<Page>
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

------------------------

FORM 10-Q

(MARK ONE)

<Table>

/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
</Table>

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2001
OR

<Table>

/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 For the transition
period from to
</Table>

FOR THE TRANSITION PERIOD FROM ______________ TO ______________

COMMISSION FILE NUMBER 0-15071

------------------------

ADAPTEC, INC.

(Exact name of registrant as specified in its charter)

<Table>

DELAWARE 794-2748530
(State of Incorporation) (I.R.S. Employer Identification No.)

691 S. MILPITAS BLVD., MILPITAS, CALIFORNIA 95035
(Address of principal executive offices) (Zip Code)
</Table>

(408) 945-8600

(Registrant's telephone number, including area code)

NOT APPLICABLE
(Former name, former address and former fiscal year, if changed since last
report)

------------------------

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/ No / /

The number of shares outstanding of the Company's common stock as of
August 1, 2001 was 99,123,002.

This document consists of 32 pages, excluding exhibits, of which this is
page 1.

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<Page>
TABLE OF CONTENTS

<Table>
<Caption>
PAGE
--------

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements:

Condensed Consolidated Statements of
Operations................................................ 3

Condensed Consolidated Balance Sheets....... 4

Condensed Consolidated Statements of Cash
Flows..................................................... 5

Notes to Condensed Consolidated Financial
Statements................................................ 6-15

Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations.................................. 16-30

Item 3. Quantitative and Qualitative Disclosures
About Market Risk......................................... 29

PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K............ 30

Signatures........................................... 31
</Table>

2
<Page>
PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ADAPTEC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

<Table>
<Caption>
THREE MONTH PERIOD ENDED
-----------------------------------------
JUNE 30, JUNE 30,
2001 2000
------------------- -------------------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

Net revenues.............................................. $110,688 $154,494
Cost of revenues.......................................... 58,252 64,509
-------- --------
Gross profit.............................................. 52,436 89,985
-------- --------
Operating expenses:
Research and development................................ 26,241 24,921
Selling, marketing and administrative................... 26,875 31,627
Amortization of goodwill and other intangibles.......... 13,579 15,896
Restructuring charges................................... 6,912 --
Other charges........................................... 4,092 --
-------- --------
Total operating expenses.................................. 77,699 72,444
-------- --------
Income (loss) from operations............................. (25,263) 17,541
Interest and other income................................. 10,548 20,691
Interest expense.......................................... (3,013) (3,044)
-------- --------
Income (loss) from continuing operations before
provision for income taxes.............................. (17,728) 35,188
Provision for income taxes................................ 775 15,287
-------- --------
Net income (loss) from continuing operations.............. (18,503) 19,901
Net income from discontinued operations................... 495 1,747
-------- --------
Net income (loss)......................................... $(18,008) $ 21,648
======== ========
Net income (loss) per share:
Basic:
Continuing operations................................. $ (0.19) $ 0.20
Discontinued operations............................... $ 0.00 $ 0.02
Diluted:
Continuing operations................................. $ (0.19) $ 0.19
Discontinued operations............................... $ 0.00 $ 0.02
Shares used in computing net income (loss) per share:
Basic................................................... 99,090 100,805
Diluted................................................. 99,090 105,480
</Table>

See accompanying Notes to Condensed Consolidated Financial Statements.

3
<Page>
ADAPTEC, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

<Table>
<Caption>
JUNE 30, MARCH 31,
2001 2001
---------- -----------
(IN THOUSANDS)

ASSETS
Current assets:
Cash and cash equivalents................................. $ 189,061 $ 207,644
Marketable securities..................................... 415,236 443,685
Accounts receivable, net.................................. 49,323 41,805
Inventories............................................... 51,615 72,781
Other current assets...................................... 99,556 93,966
---------- ----------
Total current assets.................................... 804,791 859,881
Property and equipment, net................................. 103,720 107,634
Goodwill and other intangibles.............................. 134,637 148,216
Other long-term assets...................................... 43,372 47,906
Net assets of discontinued operations....................... -- 44,153
---------- ----------
Total assets................................................ $1,086,520 $1,207,790
========== ==========

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable.......................................... $ 17,513 $ 24,882
Accrued liabilities....................................... 149,544 169,028
---------- ----------
Total current liabilities............................... 167,057 193,910
---------- ----------
4 3/4% Convertible Subordinated Notes....................... 229,800 229,800
Other long-term liability................................... 3,700 5,550
Contingencies (Note 6)
Stockholders' equity:
Common stock.............................................. 99 99
Additional paid-in capital................................ 59,983 59,722
Accumulated other comprehensive income, net............... 3,874 4,215
Retained earnings......................................... 622,007 714,494
---------- ----------
Total stockholders' equity.................................. 685,963 778,530
---------- ----------
Total liabilities and stockholders' equity.................. $1,086,520 $1,207,790
========== ==========
</Table>

See accompanying Notes to Condensed Consolidated Financial Statements.

4
<Page>
ADAPTEC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

<Table>
<Caption>
THREE MONTH PERIOD ENDED
-----------------------------
JUNE 30, 2001 JUNE 30, 2000
------------- -------------
(IN THOUSANDS)

NET CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES........ $(13,049) $ 26,161
-------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment......................... (3,838) (7,037)
Net proceeds from sale of land.............................. -- 20,418
Purchases of marketable securities.......................... (118,467) (111,825)
Sales of marketable securities.............................. 116,895 86,521
Maturities of marketable securities......................... 30,318 41,598
Purchases of other investments.............................. -- (350)
-------- ---------
NET CASH PROVIDED BY INVESTING ACTIVITIES................... 24,908 29,325
-------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock...................... 261 4,724
Repurchases of common stock................................. -- (131,032)
Advances from line of credit, net........................... -- 10,000
-------- ---------
NET CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES........ 261 (116,308)
-------- ---------
NET CASH PROVIDED BY (USED BY) DISCONTINUED OPERATIONS...... (30,703) 1,788
-------- ---------
NET DECREASE IN CASH AND CASH EQUIVALENTS................... (18,583) (59,034)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD............ 207,644 180,519
-------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD.................. $189,061 $ 121,485
======== =========
</Table>

See accompanying Notes to Condensed Consolidated Financial Statements.

