In light of the consolidation in the optical networking
industry, we also believe that the size of the optical component and module
suppliers will become increasingly important to our current and potential
customers in the future. We may not be able to compete successfully with
existing or new competitors, and the competitive pressures we face may result in
lower prices for our products, loss of market share, or reduced gross margins,
any of which could harm our business.

    New technologies are emerging due to increased competition and customer
demand. The introduction of new products incorporating new technologies or the
emergence of new industry standards could make our existing products
noncompetitive. For example, new technologies are being developed in the design
of wavelength division multiplexers that compete with the thin film filters that
we incorporate in our products. These technologies include arrayed waveguide
grating, or AWG, and fiber bragg grating, or FBG. If our competitors adopt new
technologies before we do, we could lose market share and our business would
suffer.

SUBSTANTIALLY ALL OF OUR MANUFACTURING OPERATIONS ARE LOCATED IN CHINA, WHICH
EXPOSES US TO THE RISK THAT OUR FAILURE TO COMPLY WITH THE LAWS AND REGULATIONS
OF CHINA, OR EVENTS IN THAT COUNTRY, WILL DISRUPT OUR OPERATIONS.

    Substantially all of our manufacturing operations are located in China and
are subject to the laws and regulations of China. Our operations in China may be
adversely affected by changes in the laws and

                                       21

<PAGE>

regulations of China, such as those relating to taxation, import and export
tariffs, environmental regulations, land use rights, property and other matters.
China's central or local government may impose new, stricter regulations or
interpretations of existing regulations, which would require additional
expenditures. China's economy differs from the economies of many countries in
terms of structure, government involvement, level of development, growth rate,
capital reinvestment, allocation of resources, self-sufficiency and rate of
inflation, among others. Our results of operations and financial condition may
be harmed by changes in the political, economic or social conditions in China.

    In addition, events out of our control in China, such as political unrest,
terrorism, war, labor strikes and work stoppages, could disrupt our operations.
There currently is political tension between the United States and China, which
could lead to a breakdown in trade relations. There is also significant tension
between China and Taiwan, which could result in hostilities. Additionally, China
has stepped up its condemnation of the United States' pledge of military support
to Taiwan, which could lead to hostilities. If hostilities or other events cause
a disruption in our operations, it would be difficult for us to establish
manufacturing operations at an alternative location on comparable terms.

DISRUPTION TO COMMERCIAL ACTIVITIES IN THE UNITED STATES OR IN OTHER COUNTRIES
MAY ADVERSELY IMPACT OUR RESULTS OF OPERATIONS, OUR ABILITY TO RAISE CAPITAL OR
OUR FUTURE GROWTH.

    Our operations in the United States and China also expose us to the
following general risks associated with international operations:

    - disruptions to commercial activities or damage to our facilities as a
      result of political unrest, war, terrorism, labor strikes and work
      stoppages;

    - difficulties and costs of staffing and managing foreign operations with
      personnel who have expertise in optical network technology;

    - unexpected changes in regulatory or certification requirements for optical
      systems or networks;

    - disruptions in the transportation of our products and other risks related
      to the infrastructure of foreign countries;

    - fluctuations in the value of currencies; and

    - economic instability.

    To the extent that such disruptions interfere with our commercial
activities, our results of operations could be harmed.

OUR WAVELENGTH EXPANSION PRODUCTS HAVE ACCOUNTED FOR A MAJORITY OF OUR REVENUES,
AND OUR REVENUES COULD BE HARMED IF THE PRICE OF OR DEMAND FOR THESE PRODUCTS
FURTHER DECLINES OR IF THESE PRODUCTS FAIL TO ACHIEVE BROADER MARKET ACCEPTANCE.

    Although we currently offer a broad spectrum of products, sales of our
wavelength expansion products accounted for a majority of our revenues in the
three months and six months ended December 31, 2001 and fiscal years ended June
30, 2001 and 2000. These products include, among others, dense wavelength

                                       22

<PAGE>

division multiplexers, or DWDMs and multiplexers, used primarily in optical
amplification and amplification components. These products accounted for 87%,
74%, 57% and 81% of our revenues in the three months and six months ended
December 31, 2001 and fiscal years ended June 30, 2001 and 2000, respectively.
We believe that our future growth and a significant portion of our future
revenues will depend on the commercial success of our wavelength expansion
products. Customers that have purchased wavelength expansion products may not
continue to purchase these products from us. Any decline in the price of, or
demand for, our wavelength expansion products, or their failure to achieve
broader market acceptance, could harm our revenues.

THE OPTICAL NETWORKING COMPONENT INDUSTRY IS EXPERIENCING DECLINING AVERAGE
SELLING PRICES, WHICH COULD CAUSE OUR GROSS MARGINS TO DECLINE AND HARM OUR
OPERATING RESULTS.

