Evans & Sutherland Reports Third Quarter 2007 Results

SALT LAKE CITY, UTAH, November 1, 2007, Evans & Sutherland Computer Corporation (E&S) (NASDAQ: ESCC) today reported financial results in its Form 10-Q filing for the third quarter ended September 28, 2007.

Sales for the third quarter were $6.7 million, up 52% from sales of $4.4 million in the third quarter of 2006 adjusted on a continuing operations basis. There was a net loss from continuing operations in the third quarter of $1.7 million or $0.15 per share, compared to net loss of $2.2 million or $0.20 per share, in the same quarter of 2006. Backlog at the end of the third quarter was $27.9 million up 37% from December 31, 2006.

Comments from David H. Bateman, President and Chief Executive Officer: "The third quarter of this year continued the trend of improved performance in the business. The most notable factor in the quarter was the receipt of functional Grating Light Valves (GLVs). The functionality of GLV's has been the most problematic issue in the development of our laser projector products and one which we have worked with our supplier over a long period to overcome. We are now receiving weekly deliveries of functional GLV components which provide effective light modulation and improved image performance. We expect this improvement will lead to the successful completion of customer contracts for our laser projector systems. Several important deliveries of Digistar 3 laser systems have begun and are in the process of being installed and tested for customer acceptance. Additionally, we are installing upgrades to previously delivered laser projectors, particularly for retrofit of GLV's. The upgrades will continue through the fourth quarter in an effort to improve customer satisfaction. As a result of these developments, we expect an increase in customer acceptances of previously delivered laser systems as well as some acceptances for newly delivered systems in the fourth quarter. We also made significant strides in the Laser Wide projector which is planned to be demonstrated later this year under the Laser Agreement with Rockwell Collins.

As expected, new orders slowed for the quarter compared to the first two quarters. However, the backlog is still strong at over $27.9 million. We expect new orders for the fourth quarter to modestly increase from the third quarter.

Within our ongoing operations, results for the quarter continued to improve with the reduction of operating expenses and improvement in gross margin. We achieved further reductions in costs for support of late stage pre-production laser projectors that were delivered to support existing customers in spite of some additional costs for the previously discussed GLV upgrades. New production deliveries of our laser projector are being made with all of the latest components, which we expect will lead to more timely customer acceptances. Manufacturing activity for domes at Spitz and systems for Digital Theater remains at a high level in order to meet customer deliveries scheduled for the remainder of the year.

Development activity for our exciting laser projection technology has made good progress, despite some ongoing issues with supplier performance. We continue to be encouraged by the potential for this technology in the new markets identified in our advanced display business plan. These activities will continue throughout the year with new product releases targeted for the later part of 2008.

With the further harmonization of Spitz into our business, recent improvements in production and performance of our laser projector, robust orders, and continued active customer interest in new areas for our laser technology, we remain confident and positive for the future direction of the company."

About Evans & Sutherland

Evans & Sutherland produces professional hardware and software to create highly realistic visual images for digital theater and other applications throughout the world. Additional information is available at www.es.com.

Statements in this press release which are not historical, including statements regarding E&S' or management's intentions, hopes, beliefs, expectations, representations, projections, plans, or predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Company assumes no obligation except as required by law to update the forward-looking statements contained in this press release as a result of new information or future events or developments. You can identify these statements by the fact that they use words such as "anticipate," "estimate," "expect," "project," "intend," "should," "plan," "goal," "believe," "confident" and other words and terms of similar meaning in connection with any discussion of future operating or financial performance together with the negative of such expressions. Among the factors that could cause actual results to differ materially are the following: the ability of the Company to successfully integrate the Spitz business; the ability to complete production models of its laser projectors without further delays or higher costs; the Company's ability to successfully market both new and existing products domestically and internationally; difficulties or delays in manufacturing; delays market and general economic conditions. A further list and description of these risks, uncertainties and other matters can be found in the Company's reports filed with the Securities and Exchange Commission.

Consolidated Statements of Operations (XLS)

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Contact:
David H. Bateman
President and CEO
Evans & Sutherland
770 Komas Drive, Salt Lake City, UT 84108
801-588-1674

E&S is a registered trademark of Evans & Sutherland Computer Corporation.