Trident Microsystems (TRIDQ) 8-K Results of Operations and Financial Condition

Exhibit 99.1

The unaudited historical information of Trident Microsystems, Inc. provided below reflects what Trident would have reported in earnings press releases in previous quarters if Trident had been publishing full, instead of abbreviated, financial statements. Trident is providing this additional information along with a full GAAP to non-GAAP reconciliation to its financial statements as a service to investors who generally maintain a spreadsheet model of historical information and have requested this information to help them maintain their models.

About Non-GAAP Adjustments

To supplement the consolidated financial results prepared under GAAP, Trident uses a non-GAAP conforming measure of net income that is GAAP net income adjusted to exclude certain costs, expenses and gains. Non-GAAP net income gives an indication of Trident’s baseline performance before gains, losses or other charges that are considered by management to be outside the company’s core operating results. In addition, non-GAAP net income is among the primary indicators management uses as a basis for planning and forecasting future periods. These measures are neither in accordance with, nor an alternative for, GAAP and may be materially different from non-GAAP measures used by other companies. Trident computes non-GAAP net income by various items, including stock based compensation, expenses related to the stock option investigation and related matters and those related to acquisition of Trident’s minority interest held by its Taiwanese subsidiary, including amortization of intangible assets and charges for in process research and development costs. A reconciliation of net income/loss on a GAAP basis to non-GAAP net income is provided in a table following the non-GAAP consolidated financial statements.

TRIDENT MICROSYSTEMS, INC
CONDENSED CONSOLIDATED INCOME STATEMENTS
(ON A GAAP BASIS)
FY 2006-2007 (UNAUDITED)

	ACT			ACT			ACT			ACT			ACT			ACT			ACT			ACT			ACT			ACT			GROWTH
USD in Thousand	Q106			Q206			Q306			Q406			Q107			Q207			Q307			Q407			FY06			FY07			FY07/06
Product Sales		33,203			40,614			44,743			52,882			71,363			68,260			60,579			70,593			171,442			270,795			58	%
Total Sales		33,204			40,614			44,743			52,882			71,363			68,260			60,579			70,593			171,442			270,795			58	%
Cost of Good Sold		14,454			18,533			20,531			24,302			34,546			32,126			29,376			35,826			77,820			131,874			69	%
IA Amortization		1,192			1,164			1,383			1,389			1,385			1,385			1,486			1,486			5,128			5,742			12	%
Stock Comp. Exp		6			34			39			34			101			135			131			159			113			526			—
Total Cost		15,652			19,731			21,953			25,725			36,032			33,646			30,993			37,471			83,061			138,142			66	%
Gross Margin		17,552			20,883			22,790			27,156			35,332			34,613			29,586			33,122			88,381			132,653			50	%
%		52.9	%		51.4	%		50.9	%		51.4	%		49.5	%		50.7	%		48.8	%		46.9	%		51.6	%		49.0	%
R&D		7,326			8,359			8,627			9,497			9,403			10,973			11,284			12,856			33,809			44,516			32	%
%		22.1	%		20.6	%		19.3	%		18.0	%		13.2	%		16.1	%		18.6	%		18.2	%		19.7	%		16.4	%
S&M		2,277			2,262			2,435			2,832			4,249			3,596			3,837			3,624			9,805			15,306			56	%
%		6.9	%		5.6	%		5.4	%		5.4	%		6.0	%		5.3	%		6.3	%		5.1	%		5.7	%		5.7	%
G&A		3,481			3,880			4,503			4,169			8,275			9,135			6,861			7,814			16,033			32,084			100	%
%		10.5	%		9.6	%		10.1	%		7.9	%		11.6	%		13.4	%		11.3	%		11.1	%		9.4	%		11.8	%
IA Amortization		36			36			134			134			134			134			167			167			341			603			77	%
%		0.1	%		0.1	%		0.3	%		0.3	%		0.2	%		0.2	%		0.3	%		0.2	%		0.2	%		0.2	%
Total Operating Expense		13,120			14,536			15,699			16,632			22,061			23,838			22,148			24,461			59,987			92,508			54	%
%		39.5	%		35.8	%		35.1	%		31.5	%		30.9	%		34.9	%		36.6	%		34.7	%		35.0	%		34.2	%
Operating Profit (Loss)		4,431			6,347			7,091			10,524			13,270			10,776			7,437			8,661			28,393			40,144			41	%
%		13.3	%		15.6	%		15.8	%		19.9	%		18.6	%		15.8	%		12.3	%		12.3	%		16.6	%		14.8	%
Interest and other income		411			476			329			1,066			2,292			1,301			1,658			1,586			2,282			6,836			41	%
Earning Before Taxes		4,843			6,822			7,419			11,591			15,562			12,077			9,095			10,247			30,675			46,981			53	%
Provision for Taxes		1,020			(371	)		1,831			3,837			4,859			4,848			3,369			3,597			6,316			16,673
TAX RATE		21.1	%		-5.4	%		24.7	%		33.1	%		31.2	%		40.1	%		37.0	%		35.1	%		20.6	%		35.5	%
Cum. Eff of chg in actg princ		1,819			0			0			0			(190	)		0			0			0			1,819			(190	)
Net Income(Loss)		5,642			7,193			5,588			7,753			10,513			7,229			5,726			6,650			26,176			30,118			15	%
%		17.0	%		17.7	%		12.5	%		14.7	%		14.7	%		10.6	%		9.5	%		9.4	%		15.3	%		11.1	%
EPS — Diluted	$	0.09		$	0.12		$	0.09		$	0.12		$	0.17		$	0.11		$	0.09		$	0.10		$	0.42		$	0.48			14	%
Fully Diluted Shares		62,049			62,418			63,716			63,738			63,116			63,501			63,440			63,571			62,526			63,380

