Altera Announces Third Quarter Results

Altera Corporation (NASDAQ:ALTR) today announced third quarter sales of $286.6 million, up 3 percent from the second quarter of 2009 and down 20 percent from the third quarter of 2008. New products grew 7 percent sequentially.

Third quarter net income was $56.7 million, $0.19 per diluted share, up from net income of $47.4 million, $0.16 per diluted share, in the second quarter of 2009 and down from $94.7 million, $0.31 per diluted share, in the third quarter of 2008. Third quarter 2009 results include a $4.8 million pre-tax charge relating to a previously announced restructuring.

Year-to-date cash flow from operating activities was $196.4 million. Altera ended the quarter with $1.4 billion in cash and short-term investments.

Altera’s board of directors has declared a quarterly cash dividend of $0.05 per share payable on December 1, 2009 to stockholders of record on November 10, 2009.

"Compared to our initial expectations, business conditions improved steadily during the quarter," said John Daane, president, chief executive officer, and chairman of the board. "Sales of 40-nm devices tripled sequentially. Our first-to-market position and technology advantages at 40-nm continue to drive record design-win results."

Several recent accomplishments mark the company’s continuing progress.

• Altera's Stratix® IV GX FPGAs have now moved to volume production — the first 40-nm FPGAs in the industry to reach this milestone. The Stratix IV device was the industry's first 40-nm FPGA available when it began shipping at the end of 2008. The Stratix IV family offers the highest density and highest performance FPGAs available today and is used in a variety of customers' high-speed backplane and cabling interfaces, chip-to-chip interconnects and protocol-bridging applications. Altera remains on schedule to ship its entire Stratix IV FPGA family in volume production by April 2010.
• Altera has increased the high-end density range of its 40-nm Stratix IV E FPGAs to an industry-leading 820,000 logic elements. The Stratix IV EP4SE820 FPGA is the industry's highest density, highest performance and lowest power FPGA in its class. Stratix IV users also benefit from the productivity advantages of Altera's Quartus® II design software that are particularly valuable in high-density designs. Features such as advanced place-and-route algorithms, multiprocessor support and incremental compile reduce customers' compile times by a factor of two or three on average when compared to the nearest competitor's 40-nm high-density FPGAs. The EP4SE820 FPGA is ideally suited for a variety of high-end digital applications that require resource-rich FPGAs, including ASIC prototyping and emulation, wireline, wireless, military, and computer and storage applications.
• Altera recently received the "2009 FPGA Best Market Performance Award in the China Telecommunication Market" from China Electronics News (CEN). With a circulation of 200,000 in China, CEN operates under the supervision of the Ministry of Industry and Information Technology. In making the award, CEN noted that Altera's industry-first 40-nm devices provided a good balance of integrated features, outstanding performance and unique Programmable Power Technology, which helped telecommunication suppliers meet their performance, power and cost targets.

Conference Call and Quarterly Update:

A conference call will be held today at 1:45 p.m. Pacific Time to discuss the quarter's results and management's current business outlook. The webcast and subsequent replay will be available in the Investor Relations section of the company's website at www.altera.com. A telephonic replay of the call may be accessed later in the day by calling (719) 457-0820 and referencing confirmation code 258712. The telephonic replay will be available for two weeks following the live call.

Altera’s fourth quarter business update will be issued in a press release available after the market close on December 3, 2009.

Forward-Looking Statements

Statements in this press release that are not historical are "forward-looking statements" as the term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally written in the future tense and/or preceded by words such as "will," "expects," "anticipates," or other words that imply or predict a future state. Forward-looking statements include Stratix IV shipment schedules and any projection of revenue, gross margin, expense or other financial items discussed in the Business Outlook section of this press release. Investors are cautioned that all forward-looking statements in this release involve risks and uncertainty that can cause actual results to differ from those currently anticipated, due to a number of factors, including without limitation, current global economic conditions, customer business environment, vertical market mix, market acceptance of the company's products, product introduction schedules, the rate of growth of the company's new products including the Arria® GX, Arria II GX, Cyclone® II, Cyclone III, Stratix II, Stratix II GX, Stratix III, Stratix IV, Stratix IV GX, Stratix IV GT, MAX® II and HardCopy® device families, changes in the mix of our business between prototyping and production-based demand, research and development schedules, changes to operating expense spending priorities, as well as changes in economic conditions and other risk factors discussed in documents filed by the company with the Securities and Exchange Commission (SEC) from time to time. Copies of Altera's SEC filings are posted on the company's website and are available from the company without charge. Forward-looking statements are made as of the date of this release, and, except as required by law, the company does not undertake an obligation to update its forward-looking statements to reflect future events or circumstances.

About Altera

Altera programmable solutions enable system and semiconductor companies to rapidly and cost-effectively innovate, differentiate and win in their markets. Find out more about Altera’s FPGA, CPLD and ASIC devices at www.altera.com.

Altera, The Programmable Solutions Company, the stylized Altera logo, specific device designations and all other words that are identified as trademarks and/or service marks are, unless noted otherwise, the trademarks and service marks of Altera Corporation in the U.S. and other countries. All other product or service names are the property of their respective holder.