Exhibit 99.1



Rimage Corporation Reports Record Third Quarter Earnings



Minneapolis, MNOctober 31, 2006Rimage
Corporation (Nasdaq: RIMG) today reported strong operating results for the third quarter of 2006 ended September 30.



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        Sales totaled $24.8 million, compared to $27.9 million in last years third quarter, which benefited from a retail order of approximately $6.0 million. Third quarter sales were at the high end of the previously reported guidance for this period.




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        Earnings came to a quarterly record of $4.4 million or $0.43 per diluted share, an increase of 9% from $4.1 million or $0.39 per diluted share in the year-earlier period. Earnings, which significantly exceeded Rimages third quarter guidance, included stock compensation expense of approximately $637,000. Earnings also were positively affected by higher than previously expected tax-exempt interest income and a reduction in a prior years tax reserve. Due primarily to these items, the effective tax rate for the third quarter of 2006 declined to 32% from 36% in the comparable period of 2005. The effective tax rate for full-year 2006 is forecasted to return to a normalized level of 36% to 37%.




Bernard P. (Bernie) Aldrich, president and chief executive officer, commented: Our third quarter operating results benefited from strong sales of our mission-critical Producer CD/DVD publishing systems for retail and medical imaging applications, as well as the introduction of our next-generation P3 Producer product line during the quarter. Reflecting these factors, Rimages gross margin increased to 49% from 46% in the second quarter and 48% in last years third quarter. In addition, total operating expenses declined significantly despite incurring costs related to the successful implementation of an SAP enterprise resource planning system for Rimages domestic operation. Implementation of the SAP system at our European operation will commence in the fourth quarter, with completion scheduled by the end of the first quarter of 2007.



Aldrich continued: We ended the third quarter with a backlog of approximately $2 million, which is scheduled for shipment in the fourth quarter of 2006 and first quarter of 2007. Looking ahead, we will continue to focus on significant opportunities in our targeted retail, medical imaging and business services markets, making us believe Rimages near and longer-term outlooks are very positive.



Financial Highlights

Recurring revenues, including sales of printer ribbons and cartridges, parts, blank CD/DVD media and maintenance contracts, increased 15% in the third quarter of 2006 and accounted for 45% of sales, compared to 35% in the third quarter of 2005. The growth of consumable supplies has been generated by strategic efforts to capitalize upon the continued expansion of Rimages worldwide installed base of CD/DVD publishing systems.



International sales accounted for 29% of total sales in the third quarters of 2006 and 2005. Rimage is moving forward with efforts to strengthen its large European operation, which continued to generate the majority of the quarters international sales. Currency effects increased worldwide sales by 1% in the third quarter of 2006.



Rimage generated substantial operating cash flows in this years third quarter. Cash and investments rose to $73.3 million, from $69.6 million at the end of the second quarter and $64.5 million at the end of 2005. Stockholders equity increased to $90.5 million from $76.5 million at year-end 2005.

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For the fourth quarter of 2006 ending December 31, Rimage is forecasting revenues of $23.0 to $25.0 million and earnings of $0.23 to $0.28 per diluted share, which includes estimated stock compensation expense of $400,000 to $500,000 on a pre-tax basis. Due to a change in product mix, gross margins on a portion of forecasted retail sales are expected to be somewhat below the third quarter level. In addition, fourth quarter operating expenses will reflect continued strengthening of Rimages sales and marketing organization in the form of additional key personnel.



About Rimage

Rimage Corporation is the worlds leading provider of CD and DVD publishing systems, which are used by businesses to produce discs with customized digital content on an on-demand basis. Rimages publishing systems, which span the range from high to low CD/DVD production volumes, integrate robotics, software and surface label printers into a complete publishing solution. Rimage is focusing its CD/DVD publishing solutions on a set of vertical markets with special needs for customized, on-demand digital information, including digital photography, medical imaging and financial institutions. Visit our web site atwww.rimage.com.



Statements regarding Rimages anticipated performance are forward-looking and therefore involve risks and uncertainties, including but not limited to: market conditions, competitive products, changes in technology, conditions in overseas markets that could affect international sales, and other factors set forth in Rimages filings with the Securities and Exchange Commission.



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RIMAGE CORPORATION

Selected Consolidated Financial Information

(In thousands except per share data)

(Unaudited)



Consolidated Statement of Operations Information:



Three months ended
September 30,
        
        Nine months ended
September 30,2006
        
        2005
        
        2006
        
        2005Revenues
        $24,777
        
        $27,962
        
        $72,733
        
        $71,144Cost of Revenues
        12,517
        
        14,571
        
        39,158
        
        38,498Gross Profit
        12,260
        
        13,391
        
        33,575
        
        32,646Operating Expenses:Research and Development
        1,459
        
        1,399
        
        4,781
        
        4,177Selling, General and Administrative
        5,032
        
        5,937
        
        16,115
        
        15,083Total Operating Expenses
        6,491
        
        7,336
        
        20,896
        
        19,260Operating Income
        5,769
        
        6,055
        
        12,679
        
        13,386Other Income, Net
        739
        
        360
        
        1,997
        
        895Income Before Income Taxes
        6,508
        
        6,415
        
        14,676
        
        14,281Income Tax Expense
        2,067
        
        2,330
        
        5,217
        
        5,217Net Income
        4,441
        
        4,085
        
        9,459
        
        9,064Net Income Per Basic Share
        $.45
        
        $.43
        
        $.97
        
        $.95Net Income Per Diluted Share
        $.43
        
        $.39
        
        $.92
        
        $.88Basic Weighted AverageShares Outstanding
        9,854
        
        9,553
        
        9,783
        
        9,507Diluted Weighted AverageShares Outstanding
        10,375
        
        10,380
        
        10,336
        
        10,250




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Consolidated Balance Sheet Information:



Balance as ofSeptember 30,
2006
        
        December 31,
2005(Unaudited)Cash and Marketable Securities
        
        $48,138
        
        $64,471Accounts Receivable
        
        14,892
        
        12,689Inventories
        
        6,496
        
        6,621Total Current Assets
        
        71,988
        
        86,444Property and Equipment, Net
        
        3,924
        
        2,525Marketable Securities  Non-Current
        
        25,135
        
        Total Assets
        
        101,167
        
        89,009Current Liabilities
        
        10,651
        
        12,467Long-Term Liabilities
        
        12
        
        13Stockholders Equity
        
        90,504
        
        76,529








For additional information, contact:Bernard P. (Bernie) Aldrich, CEO
        Richard G. CinquinaRobert M. Wolf, CFO
        Equity Market PartnersRimage Corporation
        904/415-1415952/944-8144


Conference Call and Replay

Rimage Corporation will review its third quarter operating results in a conference call at 4:30 PM Eastern today. Investors can listen to the conference call atwww.rimage.com. Listeners should go to this web site at least 15 minutes before the scheduled start time to download and install any necessary audio software. A replay of the conference call will be available through November 7, by dialing 1-303-590-3000 and providing the 11073233 confirmation code.



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