Trident Microsystems (TRIDQ) 8-K Condensed Consolidated Statements of Operations

Exhibit 99.1

TRIDENT MICROSYSTEMS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended									Twelve Months Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
(In thousands, except per share data)	2011			2011			2010			2011			2010
Net revenues	$	60,359		$	80,088		$	118,578		$	298,349		$	557,198
Cost of revenues (1)		51,940			61,957			95,872			233,920			439,635
Gross profit		8,419			18,131			22,706			64,429			117,563
% of net revenues		13.9	%		22.6	%		19.1	%		21.6	%		21.1	%
Research and development expenses		31,015			36,607			43,575			138,972			175,001
% of net revenues		51.4	%		45.7	%		36.7	%		46.6	%		31.4	%
Selling, general and administrative expenses		12,173			16,707			17,278			65,263			79,161
% of net revenues		20.2	%		20.9	%		14.6	%		21.9	%		14.2	%
Goodwill impairment		—			—			—			—			7,851
% of net revenues		0.0	%		0.0	%		0.0	%		0.0	%		1.4	%
Restructuring charges		1,894			3,496			13,095			10,042			28,261
% of net revenues		3.1	%		4.4	%		11.0	%		3.4	%		5.1	%
Operating loss		(36,663	)		(38,679	)		(51,242	)		(149,848	)		(172,711	)
% of net revenues		(60.7	)%		(48.3	)%		(43.2	)%		(50.2	)%		(31.0	)%
Gain (loss) on investment		—			—			—			2,098			(303	)
Gain on acquisition		—			—			—			—			43,402
Interest and other income (expense), net		(1,223	)		435			(1,660	)		5,089			1,819
Loss before income taxes		(37,886	)		(38,244	)		(52,902	)		(142,661	)		(127,793	)
% of net revenues		(62.8	)%		(47.8	)%		(44.6	)%		(47.8	)%		(22.9	)%
Provision for income taxes (2)		6,314			874			877			7,689			1,096
% of net revenues		10.5	%		1.1	%		0.7	%		2.6	%		0.2	%
Net loss	$	(44,200	)	$	(39,118	)	$	(53,779	)	$	(150,350	)	$	(128,889	)
% of net revenues		(73.2	)%		(48.8	)%		(45.4	)%		(50.4	)%		(23.1	)%
Basic and diluted net loss per share	$	(0.25	)	$	(0.22	)	$	(0.31	)	$	(0.85	)	$	(0.79	)
Shares used in basic and diluted per share computation		178,905			178,237			174,772			177,393			163,438

(1) Cost of revenues includes inventory related write-downs of $5,195, $6,336, $2,147, $14,442, and $4,771 for the periods shown left to right, respectively.

(2) Provision for income taxes includes deferred tax asset valuation allowances of $4,260 for the three and twelve months ended December 31, 2011.

TRIDENT MICROSYSTEMS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	December 31,			September 30,			December 31,
(In thousands)	2011			2011			2010
ASSETS
Current assets
Cash and cash equivalents	$	54,208		$	35,928		$	93,224
Accounts receivable, net		25,998			39,475			62,328
Accounts receivable from related parties		2,713			5,052			7,337
Inventories		12,783			19,018			23,025
Note receivable from related party		20,884			20,884			20,884
Prepaid expenses and other current assets		11,005			11,463			18,330
Total current assets		127,591			131,820			225,128
Property and equipment, net (1,2)		9,236			25,962			31,566
Intangible assets, net (2)		43,913			52,001			82,921
Long-term receivable from related party		—			—			1,500
Other assets		21,148			27,057			29,826
Total assets	$	201,888		$	236,840		$	370,941
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	13,152		$	15,365		$	7,828
Accounts payable to related parties		23,395			21,443			26,818
Accrued expenses and other current liabilities		49,857			48,438			79,305
Income taxes payable		3,085			3,523			2,077
Total current liabilities		89,489			88,769			116,028
Long-term income taxes payable		23,471			22,764			25,476
Deferred income tax liabilities		301			200			200
Other long-term liabilities (1)		7,878			1,055			4,933
Total liabilities		121,139			112,788			146,637
Stockholders’ equity
Common stock		183			183			177
Additional paid-in capital		441,614			440,717			434,825
Accumulated deficit		(361,048	)		(316,848	)		(210,698	)
Total stockholders’ equity		80,749			124,052			224,304
Total liabilities and stockholders’ equity	$	201,888		$	236,840		$	370,941

(1) During the three months ended December 31, 2011, Trident entered into an agreement to sell and leaseback its property in Shanghai, China. Property and equipment, net reflects the removal of the net book value of the building, $14,984. Other long-term liabilities includes the deferred gain on the sale of $7,177.

(2) The Company is currently performing the necessary analysis to determine whether its long-lived assets were impaired as of December 31, 2011.

TRIDENT MICROSYSTEMS, INC.

