Altera 8-K Altera Announces Fourth Quarter Results Sales Up Strongly

Exhibit 99.1

INVESTOR CONTACT	MEDIA CONTACT
Scott Wylie – Vice President	Mark Plungy – Senior Manager
Investor Relations	Public Relations
(408) 544-6996	(408) 544-6397
swylie@altera.com	newsroom@altera.com

ALTERA ANNOUNCES FOURTH QUARTER RESULTS
SALES UP STRONGLY

San Jose, Calif., January 26, 2010—Altera Corporation (NASDAQ: ALTR) today announced fourth quarter sales of $365.0 million, up 27 percent from the third quarter of 2009 and up 16 percent from the fourth quarter of 2008. New product sales increased 30 percent sequentially. Fourth quarter net income was $103.0 million, $0.34 per diluted share, compared with net income of $56.7 million, $0.19 per diluted share, in the third quarter of 2009 and $83.0 million, $0.28 per diluted share, in the fourth quarter of 2008.

Sales for 2009 were $1.20 billion, a decrease of 13 percent compared with $1.37 billion in 2008. Net income was $251.1 million, $0.84 per diluted share, versus net income of $359.7 million, $1.18 per diluted share, in 2008.

For the year, cash flow from operating activities was $372.7 million. Altera ended 2009 with $1.5 billion in cash and short-term investments, an increase from $1.2 billion at 2008 year end.

Altera’s board of directors has declared a quarterly cash dividend of $0.05 per share payable on March 1, 2010 to shareholders of record on February 10, 2010.

“The fourth quarter produced extraordinary growth driven by customer program ramps and better end demand across all of our markets,” said John Daane, president, chief executive officer, and chairman of the board. “Our new products were the growth leaders in a quarter that saw sequential improvements across all product and market segment categories. We believe that in 2010 our 40-nm product leadership will create an additional growth driver for the company as customers shift from the prototype stage to production-based demand.”

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Several recent accomplishments mark the company’s continuing progress.

• Altera is now shipping production-qualified 40-nmStratix^® IV GT FPGAs, the industry’s first FPGAs to feature integrated 11.3-Gbps transceivers. Stratix IV GT FPGAs are the only single-chip devices available today that meet the high-speed bandwidth requirements for next-generation framer, MAC, bridging and switching applications for 100-Gigabit Ethernet and 100-Gigabit Optical Transport Networks. Five of the top seven advanced optical transport suppliers have now selected Stratix IV GT FPGAs for their 100G development. Altera’s 100G solutions include production silicon, 100G intellectual property, 100G reference designs and development boards supporting 100G applications.

• Altera’sStratix IV GT FPGAs were recognized byEDN Chinawith its prestigious “Best Product Award.”EDN Chinaannually honors the products and people that shape the electronics industry. Finalists are nominated by a panel of judges that includes technical experts from industry, universities and institutes, as well asEDN Chinaeditors. The final award winners are selected byEDN China’s 40,000 readers and website users. Altera’s Stratix IV GT FPGAs received the most votes and wonEDN China’s “Best Product Award” in the programmable logic devices category.

• Altera’sArria^® II GX FPGAs were awarded the “Embedded System Editor’s Choice Award” as the Best FPGA Product of the Year 2009 by China’sElectronic Engineering & Product World (EEPW) Magazine. The award was presented during the Electronic Forum held at China’s Tsinghua University in Beijing. The award is based on a combination of a judging committee made up of EEPW’s editorial team, experts and engineers from industry associations and online votes.

• Expanding on the success of theCyclone^® FPGA series and extending its transceiver leadership, the newCyclone IV FPGA family has been announced. This new FPGA family responds to increased low-cost bandwidth needs driven by the demand for mobile video, voice, and data access, and the hunger for high-quality 3D images. With low power consumption and small packages, these devices address cost-sensitive, small form-factor applications in thewireless,wireline,broadcast,industrial andconsumer markets. With a focus on low cost, the smallest Cyclone IV GX device is the industry’s smallest FPGA with transceivers. Production shipments of the first Cyclone IV devices will begin in the first quarter of 2010.

• Altera has released itsQuartus^® II software version 9.1, the industry’s number-one software in performance and productivity for CPLD, FPGA and HardCopy^® ASIC designs. New features and enhancements within Quartus II software v9.1 reduce compile times 20 percent versus the previous software release, while continuing to deliver on average 2X to 3X faster compile times compared to competing high-density 40-nm and 65-nm designs. Quartus II software v9.1 builds upon the productivity advantage Altera consistently delivers with its design software. The software provides the industry’s fastest compile times for high-end FPGAs, averaging a 20 percent reduction annually over the past five years.

