IRIDEX Reports Third Quarter 2009 Financial Results

Third Consecutive Profitable Quarter

MOUNTAIN VIEW, Calif., Nov. 12 /PRNewswire-FirstCall/ -- IRIDEX Corporation
(Nasdaq: IRIX) today reported financial results for the third quarter of 2009
ended October 3, 2009.

For the third quarter of 2009, the Company recorded a net profit of $0.6
million or $0.07 per diluted share compared to a net loss of $0.2 million or
$(0.03) per diluted share for the third quarter of 2008. Revenue for the third
quarter of 2009 was $10.4 million, a 13.2% decrease from the $12.0 million
reported for the third quarter of 2008. However, gross margins improved to
49.2% from 41.6% and cash generated from operations was $2.4 million compared
to a decrease of $0.9 million.

"Our cash generation remains excellent, we have generated $5.2 million in cash
from operations for the year to date and our cash balance now stands at $7.9
million and we have reduced our debt from $6.0 million to $3.5 million" stated
Mr. Theodore A. Boutacoff, President and CEO. "We continue to see the benefits
of creating a very efficient and scalable business."

"We have recorded our third consecutive quarter of profitability which is an
outstanding achievement given the current economy. Of particular note, we have
been profitable at the operating income level for three consecutive quarters,
generating $1.0 million in operating income this quarter and $1.7 million year
to date. Although our revenues were down, the majority of the decrease was in
our aesthetics and OEM businesses and we were pleased to see a rebound in
demand for ophthalmology systems domestically. Our margins have improved and
we are controlling our operating expenses well."

"Looking forward, the outlook for our business is improving. We had a very
successful American Academy of Ophthalmology where we introduced two new
products; the Dual Port IQ 532 green laser system and the Modular
Multi-wavelength laser solution. In addition, our recently introduced IQ 577
yellow laser was featured in a number of physician presentations which
outlined the significant clinical and patient benefits of the product. We
believe these products and their acceptance, together with other initiatives
we are undertaking, provide us with growth opportunities for 2010."

Conference Call

IRIDEX management will conduct a conference call later today, Thursday,
November 12, 2009 at 5:00 p.m. Eastern Time. Interested parties may access
the live conference call via telephone by dialing (888) 561-1721 (U.S.) or
(480) 629-9868 (International) and quoting Conference ID 4181294, or by
visiting the Company's website at www.iridex.com. A telephone replay will be
available beginning on Thursday, November 12, 2009 through Thursday, November
19, 2009 by dialing (800) 406-7325 (U.S.) or (303) 590-3030 (International)
and entering Access Code 4181294. In addition, later today an archived version
of the webcast will be available on the Company's website at www.iridex.com.

About IRIDEX

IRIDEX Corporation was founded in 1989 and is a worldwide leader in
developing, manufacturing, and marketing innovative and versatile laser-based
medical systems and delivery devices. We provide solutions for multiple
specialties, including ophthalmology, dermatology and otolaryngology. We
maintain a deep commitment to the success of our customers, with comprehensive
technical, clinical, and service support programs. IRIDEX is dedicated to a
standard of excellence, offering superior technology for superior results.
IRIDEX products are sold in the United States through a direct sales force and
internationally through a combination of a direct sales force and a network of
approximately 100 independent distributors into 107 countries. For further
information, visit the Company's website at http://www.iridex.com.

Safe Harbor Statement

This announcement contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended and Section 21E of the
Securities Act of 1934, as amended, relating to the Company's products, growth
strategy and prospects. Please see a detailed description of these and other
risks contained in our Quarterly Report on From 10-Q for the quarter ended
October 3, 2009 and our Annual Report on Form 10-K for the fiscal year ended
January 3, 2009, each of which was filed with the Securities and Exchange
Commission. Forward-looking statements contained in this announcement are made
as of this date and will not be updated.

IRIDEX Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(unaudited)

Three Months Ended Nine Months Ended
October 3, September 27, October 3, September 27,
2009 2008 2009 2008
---- ---- ---- ----

Revenues $10,400 $11,987 $31,649 $36,383
Cost of revenues 5,278 6,997 16,650 21,257
----- ----- ------ ------
Gross profit 5,122 4,990 14,999 15,126

Operating expenses:
Research and
development 888 972 2,635 2,995
Sales and
marketing 2,204 2,732 6,766 8,011
General and
administrative 1,061 1,516 3,867 5,345
----- ----- ----- -----
Total
operating
expenses 4,153 5,220 13,268 16,351

--- ---- ----- ------
Income (loss)
from operations 969 (230) 1,731 (1,225)
Legal
settlement - - 800 800
Interest and
other expense,
net (64) (54) (197) (426)
--- --- ---- ----
Income (loss)
before income
taxes 905 (284) 2,334 (851)
Provision for
(benefit from)
income taxes 259 (35) 266 16
--- --- --- ---
Net income (loss) $646 $(249) $2,068 $(867)
==== ===== ====== =====

Net income (loss)
per share - basic
and diluted $0.07 $(0.03) $0.23 $(0.10)
===== ====== ===== ======

Shares used in
computing net
income (loss) per
share - basic 8,845 8,824 8,845 8,824
===== ===== ===== =====
Shares used in
computing net
income (loss) per
share - diluted 8,900 8,824 9,003 8,824
===== ===== ===== =====

IRIDEX Corporation
Condensed Consolidated Balance Sheets
(In thousands)
(unaudited)

October 3, January 3,
2009 2009
---- ----
Assets (unaudited)
------
Current Assets:
Cash and cash equivalents $7,884 $5,307
Accounts receivable, net 7,148 8,199
Inventories, net 9,666 11,644
Prepaids and other current assets 489 540
--- ---
Total current assets 25,187 25,690
Property and equipment, net 547 832
Other intangible assets, net 1,233 1,474
Other long term assets 357 229
--- ---
Total assets 27,324 28,225
====== ======

Liabilities and Stockholders' Equity
------------------------------------
Current Liabilities:
Accounts payable $1,314 $2,415
Bank line of credit 3,500 6,000
Accrued compensation 2,157 1,729
Accrued expenses 2,147 2,249
Accrued warranty 1,168 1,345
Deferred revenue 2,713 2,741
----- -----
Total current liabilities 12,999 16,479
------ ------

Stockholders' Equity:
Convertible preferred stock 5 5
Common Stock 89 89
Additional paid-in capital 39,657 39,105
Accumulated other comprehensive loss (233) (192)
Treasury stock, at cost (430) (430)
Accumulated deficit (24,763) (26,831)
------- -------
Total stockholders' equity 14,325 11,746
------ ------
Total liabilities and stockholders' equity $27,324 $28,225
======= =======

SOURCE IRIDEX Corporation

Jim Mackaness, Chief Financial Officer of IRIDEX Corporation, +1-650-940-4700