Altera Announces Third Quarter Results

® V, CycloneIV, Arria^® V, ArriaII, Stratix^® V,Stratix IV FPGAs, MAX^® V CPLDs and HardCopy^®IV device families, 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. Follow Altera via Facebook, RSS and Twitter.

ALTERA, ARRIA, CYCLONE, HARDCOPY, MAX, MEGACORE, NIOS, QUARTUS and STRATIX words and logos are trademarks of Altera Corporation and registered in the U.S. Patent and Trademark Office and in other countries. All other words and logos identified as trademarks or service marks are the property of their respective holders as described at www.altera.com/legal.

INVESTOR CONTACT		MEDIA CONTACT
Scott Wylie - Vice President		Sue Martenson - Senior Manager
Investor Relations		Public Relations
(408) 544-6996		(408) 544-8158
swylie@altera.com		newsroom@altera.com

ALTERA CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)

	Three Months Ended									Nine Months Ended
	September 28, 2012			June 29, 2012			September 30, 2011			September 28, 2012			September 30, 2011

Net sales	$	495,010		$	464,831		$	522,474		$	1,343,595		$	1,606,671
Cost of sales	152,007			141,315			166,938			408,156			473,565
Gross margin	343,003			323,516			355,536			935,439			1,133,106
Operating expense
Research and development expense	91,606			92,356			80,771			266,259			235,438
Selling, general, and administrative expense	74,243			71,796			69,345			215,824			208,550
Total operating expense	165,849			164,152			150,116			482,083			443,988
Operating margin ⁽¹⁾	177,154			159,364			205,420			453,356			689,118
Compensation expense (gain) — deferred compensation plan	3,274			(2,313)			(6,642)			6,697			(4,926)
(Gain)/loss on deferred compensation plan securities	(3,274)			2,313			6,642			(6,697)			4,926
Interest income and other	(2,775)			(1,415)			(663)			(5,997)			(2,505)
Loss/(gain) reclassified from other comprehensive income	108			(69)			—			(63)			—
Interest expense	2,333			2,116			806			5,386			2,717
Income before income taxes	177,488			158,732			205,277			454,030			688,906
Income tax expense (benefit)	19,999			(3,947)			19,873			18,028			64,806
Net income	157,489			162,679			185,404			436,002			624,100

Other comprehensive income:
Unrealized gain on investments
Unrealized holding gain on investments arising during period, net of tax of $43, $8 and $108	3,620			2,799			—			6,723			—
Less: Reclassification adjustments for gain on investments included in net income, net of tax of $1, $1 and $6	(41)			(3)			—			(64)			—
	3,579			2,796			—			6,659			—
Unrealized gain on derivatives
Unrealized (loss)/gain on derivatives arising during period, net of tax of $6, $34 and $36	(10)			63			—			67			—
Less: Reclassification adjustments for loss/(gain) on derivatives included in net income, net of tax of $53, $23 and $2	97			(42)			—			5			—
	87			21			—			72			—
Other comprehensive income	3,666			2,817			—			6,731			—
Comprehensive income	$	161,155		$	165,496		$	185,404		$	442,733		$	624,100

Net income per share:
Basic	$	0.49		$	0.51		$	0.58		$	1.36		$	1.94
Diluted	$	0.49		$	0.50		$	0.57		$	1.34		$	1.90

Shares used in computing per share amounts:
Basic	319,870			321,218			321,745			321,200			322,012
Diluted	323,560			325,285			327,044			325,275			328,264

Cash dividends per common share	$	0.10		$	0.08		$	0.08		$	0.26		$	0.20

Tax rate	11.3		%	(2.5)		%	9.7		%	4.0		%	9.4		%
% of Net sales:
Gross margin	69.3		%	69.6		%	68.0		%	69.6		%	70.5		%
Research and development	18.5		%	19.9		%	15.5		%	19.8		%	14.7		%
Selling, general, and administrative	15.0		%	15.4		%	13.3		%	16.1		%	13.0		%
Operating margin ⁽¹⁾	35.8		%	34.3		%	39.3		%	33.7		%	42.9		%
Net income	31.8		%	35.0		%	35.5		%	32.5		%	38.8		%

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