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QuickLogic Corporation (NASDAQ: QUIK), the pioneer of Embedded Standard Products (ESPs) and the leader in lowest-power programmable logic solutions, today announced its financial results for the fourth quarter and fiscal year ended December 31, 2005.

Revenue for 2005 was $48.3 million, up eight percent from $44.6 million in 2004. The ESP and Advanced ESP product families contributed 38 percent of revenue in 2005. Under generally accepted accounting principles (GAAP), 2005 net income was $2.4 million, or $0.08 per diluted share, compared with a net loss of $8.8 million, or $0.35 per share, in 2004. In 2005, non-GAAP net income was $3.9 million, or $0.14 per diluted share, compared with a net loss of $3.9 million, or $0.15 per share, in 2004.

Revenue for the fourth quarter of 2005 was $10.3 million, compared with $11.1 million in the fourth quarter of 2004 and $12.6 million in the third quarter of 2005. The ESP and Advanced ESP product families contributed 45 percent of revenue in the fourth quarter of 2005, compared with 36 percent of revenue in the third quarter of 2005. Under GAAP, the net loss for the fourth quarter of 2005 was $456,000, or $0.02 per share. This compares with a net loss of $6.0 million, or $0.23 per share, in the fourth quarter of 2004, and with net income of $1.6 million, or $0.06 per diluted share, in the third quarter of 2005.

Non-GAAP net loss for the fourth quarter of 2005 was $456,000, or $0.02 per share, compared with a non-GAAP net loss of $1.3 million, or $0.05 per share, in the fourth quarter of 2004, and with non-GAAP net income of $1.7 million, or $0.06 per diluted share, in the third quarter of 2005. QuickLogic reports net income, or loss, in accordance with GAAP and also on a non-GAAP basis to highlight infrequent or non-recurring charges. Non-GAAP results, where applicable, exclude long-lived asset impairments, the write-off of long-lived assets and write-downs of the Company’s investment in Tower Semiconductor Ltd.

“In 2005, we were pleased to achieve solid profitability for the year and generate $3.4 million in cash. In the fourth quarter, we had significant revenue from our new products - Eclipse II, QuickPCI II and QuickMIPS - which contributed 12 percent of our total revenue,” said E. Thomas Hart, chairman, president and CEO. “Although we were pleased with the revenue growth of our new products, it did not fully offset the decline in revenue from our end-of-life pASIC1 and pASIC2 products, as well as from our other products. Also in the fourth quarter, we announced the introduction of PolarPro, the world’s lowest power FPGA family, and shipped engineering samples of the first product to select customers. We are excited about the prospects for this new family, particularly in high-volume prosumer, battery-powered, handheld products.”

Conference Call 

QuickLogic will hold a conference call at 2:30 p.m. Pacific Time today, February 1, 2006, to discuss the fiscal year and fourth quarter financial results. To participate, please call 1-888-873-4896 or 1-617-213-8850 (international) by 2:20 p.m. Pacific Time on February 1, 2006. You will need to reference the pass code: 23557889. A live webcast of the conference call will be available via the investor relations page of the company’s website at www.quicklogic.com. A recording of the call will be available starting one hour after completion of the call. To access the recording, please call 1-888-286-8010 or 1-617-801-6888 (international). You will need to reference the pass code: 47480056. The call recording will be archived until February 8, 2006 and the webcast will be available for 12 months.

Non-GAAP Financial Measures

QuickLogic reports financial information in accordance with generally accepted accounting principles (GAAP), but believes that non-GAAP financial measures are helpful in evaluating its operating results and comparing its performance to its peer companies. Accordingly, the Company also uses calculations of (i) non-GAAP net income (loss), which represents net income (loss) excluding the effect of long-lived asset impairments, the write-off of long-lived assets and write-downs of the Company’s investment in Tower Semiconductor Ltd.; and (ii) non-GAAP net income (loss) per share, which represents basic and diluted net income (loss) per share excluding long-lived asset impairments, the write-off of long-lived assets and write-downs of the Company’s investment in Tower Semiconductor Ltd. 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. Investors should note, however, that the non-GAAP financial measures used by the Company may not be the same non-GAAP financial measures, and may not be calculated in the same manner, as that of other companies. The Company 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 net income (loss) to non-GAAP net income (loss) is included in the financial statements portion of this release. Investors are encouraged to review the related GAAP financial measures and the reconciliation of non-GAAP financial measures to 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 prospects of our new products and the revenue generating potential of such new products, which is dependent on the market acceptance of our products and the level of customer orders. Actual results could differ materially from any such forward-looking statements. Factors that could cause actual results to differ materially include our ability to replace pASIC1 and pASIC2 revenue, which we expect to decline substantially due to end-of-life purchases of such products; delays in the market acceptance of the Company’s ESPs or new products; the ability to convert new design opportunities into customer revenue; the level and timing of customer design activity; the market acceptance of our customers’ products; 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 product families; intense competition, including the introduction of new products by competitors; our ability to hire and retain qualified personnel; changes in product demand or supply; 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.

About QuickLogic

QuickLogic Corporation (NASDAQ: QUIK) is the inventor and pioneer of innovative, customizable semiconductor solutions for mobile and portable electronics OEMs and 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.

The QuickLogic name and logo are registered trademarks of QuickLogic Corporation. All other brands or trademarks are the property of their respective holders and should be treated as such.