2

TRIDENT
MICROSYSTEMS, INC
CONDENSED CONSOLIDATED INCOME STATEMENTS
(ON A NON-GAAP BASIS)
FY 2006-2007 (UNAUDITED)

	ACT			ACT			ACT			ACT			ACT			ACT			ACT			ACT			ACT			ACT			GROWTH
USD in Thousand	Q106			Q206			Q306			Q406			Q107			Q207			Q307			Q407			FY06			FY07			FY07/06
Product Sales		33,204			40,614			44,743			52,882			71,363			68,260			60,579			70,593			171,443			270,795			58	%
Total Sales		33,204			40,614			44,743			52,882			71,363			68,260			60,579			70,593			171,442			270,795			58	%
Growth%		59	%		22	%		10	%		18	%		35	%		-4	%		-11	%		17	%		148.4	%		58.0	%
Cost of Good Sold		14,454			18,533			20,531			24,302			34,546			31,211			29,376			35,826			77,820			130,959			68	%
Total Cost		14,454			18,533			20,531			24,302			34,546			32,126			29,376			35,826			77,819			131,874			69	%
Gross Margin		18,750			22,081			24,212			28,580			36,817			36,134			31,203			34,767			93,623			138,921			48	%
%		56.5	%		54.4	%		54.1	%		54.0	%		51.6	%		52.9	%		51.5	%		49.2	%		54.6	%		51.3	%
R&D		5,677			6,005			6,032			7,184			7,225			8,659			9,003			10,288			24,898			35,175			41	%
%		17.1	%		14.8	%		13.5	%		13.6	%		10.1	%		12.7	%		14.9	%		14.6	%		14.5	%		13.0	%
S&M		2,227			2,142			2,288			2,667			3,861			3,392			3,059			3,264			9,324			13,576			46	%
%		6.7	%		5.3	%		5.1	%		5.0	%		5.4	%		5.0	%		5.0	%		4.6	%		5.4	%		5.0	%
G&A		2,666			2,873			3,493			3,324			3,116			2,438			2,957			2,677			12,355			11,188			-10	%
%		8.0	%		7.1	%		7.8	%		6.3	%		4.4	%		3.6	%		4.9	%		3.8	%		7.2	%		4.1	%
Total Operating Expense		10,570			11,020			11,813			13,175			14,202			14,489			15,019			16,229			46,577			59,939			29	%
%		31.8	%		27.1	%		26.4	%		24.9	%		19.9	%		21.2	%		24.8	%		23.0	%		27.2	%		22.1	%
Operating Profit (Loss)		8,180			11,061			12,399			15,405			22,615			21,645			16,184			18,538			47,045			78,982			68	%
%		24.6	%		27.2	%		27.7	%		29.1	%		31.7	%		31.7	%		26.7	%		26.3	%		27.4	%		29.2	%
Interest and other income		512			643			570			1,116			2,292			1,301			1,442			1,586			2,841			6,621			133	%
Earning Before Taxes		8,692			11,704			12,969			16,521			24,907			22,946			17,626			20,124			49,886			85,603
Provision for Taxes		1,020			(371	)		1,832			3,837			4,859			4,848			3,369			3,597			6,317			16,673			164	%
NON-GAAP TAX RATE		11.7	%		-3.2	%		14.1	%		23.2	%		19.5	%		21.1	%		19.1	%		17.9	%		12.7	%		19.5	%
Non-GAAP Net Income(Loss)		7,672			12,075			11,137			12,684			20,048			18,098			14,257			16,527			43,569			68,930			58	%
%		23.1	%		29.7	%		24.9	%		24.0	%		28.1	%		26.5	%		23.5	%		23.4	%		25.4	%		25.5	%
Non-GAAP EPS — Diluted	$	0.12		$	0.19		$	0.17		$	0.20		$	0.32		$	0.28		$	0.22		$	0.26		$	0.70		$	1.09			56	%
Fully Diluted Shares		62,049			62,418			63,716			63,738			63,116			63,501			63,440			63,571			62,526			63,380
Excluded in Non-GAAP:
IP Amortization		1,228			1,200			1,517			1,524			1,519			1,519			1,654			1,653			5,469			6,345
Stock Comp Exp.		2,520			3,515			3,791			3,357			3,599			3,502			4,038			4,467			13,183			15,607
Stock option related legal fees		0			0			0			0			4,227			5,722			3,056			3,756			0			16,761
Stock Gain Adjustments		0			0			0			0			0			127			0			0			0			127
Investment (Gain)/Loss		101			167			242			50			0			0			(216	)		0			560			(216	)
Cum. Eff of chg in actg princ		(1,819	)		0			0			0			190			0			0			0			(1,819	)		190
Total		2,030			4,882			5,550			4,931			9,535			10,870			8,532			9,876			17,394			38,814