5
<Page>
ADAPTEC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. BASIS OF PRESENTATION

In the opinion of management, the accompanying unaudited condensed
consolidated interim financial statements of Adaptec, Inc. and its wholly-owned
subsidiaries (collectively the "Company") have been prepared on a consistent
basis with the March 31, 2001 audited consolidated financial statements and
include all adjustments, consisting of only normal recurring adjustments, except
as described in Notes 3, 5, 9 and 10, necessary to provide a fair statement of
the results for the interim periods presented. These interim financial
statements should be read in conjunction with the audited consolidated financial
statements and notes thereto included in the Company's Annual Report on
Form 10-K for the year ended March 31, 2001. For presentation purposes, the
Company has indicated its first quarter of fiscal 2002 as having ended on
June 30, 2001, whereas in fact, the Company's first quarter of fiscal 2002 ended
on June 29, 2001. The results of operations for the three month period ended
June 30, 2001 are not necessarily indicative of the results to be expected for
the entire year.

On April 12, 2001, the Company's Board of Directors formally approved a plan
to spin off the Software segment, Roxio, Inc., into a fully independent and
separate company (Note 3). As a result of the spin-off, the Company's historical
condensed consolidated financial statements have been restated to account for
Roxio as discontinued operations for all periods presented in accordance with
Accounting Principles Board ("APB") Opinion No. 30, "Reporting the Results of
Operations--Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and Transactions."
Unless otherwise indicated, the Notes to Condensed Consolidated Financial
Statements relate to the discussion of the Company's continuing operations.

2. RECENT ACCOUNTING PRONOUNCEMENTS

In July 2001, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 141, "Business
Combinations," and SFAS No. 142, "Goodwill and Other Intangible Assets," which
are effective for all business combinations completed after June 30, 2001. SFAS
No. 141 replaces APB Opinion No. 16, "Business Combinations," and eliminates
pooling-of-interests accounting prospectively. It also provides guidance on
purchase accounting related to the recognition of intangible assets and
accounting for negative goodwill. SFAS No. 142 changes the accounting for
goodwill from an amortization method to an impairment-only approach, whereby
goodwill will be evaluated annually and whenever events or circumstances occur
indicating that goodwill might be impaired. Upon adoption of SFAS No. 142,
amortization of goodwill recorded for business combinations consummated prior to
July 1, 2001 will cease, and intangible assets acquired prior to July 1, 2001
that do not meet the criteria for recognition under SFAS No. 141 will be
reclassified to goodwill. Companies are required to adopt SFAS No. 142 for
fiscal years beginning after December 15, 2001, but early adoption is permitted.
The Company will adopt SFAS No. 142 on April 1, 2002, the beginning of fiscal
2003, for acquisitions consummated prior to July 1, 2001. The Company is in the
process of determining the impact the adoption will have on its financial
position and results of operations.

In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133 establishes accounting and
reporting standards for derivative instruments and for hedging activities and
requires recognition of all derivatives as assets or liabilities and measurement
of those instruments at fair value. In June 1999, the FASB issued SFAS No. 137,
"Accounting for Derivative Instruments and Hedging Activities-Deferral of the
Effective Date of FASB Statement No. 133," which defers the required date of
adoption of SFAS No. 133 for one year, to fiscal years beginning after June 15,

6
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ADAPTEC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

2. RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)
2000. The Company adopted SFAS No. 133 in the first quarter of fiscal 2002. The
adoption did not have a material effect on the Company's financial position and
results of operations.

3. DISCONTINUED OPERATIONS--ROXIO

On April 12, 2001, the Company's Board of Directors formally approved a plan
to spin off Roxio and declared a dividend of the Roxio's common stock to the
Company's stockholders of record on April 30, 2001. The dividend was distributed
after the close of business on May 11, 2001, in the amount of 0.1646 shares of
Roxio's common stock for each outstanding share of the Company's common stock.
The distribution of the Roxio's common stock was intended to be tax-free to the
Company and to the Company's stockholders. The Company distributed all of the
Roxio's common stock, except for 190,936 shares retained by the Company for
issuance upon the potential exercise of the outstanding warrants held by Agilent
Technologies, Inc. ("Agilent") to purchase shares of the Company's common stock
(Note 5). The distribution of the Roxio's common stock dividend on May 11, 2001
resulted in the elimination of the net assets of discontinued operations and a
$74.5 million reduction of retained earnings. Of this amount, $33.2 million
represents the initial long-term funding the Company contributed to Roxio at the
date of distribution.

In accordance with SFAS No. 115, "Accounting for Certain Investments in Debt
and Equity Securities," the Company classified the 190,936 shares of Roxio's
common stock as available-for-sale securities. They were recorded at fair market
value and included under "Marketable securities" in the Condensed Consolidated
Balance Sheet as of June 30, 2001.

As a result of the spin-off, the Company's historical condensed consolidated
financial statements have been restated to account for Roxio as discontinued
operations for all periods presented in accordance with APB Opinion No. 30.
Accordingly, the net revenues, costs and expenses, assets and liabilities, and
cash flows of Roxio have been excluded from the respective captions in the
Condensed Consolidated Statements of Operations, Condensed Consolidated Balance
Sheets and Condensed Consolidated Statements of Cash Flows. The net income, net
assets and net cash flows of Roxio have been reported as "discontinued
operations" in the accompanying condensed consolidated financial statements.

The operating results of Roxio for the period from April 1, 2001 to
April 11, 2001 were reflected under "Net income from discontinued operations" in
the Condensed Consolidated Statement of Operations for the three month period
ended June 30, 2001.