    The optical networking component industry is experiencing declining average
selling prices, or ASPs, as a result of increasing competition and declining
market demand. We anticipate that ASPs will continue to decrease in the future
in response to product introductions by competitors, price pressures from
significant customers and greater manufacturing efficiencies achieved through
increased automation in the manufacturing process. These ASP declines have
contributed and may continue to contribute to a decline in our gross margins,
which could harm our results of operations.

OUR FAILURE TO ACHIEVE ACCEPTABLE MANUFACTURING YIELDS IN A COST-EFFECTIVE
MANNER COULD DELAY PRODUCT SHIPMENTS TO OUR CUSTOMERS AND HARM OUR OPERATING
RESULTS.

    Because manufacturing our products involves complex and precise processes
and the majority of our manufacturing costs are relatively fixed, manufacturing
yields are critical to our results of operations. Lower than expected
manufacturing yields could delay product shipments and harm our operating
results. Factors that affect our manufacturing yields include the quality of raw
materials used to make our products, quality of workmanship and our
manufacturing processes in China. Our or our suppliers' inadvertent use of
defective materials could significantly reduce our manufacturing yields.
Furthermore, because of the large labor component in and complexity of the
manufacturing process, quality of workmanship is critical to achieving
acceptable yields. We cannot assure you that we will be able to hire and train a
sufficient number of qualified personnel to cost-effectively produce our
products with the quality and in the quantities required by our customers.
Changes in our manufacturing processes or those of our suppliers could also
impact our yields. In some cases, existing manufacturing techniques, which
involve substantial manual labor, may not allow us to cost-effectively meet our
manufacturing yield goals so that we maintain acceptable gross margins while
meeting the cost targets of our customers. We will need to develop new
manufacturing processes and techniques that will involve higher levels of
automation in order to increase our gross margins and help achieve the targeted
cost levels of our customers. We may not achieve manufacturing cost levels that
will allow us to achieve acceptable gross margins or fully satisfy customer
demands.

OUR PRODUCTS MAY HAVE DEFECTS THAT ARE NOT DETECTED UNTIL FULL DEPLOYMENT OF A
CUSTOMER'S EQUIPMENT, WHICH COULD RESULT IN A LOSS OF CUSTOMERS, DAMAGE TO OUR
REPUTATION AND SUBSTANTIAL COSTS.

    Our products are deployed in large and complex optical networks and must be
compatible with other system components. Our products can only be fully tested
for reliability when deployed in networks for long periods of time. Our
customers may discover errors, defects or incompatibilities in our products

                                       23

<PAGE>

after they have been fully deployed and operated under peak stress conditions.
Our products may also have errors, defects or incompatibilities that are not
found until after a system upgrade is installed. Errors, defects,
incompatibilities or other problems with our products could result in:

    - loss of customers;

    - loss of or delay in revenues;

    - loss of market share;

    - damage to our brand and reputation;

    - inability to attract new customers or achieve market acceptance;

    - diversion of development resources;

    - increased service and warranty costs;

    - legal actions by our customers; and

    - increased insurance costs.

    If any of these occur, our operating results could be harmed.

IF WE ARE UNABLE TO PROTECT OUR PROPRIETARY TECHNOLOGY, OUR ABILITY TO SUCCEED
WILL BE HARMED.

    Our ability to compete successfully and achieve future growth will depend,
in part, on our ability to protect our proprietary technology. We rely on a
combination of patent, copyright, trademark, and trade secret laws and
restrictions on disclosure to protect our intellectual property rights. However,
the steps we have taken may not prevent the misappropriation of our intellectual
property, particularly in foreign countries, such as China, where the laws may
not protect our proprietary rights as fully as in the United States. We
currently hold 29 patents and have 34 pending patent applications in the United
States. We cannot assure you that patents will be issued from pending or future
applications or that, if patents are issued, they will not be challenged,
invalidated or circumvented. Rights granted under these patents may not provide
us with meaningful protection or any commercial advantage. If we are unable to
protect our proprietary technology, our ability to succeed will be harmed. We
may in the future initiate claims or litigation against third parties for
infringement of our proprietary rights. These claims could result in costly
litigation and the diversion of our technical and management personnel.

WE MAY BE INVOLVED IN INTELLECTUAL PROPERTY DISPUTES IN THE FUTURE, WHICH WILL
DIVERT MANAGEMENT'S ATTENTION AND COULD CAUSE US TO INCUR SIGNIFICANT COSTS AND
PREVENT US FROM SELLING OR USING THE CHALLENGED TECHNOLOGY.

