QuickLogic Announces Fourth Quarter and Fiscal 2009 Results - Fourth Quarter New Product Revenue up 50% Sequentially

SUNNYVALE, Calif.--(BUSINESS WIRE)-- QuickLogic Corporation (NASDAQ:QUIK), the lowest power programmable semiconductor solutions leader, today announced the financial results for its fourth quarter and fiscal year ended January 3, 2010.

Total revenue for the fourth quarter of 2009 was $4.3 million, up 28% from the third quarter of 2009 and down 28% from the fourth quarter of 2008. The sequential increase of revenue is consistent with the revenue guidance given during the Company's October 27, 2009, third quarter earnings call. During the fourth quarter, new product revenue increased about 50% to $2.0 million from $1.4 million in the third quarter of 2009. This sequential increase in new product revenue accounted for roughly half of the total revenue in the fourth quarter.

Under generally accepted accounting principles (GAAP), the net loss for the fourth quarter of 2009 was $1.9 million, or $0.06 per share, compared with a net loss of $3.0 million, or $0.10 per share, in the third quarter of 2009 and a net loss of $2.6 million, or $0.09 per share, in the fourth quarter of 2008. Non-GAAP net loss for the fourth quarter of 2009 was $1.3 million, or $0.04 per share, compared with a non-GAAP net loss of $1.9 million, or $0.06 per share, in the third quarter of 2009 and a non-GAAP net loss of $1.2 million, or $0.04 per share, in the fourth quarter of 2008.

Revenue for 2009 was $15.1 million, compared with revenue of $31.9 million in 2008. Under GAAP, the net loss for 2009 was $9.8 million, or $0.32 per share, compared with a net loss of $9.4 million, or $0.32 per share, in 2008. Non-GAAP net loss for 2009 was $7.1 million, or $0.23 per share, compared with a non-GAAP net loss of $3.0 million, or $0.10 per share, in 2008.

"We are pleased with the significant growth of new product shipments during the fourth quarter, driven primarily by multiple 3G USB modem OEMs," said Tom Hart, QuickLogic's Chairman of the Board and CEO. "We have now established CSSPs with Tier 1 OEMs in the high growth, mobile electronics segment; a testament to our focus, innovative technology, and strong ecosystem of partners."

Conference Call

QuickLogic will hold a conference call at 2:30 p.m. Pacific Standard Time today, February 9, 2010, to discuss its current financial results. The conference call is being webcast and can be accessed via QuickLogic's website at www.quicklogic.com. To participate in the conference, please call (877) 718-5107 by 2:20 p.m. Pacific Standard Time. A recording of the call will be available starting one hour after completion of the call. To access the recording, please call (719) 457-0820 and reference the passcode: 6740423. The call recording will be archived until Friday, February 12, 2010 and the webcast will be available for 12 months.

About QuickLogic

QuickLogic Corporation (NASDAQ: QUIK) is the inventor and pioneer of innovative, customizable semiconductor solutions for mobile and portable electronics original equipment manufacturers (OEMs) and original design manufacturers (ODMs). These silicon plus software solutions are called Customer Specific Standard Products (CSSPs). CSSPs enable our customers to bring their products to market more quickly and remain in the market longer, with the low power, cost and size demanded by the mobile and portable electronics market. For more information about QuickLogic and CSSPs, visit www.quicklogic.com. Code: QUIK-G

Non-GAAP Financial Measures

QuickLogic reports financial information in accordance with GAAP, but believes that non-GAAP financial measures are helpful in evaluating its operating results and comparing its performance to comparable companies. Accordingly, the Company excludes charges related to stock-based compensation, restructuring, the write-down of the Company's investment in Tower Semiconductor Ltd. and the effect of the write-off of long-lived assets in calculating non-GAAP (i) income (loss) from operations, (ii) net income (loss), (iii) net income (loss) per share, and (iv) gross margin percentage. The Company provides this non-GAAP information to enable investors to evaluate its operating results in a manner similar to how the Company analyzes its operating results and to provide consistency and comparability with similar companies in the Company's industry.

Management uses the non-GAAP measures, which exclude gains, losses and other charges that are considered by management to be outside of the Company's core operating results, internally to evaluate its operating performance against results in prior periods and its operating plans and forecasts. In addition, the non-GAAP measures are used to plan for the Company's future periods, and serve as a basis for the allocation of Company resources, management of operations and the measurement of profit-dependent cash and equity compensation paid to employees and executive officers.

Investors should note, however, that the non-GAAP financial measures used by QuickLogic may not be the same non-GAAP financial measures, and may not be calculated in the same manner, as that of other companies. QuickLogic does not itself, nor does it suggest that investors should, consider such non-GAAP financial measures alone or as a substitute for financial information prepared in accordance with GAAP. A reconciliation of GAAP financial measures to non-GAAP financial measures is included in the financial statements portion of this press release. Investors are encouraged to review the related GAAP financial measures and the reconciliation of non-GAAP financial measures with their most directly comparable GAAP financial measures.