4. BALANCE SHEETS DETAILS

Inventories are stated at the lower of cost (first-in, first-out) or market.
The components of inventories were as follows:

<Table>
<Caption>
JUNE 30, 2001 MARCH 31, 2001
------------- --------------
(IN THOUSANDS)

Raw materials............................................. $16,492 $25,789
Work-in-process 11,063 15,867
Finished goods............................................ 24,060 31,125
------- -------
Total..................................................... $51,615 $72,781
======= =======
</Table>

7
<Page>
ADAPTEC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

4. BALANCE SHEETS DETAILS (CONTINUED)
The components of accrued liabilities were as follows:

<Table>
<Caption>
JUNE 30, 2001 MARCH 31, 2001
------------- --------------
(IN THOUSANDS)

Tax related............................................... $ 88,268 $ 95,635
Acquisition related....................................... 18,500 18,500
Accrued compensation and related taxes.................... 17,485 17,951
Sales and marketing related............................... 4,182 3,791
Accrued royalty fees...................................... -- 16,290
Other..................................................... 21,109 16,861
-------- --------
Total..................................................... $149,544 $169,028
======== ========
</Table>

5. AGILENT AGREEMENT

In January 2000, the Company entered into a four-year Development and
Marketing Agreement (the "Agreement") with Agilent to co-develop, market and
sell fibre channel host bus adapters using fibre channel host bus adapter and
software driver technology licensed from Agilent. The Company issued warrants to
Agilent to purchase 1,160,000 shares of the Company's common stock at $62.25 per
share. In addition, the Company was to pay royalties to Agilent based on
revenues generated from the fibre channel products incorporating the licensed
technology. The Agreement provided for minimum royalty fees of $6.0 million in
the first contract year and $12.0 million in the second contract year. The
Company incurred royalty fees of $1.0 million in the first contract year and
estimated that it would incur $2.0 million in the second contract year
associated with sales of the Company's products incorporating the licensed
technology. Therefore, the Company accrued and expensed the remaining minimum
royalty fees of $5.0 million for the first contract year in fiscal 2000, and
$10.0 million for the second contract year in fiscal 2001.

In June 2001, the Company and Agilent mutually agreed to terminate the
Agreement. Pursuant to the Agreement's termination, the Company paid Agilent the
minimum royalty fees of $18.0 million for the first and second contract years.
In return, the Company received a fully paid, non-exclusive, worldwide perpetual
license to use Agilent's fibre channel host bus adapter and software driver
technology. In addition, Agilent will continue to supply the Company with the
Tachyon chips used in the Company's fibre channel products. Of the
$18.0 million royalty fees, $16.4 million had previously been accrued as of the
date of termination. The remaining $1.6 million royalty fees were expensed and
included as "Cost of revenues" in the Condensed Consolidated Statement of
Operations for the three month period ended June 30, 2001.

As a result of the Roxio spin-off (Note 3), the Company declared a dividend
of the Roxio's common stock to the Company's stockholders of record on
April 30, 2001. Upon exercise of its warrants to purchase 1,160,000 shares of
the Company's common stock, Agilent will be entitled to receive the Roxio
dividend as if it was a stockholder of record on April 30, 2001. As a result,
the Company has retained 190,936 shares of Roxio's common stock from the
distribution and will distribute these shares to Agilent in the event Agilent
exercises its warrants. The termination of the Agreement does not affect the
warrants held by Agilent.

8
<Page>
ADAPTEC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

6. CONTINGENCIES

In December 1999, the Company purchased Distributed Processing Technology,
Corp. ("DPT") and as part of the purchase agreement, $18.5 million of the
purchase price was held back (the "Holdback Amount") from former DPT
stockholders (the "DPT Stockholders") for unknown liabilities that may have
existed as of the acquisition date. For accounting purposes, the Holdback Amount
was included as part of the acquisition purchase price. Subsequent to the date
of purchase, the Company determined that certain representations and warranties
made by the DPT Stockholders were incomplete or inaccurate, which resulted in a
loss of revenues and additional expenses to the Company. In addition, certain
DPT products were found to be defective and the Company expects to incur
additional product liability expenses. In December 2000, the Company filed a
claim against the DPT Stockholders for the entire Holdback Amount. In
January 2001, the DPT Stockholders notified the Company as to their objection to
the Company's claim. Under the terms of the purchase agreement, the Company's
claim will be submitted to arbitration.

A class action lawsuit is pending in the United States District Court for
the Northern District of California against the Company and certain of its
current and former officers and directors. The class action lawsuit alleges that
the Company made false and misleading statements at various times during the
period between April 1997 and January 1998 in violation of federal securities
laws. The Company's motion to dismiss the complaint was granted in April 2000.
The plaintiffs filed an amended complaint in July 2000. In October 2000, the
Company filed a motion to dismiss the amended complaint. The Company believes
the class action lawsuit is without merit and intends to defend itself
vigorously.

On June 27, 2000, the Company received a statutory notice of deficiency from
the Internal Revenue Service ("IRS") with respect to its federal income tax
returns for fiscal 1994 through 1996. The Company filed a Petition with the
United States Tax Court on September 25, 2000, contesting the asserted
deficiencies. On December 15, 2000, the Company received a statutory notice of
deficiency from the IRS with respect to its federal income tax return for fiscal
1997. The Company filed a Petition with the United States Tax Court on
March 14, 2001, contesting the asserted deficiencies. The Company believes it
has meritorious defenses against all deficiencies asserted in these statutory
notices. In addition, the IRS is currently auditing the Company's federal income
tax returns for fiscal 1998 and 1999, for which no proposed adjustments have
been received. The Company believes sufficient taxes have been provided in all
prior years and the ultimate outcome of the IRS audits will not have a material
adverse effect on the Company's financial position and results of operations.

The Company is a party to other litigation matters and claims which are
normal in the course of its operations, and while the results of such litigation
matters and claims cannot be predicted with certainty, the Company believes that
the final outcome of such matters will not have a material adverse effect on the
Company's financial position and results of operations.

