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      STACKER NOTE                                         STACKER NOTE
           STAC ELECTRONICS REPORTS PROFIT FOR FOURTH FISCAL QUARTER                                        
      STAC FAX  1130 (10-31-1994)
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      SAN DIEGO, Calif., October 31, 1994 - Stac Electronics (NASDAQ:
      STAC) today reported revenues of $7,625,000 for its fourth fiscal
      quarter which ended September 30, 1994, representing a decrease
      of 2 percent compared to revenues of $7,796,000 recorded for the
      fourth quarter of fiscal 1993.  Revenues for the fiscal year
      ended September 30, 1994 were $31,325,000, representing a
      decrease of 15 percent compared to revenues of $36,984,000 for
      the fiscal year ended September 30, 1993.
      
      Net income for the fourth fiscal quarter of 1994 was $1,963,000
      compared to a net loss of $420,000 for the fourth fiscal quarter
      of 1993.  Net income for the fiscal year ended September 30, 1994
      was $333,000 compared to net income of $415,000 for fiscal 1993.
      
      Earnings per share for the fourth quarter of fiscal 1994 were
      $.06 compared to a net loss per share of $.02 for the fourth
      quarter of fiscal 1993.  Earnings per share for the fiscal year
      ended September 30, 1994 were $.00 compared to earnings per share
      of $.02 for fiscal 1993.  Earnings per share is based on net
      income minus dividends paid on preferred stock of $400,000 and
      $448,000 for the quarter and fiscal year ended September 30,
      1994, respectively.  No preferred dividends were paid in fiscal
      1993.
      
      Software sales accounted for approximately 38 percent of revenues
      for the September 1994 quarter and 62 percent of revenues for
      fiscal 1994, compared to 73 percent and 80 percent of revenues
      for the comparable periods of fiscal 1993.  Royalties were 48
      percent and 20 percent of
      revenues for the fourth quarter and fiscal year ended September
      30, 1994, respectively, compared to 6 percent and 5 percent for
      the same periods of fiscal 1993.  Sales of the company's data
      compression, error correction and tape controller semiconductor
      products were 14 percent and 18 percent of revenues for the
      quarter and year ended September 30, 1994, respectively, compared
      to 21 percent and 15 percent for the same periods of fiscal 1993.
      International sales, which are included in total software sales,
      were 10 percent of revenues for the September 1994 quarter and 17
      percent of revenues for fiscal 1994 compared to 20 percent and 18
      percent for the comparable
      periods of fiscal 1993.
      
      The change in the company's revenue mix for the quarter and
      fiscal year ended September 30, 1994 from that of the prior year
      is the result of an increase in license and royalty income and a
      decrease in retail sales of the company's award winning Stacker*
      disk compression software.  In June 1994 the company granted a
      patent license to Microsoft** which enables them to ship a
      competing, but non-Stacker based, disk compression product in MS-
      DOS** 6, the basic operating system for personal computers.
      While Stacker for Windows** & DOS is not included in Microsoft's
      operating systems, sales of Stacker have declined nevertheless
      because of the broad distribution of MS-DOS 6 with the competing
      disk compression.
      
      Total operating expenses for the fourth quarter of fiscal 1994
      were $4,275,000, a decrease of $2,885,000 from operating expenses
      for the fourth quarter of fiscal 1993.  Sales and marketing
      expenses in 1994's fourth fiscal quarter were $1,977,000, a
      decrease of  $1,606,000 from those of a year earlier due to
      decreased expenses in Europe following the third quarter 1994
      consolidation of European sales operations and a decrease in
      advertising and promotional expenses.  General and administrative
      expenses in the September 1994 quarter decreased by $1,666,000
      from those of a year earlier due to the settlement of patent
      litigation in June 1994 and the elimination of the related legal
      costs.
      
      In a separate release, Stac today announced that it has acquired
      the assets of privately-held Ocean Isle Software for $20 million
      in cash. Ocean Isle develops and markets its award-winning
      ReachOut* software - the industry's fastest remote control and
      file transfer product that allows users to access their data 
      remotely.
      
      Stac Electronics is the leading supplier of high performance
      compression products for data storage and communications.
      Implemented in software and silicon, Stac's products are sold
      direct from the company and through retail and OEM sales
      distribution channels worldwide.
      
      * Stac, Stacker and ReachOut are trademarks or registered
      trademarks
      of Stac Electronics.
      ** Microsoft, Windows and MS-DOS are trademarks or registered
      trademarks of
      Microsoft Corporation.
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      Copyright 1994 Stac Electronics
