Supplemental Historic Financial Information, Q2 FY 2002

LATTICE SEMICONDUCTOR CORPORATION

- Supplemental Historic Financial Information -

(Q2 2002)

Operations Information (Proforma)	Q202	Q102	Q201
Percent of Revenue
Gross Margin	60.2%	59.9%	62.5%
R&D Expense	37.3%	36.3%	24.5%
SG&A Expense	21.6%	20.1%	18.0%
Operating Income	1.2%	3.4%	20.0%
Proforma Earnings	12.4%	6.8%	18.4%
Tax Rate	26.0%	26.0%	33.0%
Depreciation Expense ($000)	4,780	4,699	4,753
Capital Expenditures ($000)	5,626	4,707	4,002
Balance Sheet Information	Q202	Q102	Q201
Current Ratio	8.2	6.7	7.3
A/R Days Revenue Outstanding	46	57	24
Inventory Months	8.5	8.1	7.3
Revenue % (by Product Family)	Q202	Q102	Q201
FPGA	13%	8%	0%
CPLD	68%	71%	77%
SPLD	19%	21%	23%
Revenue % (by Geography)	Q202	Q102	Q201
Americas	47%	48%	53%
Europe (incl. Africa)	23%	29%	27%
Asia (incl. ROW)	30%	23%	20%
Revenue % (by End Market)	Q202	Q102	Q201
Communications	55%	46%	47%
Computing	23%	27%	25%
Other	22%	27%	28%
Revenue % (by Channel)	Q202	Q102	Q201
Direct	52%	50%	41%
Distribution	48%	50%	59%

(Loss) income before (benefit)

Appendix 1

Lattice Semiconductor Corporation

Consolidated Statement of Operations

(in thousands, except per share data)

(unaudited)

	Three months ended						Six months ended
Description	June 30, 2002		Mar. 31, 2002		June 30, 2001		June 30, 2002		June 30, 2001
Revenue	$56,466		$58,878		$74,082		$115,344		$185,180
Costs and expenses:
Costs of products sold	22,492		23,606		27,771		46,098		69,681
Research and development	21,078		21,385		18,126		42,463		36,315
Selling, general and administrative	12,220		11,858		13,366		24,078		30,767
In-process research and development (1)	--		24,200		--		24,200		--
Amortization of intangible assets (2)	17,923		18,623		21,160		36,546		41,897
Total costs and expenses	73,713		99,672		80,423		173,385		178,660
(Loss) income from operations	(17,247)		(40,794)		(6,341)		(58,041)		6,520
Other income (expense), net	3,078		(1,901)		1,383		1,177		4,334
(Loss) income before (benefit) provision for income taxes	(14,169)		(42,695)		(4,958)		(56,864)		10,854
(Benefit) provision for income taxes	(6,022)		(17,078)		(1,281)		(23,100)		3,255
Net (loss) income	($8,147)		($25,617)		($3,677)		($33,764)		$7,599
Basic net (loss) income per share	($0.07)		($0.23)		($0.03)		($0.31)		$0.07
Diluted net (loss) income per share	($0.07)		($0.23)		($0.03)		($0.31)		$0.07
Shares used in per share calculations:
Basic	109,684		109,558		108,623		109,619		108,368
Diluted (3)	109,684		109,558		108,623		109,619		112,280

Notes:

(1) Represents write-off of in-process research and development in conjunction with the January 18, 2002 acquisition of the FPGA business of Agere Systems, Inc.

(2) Intangible assets subject to amortization aggregate $178.5 million, net, at June 30, 2002 and relate to the acquisition of the FPGA business of Agere Systems, Inc. on January 18, 2002, the acquisition of Vantis Corporation on June 16, 1999 and the acquisition of Integrated Intellectual Property Inc. on March 16, 2001. These intangible assets are amortized to expense generally over three to seven years on a straight-line basis.

(3) For the six months ended June 30, 2001, the computation of diluted earnings per share includes the effect of stock options but excludes the effect of $260 million of convertible notes as they are antidilutive. For all other periods presented, the computation of net loss per share excludes the effect of stock options and the convertible notes as both are antidilutive.

Appendix 2

Lattice Semiconductor Corporation

Pro forma Earnings Reconciliation (1)

(unaudited)

	Three months ended			Six months ended
Description	June 30, 2002	March 31, 2002	June 30, 2001	June 30, 2002	June 30, 2001
Pro forma earnings	$0.06	$0.04	$0.12	$0.10	$0.36
Deduct:
Amortization of intangible assets	($0.09)	($0.10)	($0.13)	($0.20)	($0.26)
In-process research and development (2)	--	($0.13)	--	($0.13)	--
Tax shield (3)	($0.04)	($0.03)	($0.02)	($0.07)	($0.04)
Difference in effective tax rate (4)	--	($0.01)	($0.03)	($0.01)	($0.02)
Difference in share count (5)	--	--	$0.03	--	$0.03
Diluted net income per share	($0.07)	($0.23)	($0.03)	($0.31)	$0.07

Notes:

(1) This table reconciles proforma earnings per share information to diluted net income per share which is presented in Appendix 1.

(2) Represents write-off of in-process research and development in conjunction with the January 18, 2002 acquisition of the FPGA business of Agere Systems, Inc.

(3) Tax Shield represents the current period tax deduction available from amortizing gross goodwill and other intangible assets (approximately $750 million as of June 30, 2002) over 15 years on a straight line basis using a 34% tax rate.

(4) The effective tax rate is the ratio of income tax expense to pretax income. The rates for all periods presented in the Pro forma Earnings presentation are different from the rates in the GAAP Statement of Operations, due to the difference in the proportion of taxable income derived from operations. For the three months ended June 30, 2001 and March 31, 2002, further differences in the effective tax rate are attributable to a change in the estimated rate at which tax benefits related to pretax losses will be recovered.

(5) Share count differences in earnings per share calculations result from the exclusion of potentially dilutive securities (stock options) in periods where their effect is antidilutive.