7. STOCK OPTION EXCHANGE PROGRAM

In May 2001, the Company announced a voluntary stock option exchange program
(the "Program") for the Company's employees. Under the Program, employees had
until June 21, 2001 to make an election to cancel their outstanding stock
options having exercise prices greater than $15.00 per share under the 2000
Nonstatutory Stock Option Plan, the 1999 Stock Plan and the 1990 Stock Plan, in
exchange for an equal number of new nonqualified stock options to be granted
under either the 2000 Nonstatutory Stock Option Plan or the 1999 Stock Plan. If
an election to cancel was made, employees must also cancel all

9
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ADAPTEC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

7. STOCK OPTION EXCHANGE PROGRAM (CONTINUED)
stock options that were granted within the six months prior to June 21, 2001
regardless of the exercise prices of these stock options. The new stock options
will be granted on the date of the Board of Directors' first compensation
committee meeting held more than six months and one day after June 21, 2001 (the
"Replacement Grant Date"). The exercise price of these new stock options will be
the closing price of the Company's common stock on the day before the
Replacement Grant Date. The new stock options will have a ten-year term, and
will be vested to the same degree that the canceled stock options were vested.
The unvested portion of the new stock options will vest in equal installments on
a quarterly basis over the two years following the Replacement Grant Date. The
Program is not available to the Company's non-employee directors. All canceled
stock options were retired from the pool of stock options available for grant
upon the completion of the Program on June 21, 2001. Approximately 1,400
employees participated in the Program and canceled 7.6 million stock options
with exercise prices ranging between $8.87 and $59.13 per share.

8. STATEMENTS OF OPERATIONS

The components of interest and other income were as follows:

<Table>
<Caption>
THREE MONTH PERIOD ENDED
-----------------------------
JUNE 30, 2001 JUNE 30, 2000
------------- -------------
(IN THOUSANDS)

Interest income............................................. $10,548 $ 7,640
Gain on sale of JNI common stock............................ -- 5,547
Gain on sale of land........................................ -- 7,504
------- -------
Total....................................................... $10,548 $20,691
======= =======
</Table>

A net realized gain of $1.4 million and a net realized loss of $0.5 million
from sales of marketable securities were included in interest income for the
three month periods ended June 30, 2001 and 2000, respectively.

9. RESTRUCTURING CHARGES

FISCAL 2002 FIRST QUARTER RESTRUCTURING PLAN:

In response to the continuing economic slowdown, the Company implemented a
restructuring plan in the first quarter of fiscal 2002 and recorded a
restructuring charge of $6.2 million. The goal of the restructuring plan is to
reduce costs and improve operating efficiencies in order to match the current
business environment. The restructuring charge consisted of severance and
benefits of $5.2 million related to the involuntary termination of approximately
325 employees. These terminated employees were primarily in the manufacturing,
administrative, sales and marketing and engineering functions. Approximately 53%
of these terminated employees were based in the U.S., 43% in Singapore and 4% in
other locations. Additionally, the Company accrued for lease costs of
$0.2 million pertaining to the estimated future obligations for non-cancelable
lease payments for excess facilities in Florida that were vacated due to the
reductions in workforce. The Company also wrote off leasehold improvements with
a net book value of $0.4 million and production-related machinery and equipment
with a net book value of

10
<Page>
ADAPTEC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

9. RESTRUCTURING CHARGES (CONTINUED)
$0.4 million. The assets were taken out of service as they were deemed
unnecessary due to the reductions in workforce.

The following table sets forth an analysis of the components of the fiscal
2002 first quarter restructuring charge and the payments made against the
reserve through June 30, 2001:

<Table>
<Caption>
SEVERANCE
AND ASSET OTHER
BENEFITS WRITE-OFFS CHARGES TOTAL
--------- ---------- -------- --------
(IN THOUSANDS)

Restructuring provision:
Severance and benefits......................... $5,174 $ -- $ -- $5,174
Accrued lease costs............................ -- -- 219 219
Property and equipment write-off............... -- 811 -- 811
Other charges.................................. -- -- 25 25
------ ---- ---- ------
Total........................................ 5,174 811 244 6,229
Cash paid........................................ (1,077) -- -- (1,077)
Non-cash charges................................. -- (811) -- (811)
------ ---- ---- ------
Reserve balance at June 30, 2001................. $4,097 $ -- $244 $4,341
====== ==== ==== ======
</Table>

FISCAL 2001 FOURTH QUARTER RESTRUCTURING PLAN:

In the first quarter of fiscal 2002, the Company recorded an additional
$0.7 million charge to the fiscal 2001 fourth quarter restructuring provision.
The adjustments included accrued lease costs of $0.5 million, and the Company
wrote down an additional $0.3 million of the estimated realizable value of
certain manufacturing equipment identified in the fiscal 2001 fourth quarter
restructuring. These adjustments were offset by a decrease in severance and
benefits of $0.1 million as actual costs were lower than originally anticipated.

11
<Page>
ADAPTEC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

9. RESTRUCTURING CHARGES (CONTINUED)
The following table sets forth an analysis of the components of the fiscal
2001 fourth quarter restructuring charge and the payments made against the
reserve through June 30, 2001:

<Table>
<Caption>
SEVERANCE
AND ASSET OTHER
BENEFITS WRITE-OFFS CHARGES TOTAL
--------- ---------- -------- --------
(IN THOUSANDS)

Restructuring provision:
Severance and benefits......................... $6,083 $ -- $ -- $6,083
Accrued lease costs............................ -- -- 1,407 1,407
Property and equipment write-off............... -- 2,169 -- 2,169
Other charges.................................. -- -- 245 245
------ ------ ------ ------
Total........................................ 6,083 2,169 1,652 9,904
Cash paid........................................ (2,264) -- (48) (2,312)
Non-cash charges................................. -- (2,169) -- (2,169)
------ ------ ------ ------
Reserve balance at March 31, 2001................ 3,819 -- 1,604 5,423
Provision adjustment............................. (75) 252 506 683
Cash paid........................................ (1,769) -- (132) (1,901)
Non-cash charges................................. -- (252) -- (252)
------ ------ ------ ------
Reserve balance at June 30, 2001................. $1,975 $ -- $1,978 $3,953
====== ====== ====== ======
</Table>

The Company anticipates that the total remaining restructuring reserve
balance of $8.3 million relating to the fiscal 2002 first quarter and the fiscal
2001 fourth quarter restructuring plans will be substantially paid out by the
end of fiscal 2002.