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(Unaudited)

	Three Months Ended									Twelve Months Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
(In thousands, except per share data)	2011			2011			2010			2011			2010
GAAP Gross profit (1)	$	8,419		$	18,131		$	22,706		$	64,429		$	117,563
Amortization of acquisition-related intangible assets (2)		7,498			7,915			9,407			33,290			48,207
Stock-based compensation expense (3)		55			82			100			287			372
Impairment of intangible assets other than goodwill (4)		—			—			761			—			2,517
Non-GAAP Gross profit	$	15,972		$	26,128		$	32,974		$	98,006		$	168,659
% of Net revenues		26.5	%		32.6	%		27.8	%		32.8	%		30.3	%
GAAP Research and development expenses (R&D)	$	31,015		$	36,607		$	43,575		$	138,972		$	175,001
Amortization of acquisition-related intangible assets (2)		(589	)		(627	)		(734	)		(2,576	)		(2,818	)
Stock-based compensation expense (3)		(559	)		(698	)		(927	)		(2,868	)		(3,550	)
Impairment of intangible assets other than goodwill (4)		—			(729	)		—			(1,427	)		—
Non-GAAP Research and development expenses	$	29,867		$	34,553		$	41,914		$	132,101		$	168,633
% of Net revenues		49.5	%		43.1	%		35.3	%		44.3	%		30.3	%
GAAP Selling, general and administrative expenses (SG&A)	$	12,173		$	16,707		$	17,278		$	65,263		$	79,161
Amortization of acquisition-related intangible assets (2)		—			(318	)		(1,268	)		(2,442	)		(4,690	)
Stock-based compensation expense (3)		(284	)		(763	)		(1,124	)		(2,682	)		(2,987	)
Impairment of intangible assets other than goodwill (4)		112			(4,025	)		—			(3,913	)		—
Stock options related professional fees (5)		(15	)		(185	)		(989	)		(553	)		(2,211	)
Acquisition-related expenses (6)		—			—			44			(18	)		(5,293	)
Non-GAAP Selling, general and administrative expenses	$	11,986		$	11,416		$	13,941		$	55,655		$	63,980
% of Net revenues		19.9	%		14.3	%		11.8	%		18.7	%		11.5	%
GAAP Operating Loss	$	(36,663	)	$	(38,679	)	$	(51,242	)	$	(149,848	)	$	(172,711	)
Total of above adjustments to Gross profit, R&D and SG&A		8,888			15,342			15,266			50,056			72,645
Restructuring Charges (7)		1,894			3,496			13,095			10,042			28,261
Impairment of goodwill (4)		—			—			—			—			7,851
Non-GAAP Operating Loss	$	(25,881	)	$	(19,841	)	$	(22,881	)	$	(89,750	)	$	(63,954	)
% of Net revenues		-42.9	%		-24.8	%		-19.3	%		-30.1	%		-11.5	%
GAAP Net loss	$	(44,200	)	$	(39,118	)	$	(53,779	)	$	(150,350	)	$	(128,889	)
Total operating loss adjustments		10,782			18,838			28,361			60,098			108,757
Legal settlements (10)		—			—			—			(5,412	)		(2,491	)
(Gain) loss on investment (9)		1,153			—			—			(945	)		303
Gain on acquisition (8)		—			—			—			—			(43,402	)
Non-GAAP Net loss	$	(32,265	)	$	(20,280	)	$	(25,418	)	$	(96,609	)	$	(65,722	)
% of Net revenues		-53.5	%		-25.3	%		-21.4	%		-32.4	%		-11.8	%
GAAP basic and diluted net income (loss) per share	$	(0.25	)	$	(0.22	)	$	(0.31	)	$	(0.85	)	$	(0.79	)
GAAP shares - basic and dilutive		178,905			178,237			174,772			177,393			163,438

(1) Gross profit includes inventory related write-downs of $5,195, $6,336, $2,147, $14,442, and $4,771 for the periods shown left to right, respectively.

(2) Amortization of acquisition-related intangible assets represents the amortization of identifiable intangible assets. Management deemed that these acquisition-related charges are not related to Trident’s core operating performance and it is appropriate to exclude those charges from Trident’s non-GAAP financial measures, as it enhances the ability of investors to compare Trident’s period-over-period operating results.

(3) Stock-based compensation expense relates primarily to equity awards such as stock options and restricted stock. This is a non-cash expense that varies in amount from period to period and is dependent on market forces that are often beyond Trident’s control. Hence, management excludes this item from the non-GAAP financial measures.

(4) Charges for impairment of goodwill and intangible assets were $729 for impairment of licenses and $4,025 for impairment of an enterprise resource planning system for the three months ended September 30, 2011. The charges related to the impairment of the enterprise resource planning system were recalculated and reduced in the three months ended December 31, 2011 by $112. Management believes that these charges are not directly associated with the Company’s core operating performance.

(5) Stock options related professional fees are excluded from the non-GAAP net loss calculation. Management believes that these professional fees are not related to the Company’s ongoing business and operating performance of Trident.

(6) Acquisition-related expenses represent external costs incurred in connection with our acquisition, which we generally would not have incurred in the normal course of business.

(7) Management believes that restructuring charges are not directly associated with the Company’s core operating performance.

(8) The purchase price allocation assigned $43,402 to gain on acquisition. Management believes that gain on acquisition is not related to the ongoing business and operating performance of Trident.

(9) (Gain) loss on investments includes $1,153 of taxes related to the sale of Trident’s Shanghai property. Management believes that (Gain) loss on investments are not related to the ongoing business and operating performance of Trident.

(10) Management believes that legal settlements are not related to the ongoing business and operating performance of Trident.