    Participants in the communications and optical components markets in which
we sell our products have experienced frequent litigation regarding patent and
other intellectual property rights. Numerous patents in these industries are
held by others, including our competitors and academic institutions. We have no
means of knowing that a patent application has been filed in the United States
until the patent is

                                       24

<PAGE>

issued. Optical component suppliers may seek to gain a competitive advantage or
other third parties may seek an economic return on their intellectual property
portfolios by making infringement claims against us.

    In June 2000, Chorum Technologies, LP filed a lawsuit against us and our
wholly-owned subsidiary, Telelight Communication Inc., in the United States
District Court for the Northern District of Texas alleging, among other things,
infringement of two U.S. patents allegedly owned by Chorum relating to fiber
optical interleaving, based on our manufacture of and offer to sell various
fiber optic interleaver products. On May 7, 2001, the Company filed a lawsuit
against Chorum in the United States District Court for the District of Delaware,
alleging, among other matters, that Chorum infringes one of our patents relating
to fiber optic couplers based on Chorum's manufacture of and offer to sell
various DWDM products.

    In October 2001, we reached an agreement with Chorum LP and its affiliates
to dismiss the patent infringement litigation between the companies without
prejudice. We cannot assure you that Chorum or Oplink will not in the future
elect to refile the prior patent infringement actions or file new patent
infringement actions against the other.

    Both prosecuting or defending any lawsuit to which we may become a party in
the future as a result of alleged infringement of others' intellectual property,
will likely be costly and time consuming and will divert the efforts and
attention of our management and technical personnel. Patent litigation is highly
complex and can extend for a protracted period of time, which can substantially
increase the cost of litigation. Accordingly, the expenses and diversion of
resources associated with any intellectual property litigation to which we may
become a party, could seriously harm our business and financial condition. Any
intellectual property litigation also could invalidate our proprietary rights
and force us to do one or more of the following:

    - obtain from the owner of the infringed intellectual property right a
      license to sell or use the relevant technology, which license may not be
      available on reasonable terms, or at all;

    - stop selling, incorporating or using our products that use the challenged
      intellectual property;

    - pay substantial money damages; or

    - redesign the products that use the technology.

    Any of these actions could result in a substantial reduction in our revenue
and could result in losses over an extended period of time.

WE ARE THE TARGET OF A SECURITIES CLASS ACTION COMPLAINT AND ARE AT RISK OF
SECURITIES CLASS ACTION LITIGATION, WHICH WILL LIKELY RESULT IN SUBSTANTIAL
COSTS AND DIVERT MANAGEMENT ATTENTION AND RESOURCES.

    In November 2001, the Company and certain of its officers and directors, as
well as certain of the underwriters from the Company's IPO, were named as
defendants in a class action shareholder complaint filed in the United States
District Court for the Southern District of New York and captioned Harward v.
Oplink Communications, Inc., et al., Case No. 01-CV-9904. In the complaint, the
plaintiffs allege that the Company, certain of its officers and directors and
its IPO underwriters violated the federal

                                       25

<PAGE>

securities laws because the Company's IPO registration statement and prospectus
contained untrue statements of material fact or omitted material facts regarding
the compensation to be received by, and the stock allocation practices of, the
IPO underwriters. The plaintiffs seek unspecified monetary damages and other
relief. Similar complaints were filed in the same court against numerous public
companies that conducted IPOs of their common stock since the mid-1990s. This
action will likely divert the efforts and attention of our management and, if
determined adversely to the Company, could have a material impact on our
business.

IF WE ARE UNABLE TO DEVELOP NEW PRODUCTS AND PRODUCT ENHANCEMENTS THAT ACHIEVE
MARKET ACCEPTANCE, SALES OF OUR PRODUCTS COULD DECLINE, WHICH WOULD HARM OUR
OPERATING RESULTS.

    The communications industry is characterized by rapid technological changes,
frequent new product introductions, changes in customer requirements and
evolving industry standards. As a result, our products could quickly become
obsolete as new technologies are introduced and incorporated into new and
improved products. Our future success depends on our ability to anticipate
market needs and to develop products that address those needs. Our failure to
predict market needs accurately or to develop new products or product
enhancements in a timely manner will harm market acceptance and sales of our
products. In this regard, we are currently developing bandwidth creation
products as well as bandwidth management products. If the development of these
products or any other future products takes longer than we anticipate, or if we
are unable to develop and introduce these products to market, our revenues could
suffer and we may not gain market share. Even if we are able to develop and
commercially introduce these new products, the new products may not achieve
widespread market acceptance.