10. OTHER CHARGES

The Company holds minority investments in certain nonpublic companies. These
minority investments are accounted for under the cost method as the Company does
not have the ability to exercise significant influence over operations. The
Company regularly monitors these minority investments for impairment and records
reductions in the carrying values when necessary. During the first quarter of
fiscal 2002, the Company recorded an impairment charge of $4.1 million related
to a decline in the values of certain minority investments deemed to be other
than temporary. The impairment charge was included under "Other charges" in the
Condensed Consolidated Statement of Operations for the three month period ended
June 30, 2001.

12
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ADAPTEC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

11. INCOME TAXES

Income tax provisions for interim periods are based on the Company's
estimated annual income tax rate. The Company's effective tax rate is generally
less than the combined U.S. federal and state statutory income tax rate of 40%,
primarily due to income earned in Singapore where the Company is subject to a
significantly lower income tax rate, resulting from a tax holiday relating to
certain products. In the first quarter of fiscal 2002, the Company recorded an
income tax provision of $0.8 million. The Company did not derive a tax benefit
from its net loss primarily because the write-off of certain minority
investments and a portion of the restructuring charges and the amortization of
goodwill and other intangibles were not fully deductible for tax purposes.

12. NET INCOME (LOSS) PER SHARE

A reconciliation of the numerators and denominators of the basic and diluted
net income (loss) per share computations is as follows:

<Table>
<Caption>
THREE MONTH PERIOD
ENDED
---------------------
JUNE 30, JUNE 30,
2001 2000
--------- ---------
(IN THOUSANDS, EXCEPT
PER SHARE AMOUNTS)

Numerators:
Net income (loss) from continuing operations.............. $(18,503) $19,901
Net income from discontinued operations................... 495 1,747
-------- -------
Net income (loss)......................................... $(18,008) $21,648
======== =======
Denominators:
Weighted average shares outstanding--basic................ 99,090 100,805
Effect of dilutive securities:
Employee stock options and other........................ -- 4,675
-------- -------
Weighted average shares and potentially dilutive
common shares outstanding--diluted...................... 99,090 105,480
======== =======
Net income (loss) per share--basic:
Continuing operations..................................... $ (0.19) $ 0.20
Discontinued operations................................... $ 0.00 $ 0.02
Net income (loss) per share--diluted:
Continuing operations..................................... $ (0.19) $ 0.19
Discontinued operations................................... $ 0.00 $ 0.02
</Table>

For the three month period ended June 30, 2001, outstanding options to
purchase 9,238,000 shares of common stock were not included in the computation
of diluted net loss per share because the Company incurred a net loss during the
period. For the three month period ended June 30, 2000, outstanding options to
purchase 8,172,000 shares of common stock were not included in the computation
of diluted net income per share because the options' exercise prices were
greater than the average market price of the common stock.

13
<Page>
ADAPTEC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

12. NET INCOME (LOSS) PER SHARE (CONTINUED)
As a result of the Roxio spin-off (Note 3), the number of unissued shares of
common stock reserved by the Company for the 4 3/4% Convertible Subordinated
Notes has been adjusted to 6,033,000 shares from 4,448,000 shares as a result of
the adjustment to the conversion price. Neither the 6,033,000 shares nor the
4,448,000 shares of common stock related to the 4 3/4% Convertible Subordinated
Notes were included in the computation of diluted net income (loss) per share
for the three month periods ended June 30, 2001 and 2000, respectively, because
they were anti-dilutive.

13. COMPREHENSIVE LOSS

The Company's comprehensive loss consisted of net income (loss) and the
changes in net unrealized gains on available-for-sale securities, net of income
taxes.

The components of comprehensive loss, net of income taxes, were as follows:

<Table>
<Caption>
THREE MONTH PERIOD
ENDED
-------------------
JUNE 30, JUNE 30,
2001 2000
-------- --------
(IN THOUSANDS)

Net income (loss)........................................... $(18,008) $21,648
Changes in net unrealized gains on available-for-sale
securities,
net of income taxes....................................... (341) (25,346)
-------- -------
Total....................................................... $(18,349) $(3,698)
======== =======
</Table>

Accumulated other comprehensive income presented in the accompanying
Condensed Consolidated Balance Sheets represents the net unrealized gains on
available-for-sale securities, net of income taxes. The realization of these
gains is dependent on the market value of the securities, which is subject to
fluctuation. There can be no assurance if and when these gains will be realized.

14. SEGMENT REPORTING

The Company evaluates its product segments in accordance with SFAS No. 131,
"Disclosures about Segments of an Enterprise and Related Information." Its
current reportable business segments are Storage Solutions Group ("SSG"),
Desktop Solutions Group ("DSG"), Storage Networking Group ("SNG") and Other.
Please see "Item 1. Business" in Part I of the Company's Annual Report on
Form 10-K for the year ended March 31, 2001 for a detailed discussion of the
reportable business segments.

14
<Page>
ADAPTEC, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(UNAUDITED)

14. SEGMENT REPORTING (CONTINUED)
Summarized financial information concerning the Company's reportable
business segments is shown in the following table. The Company does not
separately identify assets or depreciation by segments nor are the segments
evaluated under these criteria.