Safe Harbor Statement Under The Private Securities Litigation Reform Act of 1995

This press release contains forward-looking statements made by our CEO relating to the revenue generating potential of new products, which is dependent on the market acceptance of our products and the level of customer orders. Actual results could differ materially from the results described in these forward-looking statements. Factors that could cause actual results to differ materially include: delays in the market acceptance of the Company's new products; the ability to convert design opportunities into customer revenue; our ability to replace revenue from end-of-life products; the level and timing of customer design activity; the market acceptance of our customers' products; the risk that new orders may not result in future revenue; our ability to introduce and produce new products based on advanced wafer technology on a timely basis; our ability to adequately market the low power, competitive pricing and short time-to-market of our new products; intense competition, including the introduction of new products by competitors; our ability to hire and retain qualified personnel; changes in product demand or supply; capacity constraints; and general economic conditions. These factors and others are described in more detail in the Company's public reports filed with the Securities and Exchange Commission, including the risks discussed in the "Risk Factors" section in the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and in the Company's prior press releases.

ArcticLink, pASIC, PolarPro, QuickLogic, QuickPCI and QuickRAM are registered trademarks and Eclipse and the QuickLogic logo are trademarks of QuickLogic Corporation. All other brands or trademarks are the property of their respective holders and should be treated as such.


QUICKLOGIC CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

                Three Months Ended                      Years Ended

                January 3,   December 28,  September    January 3,  December 28,
                2010         2008          27,          2010        2008
                                           2009

Revenue         $ 4,279      $ 5,914       $ 3,332      $ 15,074    $ 31,910

Cost of
revenue,
excluding
inventory
write-down and    2,170        2,656         1,955        7,297       13,343
related
charges and
long-lived
asset
impairment

Inventory
write-down and    (49    )     267           231          418         1,598
related
charges

Long-lived
asset             -            -             150          150         1,545
impairment

Gross profit      2,158        2,991         996          7,209       15,424

Operating
expenses:

Research and      1,314        1,400         1,400        6,203       8,185
development

Selling,
general and       2,740        3,093         2,525        10,617      14,049
administrative

Long-lived
asset             -            -             -            -           468
impairment

Restructuring     59           50            -            59          502
costs

Loss from         (1,955 )     (1,552 )      (2,929 )     (9,670 )    (7,780 )
operations

Write-down of
investment in
Tower             -            (981   )      -            -           (1,398 )
Semiconductor
Ltd.

Interest          (15    )     (23    )      (31    )     (93    )    (225   )
expense

Interest
income and        (23    )     (94    )      (30    )     (54    )    (6     )
other, net

Loss before       (1,993 )     (2,650 )      (2,990 )     (9,817 )    (9,409 )
income taxes

Provision for
(benefit from)    (59    )     (30    )      7            (63    )    (54    )
income taxes

Net loss        $ (1,934 )   $ (2,620 )    $ (2,997 )   $ (9,754 )  $ (9,355 )

Net loss per
share:

Basic           $ (0.06  )   $ (0.09  )    $ (0.10  )   $ (0.32  )  $ (0.32  )

Diluted         $ (0.06  )   $ (0.09  )    $ (0.10  )   $ (0.32  )  $ (0.32  )

Weighted
average
shares:

Basic             32,510       29,844        30,322       30,739      29,653

Diluted           32,510       29,844        30,322       30,739      29,653





QUICKLOGIC CORPORATION

SUPPLEMENTAL RECONCILIATIONS OF GAAP AND NON-GAAP FINANCIAL MEASURES

(In thousands, except per share amounts)

(Unaudited)

                Three Months Ended                         Years Ended

                January 3,    December 28,  September      January 3,    December 28,
                2010          2008          27, 2009       2010          2008

GAAP loss from  $ (1,955 )    $ (1,552 )    $ (2,929 )     $ (9,670 )    $ (7,780 )
operations

Adjustment for
stock-based
compensation
within:

Cost of           48            47            110            280           267
revenue

Research and      137           74            213            576           517
development

Selling,
general and       390           249           535            1,528         1,557
administrative

Adjustment for
long-lived
asset
impairment
within:

Cost of           -             -             150            150           1,545
revenue

Operating         -             -             -              -             468
expenses

Adjustment for
the write-off
of equipment
within:

Cost of           -             12            96             96            42
revenue

Selling,
general and       -             -             2              15            15
administrative

Adjustment for
restructuring     59            50            -              59            502
costs

Non-GAAP loss
from            $ (1,321 )    $ (1,120 )    $ (1,823 )     $ (6,966 )    $ (2,867 )
operations

GAAP net loss   $ (1,934 )    $ (2,620 )    $ (2,997 )     $ (9,754 )    $ (9,355 )

Adjustment for
stock-based
compensation
within:

Cost of           48            47            110            280           267
revenue

Research and      137           74            213            576           517
development

Selling,
general and       390           249           535            1,528         1,557
administrative

Adjustment for
long-lived
asset
impairment
within:

Cost of           -             -             150            150           1,545
revenue

Operating         -             -             -              -             468
expenses

Adjustment for
the write-off
of equipment
within:

Cost of           -             12            96             96            42
revenue

Selling,
general and       -             -             2              15            15
administrative

Other expense     -             -             -              -             -

Adjustment for
restructuring     59            50            -              59            502
costs

Adjustment for
write-down of
investment in     -             981           -              -             1,398
Tower
Semiconductor
Ltd.

