AUSTIN, Texas--Jan. 24, 2001--Cirrus Logic Inc. (NASDAQ:CRUS)today announced financial results for its third quarter of fiscal 2001, ended Dec. 30, 2000.

Fiscal third quarter revenues grew to $208 million, up 10 percent from the $189.5 million reported in the prior quarter, and up 38 percent from the $150.8 million reported in the third fiscal quarter a year ago.

Revenues from core businesses were up 14 percent sequentially and 56 percent year over year. Core revenues exclude revenues from end-of-life products.

Pro forma net income for fiscal Q3 was $22.4 million, an increase of 39 percent from $16.1 million pro forma net income reported in the prior quarter, or seven times the $3.3 million reported in the same quarter a year ago. On a pro forma basis, diluted earnings per share were $0.28, up 22 percent from $0.23 reported in the prior quarter. Pro forma results for the fiscal third quarter exclude investment gains and the amortization of acquisition related expenses.

``We delivered another strong quarter, which was in line with the original financial guidance we gave in October,'' said David D. French, president and chief executive officer of Cirrus Logic. ``In addition, we believe we are on track to achieve our October guidance for revenues of $775 million to $790 million and pro forma earnings per share of $0.90 to $0.94 in fiscal 2001.''

``We converted $271 million of debt during the quarter, leaving the company virtually debt-free, with shareholders' equity reaching $420 million and cash in excess of $250 million. This puts us in a very strong position to explore strategic growth opportunities,'' French added.

Outlook

Looking forward, the company expects revenues in the March quarter (fiscal Q4 of 2001) to be essentially flat with revenues in fiscal Q3 of 2001, based on the strength of our consumer electronics focus offsetting softness in the PC sector.

French concluded: ``I believe our strong balance sheet and strategic vision of Internet entertainment electronics position us well for the future. We occupy leadership positions in our chosen markets, and see strong ongoing design win activity. This was highly evident at the recent Consumer Electronics Show where many customers demonstrated their new products using our chip solutions, including Intel with its Pocket Concert MP3 player and virtually every major Japanese manufacturer of A/V receivers and set-top boxes.''

Conference Call

Cirrus Logic management will hold a conference call to discuss these results today, Jan. 24 at 4:00 p.m. Central Time. Those wishing to join should dial 212/547-0138, passcode ``Cirrus Logic'' at approximately 3:45 p.m. A live Webcast of the conference call will also be available via the company's Web site at www.cirrus.com. A replay of the call will be available starting one hour after the completion of the call until Feb 7, 2001. To access the replay, please dial 402/220-3824.

About Cirrus Logic

Cirrus Logic is a premier supplier of high-performance analog and DSP chip solutions for Internet entertainment electronics. Building on its global market share leadership in audio integrated circuits and its rich mixed-signal patent portfolio, the company targets high-volume audio, storage and communications applications. Cirrus Logic sells its products under the Crystal (R), Maverick(tm) and 3Ci(tm) brands as well as its own name. Founded in 1984 in Silicon Valley, Cirrus Logic operates from headquarters in Austin, Texas and major sites located in Fremont, Calif. and Broomfield, Colo. as well as offices in Europe, Japan and Asia. More information about Cirrus Logic is available at www.cirrus.com.

Except for historical information contained herein, the matters set forth in this news release are forward-looking statements that are dependent on certain risks and uncertainties including such factors, among others, as overall conditions in the semiconductor market, customer cancellations of orders, or the failure to place orders consistent with forecasts, unforeseen manufacturing difficulties, or hardware or software deficiencies, or delays in customer qualification of key new products, achieving high utilization of the company's manufacturing resources, final determination of appropriate inventory write-downs based on the outlook at the end of each quarter, actual operational spending, obtaining financing sufficient to meet the company's needs and the risk factors listed in the company's Form 10-K for the year ended March 25, 2000, and in other filings with the Securities and Exchange Commission. The foregoing information concerning Cirrus Logic's business outlook represents our outlook as of the date of this news release, and Cirrus Logic undertakes no obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.