<Table>
<Caption>
THREE MONTH PERIOD
ENDED
-------------------
JUNE 30, JUNE 30,
2001 2000
-------- --------
(IN THOUSANDS)

SSG:
Net revenues........................................... $88,498 $119,984
Income (loss).......................................... (7,863) 12,718
DSG:
Net revenues........................................... 18,929 27,942
Income................................................. 2,096 7,807
SNG:
Net revenues........................................... 3,261 6,568
Loss................................................... (9,014) (1,316)
Other:
Net revenues........................................... -- --
Income (loss).......................................... (2,947) 15,979
</Table>

The following table presents the details of "Other" segment's income (loss):

<Table>
<Caption>
THREE MONTH PERIOD
ENDED
-------------------
JUNE 30, JUNE 30,
2001 2000
-------- --------
(IN THOUSANDS)

Unallocated corporate expenses, net....................... $ 522 $(1,668)
Restructuring charges..................................... (6,912) --
Other charges............................................. (4,092) --
Interest and other income................................. 10,548 20,691
Interest expense.......................................... (3,013) (3,044)
------- -------
Total..................................................... $(2,947) $15,979
======= =======
</Table>

15. SUBSEQUENT EVENT--ACQUISITION

In July 2001, the Company announced a plan to purchase Platys
Communications, Inc., a developer of advanced Internet protocol ("IP") storage
solutions. The acquisition will include both stock and cash of approximately
$150 million in value. The acquisition will be accounted for under SFAS No. 141
and SFAS No. 142.

15
<Page>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

This Quarterly Report on Form 10-Q contains forward-looking statements that
involve risks and uncertainties. The statements contained in this document that
are not purely historical are forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, including, without limitation, statements regarding our
expectations, beliefs, intentions or strategies regarding the future. We may
identify these statements by the use of words such as "anticipate," "believe,"
"continue," "could," "estimate," "expect," "intend," "may," "might," "plan,"
"potential," "predict," "project," "should," "will," "would" and other similar
expressions. All forward-looking statements included in this document are based
on information available to us on the date hereof, and we assume no obligation
to update any such forward-looking statements.

Our actual results could differ materially from those anticipated in these
forward-looking statements as a result of certain factors, including those set
forth in the "Certain Factors Bearing Risks on Future Operating Results" section
and elsewhere in this document. In evaluating our business, prospective
investors should consider carefully these factors in addition to the other
information set forth in this document.

As discussed further in the "Roxio Spin-Off" section below, we successfully
completed the spin-off of our Software segment, Roxio, Inc., into a fully
independent and separate company in the first quarter of fiscal 2002. Unless
otherwise indicated, the Management's Discussion and Analysis of Financial
Condition and Results of Operations relate to our continuing operations.

RESULTS OF OPERATIONS

The following table sets forth the items in the Condensed Consolidated
Statements of Operations as a percentage of net revenues:

<Table>
<Caption>
THREE MONTH
PERIOD ENDED
-------------------
JUNE 30, JUNE 30,
2001 2000
-------- --------

Net revenues................................................ 100% 100%
Cost of revenues............................................ 53 42
--- ---
Gross margin................................................ 47 58
--- ---
Operating expenses:
Research and development.................................. 24 16
Selling, marketing and administrative..................... 24 21
Amortization of goodwill and other intangibles............ 12 10
Restructuring charges..................................... 6 --
Other charges............................................. 4 --
--- ---
Total operating expenses.................................... 70 47
--- ---
Income (loss) from operations............................... (23) 11
Interest and other income................................... 10 14
Interest expense............................................ (3) (2)
--- ---
Income (loss) from continuing operations before provision
for income taxes.......................................... (16) 23
Provision for income taxes.................................. 1 10
--- ---
Net income (loss) from continuing operations................ (17) 13
Net income from discontinued operations..................... 1 1
--- ---
Net income (loss)........................................... (16)% 14%
=== ===
</Table>

16
<Page>
BUSINESS SEGMENTS. We evaluate our product segments in accordance with
Statement of Financial Accounting Standards, or SFAS, No. 131, "Disclosures
about Segments of an Enterprise and Related Information." Our current reportable
business segments are Storage Solutions Group, or SSG, Desktop Solutions Group,
or DSG, Storage Networking Group, or SNG, and Other. Please see "Item 1.
Business" in Part I of our Annual Report on Form 10-K for the year ended
March 31, 2001 for a detailed discussion of our reportable business segments.

NET REVENUES. Net revenues were $110.7 million for the first quarter of
fiscal 2002, a decrease of 28% from net revenues of $154.5 million for the first
quarter of fiscal 2001. Net revenues for the first quarter of fiscal 2002 were
comprised of $88.5 million from the SSG segment, a decrease of 26% from the
first quarter of fiscal 2001, $18.9 million from the DSG segment, a decrease of
32% from the first quarter of fiscal 2001, and $3.3 million from the SNG
segment, a decrease of 50% from the first quarter of fiscal 2001.

Net revenues from the SSG segment decreased from the first quarter of fiscal
2001, primarily due to the industry-wide slowdown in capital spending which
resulted in slower sales than we anticipated. The economic slowdown continued to
cause both our original equipment manufacturer, or OEM, and channel distributor
customers to focus on reducing their inventories on hand. These inventory
pressures negatively affected orders for our redundant array of independent
disks, or RAID, and small computer system interface, or SCSI, products in the
first quarter of fiscal 2002.

Net revenues from the DSG segment decreased from the first quarter of fiscal
2001, primarily due to the continued decline in the demand for our SCSI-based
desktop solutions resulting from the penetration of lower cost solutions. The
decline in net revenues was partially offset by sales of our FireWire/1394-based
solutions which were launched in the third quarter of fiscal 2001, and our USB
2.0 host bus adapters which were launched in the first quarter of fiscal 2002.

Net revenues from the SNG segment decreased from the first quarter of fiscal
2001, primarily because several of our customers pushed out their orders due to
the economic slowdown. In addition, certain OEMs canceled their requirements for
our network interface cards, or NICs, in their products.