WE DEPEND ON THE CONTINUED GROWTH AND SUCCESS OF THE COMMUNICATIONS INDUSTRY,
WHICH IS EXPERIENCING AN ECONOMIC DOWNTURN, AS WELL AS RAPID CONSOLIDATION AND
REALIGNMENT AND MAY NOT CONTINUE TO DEMAND FIBER OPTIC PRODUCTS AT HISTORICAL
RATES, THEREBY REDUCING DEMAND FOR OUR PRODUCTS AND HARMING OUR OPERATING
RESULTS.

    We depend on the continued growth and success of the communications
industry, including the continued growth of the Internet as a widely-used medium
for commerce and communication and the continuing demand for increased bandwidth
over communications networks. As a result of recent unfavorable economic
conditions and reduced capital spending in the communications industry, our
growth rate may be significantly lower than our historical quarterly growth
rate. For example, during the third quarter and fourth quarter of fiscal 2001
and the first quarter and second quarter of fiscal 2002, revenues decreased
16.7%, 43.8%, 50.6% and increased 6.1%, respectively, from the immediately
preceding quarters primarily due to the economic downturn in the communications
industry. Furthermore, the rate at which communications service providers and
other fiber optic network users have built new fiber optic networks or installed
new systems in their existing fiber optic networks has fluctuated in the past
and these fluctuations may continue in the future. These fluctuations may result
in reduced demand from historical rates for new or upgraded fiber optic systems
that utilize our products and, therefore, may result in reduced demand for our
products.

    The communications industry is also experiencing rapid consolidation and
realignment, as industry participants seek to capitalize on the rapidly changing
competitive landscape developing around the Internet and new communications
technologies such as fiber optic and wireless communications networks. As the
communications industry consolidates and realigns to accommodate technological
and

                                       26

<PAGE>

other developments, our customers may consolidate or align with other
entities in a manner that harms our business.

BECAUSE NONE OF OUR CUSTOMERS ARE OBLIGATED TO PURCHASE OUR PRODUCTS, THEY MAY
AND DO CANCEL OR DEFER THEIR PURCHASES ON SHORT NOTICE AND AT ANY TIME, WHICH
COULD HARM OUR OPERATING RESULTS.

    We do not have contracts with our customers that provide any assurance of
future sales, and sales are typically made pursuant to individual purchase
orders, often with extremely short lead times. Accordingly, our customers:

    - may and do stop purchasing our products at any time without penalty;

    - are free to purchase products from our competitors;

    - are not required to make minimum purchases; and

    - may and do cancel orders that they place with us.

    Sales to any single customer may and do vary significantly from quarter to
quarter. Our customers generally do not place purchase orders far in advance. In
addition, our customer purchase orders have varied significantly from quarter to
quarter. This means that customers who account for a significant portion of our
revenues in one quarter may not and do not place any orders in the succeeding
quarter, which makes it difficult to forecast revenue in future periods.
Moreover, our expense levels are based in part on our expectations of future
revenue, and we may be unable to adjust costs in a timely manner in response to
further revenue shortfalls. This can result in significant quarterly
fluctuations in our operating results.

OUR REVENUES AND RESULTS OF OPERATIONS MAY BE HARMED IF WE FAIL TO INCREASE THE
VOLUME OF ORDERS, WHICH WE RECEIVE AND FILL ON A SHORT-TERM BASIS.

    Historically, a substantial portion of our net revenues in any fiscal period
has been derived from orders in backlog. Currently, due to the downturn in the
fiber optics industry, we are substantially dependent upon orders we receive and
fill on a short-term basis. Our customers can generally cancel, reschedule or
delay orders in backlog without obligation to us. As a result, we cannot rely on
orders in backlog as a reliable and consistent source of future revenue. If any
of our customers did in fact cancel or delay these orders, and we were not able
to replace them with new orders for product to be supplied on a short-term
basis, our results of operations could be harmed. For example, during the third
quarter and fourth quarter of fiscal 2001 and the first quarter and second
quarter of fiscal 2002, our customers both delayed and cancelled some orders in
backlog resulting in a 16.7%, 43.8% and 50.6% decrease in revenues and a 6.1%
increase in revenues, respectively, from the immediately preceding quarter.

OUR LENGTHY AND VARIABLE QUALIFICATION AND SALES CYCLE MAKES IT DIFFICULT TO
PREDICT THE TIMING OF A SALE OR WHETHER A SALE WILL BE MADE, WHICH MAY HARM OUR
OPERATING RESULTS.