Non-GAAP net    $ (1,300 )    $ (1,207 )    $ (1,891 )     $ (7,050 )    $ (3,044 )
loss

GAAP net loss   $ (0.06  )    $ (0.09  )    $ (0.10  )     $ (0.32  )    $ (0.32  )
per share

Adjustment for
stock-based       0.02          0.01          0.03           0.08          0.08
compensation

Adjustment for
long-lived        -             -             0.01           0.01          0.07
asset
impairment

Adjustment for
write-off of      -             *             *              *             *
equipment

Adjustment for
restructuring     *             *             -              *             0.02
costs

Adjustment for
write-down of
investment in     -             0.04          -              -             0.05
Tower
Semiconductor
Ltd.

Non-GAAP net    $ (0.04  )    $ (0.04  )    $ (0.06  )     $ (0.23  )    $ (0.10  )
loss per share

GAAP gross
margin            50.4     %    50.6     %    29.9     %     47.8     %    48.3     %
percentage

Adjustment for
stock-based       1.1           0.8           3.3            1.9           0.8
compensation

Adjustment for
long-lived        -             -             4.5            1.0           4.8
asset
impairment

Adjustment for
write-off of      -             0.2           2.9            0.6           0.2
equipment

Non-GAAP gross
margin            51.5     %    51.6     %    40.6     %     51.3     %    54.1     %
percentage

* Figures were not considered in the reconciliation of Non-GAAP net loss per share
due to the insignificant amount.




QUICKLOGIC CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

                                        January 3, 2010   December 28, 2008(1)

ASSETS

Current assets:

Cash and cash equivalents               $ 18,195          $ 19,376

Short-term investment in Tower            868               116
Semiconductor Ltd.

Accounts receivable, net                  2,457             1,746

Inventories                               2,119             1,900

Other current assets                      536               833

Total current assets                      24,175            23,971

Property and equipment, net               2,693             3,493

Investment in Tower Semiconductor Ltd.    437               59

Other assets                              296               903

TOTAL ASSETS                            $ 27,601          $ 28,426

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Revolving line of credit                $ 2,000           $ 2,000

Trade payables                            2,721             1,992

Accrued liabilities                       1,108             1,537

Deferred income on shipments to           -                 282
distributors

Current portion of capital lease          249               753
obligations

Total current liabilities                 6,078             6,564

Long-term liabilities:

Capital lease obligations, less current   264               -
portion

Total liabilities                         6,342             6,564

Stockholders' equity:

Common stock, at par value                35                30

Additional paid-in capital                177,862           169,846

Accumulated other comprehensive income    1,130             -

Accumulated deficit                       (157,768 )        (148,014 )

Total stockholders' equity                21,259            21,862

TOTAL LIABILITIES AND STOCKHOLDERS'     $ 27,601          $ 28,426
EQUITY

_________________________

(1) Derived from the December 28, 2008
audited balance sheet included in the
2008 Annual Report on Form 10-K of
QuickLogic Corporation.




QUICKLOGIC CORPORATION

SUPPLEMENTAL DATA

(Unaudited)

             Percentage of Revenue                   Change in Revenue

             Q4 2009  Q3 2009  Fiscal  Fiscal 2008   Q3 2009 to  2008 to 2009
                               2009                  Q4 2009

COMPOSITION
OF REVENUE

Revenue by
product
(1):

New          48 %     41 %     32 %    25 %          50  %       -40 %
products

Mature       50 %     57 %     64 %    54 %          14  %       -44 %
products

End-of-life  2  %     2  %     4  %    21 %          11  %       -91 %
products

Revenue by
geography:

North        33 %     47 %     45 %    41 %          -10 %       -48 %
America

Europe       16 %     20 %     19 %    15 %          2   %       -40 %

Rest of      39 %     26 %     26 %    36 %          91  %       -66 %
world

Japan        12 %     7  %     10 %    8  %          131 %       -42 %

_________________________

(1) New products represent products introduced since 2005, and include
ArcticLink, PolarPro II, PolarPro, Eclipse II and QuickPCI II products.
Mature products include QuickRAM, pASIC(R) 3, Eclipse, QuickDSP and QuickFC
products, as well as royalty revenue, programming hardware and software.
End-of-life products include pASIC 1, pASIC 2, V3, QuickPCI and QuickMIPS
products.




    Source: QuickLogic Corporation