GROSS MARGIN. As a percentage of net revenues, gross margin for the first
quarter of fiscal 2002 was 47% compared to 58% for the first quarter of fiscal
2001. Our gross margin in the first quarter of fiscal 2002 was adversely
affected by excess inventory charges primarily due to customers delaying
shipments or canceling orders as a result of the slowdown in capital
expenditures, as well as excess manufacturing capacity due to lower production
volumes.

RESEARCH AND DEVELOPMENT EXPENSES. Spending for research and development
was $26.2 million for the first quarter of fiscal 2002, an increase of 5% from
$24.9 million for the first quarter of fiscal 2001. The increase in research and
development expenses was primarily attributable to additional investments in
developing new products targeted at the RAID, SCSI, Internet protocol, or IP,
storage and desktop markets. These new investments include BIOS-based RAID, RAID
on motherboard, or ROMB, zero-channel RAID and Ultra320 SCSI in our SSG segment;
FireWire/1394 and USB 2.0 in our DSG segment; and iSCSI (an IP storage standard)
and infiniband in our SNG segment. Despite the current economic slowdown, we are
committed to a significant level of research and development in order to enhance
our technological investments in our solutions. For example, we successfully
demonstrated our first iSCSI solutions with certain major OEMs including
Hewlett-Packard, IBM and Nishan in the first quarter of fiscal 2002. As a
percentage of net revenues, research and development expenses for the first
quarter of fiscal 2002 were 24% compared to 16% for the first quarter of
fiscal 2001.

17
<Page>
SELLING, MARKETING AND ADMINISTRATIVE EXPENSES. Spending for selling,
marketing and administrative activities was $26.9 million for the first quarter
of fiscal 2002, a decrease of 15% from $31.6 million for the first quarter of
fiscal 2001. The decrease in selling, marketing and administrative expenses was
primarily attributable to the reductions of our marketing programs and our
workforce as a result of the restructuring plan implemented in the fourth
quarter of fiscal 2001. As a percentage of net revenues, selling, marketing and
administrative expenses were 24% for the first quarter of fiscal 2002 compared
to 21% for the first quarter of fiscal 2001.

AMORTIZATION OF GOODWILL AND OTHER INTANGIBLES. Amortization of goodwill
and other intangibles was $13.6 million for the first quarter of fiscal 2002,
compared to $15.9 million for the first quarter of fiscal 2001. Amortization of
goodwill and other intangibles for both quarters resulted from our fiscal 2000
acquisition of Distributed Processing Technology, Corp., or DPT. In addition,
amortization expense for the first quarter of fiscal 2001 also included the
amortization of warrant costs associated with the warrants issued to Agilent
Technologies, Inc., or Agilent.

RESTRUCTURING CHARGES. In response to the continuing economic slowdown, we
implemented a restructuring plan in the first quarter of fiscal 2002 and
recorded a restructuring charge of $6.2 million. The goal of the restructuring
plan is to reduce costs and improve operating efficiencies in order to match the
current business environment. The restructuring charge consisted of severance
and benefits of $5.2 million related to the involuntary termination of
approximately 325 employees. These terminated employees were primarily in the
manufacturing, administrative, sales and marketing and engineering functions.
Approximately 53% of the terminated employees were based in the U.S., 43% in
Singapore and 4% in other locations. Additionally, we accrued for lease costs of
$0.2 million pertaining to the estimated future obligations for non-cancelable
lease payments for excess facilities in Florida that were vacated due to the
reductions in workforce. We also wrote off leasehold improvements with a net
book value of $0.4 million and production-related machinery and equipment with a
net book value of $0.4 million. The assets were taken out of service as they
were deemed unnecessary due to the reductions in workforce.

In the first quarter of fiscal 2002, we recorded an additional $0.7 million
charge to the fiscal 2001 fourth quarter restructuring provision. The
adjustments included accrued lease costs of $0.5 million, and we also wrote down
an additional $0.3 million of the estimated realizable value of certain
manufacturing equipment identified in the fiscal 2001 fourth quarter
restructuring. These adjustments were offset by a decrease in severance and
benefits of $0.1 million as actual costs were lower than originally anticipated.

OTHER CHARGES. We hold minority investments in certain nonpublic companies.
These minority investments are accounted for under the cost method as we do not
have the ability to exercise significant influence over operations. We regularly
monitor these minority investments for impairment and record reductions in the
carrying values when necessary. During the first quarter of fiscal 2002, we
recorded an impairment charge of $4.1 million related to a decline in the values
of certain minority investments deemed to be other than temporary.

INTEREST AND OTHER INCOME. The components of interest and other income were
as follows:

<Table>
<Caption>
THREE MONTH
PERIOD ENDED
-------------------
JUNE 30, JUNE 30,
2001 2000
-------- --------
(IN THOUSANDS)

18
<Page>
A net realized gain of $1.4 million and a net realized loss of $0.5 million
from sales of marketable securities were included in interest income for the
three month periods ended June 30, 2001 and 2000, respectively.

INTEREST EXPENSE. Interest expense was $3.0 million for the first quarters
of both fiscal 2002 and 2001. Interest expense during these periods resulted
primarily from our 4 3/4% Convertible Subordinated Notes.

INCOME TAXES. Our income tax provisions were $0.8 million and
$15.3 million in the first quarters of fiscal 2002 and 2001, respectively.
Income tax provisions for interim periods are based on our estimated annual
income tax rate. Our effective tax rate is generally less than the combined U.S.
federal and state statutory income tax rate of 40%, primarily due to income
earned in Singapore where we are subject to a significantly lower income tax
rate, resulting from a tax holiday relating to certain products. In the first
quarter of fiscal 2002, we did not derive a tax benefit from our net loss
primarily because the write-off of certain minority investments and a portion of
the restructuring charges and amortization of goodwill and other intangibles
were not fully deductible for tax purposes. In the first quarter of fiscal 2001,
the reduction in our effective income tax rate from the Singapore tax holiday
was more than offset by the effects of the portion of the amortization of
goodwill and other intangibles not deductible for tax purposes.

