News Release

In Detail

Consolidated Financial Statements, Q1, FY 2003

Consolidated Statement of Operations

(in thousands, except per share data)

(unaudited)

	Three months ended
Description	Mar. 31, 2003	Dec. 31, 2002	Mar. 31, 2002
Revenue	$58,311	$57,710	$58,878
Costs and expenses:
Costs of products sold	23,208	23,019	23,606
Research and development	21,832	21,790	21,385
Selling, general and administrative	12,483	12,309	11,858
In-process research and development (1)	--	--	24,200
Amortization of intangible assets (2)(3)	21,114	18,799	18,623
Total costs and expenses	78,637	75,917	99,672
Loss from operations	(20,326)	(18,207)	(40,794)
Other income (loss), net	1,491	2,253	(1,901)
Loss before provision (benefit)
for income taxes	(18,835)	(15,954)	(42,695)
Provision (benefit) for income taxes (4)	--	111,146	(17,078)
Net loss	($18,835)	($127,100)	($25,617)
Basic loss per share	($0.17)	($1.14)	($0.23)
Diluted net loss per share	($0.17)	($1.14)	($0.23)
Shares used in per share calculations:
Basic	111,390	111,311	109,558
Diluted (5)	111,390	111,311	109,558

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 $138.1 million, net, at March 31, 2003 and relate to the acquisition of Cerdelinx Technologies, Inc. on August 26, 2002, 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) Includes $3.3 million, $1.1 million and $0.6 million of deferred stock compensation expense for the quarters ended March 31, 2003, December 31, 2002 and March 31, 2002, respectively, attributable to Research and Development activities.

(4) In the quarter ended December 31, 2002, we recorded a tax charge of $118.6 million, representing a 100% valuation allowance on our recorded deferred tax assets, in accordance with the provisions of Statement of Financial Accounting Standards No. 109.

(5) For all periods presented, the computation of diluted net loss per share excludes the effect of stock options and our convertible notes as they are antidilutive.

Consolidated Balance Sheet

(in thousands)

(unaudited)

Description	Mar. 31,2003	Dec. 31,2002
Assets
Current assets:
Cash and short-term investments	$252,847	$276,880
Accounts receivable, net	30,651	26,374
Inventories	51,876	56,241
Other current assets	34,748	35,033
Total current assets	370,122	394,528
Property and equipment, net	61,284	62,786
Foundry investments, advances and other assets	100,059	104,507
Goodwill and other intangible assets, net (1)	361,754	379,442
	$893,219	$941,263
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and other accrued
liabilities	$37,170	$33,597
Deferred income on sales to distributors	13,102	11,983
Income taxes payable	--	142
Total current liabilities	50,272	45,722
4 3/4% Convertible notes due in 2006	175,304	208,061
Other long-term liabilities	26,335	26,345
	201,639	234,406
Stockholders' equity	641,308	661,135
	$893,219	$941,263

Note:

(1) Includes approximately $11.0 million of other intangible assets, net, recorded in the September 2002 quarter in connection with the August 26, 2002 acquisition of Cerdelinx Technologies, Inc. Also includes $142.5 million in Goodwill and $65.6 million of other intangible assets, net, recorded in the March 2002 quarter in connection with the January 18, 2002 acquisition of the FPGA business of Agere Systems, Inc., and approximately $81.1 million in Goodwill and $61.6 million of other intangible assets, net, related to previous acquisitions. The other intangible assets will be amortized to expense generally over three to seven years. Goodwill is not amortized effective with the March 2002 quarter.