    Our customers typically expend significant efforts in evaluating and
qualifying our products and manufacturing process prior to placing an order.
This evaluation and qualification process frequently

                                       27

<PAGE>

results in a lengthy sales cycle, typically ranging from nine to twelve months
and sometimes longer. While our customers are evaluating our products and before
they place an order with us, we may incur substantial sales, marketing, research
and development expenses, expend significant management efforts, increase
manufacturing capacity and order long lead-time supplies. Even after this
evaluation process, it is possible a potential customer will not purchase our
products. In addition, product purchases are frequently subject to unplanned
processing and other delays, particularly with respect to larger customers for
which our products represent a very small percentage of their overall purchase
activity. Long sales cycles may cause our revenues and operating results to vary
significantly and unexpectedly from quarter to quarter, which could cause
volatility in our stock price.

WE DEPEND ON KEY PERSONNEL TO MANAGE OUR BUSINESS EFFECTIVELY IN A RAPIDLY
CHANGING MARKET, AND IF WE ARE UNABLE TO HIRE ADDITIONAL PERSONNEL, OUR ABILITY
TO SELL OUR PRODUCTS COULD BE HARMED.

    Our future success depends upon the continued services of our executive
officers and other key engineering, finance, sales, marketing, manufacturing and
support personnel. In addition, we depend substantially upon the continued
services of key management personnel at our Chinese subsidiaries. None of our
officers or key employees is bound by an employment agreement for any specific
term, and these personnel may terminate their employment at any time. In
addition, we do not have "key person" life insurance policies covering any of
our employees.

    Our ability to continue to attract and retain highly-skilled personnel will
be a critical factor in determining whether we will be successful in the future.
Competition for highly-skilled personnel is intense, especially in the San
Francisco Bay area. We may not be successful in attracting, assimilating or
retaining qualified personnel to fulfill our current or future needs. Our future
success depends upon the continued services of our executive officers,
particularly Mr. Frederick R. Fromm, our Chief Executive Officer and President,
who joined us in July 2000, Mr. Bruce D. Horn, our Chief Financial Officer, who
joined us in April 2000, Mr. Kenneth W. Brizel, our Senior Vice President of
Strategy and Business Development, who joined us in October 2000, Mr. Yanfeng
Yang, our Vice President of Global Manufacturing/Operations, who assumed his
position in September 2001, and Mr. Christian A. Lepiane, our Vice President of
Worldwide Sales, and Ms. Zeynep Hakimoglu, our Vice President of Product Line
Management, both of whom joined us in November 2001. In addition, members of our
management team have recently assumed new positions within the Company. On
November 7, 2001, Mr. Fromm became our Chief Executive Officer. Our former Chief
Executive Officer, Mr. Joseph Y. Liu, became Chairman of the Board of Directors.
The changes were in accordance with our planned succession strategy. If our
management team does not work effectively together, it could seriously harm our
business.

BECAUSE SOME OF OUR THIRD-PARTY SALES REPRESENTATIVES AND DISTRIBUTORS CARRY
PRODUCTS OF ONE OR MORE OF OUR COMPETITORS, THEY MAY NOT RECOMMEND OUR PRODUCTS
OVER COMPETITORS' PRODUCTS.

    A majority of our revenues are derived from sales through our domestic and
international sales representatives and distributors. Our sales representatives
and distributors are independent organizations that generally have exclusive
geographic territories and generally are compensated on a commission basis. We
are currently migrating some of our larger customers to direct sales and are
increasing our direct sales and marketing staff. We expect that we will continue
to rely on our independent sales representatives and distributors to market,
sell and support many of our products for a substantial portion of our revenues.
Some of our third-party sales representatives and distributors carry products of
one or

                                       28

<PAGE>

more of our competitors. As a result, these sales representatives and
distributors may not recommend our products over competitors' products.

BECAUSE SOME OF OUR OPERATIONS ARE LOCATED IN AN AREA EXPERIENCING POWER
SHORTAGES, WE FACE THE RISK OF POWER LOSS, WHICH COULD HARM OUR OPERATIONS.

     Portions of our operations are located in San Jose, California. Recently
California has experienced power shortages and may experience power shortages in
the future. Sustained or frequent power failures could disrupt our operations,
which would limit our ability to supply our products to our customers in
sufficient quantities on a timely basis, harming our customer relationships.

BECAUSE SOME OF OUR OPERATIONS ARE LOCATED IN ACTIVE EARTHQUAKE FAULT ZONES, WE
FACE THE RISK THAT A LARGE EARTHQUAKE COULD HARM OUR OPERATIONS.

     Portions of our operations are located in San Jose, California, an active
earthquake fault zone. This region has experienced large earthquakes in the past
and may likely experience them in the future. A large earthquake in the San Jose
area could disrupt our operations for an extended period of time, which would
limit our ability to supply our products to our customers in sufficient
quantities on a timely basis, harming our customer relationships.

OUR FAILURE TO COMPLY WITH GOVERNMENTAL REGULATIONS COULD SUBJECT US TO
LIABILITY.

