For more information on our non-GAAP financial measures and a reconciliation of such measures to the nearest GAAP measure, please see the “Condensed Consolidated Reconciliation of GAAP to Non-GAAP Results” table in this press release.

Use of Forward Looking Statements

This press release contains forward looking statements regarding our management's future expectations, beliefs, intentions, goals, strategies, plans and prospects. Such statements constitute “forward-looking” statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The achievement of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any of these risks or uncertainties materialize or if any of the assumptions prove incorrect, our actual results, performance or achievements could be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and uncertainties include, but are not limited to, our dependence on a limited number of customers for a substantial portion of our revenues; intellectual property risks; intense competition in our industry; our ability to develop and introduce new and enhanced products on a timely basis and achieve market acceptance of those products; consumer acceptance of our customers’ products that incorporate our solutions; our lack of long-term supply contracts and dependence on limited sources of supply; and potential decreases in average selling prices for our products.

For further information regarding risks and uncertainties associated with Peregrine’s business, please refer to the filings that we make with the Securities and Exchange Commission from time to time, including those set forth in the section entitled “Risk Factors” in our Form 10-K for the year ended December 28, 2013, which should be read in conjunction with these financial results. These documents are available on the SEC Filings section of the Investor Relations section of our website at http://investors.psemi.com/. Please also note that forward-looking statements represent our management's beliefs and assumptions only as of the date of this press release. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new information, becomes available in the future.

About Peregrine Semiconductor

Peregrine Semiconductor (NASDAQ: PSMI), founder of RF SOI (silicon on insulator), is a leading fabless provider of high-performance, integrated RF solutions. Since 1988 Peregrine and its founding team have been perfecting UltraCMOS® technology - a patented, advanced form of SOI - to deliver the performance edge needed to solve the RF market's biggest challenges, such as linearity. With products that deliver best-in-class performance and monolithic integration, Peregrine is the trusted choice for market leaders in automotive, broadband, industrial, Internet of Things, military, mobile devices, smartphones, space, test-and-measurement equipment and wireless infrastructure. Peregrine holds more than 180 filed and pending patents and has shipped over 2 billion UltraCMOS units. For more information, visit http://www.psemi.com.

The Peregrine Semiconductor name, logo, and UltraCMOS are registered trademarks of Peregrine Semiconductor Corporation in the U.S.A., and other countries.

(Tables Follow)

Peregrine Semiconductor Corporation
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
		Three Months Ended
		March 29, 2014				March 30, 2013
Net revenue		$	41,317			$	46,625
Cost of net revenue		26,575				26,808
Gross profit		14,742				19,817
Operating expense:
Research and development		11,384				10,164
Selling, general and administrative		13,361				10,720
Total operating expense		24,745				20,884
Loss from operations		(10,003		)		(1,067		)
Interest income (expense), net		35				(79		)
Other income (expense), net		19				(34		)
Loss before income taxes		(9,949		)		(1,180		)
Provision for income taxes		44				28
Net loss		$	(9,993	)		$	(1,208	)
Basic and diluted net loss per share:		$	(0.30	)		$	(0.04	)
Shares used to compute basic and diluted net loss per share:		32,937				31,925

Peregrine Semiconductor Corporation
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
		March 29,				December 28,
		2014				2013
Assets
Current assets:
Cash and cash equivalents		$	12,385			$	16,249
Short-term marketable securities		25,963				28,035
Accounts receivable, net		17,761				16,905
Inventories		44,928				53,489
Prepaids and other current assets		7,181				4,085
Total current assets		108,218				118,763
Property and equipment, net		21,480				23,122
Long-term marketable securities		20,591				18,888
Other assets		100				102
Total assets		$	150,389			$	160,875
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable		$	11,838			$	12,983
Accrued liabilities		9,934				11,829
Accrued compensation		3,603				4,542
Customer deposits		916				916
Deferred revenue		7,106				6,131
Total current liabilities		33,397				36,401
Other long-term liabilities		828				943
Stockholders’ equity:
Common stock		33				33
Additional paid-in capital		351,313				348,684
Accumulated deficit		(234,979		)		(224,986		)
Accumulated other comprehensive loss		(203		)		(200		)
Total stockholders’ equity		116,164				123,531
Total liabilities and stockholders’ equity		$	150,389			$	160,875

Peregrine Semiconductor Corporation
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
		Three Months Ended
		March 29,				March 30,
		2014				2013
Operating activities
Net loss		$	(9,993	)		$	(1,208	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		1,817				1,500
Loss on disposal of property and equipment		337				—
Stock-based compensation		2,104				1,466
Imputed interest related to deposit arrangements, net		41				19
Amortization of premium and discount on investments, net		80				106
Changes in operating assets and liabilities:
Accounts receivable		(767		)		(839		)
Inventories		8,570				(3,399		)
Prepaids and other current and noncurrent assets		(3,188		)		5,272
Accounts payable and accrued liabilities		(3,988		)		(15,613		)
Customer deposits		—				(9,093		)
Deferred revenue		974				(5,207		)
Net cash used in operating activities		(4,013		)		(26,996		)
Investing activities
Purchase of property and equipment		(628		)		(1,866		)
Purchase of marketable securities		(11,222		)		(8,882		)
Sale of marketable securities		11,500				10,340
Net cash used in investing activities		(350		)		(408		)
Financing activities
Payments on customer deposit financing arrangement		—				(2,787		)
Proceeds from exercise of stock options		525				261
Net cash provided by (used in) financing activities		525				(2,526		)
Effect of exchange rate changes on cash and cash equivalents		(26		)		(9		)
Net change in cash and cash equivalents		(3,864		)		(29,939		)
Cash and cash equivalents at beginning of period		16,249				44,106
Cash and cash equivalents at end of period		$	12,385			$	14,167

Peregrine Semiconductor Corporation
RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(in thousands, except per share data)
(unaudited)
		Three Months Ended
		March 29, 2014							March 30, 2013
Gross profit - GAAP		$	14,742			35.7	%		$	19,817			42.5	%
Non-cash compensation expense (1)		258				0.6			143				0.4
Gross profit - Non-GAAP		$	15,000			36.3	%		$	19,960			42.9	%
Loss from operations - GAAP		$	(10,003	)		(24.2	%)		$	(1,067	)		(2.3	%)
Non-cash compensation expense (1)		2,104				5.1			1,466				3.2
Income (loss) from operations - Non-GAAP		$	(7,899	)		(19.1	%)		$	399			0.9	%
Net loss - GAAP		$	(9,993	)		(24.2	%)		$	(1,208	)		(2.6	%)
Non-cash compensation expense (1)		2,104				5.1			1,466				3.2
Net income (loss) - Non-GAAP		$	(7,889	)		(19.1	%)		$	258			0.6	%
Diluted net loss per share - GAAP		$	(0.30	)					$	(0.04	)
Non-cash compensation expense		0.06							0.05
Diluted net income (loss) per share - Non-GAAP		$	(0.24	)					$	0.01
Shares used to compute diluted net loss per share - GAAP		32,937							31,925
Dilutive effect of stock options and warrants		—							3,810
Shares used to compute diluted net income (loss) per share - Non-GAAP		32,937							35,735
(1) Includes stock-based compensation as follows:
		Three Months Ended
		March 29, 2014							March 30, 2013
Cost of net revenue		$	258						$	196
Research and development		736							517
Selling, general and administrative		1,110							753
Total		$	2,104						$	1,466