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Business Outlook for the First Quarter 2010

Sequential Sales Growth	Up 5 to 10%
Gross Margin	67.5% to 68.5%
Research and Development	$66 to 68 million
SG&A	$59 to 61 million
Tax Rate	14 to 16%

Conference Call and Quarterly Update:

A conference call will be held today at 1:45 p.m. Pacific Time to discuss the quarter’s results and management’s current business outlook. The webcast and subsequent replay will be available in the Investor Relations section of the company’s website at www.altera.com. A telephonic replay of the call may be accessed later in the day by calling (719) 457-0820 and referencing confirmation code 258712. The telephonic replay will be available for two weeks following the live call.

Altera’s first quarter business update will be issued in a press release available after the market close on March 3, 2010.

Forward-Looking Statements

Statements in this press release that are not historical are “forward-looking statements” as the term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally written in the future tense and/or preceded by words such as “will,” “expects,” “anticipates,” or other words that imply or predict a future state. Forward-looking statements include any projection of revenue, gross margin, expense or other financial items discussed in the Business Outlook section of this press release, and the contribution from 40-nm FPGAs to 2010 growth. Investors are cautioned that all forward-looking statements in this release involve risks and uncertainty that can cause actual results to differ from those currently anticipated, due to a number of factors, including without limitation, current global economic conditions, customer business environment, vertical market mix, market acceptance of the company’s products, product introduction schedules, the rate of growth of the company’s new products including the Arria^® GX, Arria II GX, Cyclone^® II, Cyclone III, Stratix^® II, Stratix II GX, Stratix III, Stratix IV, Stratix IV GX, Stratix IV GT, MAX^® II and HardCopy^® device families, changes in the mix of our business between prototyping and production-based demand, 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.

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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’sFPGA,CPLD andASIC devices atwww.altera.com.  Follow Altera via Facebook, RSS and Twitter.

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Altera, The Programmable Solutions Company, the stylized Altera logo, specific device designations and all other words that are identified as trademarks and/or service marks are, unless noted otherwise, the trademarks and service marks of Altera Corporation in the U.S. and other countries. All other product or service names are the property of their respective holder.

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ALTERA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)

	THREE MONTHS ENDED									YEARS ENDED
	December 31,			September 25,			December 31,			December 31,			December 31,
	2009			2009			2008			2009			2008
Net sales	$	364,998		$	286,612		$	314,544		$	1,195,413		$	1,367,224
Cost of sales(1)		115,281			93,686			96,699			396,584			449,750
Gross margin		249,717			192,926			217,845			798,829			917,474
Operating expenses
Research and development(1)		66,940			70,097			68,846			260,208			257,717
Selling, general, and administrative(1)		63,404			56,332			62,757			234,074			255,391
Total operating expenses		130,344			126,429			131,603			494,282			513,108
Operating margin(2)		119,373			66,497			86,242			304,547			404,366
Compensation expense (benefit) — deferred compensation plan		2,629			5,538			(10,184	)		11,776			(18,106	)
(Gain) loss on deferred compensation plan securities		(2,629	)		(5,538	)		10,184			(11,776	)		18,106
Interest income and other		(248	)		(740	)		(6,118	)		(6,083	)		(30,300	)
Interest expense		1,208			1,225			4,456			5,092			15,492
Income before income taxes		118,413			66,012			87,904			305,538			419,174
Income tax expense		15,439			9,308			4,863			54,476			59,523
Net income	$	102,974		$	56,704		$	83,041		$	251,062		$	359,651
Net income per share:
Basic	$	0.35		$	0.19		$	0.28		$	0.85		$	1.20
Diluted	$	0.34		$	0.19		$	0.28		$	0.84		$	1.18
Shares used in computing per share amounts:
Basic		296,036			294,758			294,803			294,493			300,951
Diluted		300,613			297,545			296,298			297,180			304,604
Cash dividends per common share	$	0.05		$	0.05		$	0.05		$	0.20		$	0.19
Tax rate		13.0	%		14.1	%		5.5	%		17.8	%		14.2	%
% of Net sales:
Gross margin		68.4	%		67.3	%		69.3	%		66.8	%		67.1	%
Research and development(1)		18.3	%		24.5	%		21.9	%		21.8	%		18.8	%
Selling, general, and administrative(1)		17.4	%		19.7	%		20.0	%		19.6	%		18.7	%
Operating margin(2)		32.7	%		23.2	%		27.4	%		25.5	%		29.6	%
Net income		28.2	%		19.8	%		26.4	%		21.0	%		26.3	%