     Our failure to comply with a variety of federal, state and local laws and
regulations in the United States and China could subject us to criminal, civil
and administrative penalties. Our products are subject to U.S. export control
laws and regulations that regulate the export of products and disclosure of
technical information to foreign countries and citizens. In some instances,
these laws and regulations may require licenses for the export of products to,
and disclosure of technology in, some countries, including China, and disclosure
of technology to foreign citizens. While we have received commodity
classifications from the United States Department of Commerce that allow us to
export our current products and disclose our current technologies without export
licenses, as we develop and commercialize new products and technologies, and as
the list of products and technologies subject to U.S. export controls changes,
we may be required to obtain export licenses or other approvals with respect to
those products and technologies. We cannot predict whether these licenses and
approvals will be required and, if so, whether they will be granted. The failure
to obtain any required license or approval could harm our business.

     We employ a number of foreign nationals in our U.S. operations and as a
result we are subject to various laws related to the status of those employees
with the Immigration and Naturalization Service. Our failure to comply with the
forgoing laws or any other laws and regulations could subject us to liability.

     In addition, we are subject to laws relating to the storage, use, discharge
and disposal of toxic or otherwise hazardous or regulated chemicals or materials
used in our manufacturing processes. While we believe that we are currently in
compliance in all material respects with these laws and regulations, if we fail
to store, use, discharge or dispose of hazardous materials appropriately, we
could be subject to substantial liability or could be required to suspend or
adversely modify our manufacturing operations.

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<PAGE>

In addition, we could be required to pay for the cleanup of our properties if
they are found to be contaminated, even if we are not responsible for the
contamination.

BECAUSE THE OPTICAL COMPONENTS INDUSTRY IS CAPITAL INTENSIVE, OUR BUSINESS MAY
BE HARMED IF WE ARE UNABLE TO RAISE ANY NEEDED ADDITIONAL CAPITAL.

     The optical components industry is capital intensive, and the transition of
our manufacturing facilities to China, the development and marketing of new
products and the hiring and retention of personnel will require a significant
commitment of resources. Furthermore, we may continue to incur significant
operating losses if the market for optical networking components develops at a
slower pace than we anticipate, or if we fail to establish significant market
share and achieve a significantly increased level of revenue. If cash from
available sources is insufficient for these purposes, or if additional cash is
used for acquisitions or other unanticipated uses, we may need to raise
additional capital. Additional capital may not be available on terms favorable
to us, or at all. If we are unable to raise additional capital when we require
it, our business could be harmed. In addition, any additional issuance of equity
or equity-related securities to raise capital will be dilutive to our
stockholders.

BECAUSE THE OPTICAL COMPONENTS INDUSTRY IS EVOLVING RAPIDLY AND HIGHLY
COMPETITIVE, OUR STRATEGY INVOLVES ACQUIRING OTHER BUSINESSES AND TECHNOLOGIES
TO GROW OUR BUSINESS. IF WE ARE UNABLE TO SUCCESSFULLY INTEGRATE ACQUIRED
BUSINESSES OR TECHNOLOGIES, OUR OPERATING RESULTS MAY BE HARMED.

     The optical components industry is evolving rapidly and is highly
competitive. Accordingly, we have pursued and expect to continue to pursue
acquisitions of businesses and technologies, or the establishment of joint
venture arrangements, that could expand our business. The negotiation of
potential acquisitions or joint ventures, as well as the integration of an
acquired or jointly developed business or technology, could cause diversion of
management's time and other resources or disrupt our operations. Future
acquisitions could result in:

     - additional operating expenses without additional revenues;

     - potential dilutive issuances of equity securities;

     - the incurrence of debt and contingent liabilities;

     - amortization of goodwill and other intangibles;

     - research and development write-offs; and

     - other acquisition-related expenses.

     Furthermore, we may not be able to successfully integrate acquired
businesses or joint ventures with our operations, and we may not receive the
intended benefits of any future acquisition or joint venture.

RISKS RELATED TO OUR COMMON STOCK

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<PAGE>

IF WE WERE UNABLE TO MAINTAIN OUR NASDAQ NATIONAL MARKET LISTING, THE LIQUIDITY
OF OUR COMMON STOCK WOULD BE SERIOUSLY IMPAIRED.

