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News Release

In Detail

Appendix 1 - Consolidated Operations Information- Non-GAAP Basis (1)
(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
Total costs and expenses	57,523	57,118	56,849
Income from operations	788	592	2,029
Other income (loss), net	1,491	2,253	(1,901)
Income before provision
for income taxes	2,279	2,845	128
Provision for income taxes	--	740	33
Tax shield (2)	--	4,250	3,923
Non-GAAP earnings	$2,279	$6,355	$4,018
Diluted Non-GAAP earnings per share (3)	$0.02	$0.06	$0.04
Shares used in calculations	113,098	112,876	112,971

Notes:

(1) This table presents operating information which is consistent with the information reported by First Call, IBES and Zacks for Lattice Semiconductor Corporation. A reconciliation to GAAP on a per share basis is attached as Appendix 2.

(2) Tax Shield represents the current period tax deduction available from amortizing gross goodwill and other intangible assets (approximately $750 million as of December 31, 2002) over 15 years on a straight line basis using a 34% tax rate. As of the March 31, 2003 quarter, we are no longer reporting a Tax Shield.

(3) For all periods presented, the computation of diluted Non-GAAP earnings includes the effect of stock options but excludes the effect of our convertible notes as they are antidilutive.

Appendix 2 - Non-GAAP Earnings Reconciliation (1)
(unaudited)
	Three months ended
Description	Mar. 31, 2003	Dec. 31, 2002	Mar. 31, 2002
Net loss	($0.17)	($1.14)	($0.23)
Add:
Amortization of intangible assets	$0.19	$0.12	$0.10
In-process research and development (2)	--	--	$0.13
Valuation allowance for deferred tax assets (3)	--	$1.00	--
Tax shield (4)	--	$0.04	$0.03
Difference in effective tax rate (5)	--	$0.04	$0.01
Non-GAAP income	$0.02	$0.06	$0.04

(1) This table reconciles net income (loss) to non-GAAP information, which is presented in Appendix 1, on a per-share basis.

(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) 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.

(4) Tax Shield represents the current period tax deduction available from amortizing gross goodwill and other intangible assets (approximately $750 million as of December 31, 2002) over 15 years on a straight line basis using a 34% tax rate. As of the March 31, 2003 quarter, we are no longer reporting a Tax Shield.

(5) The effective tax rate is the ratio of income tax expense to pretax income. The rates presented in the non-GAAP information presentation for the quarters ended December 31, 2002 and March 31, 2002 are different from the rates in the Statement of Operations, due primarily to the difference in the proportion of taxable income derived from operations.

Appendix 3 - Supplemental Historic Financial Information (Q1 2003)
Operations Information	Q103	Q402	Q102
Percent of Revenue
Gross Margin	60.2%	60.1%	59.9%
R&D Expense	37.4%	37.8%	36.3%
SG&A Expense	21.4%	21.3%	20.1%
Operating (Loss) Income	-34.9%	-31.5%	-69.3%
Operating Income (Non-GAAP)	1.4%	1.0%	3.4%
Depreciation Expense ($000)	4,742	4,856	4,699
Capital Expenditures ($000)	3,211	3,781	4,707
Balance Sheet Information	Q103	Q402	Q102
Current Ratio	7.4	8.6	6.7
A/R Days Revenue Outstanding	48	42	57
Inventory Months	6.7	7.3	8.1
Revenue % (by Product Family)	Q103	Q402	Q102
FPGA	14%	16%	8%
CPLD	70%	68%	71%
SPLD	16%	16%	21%
Revenue % (by Geography)	Q103	Q402	Q102
Americas	41%	42%	48%
Europe (incl. Africa)	29%	23%	29%
Asia (incl. ROW)	30%	35%	23%
Revenue % (by End Market)	Q103	Q402	Q102
Communications	44%	45%	46%
Computing	21%	26%	27%
Other	35%	29%	27%
Revenue % (by Channel)	Q103	Q402	Q102
Direct	54%	55%	50%
Distribution	46%	45%	50%