Summary financial data follows:

CIRRUS LOGIC INC. PRO FORMA CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (unaudited) (in thousands, except per share data) (not prepared in accordance with GAAP)

Quarter Ended

Dec. 30

Sept. 23

Dec. 25

2000

2000

1999

Net Sales

$ 207,998

$ 189,537

$ 150,759

Costs and Expenses

Cost of sales

124,760

110,513

93,435

Research and development(Note 1)

32,999

32,654

28,034

Selling, general and administrative (Note 2)

27,155

27,799

23,270

Restructuring costs and other(gains) (Note 3)

Abandonment of assets charge(Note 4)

Total costs and expenses

184,914

170,966

144,739

Income from operations

23,084

18,571

6,020

Realized gain on sale of marketable equity securities (Note 5)

Interest income and (expense), net

3,263

(811)

(3,875)

Other income (expense), net(Note 6)

(1,333)

168

1,180

Income before provision for income taxes

25,014

17,928

3,325

Provision for income taxes

2,411

1,888

Minority interest in (income) loss of eMicro

(179)

105

Net income

22,424

16,145

3,325

Earnings Per Share

Basic

$ 0.30 $

$ 0.24

0.05

Diluted (Note7)

$ 0.28

$ 0.23

$ 0.05

Weighted average common shares outstanding

Basic

75,127

66,041

62,134

Diluted (Note7)

80,388

70,918

68,524

CIRRUS LOGIC INC.

NOTES TO PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS

(unaudited)

The following non-recurring unusual or extraordinary items, and

their related tax effects, have been excluded from the Company's

historical financial results for this pro forma presentation:

(Note 1) During Q3 FY '01, Q2 FY '01 and Q3 FY '00, Cirrus Logic

recorded $0.9 million of research and development expenses related to

the amortization of acquired intangible assets. During Q2 FY '01,

Cirrus Logic recorded $1.0 million of research and development

expenses related to the acquisition of AudioLogic Inc.

(Note 2) During Q2 FY '01, Cirrus Logic recorded $1.5 million of

selling, general and administrative expenses related to the

acquisition of AudioLogic Inc.

(Note 3) During Q2 FY '01, Cirrus Logic recognized a restructuring

gain of $1.8 million primarily related to the final resolution of the

MiCRUS restructuring agreement.

(Note 4) During Q3 FY '00, Cirrus Logic made a strategic decision to

abandon the development efforts undertaken on the manufacturing

component of the Company's enterprise resource planning software. In

connection with this, the Company recorded an asset abandonment charge

of approximately $10.2 million.

(Note 5) During Q3 FY '01 and Q2 FY '01, Cirrus Logic recognized gains

of $3.0 million and $1.9 million respectively related to the sale of

options in Phone.com (now Openwave Systems Inc.; Nasdaq:OPWV). During

Q3 FY '00 Cirrus Logic recognized a $34.3 million gain on the sale of

shares of Phone.com.

(Note 6) During Q3 FY '01, Cirrus Logic wrote off a $0.5 million

investment in a private company. During Q3 FY '00 Cirrus Logic

recorded an adjustment of $2.4 million relating to the reduction of a

liability previously accrued in connection with the sale of a

technology license.

(Note 7) Q3 FY '00 diluted earnings per share on GAAP basis included

an adjustment to increase net income by $4.5 million and diluted

shares by 12,387 which are the after-tax interest savings and shares

which would have been issued in connection with the convertible debt.

CIRRUS LOGIC INC. CONSOLIDATED CONDENSED BALANCE SHEETS (unaudited) (in thousands)

Dec. 30

Sept. 23

Dec. 25

2000

2000

1999

ASSETS

Current Assets

Cash and cash equivalents

$254,070

$ 254,711

$144,034

Restricted cash

11,008

1,421

57,173

Marketable equity securities

15,506

33,875

48,077

Accounts receivable, net

122,225

129,654

94,672

Inventories,net

113,501

86,479

53,288

Other current assets

24,585

26,979

23,421

540,895

533,119

420,665

Property and equipment, net

34,171

36,902

34,730

Deposits and other assets

34,349

45,289

49,437

$609,415

$615,310

$504,832

LIABILITIES AND SHAREHOLDER EQUITY

Current liabilities

Accounts payable and accrued liabilities

$121,775

$141,303

$130,567

Current maturities of long term debt and capital lease obligations

3,825

7,948

12,829

Income taxes payable

56,253

53,706

40,193

181,853

202,957

183,589

Long term obligations and convertible subordinated notes

5,287

277,304

304,945

Stock issued under the restructuring agreement with IBM

32,000

Minority interest in eMicro

1,955

1,776

Net shareholder equity (deficiency)