     If our stock price falls below one dollar for thirty consecutive business
days and we are unable to cure such deficiency, we may be subject to delisting
from the Nasdaq National Market. Delisting from the Nasdaq National Market would
seriously impair the liquidity of our common stock and limit our potential to
raise future capital through the sale of our common stock, which could
materially harm our business. During the three months and six months ended
December 31, 2001, the closing price of our common stock on the Nasdaq National
Market ranged from $0.64 to $3.44 and from $0.63 to $3.44, respectively. In
response to the extraordinary market conditions following the events of
September 11, 2001, The Nasdaq Stock Market, Inc. implemented a moratorium on
the Nasdaq National Market listing requirements, including the minimum bid price
requirement. This moratorium ended on January 2, 2002 and the listing
requirements were reinstated. Additionally, many companies that face delisting
as a result of bid prices below the Nasdaq's maintenance standards seek to
maintain their listings by effecting reverse stock splits. However, reverse
stock splits do not always result in a sustained share price increase. We will
evaluate this option as well as others if our stock price falls below one dollar
in the future.

INSIDERS CONTINUE TO HAVE SUBSTANTIAL CONTROL OVER US, WHICH MAY NEGATIVELY
AFFECT YOUR INVESTMENT.

     Our current executive officers, directors and their affiliates own, in the
aggregate, as of December 31, 2001, approximately 27.2% of our outstanding
shares. As a result, these persons and/or entities acting together will be able
to substantially influence the outcome of all matters requiring approval by our
stockholders, including the election of directors and approval of significant
corporate transactions. This ability may have the effect of delaying or
preventing a change in control, which may be favored by our other stockholders.

BECAUSE OF THE EARLY STAGE OF OUR BUSINESS AND THE RAPID CHANGES TAKING PLACE IN
THE FIBER OPTICS INDUSTRY, WE EXPECT TO EXPERIENCE SIGNIFICANT VOLATILITY IN OUR
STOCK PRICE, WHICH COULD CAUSE YOU TO LOSE ALL OR PART OF YOUR INVESTMENT.

     Because of the early stage of our business and the rapid changes taking
place in the fiber optics industry, we expect the market price of our common
stock to fluctuate significantly. For example, the market price of our common
stock has fluctuated from a high of $37.00 to a low of $0.63 during the period
from October 3, 2000, the date of our initial public offering to December 31,
2001. These fluctuations may occur in response to a number of factors, some of
which are beyond our control, including:

     - economic downturn in the fiber optics industry;

     - preannouncement of financial results;

     - quarterly variations in our operating results;

     - changes in financial estimates by securities analysts and our failure to
       meet any estimates;

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<PAGE>

     - changes in market values of comparable companies;

     - announcements by us or our competitors of new products or of significant
       acquisitions, strategic partnerships or joint ventures;

     - any loss by us of a major customer;

     - the outcome of, and costs associated with, any litigation to which we are
       or may become a party;

     - additions or departures of key management or engineering personnel; and

     - future sales of our common stock.

     The price of our securities may also be affected by general economic and
market conditions, and the cost of operations in our product markets. While we
cannot predict the individual effect that these factors may have on the price of
our securities, these factors, either individually or in the aggregate, could
result in significant variations in price during any given period of time. There
can be no assurance that these factors will not have an adverse effect on the
trading prices of our common stock.

PROVISIONS OF OUR CHARTER DOCUMENTS AND DELAWARE LAW MAY HAVE ANTI-TAKEOVER
EFFECTS THAT COULD PREVENT ANY CHANGE IN CONTROL, WHICH COULD NEGATIVELY AFFECT
YOUR INVESTMENT.

     Provisions of Delaware law and of our certificate of incorporation and
bylaws could make it more difficult for a third party to acquire us, even if
doing so would be beneficial to our stockholders. These provisions permit us to:

     - issue preferred stock with rights senior to those of the common stock
       without any further vote or action by the stockholders;

     - provide for a classified board of directors;

     - eliminate the right of the stockholders to call a special meeting of
       stockholders;

     - eliminate the right of stockholders to act by written consent; and

     - impose various procedural and other requirements, which could make it
       difficult for stockholders to effect certain corporate actions.

     Any of the foregoing provisions could limit the price that certain
investors might be willing to pay in the future for shares of our common stock.

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<PAGE>

Item 3. Quantitative and Qualitative Disclosure About Market Risk

     We are exposed to market risk related to fluctuations in interest rates and
in foreign currency exchange rates:

     Interest Rate Exposure. The primary objective of our investment activities
     ----------------------
is to preserve principal while maximizing the income we receive from our
investments without significantly increasing risk. Some of the securities that
we may invest in may be subject to market risk. To minimize this risk, we
maintain our portfolio of cash equivalents and short-term investments in a
variety of securities, including commercial paper, money market funds,
government and non-government debt securities and certificates of deposit. As of
December 31, 2001, all of our investments were in money market funds,
certificates of deposits, municipal bonds or high quality commercial paper.

