Xilinx First Quarter FY05 Revenues Increase 5% Sequentially

SAN JOSE, Calif., July 22 /PRNewswire-FirstCall/ -- Xilinx, Inc. (Nasdaq: XLNX) today announced revenues of $424 million in the first quarter of fiscal 2005, a sequential increase of 5% from the prior quarter and an increase of 35% from the same quarter a year ago. Net income was $95.3 million or $0.26 per diluted share including a $7.2 million pre-tax charge associated with the acquisition of Hier Design in June 2004. Net income was down 27% from $130.9 million, or $0.36 in the prior quarter, which was positively impacted by a $34.4 million reduction in taxes associated with an IRS settlement and also included a $7.0 million pre-tax charge in connection with the acquisition of Triscend Corporation.

Xilinx also announced today that the company's Board of Directors declared a quarterly cash dividend of $0.05 per outstanding share of common stock, payable on September 1, 2004 to all stockholders of record at the close of business on August 18, 2004.

Gross margin for the quarter increased for the sixth consecutive quarter to 66.0%, up from 64.7% in the prior quarter and up from 60.1% in the same quarter a year ago. This was the highest gross margin the Company has reported in 15 years. Better than expected yields and product mix contributed to the increase in gross margin. Average selling prices remained firm.

"Sales from all geographies were up sequentially in the June quarter," said Wim Roelandts, Xilinx's chairman and chief executive officer. "New products grew a healthy 10% sequentially and have nearly doubled versus the same quarter of the prior year. Virtex-II Pro(TM) sales were the largest contributor to this sequential increase as design wins are beginning to turn to meaningful production volumes. Additionally, sales from the Spartan-3(TM) family, which is the industry's first FPGA manufactured using 90-nanometer (nm) process technology doubled sequentially during the quarter."

Standard & Poor's Ratings Services recently upgraded Xilinx's corporate credit rating to investment grade, reflecting the Company's leading market position in programmable logic, good cash flow generating capability, and an increasingly diversified base of customers and end markets. Xilinx is the only PLD Company to have attained this rating.

• Xilinx recently began shipping Virtex-4 FPGAs to its early access customers. Manufactured using the world's first triple-oxide 90nm CMOS technology with 11-layer metal interconnect, Virtex-4 devices represent a quantum leap in programmable device architecture, technology, and system design capabilities. With over $2.7 billion in cumulative revenue, Virtex FPGAs are the world's most popular programmable logic brand. The Virtex-4(TM) FPGA family extends that leadership with a host of innovations that deliver unprecedented design capabilities to system designers worldwide.
• The Company's low cost Spartan Series FPGAs surpassed 800 million dollars since their introduction in 1998. More than 90 million devices have shipped to over 13,000 customers since the family's debut, making the Xilinx Spartan Series the highest volume FPGA product line in history. The world's first FPGA family utilizing 90nm process technology, Spartan-3 is shipping in production volume.
• Xilinx took top honors as the premier FPGA EDA tool vendor in a survey conducted by Electronic Engineering Times (EETimes), part of CMP Media LLC. Xilinx earned the highest ranking among respondents, taking the number one slot in all the major categories including customer satisfaction and loyalty.

• Revenues expected to increase 2% to 4% sequentially.
• Gross margin expected to be approximately 65%.
• Operating expenses expected to increase approximately 3% sequentially, excluding acquisition related charges.
• Other income expected to be approximately $6 million.
• Tax rate expected to be 22%.
• Fully diluted share count expected to approximate 362 million.

A second quarter business update will be issued in the form of a press release after the market closes on Tuesday, September 14, 2004. Financial guidance to the investment community will be limited to the points mentioned in the business update document. Please sign up for a push email alert, which is available from our investor relations web site at http://www.investor.xilinx.com .

This release contains forward-looking statements and projections. Actual events and results may differ materially from those in the forward-looking statements and are subject to risks and uncertainties including the general health of global economies as well as of the semiconductor industry, the health of our end markets and our customers' customers, our ability to forecast end customer demand, potential impact to customer ordering patterns, customer acceptance of our new products, the ability of our customers to manage their inventories, higher-than-anticipated product delinquencies, more customer volume discounts than expected, fluctuations in manufacturing yields, our ability to deliver product in a timely manner, our ability to secure meaningful wafer capacity from our suppliers, our ability to successfully migrate to 90nm process technology, currency fluctuations and their respective impact to customer purchasing power, variability in wafer pricing, stock price fluctuations and amount of share buyback, and other risk factors listed in our most recent Form 10K.

About Xilinx

Xilinx, Inc. is the worldwide leader of programmable logic solutions. Additional information about Xilinx is available at http://www.xilinx.com .

SOURCE Xilinx, Inc. 07/22/2004

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding Xilinx, Inc.'s business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.

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