Notes:
(1)	Includes restructuring expenses as follows:

	THREE MONTHS ENDED						YEARS ENDED
	December 31,		September 25,		December 31,		December 31,		December 31,
	2009		2009		2008		2009		2008
Cost of sales	$	—	$	137	$	—	$	137	$	—
Research and development		—		3,878		—		4,104		—
Selling, general, and administrative		—		738		—		5,728		—
	$	—	$	4,753	$	—	$	9,969	$	—

(2) We define operating margin as gross margin less research and development and selling, general and administrative expenses, as presented above. This presentation differs from income from operations as defined by U.S. Generally Accepted Accounting Principles (“US GAAP”), as it excludes the effect of compensation associated with the deferred compensation plan obligations. Since the effect of compensation associated with our deferred compensation plan obligations is offset by losses (gains) from related securities, we believe this presentation provides a more meaningful representation of our ongoing operating performance. A reconciliation of operating margin to income from operations follows:

	THREE MONTHS ENDED							YEARS ENDED
	December 31,		September 25,		December 31,			December 31,		December 31,
	2009		2009		2008			2009		2008
Operating margin (non-GAAP)	$	119,373	$	66,497	$	86,242		$	304,547	$	404,366
Compensation expense (benefit) — deferred compensation plan		2,629		5,538		(10,184	)		11,776		(18,106	)
Income from operations (GAAP)	$	116,744	$	60,959	$	96,426		$	292,771	$	422,472

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ALTERA CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)

	December 31,			September 25,			December 31,
	2009			2009			2008
Assets
Current assets:
Cash and cash equivalents	$	1,546,672		$	1,363,939		$	1,216,743
Accounts receivable, net		218,144			254,809			83,430
Inventories		69,705			65,826			84,637
Deferred compensation plan assets		69,891			66,801			55,990
Deferred income taxes and other current assets		137,358			166,779			186,361
Total current assets		2,041,770			1,918,154			1,627,161
Property and equipment, net		174,516			179,531			192,262
Deferred income taxes and other assets, net		76,945			49,284			60,484
	$	2,293,231		$	2,146,969		$	1,879,907
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable and current liabilities	$	138,185		$	117,642		$	124,358
Deferred compensation plan obligations		69,891			66,801			55,990
Deferred income and allowances on sales to distributors		281,885			291,732			205,674
Total current liabilities		489,961			476,175			386,022
Income taxes payable, non-current		210,967			205,384			173,880
Long-term credit facility		500,000			500,000			500,000
Other non-current liabilities		6,967			6,833			20,128
Stockholders’ equity		1,085,336			958,577			799,877
	$	2,293,231		$	2,146,969		$	1,879,907
Key Ratios & Information
Current Ratio		4:1			4:1			4:1
Liabilities/Equity		1:1			1:1			1:1
Quarterly Operating Cash Flows	$	176,352		$	105,484		$	107,830
TTM Return on Equity		27	%		26	%		45	%
Quarterly Depreciation Expense	$	6,839		$	7,361		$	7,625
Quarterly Capital Expenditures	$	1,824		$	2,384		$	11,354
Annualized Net Sales per Employee	$	450		$	412		$	508
Number of Employees		2,551			2,581			2,760
Inventory MSOH(1): Altera		1.8			2.1			2.6
Inventory MSOH(1): Distribution		0.7			1.1			1.0

(1) MSOH: Months Supply On Hand

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ALTERA CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