     Foreign Currency Exchange Rate Exposure. We operate in the United States,
     ---------------------------------------
manufacture in China, and substantially all sales to date have been made in U.S.
dollars. Accordingly, we currently have no material exposure to foreign currency
rate fluctuations.

     We expect our international revenues and expenses to be denominated
predominately in U.S. dollars. Certain expenses from our China operations are
incurred in the Chinese Renminbi. Our China operations will expand in the future
and account for a larger portion of our worldwide manufacturing. We anticipate
that we will experience the risks of fluctuating currencies due to this
expansion and may choose to engage in currency hedging activities to reduce
these risks.

                                       33

<PAGE>

PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings

     The information required by this Item is disclosed in Note 10 of Notes to
Condensed Consolidated Financial Statements set forth in Item 1 of Part I,
above. The text of such Note is incorporated herein by reference. See also "Risk
Factors - We may be involved in intellectual property disputes in the future,
which will divert management's attention and could cause us to incur significant
costs and prevent us from selling or using the challenged technology." We are
the target of a securities class action complaint and are at risk of securities
class action litigation, which could result in substantial costs and divert
management attention and resources."

Item 2.  Changes in Securities and Use of Proceeds

     (a)  Not applicable

     (b)  Not applicable

     (c)  Not applicable

     (d)  On October 3, 2000, the SEC declared effective the Company's
          Registration Statement on Form S-1 (No. 333-41506). Pursuant to this
          Registration Statement, the Company completed an initial public
          offering of 15,755,000 shares of common stock, including the
          over-allotment shares, at an initial public offering price of $18.00
          per share. The Company incurred expenses of approximately $22.6
          million, of which $19.9 million represented underwriting discounts and
          commissions and $2.7 million represented other related expenses. The
          net offering proceeds to the Company after total expenses were $261.0
          million.

          As of December 31, 2001, we had $232.7 million in cash, cash
          equivalents and short-term investments. All remaining proceeds are
          invested in cash, cash equivalents, or short-term investments
          consisting of highly liquid money market funds, commercial paper,
          government/federal notes and bonds and certificates of deposit.
          Consistent with the use of proceeds as discussed in our Registration
          Statement on Form S-1, the Company has approved a program to
          repurchase up to an aggregate of $21.2 million of its Common Stock.
          Such repurchases may be made from time to time on the open market at
          prevailing market prices or in negotiated transactions off the market.
          As of December 31, 2001, there were repurchases of $1.9 million under
          this program. The use of these proceeds does not represent a material
          change in the use of proceeds described in the prospectus.

Item 3.  Defaults Upon Senior Securities

     None

Item 4.  Submission of Matters to a Vote of Security Holders

     The Company's Annual Meeting of the Stockholders was held on November 7,
2001 (the "Annual Meeting"). The following matters were voted upon at the Annual
Meeting:

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Proposal I - To elect directors to hold office until the 2004 Annual Meeting of
Stockholders and until their successors are elected. The votes were as follows:

     Nominee              Votes For     Votes Withheld
     -------              ---------     --------------

     Frederick R. Fromm   123,155,008      2,107,890
     David Spreng         125,194,699         68,199

     There were no abstentions or broker non-votes with respect to election of
directors.

Proposal II - To ratify selection of PricewaterhouseCoopers LLP as the
independent auditors of the Company for its fiscal year ended June 30, 2002. The
votes were as follows:

     For           Against     Abstain      Broker non-votes
     ---           -------     -------      ----------------

     123,143,806   66,997     2,052,095            0

Item 5.  Other Information

     None

Item 6.  Exhibits and Reports on Form 8-K

(a)  Exhibits

     02.1 (1) Separation Agreement between Oplink and Daryl J. Eigen dated
              October 2, 2001.

     02.2 (1) Amendment to Stock Option Agreements between Oplink and Daryl J.
              Eigen dated October 2, 2001.

     02.3     Promissory Note by and between Oplink and Joseph Y. Liu dated
              November 27, 2001.

     02.4     Promissory Note by and between Oplink and Joseph Y. Liu dated
              November 28, 2001.

     02.5     Stock Pledge Agreement by and between Oplink and Joseph Y. Liu
              dated November 27, 2001.

     02.6     Stock Pledge Agreement by and between Oplink and Joseph Y. Liu
              dated November 28, 2001.

     (1) Previously filed in the Registrant's Quarterly Report on Form 10-Q
     filed on November 14, 2001.

(b)  Reports on Form 8-K

     None

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<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                    OPLINK COMMUNICATIONS, INC.
                                    (Registrant)


DATE: February 13, 2002             By: /s/ Bruce D. Horn
                                        -----------------------------------
                                    Bruce D. Horn
                                    Chief Financial Officer
                                    (Principal Financial and Accounting Officer)

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