Capital stock

698,050

416,395

368,015

Accumulated other comprehensive(loss) income

14,018

32,531

47,284

Accumulated deficit

(291,748)

(315,653)

(431,001)

420,320

133,273

(15,702)

$ 609,415

$ 615,310

$ 504,832

CIRRUS LOGIC INC. CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (unaudited) (in thousands, except per share data)

Quarter Ended

Dec. 30

Sept. 23

Dec. 25

2000

2000

1999

Net sales

$ 207,998

$ 189,537

$ 150,759

Costs and expenses

Cost of sales

124,760

110,513

93,435

Research and development (Note 1)

33,905

34,549

28,936

Selling, general and administrative (Note 2)

27,155

29,299

23,270

Restructuring costs and other(gains) (Note 3)

(1,848)

Abandonment of assets charge(Note 4)

11,174

Total costs and expenses

185,820

172,513

156,815

Income from operations

22,178

17,024

(6,056)

Realized gain on sale of marketable equity securities (Note 5)

3,020

1,905

34,293

Interest income and (expense), net

3,263

(811)

(3,875)

Other income (expense), net(Note 6)

(1,833)

168

3,561

Income before provision for income taxes

26,628

18,286

27,923

Provision for income taxes

2,572

1,924

Minority interest in (income) loss of eMicro

(179)

105

Net income

23,877

16,467

27,923

Earnings per share

Basic

$0.32

$0.25

$0.45

Diluted (Note 7)

$0.30

$0.23

$0.40

Weighted average common shares outstanding

Basic

75,127

66,041

62,134

Diluted (Note 7)

80,388

70,918

80,911

See notes to Consolidated Condensed Statement of Operations

CIRRUS LOGIC INC.

NOTES TO CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS

(unaudited)

(Note 1) During Q3 FY '01, Q2 FY '01 and Q3 FY '00, Cirrus Logic

recorded $0.9 million of research and development expenses related to

the amortization of acquired intangible assets. During Q2 FY '01,

Cirrus Logic recorded $1.0 million of research and development

expenses related to the acquisition of AudioLogic Inc.

(Note 2) During Q2 FY '01, Cirrus Logic recorded $1.5 million of

selling, general and administrative expenses related to the

acquisition of AudioLogic Inc.

(Note 3) During Q2 FY '01, Cirrus Logic recognized a restructuring

gain of $1.8 million primarily related to the final resolution of the

MiCRUS restructuring agreement.

(Note 4) During Q3 FY '00, Cirrus Logic made a strategic decision to

abandon the development efforts undertaken on the manufacturing

component of the Company's enterprise resource planning software. In

connection with this, the Company recorded an asset abandonment charge

of approximately $10.2 million.

(Note 5) During Q3 FY '01 and Q2 FY '01, Cirrus Logic recognized gains

of $3.0 million and $1.9 million respectively related to the sale of

options in Phone.com (now Openwave Systems Inc.; Nasdaq:OPWV). During

Q3 FY '00 Cirrus Logic recognized a $34.3 million gain on the sale of

shares of Phone.com.

(Note 6) During Q3 FY '01, Cirrus Logic wrote off a $0.5 million

investment in a private company. During Q3 FY '00 Cirrus Logic

recorded an adjustment of $2.4 million relating to the reduction of a

liability previously accrued in connection with the sale of a

technology license.

(Note 7) Q3 FY '00 diluted earnings per share on GAAP basis included

an adjustment to increase net income by $4.5 million and diluted

shares by 12,387 which are the after-tax interest savings and shares

which would have been issued in connection with the convertible debt.