	YEARS ENDED
	December 31,			December 31,
	2009			2008
Cash Flows from Operating Activities:
Net income	$	251,062		$	359,651
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		29,022			29,969
Stock-based compensation		64,446			48,630
Deferred income tax (benefit) expense		(5,890	)		737
Tax effect of employee stock plans		(3,648	)		1,311
Excess tax benefit from employee stock plans		(990	)		(6,767	)
Gain on sale of land		—			(112	)
Gain on substantive termination of retiree medical plan		(6,488	)		—
Changes in assets and liabilities:
Accounts receivable, net		(136,115	)		115,459
Inventories		14,931			(10,527	)
Other assets		38,862			(26,173	)
Accounts payable and other liabilities		7,918			2,810
Deferred income and allowances on sales to distributors		77,611			(74,766	)
Income taxes payable		39,860			9,717
Deferred compensation plan obligations		2,125			(673	)
Net cash provided by operating activities		372,706			449,266
Cash Flows from Investing Activities:
Purchases of property and equipment		(11,060	)		(40,273	)
Proceeds from the maturities and sales of available-for-sale investments		—			131,060
Proceeds from sale of land		—			9,063
(Purchases) sales of deferred compensation plan securities, net		(2,125	)		673
Purchases of intangible assets		(690	)		—
Net cash (used in) provided by investing activities		(13,875	)		100,523
Cash Flows from Financing Activities:
Proceeds from issuance of common stock through various stock plans		42,144			67,138
Shares withheld for employee taxes		(10,738	)		(8,229	)
Repurchases of common stock		—			(473,229	)
Payment of dividends to stockholders		(58,925	)		(57,051	)
Excess tax benefit from stock-based compensation		990			6,767
Decrease in book overdrafts		—			(320	)
Proceeds from long-term credit facility		—			250,000
Principal payments on capital lease obligations		(2,373	)		(8,217	)
Net cash used for financing activities		(28,902	)		(223,141	)
Net increase in cash and cash equivalents		329,929			326,648
Cash and cash equivalents at beginning of period		1,216,743			890,095
Cash and cash equivalents at end of period	$	1,546,672		$	1,216,743

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ALTERA CORPORATION
NET SALES SUMMARY
(Unaudited)

	THREE MONTHS ENDED									Quarterly Growth Rate						YEARS ENDED
													Year-									Annual
	December 31,			September 25,			December 31,			Sequential			Over-Year			December 31,			December 31,			Growth
	2009			2009			2008			Change			Change			2009			2008			Rate
Geography
North America		21	%		23	%		23	%		17	%		4	%		20	%		23	%		-23	%
Asia Pacific		39	%		38	%		36	%		34	%		28	%		40	%		35	%		1	%
Europe		21	%		21	%		23	%		24	%		6	%		22	%		23	%		-18	%
Japan		19	%		18	%		18	%		31	%		21	%		18	%		19	%		-18	%
Total		100	%		100	%		100	%		27	%		16	%		100	%		100	%		-13	%
Product Category
New		62	%		60	%		48	%		30	%		49	%		58	%		44	%		16	%
Mainstream		19	%		20	%		25	%		24	%		-10	%		21	%		26	%		-29	%
Mature & Other		19	%		20	%		27	%		22	%		-18	%		21	%		30	%		-40	%
Total		100	%		100	%		100	%		27	%		16	%		100	%		100	%		-13	%
Market Segment
Telecom & Wireless		41	%		40	%		38	%		31	%		26	%		44	%		36	%		4	%
Industrial Automation, Military & Auto		23	%		23	%		25	%		23	%		7	%		22	%		24	%		-18	%
Networking, Computer & Storage		14	%		16	%		14	%		14	%		13	%		14	%		16	%		-20	%
Other		22	%		21	%		23	%		35	%		12	%		20	%		24	%		-28	%
																��
Total		100	%		100	%		100	%		27	%		16	%		100	%		100	%		-13	%
FPGAs and CPLDs
FPGA		78	%		77	%		75	%		29	%		22	%		77	%		74	%		-9	%
CPLD		15	%		15	%		16	%		22	%		1	%		15	%		18	%		-27	%
Other		7	%		8	%		9	%		20	%		-5	%		8	%		8	%		-18	%
Total		100	%		100	%		100	%		27	%		16	%		100	%		100	%		-13	%

Product Category Description

Category	Products
New	Stratix II (and GX), Stratix III, Stratix IV (including E, GX and GT), Arria GX, Arria II GX, Cyclone II, Cyclone III, MAX II, HardCopy, and Hardcopy II devices
Mainstream	Stratix (and GX), Cyclone, and MAX 3000A devices
Mature & Other	Classic™, MAX 7000, MAX 7000A, MAX 7000B, MAX 7000S, MAX 9000, FLEX® series, APEX™ series, Mercury™, Excalibur™, configuration and other devices, intellectual property cores, and software and other tools

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