Fairchild Semiconductor Raises Estimates for Q1 2000

4 April 2000

Fairchild Semiconductor Again Raises Estimates for 1st Quarter 2000 Sales and Earnings; Growth Driven by Communications End Markets

    SOUTH PORTLAND, Maine--April 4, 2000--Fairchild Semiconductor International expects to report its first quarter (ending April 2, 2000) sales up approximately 10% from the fourth quarter of 1999, announced Joe Martin, executive vice president and chief financial officer. Martin also stated that gross margins continue to exceed expectations primarily because of higher than expected sales from new product introductions, especially power and interface products. With both the increase in revenue and higher operating margins, Martin expects adjusted earnings per share (which excludes charges for acquisition-related intangibles) to be proportionately higher than the current analysts' consensus estimate of $.38 per share.
    Earlier in the quarter, the company had raised estimates on both sales growth and gross margin improvement. Communications end markets are driving the higher than expected sales growth, while computer and consumer applications continue to show significant growth as well, added Martin. Martin also mentioned that the company's effective tax rate will be in the range of 10-12% for the quarter compared to analysts' estimates of 20% due to greater than expected benefit of net operating loss carryforwards.
    "We believe this strong expected sales growth and earnings improvement reflect Fairchild's continued emphasis on new product introductions and customer service programs against a backdrop of a strong marketplace," said Martin. He added that current order rates remain strong and he maintained his guidance of continued growth throughout the year.
    Fairchild will report its first quarter results after the market closes on April 25, 2000.
    Fairchild Semiconductor International (www.fairchildsemi.com) is a global company solely focused on designing, manufacturing and marketing high performance semiconductors for multiple end market uses. Fairchild's multi-market components are used in computer, telecommunications, automotive, consumer and industrial applications. Supplying logic, interface, analog, mixed signal, non-volatile memory and power products, Fairchild is filling the gap in the global supply of building block semiconductors. The company is headquartered in South Portland, Maine, USA, with 8,400 employees worldwide. Additional manufacturing facilities are located in Utah, South Korea, Malaysia and the Philippines, with regional sales offices throughout the world.

    Special Note on Forward Looking Statements:

    This news release includes "forward-looking statements" within the meaning of section 21E of the Securities Exchange Act of 1934. Forward looking statements often, though not always, include words or phrases such as "believe," "expect," "estimate," "intends," and "appears." Forward looking statements that express our beliefs, plans, objectives, or future events or performance may involve estimates, assumptions, risks, and uncertainties. In addition to factors discussed above, many other factors could cause actual results to differ materially from those expressed in the forward looking statements. Among these factors are the following: changes in overall economic conditions; changes in demand for our products; changes in inventories at our customers and distributors; technological and product development risks; availability of manufacturing capacity; availability of raw materials; competitors' actions; loss of key customers; order cancellations or reduced bookings; changes in manufacturing yields or output; significant litigation and the impact on our business due to internal systems or systems of suppliers and other third parties adversely affected by year 2000 problems. Other risk factors are listed in the company's Form 10-K for the year ended 26 December 1999 (see the Risk Factors section of the Business description and the Outlook and Business Risk section of Management's Discussion and Analysis of Financial Condition and Results of Operations).

    See related release dated April 4, 2000; Fairchild Semiconductor Announces Phase Two Growth Plan