3

Trident Microsystems, Inc
Reconciliation between net income on a GAAP basis and Non-GAAP net income
(Unaudited)

	ACT			ACT		ACT		ACT		ACT		ACT		ACT			ACT		ACT			ACT
	Q106			Q206		Q306		Q406		Q107		Q207		Q307			Q407		FY06			FY07
Net Income (GAAP)		5,642			7,193		5,588		7,753		10,513		7,229		5,726			6,650		26,176			30,118
Amortization of Intangibles
Cost of Sales		1,192			1,164		1,383		1,389		1,385		1,385		1,486			1,486		5,128			5,742
S&M		36			36		134		134		134		134		167			167		341			603
Total amortization of intangibles		1,228			1,200		1,517		1,524		1,519		1,519		1,654			1,653		5,469			6,345
Stock-based compensation
Cost of Sales		6			34		39		34		101		135		131			159		113			526
R&D		1,650			2,354		2,595		2,312		2,177		2,243		2,282			2,568		8,911			9,270
S&M		49			120		147		165		388		204		778			360		481			1,730
G&A		815			1,007		1,010		845		933		919		848			1,380		3,678			4,080
Total stock-based compensation		2,520			3,515		3,791		3,356		3,599		3,502		4,038			4,467		13,183			15,607
Loss/(Gain) on investment, net		100			167		242		50		0		0		(216	)		0		560			(216	)
Section 409A stock compensation		0			0		0		0		0		127		0			0		0			127
Stock Option related Legal Fees		0			0		0		0		4,227		5,722		3,056			3,756		0			16,761
Cumulative effect of change in Acct Princ		(1,819	)		0		0		0		190		0		0			0		(1,819	)		190
Net Income (Non-GAAP)		7,672			12,075		11,137		12,684		20,048		18,098		14,257			16,527		43,569			68,930
GAAP EPS — Diluted	$	0.09		$	0.12	$	0.09	$	0.12	$	0.17	$	0.11	$	0.09		$	0.10	$	0.42		$	0.48
Non-GAAP EPS — Diluted	$	0.12		$	0.19	$	0.17	$	0.20	$	0.32	$	0.29	$	0.22		$	0.26	$	0.70		$	1.09
Fully Diluted Shares		62,049			62,418		63,716		63,738		63,116		63,501		63,440			63,571		62,526			63,380