ROXIO SPIN-OFF

On April 12, 2001, our Board of Directors formally approved a plan to spin
off our Software segment, Roxio, into a fully independent and separate company.
Roxio is a provider of digital media software solutions that enable individuals
to create, manage and move music, photos, video and data onto recordable CDs.
Our Board of Directors declared a dividend of the Roxio's common stock to our
stockholders of record on April 30, 2001. The dividend was distributed after the
close of business on May 11, 2001, in the amount of 0.1646 shares of Roxio's
common stock for each outstanding share of our common stock. The distribution of
the Roxio's common stock was intended to be tax-free to us and to our
stockholders. We distributed all of the Roxio's common stock, except for 190,936
shares that are retained by us for issuance upon the potential exercise of the
warrants held by Agilent to purchase shares of our common stock. The
distribution of the Roxio's common stock dividend on May 11, 2001 resulted in
the elimination of our net assets of discontinued operations and a
$74.5 million reduction of our retained earnings. Of this amount, $33.2 million
represents the initial long-term funding we contributed to Roxio at the date of
distribution.

As a result of the spin-off, our historical condensed consolidated financial
statements have been restated to account for Roxio as discontinued operations
for all periods presented in accordance with Accounting Principles Board, or
APB, Opinion No. 30, "Reporting the Results of Operations--Reporting the Effects
of Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions."

Under the Master Transitional Services Agreement we entered into with Roxio,
we agreed to provide Roxio certain corporate support services, including
information technology systems, supply chain management, human resources
administration, product order administration, customer service, and legal,
finance and accounting services. Our fees for providing these services are
generally the cost of providing the services plus five percent. These
transitional service arrangements generally have a term of one year following
the legal separation. We also entered into a five year arrangement to lease
Roxio its corporate headquarter building at fair market value.

In addition, we entered into a Tax Sharing Agreement, or TSA, with Roxio for
tax matters. The TSA provides for the allocation of income, losses, credits and
other tax attributes prior to the distribution of the Roxio's common stock to
our stockholders, and assigns certain responsibilities for administrative
matters such as the filing of returns, payment of taxes due, retention of
records and conducts of audits, examinations or similar proceedings. The TSA
provides that we retain the risk of any modification of tax liabilities for
periods prior to the distribution date. In addition, the TSA requires Roxio to
indemnify us for

19
<Page>
certain taxes and similar obligations that we could incur if the distribution
does not qualify for tax-free treatment due to certain events, such as an
acquisition of a controlling interest in Roxio's or our common stock after the
distribution, Roxio's failure to continue its business after the distribution or
a repurchase of Roxio's common stock.

AGILENT AGREEMENT

In January 2000, we entered into a four-year Development and Marketing
Agreement, or the Agreement, with Agilent to co-develop, market and sell fibre
channel host bus adapters using fibre channel host bus adapter and software
driver technology licensed from Agilent. Pursuant to the Agreement, we were to
pay royalties to Agilent based on revenues generated from the fibre channel
products incorporating the licensed technology. The Agreement provided for
minimum royalty fees of $6.0 million in the first contract year and
$12.0 million in the second contract year. We incurred royalty fees of
$1.0 million in the first contract year and estimated that we would incur
$2.0 million in the second contract year associated with sales of our products
incorporating the licensed technology. Therefore, we accrued and expensed the
remaining minimum royalty fees of $5.0 million for the first contract year in
fiscal 2000, and $10.0 million for the second contract year in fiscal 2001.

In June 2001, Agilent and we agreed to terminate the Agreement. Pursuant to
the Agreement's termination, we paid Agilent the minimum royalty fees of
$18.0 million for the first and second contract years. In return, we received a
fully paid, non-exclusive, worldwide perpetual license to use Agilent's fibre
channel host bus adapter and software driver technology. In addition, Agilent
will continue to supply us with the Tachyon chips used in our fibre channel
products. Of the $18.0 million royalty fees, $16.4 million had previously been
accrued as of the date of termination. The remaining $1.6 million royalty fees
were expensed and included as "Cost of revenues" in the Condensed Consolidated
Statement of Operations for the three month period ended June 30, 2001.

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2001, our principal sources of liquidity consisted of
$604.3 million of cash, cash equivalents and marketable securities, and an
unsecured $20.0 million revolving line of credit which expires in July 2002. No
borrowings were outstanding under the line of credit as of June 30, 2001.

Our cash, cash equivalents and marketable securities decreased 7% from
$651.3 million as of March 31, 2001. During the first three months of fiscal
2002, our use of cash was primarily attributable to cash used for operating
activities, purchases of property and equipment and the initial cash funding to
Roxio.

Net cash used for operating activities for the three month period ended
June 30, 2001 was $13.0 million. The use of cash for operating activities was
primarily a result of our net loss, adjusted for a decrease in our inventories
as we focused on reducing inventories, as well as other non-cash items including
depreciation and amortization expenses, and restructuring and other charges. The
use of cash was also attributable to our payment of the royalty fees to Agilent
during the quarter.

We believe that our existing working capital, together with expected cash
flows from operations and available sources of bank, equity and equipment
financing, will be sufficient to support our operations over the next twelve
months.

RECENT ACCOUNTING PRONOUNCEMENTS

In July 2001, the Financial Accounting Standards Board, or FASB, issued SFAS
No. 141, "Business Combinations," and SFAS No. 142, "Goodwill and Other
Intangible Assets," which are effective for all business combinations completed
after June 30, 2001. SFAS No. 141 replaces APB Opinion No. 16, "Business
Combinations," and eliminates pooling-of-interests accounting prospectively. It
also provides

20
<Page>
guidance on purchase accounting related to the recognition of intangible assets
and accounting for negative goodwill. SFAS No. 142 changes the accounting for
goodwill from an amortization method to an impairment-only approach, whereby
goodwill will be evaluated annually and whenever events or circumstances occur
indicating that goodwill might be impaired. Upon adoption of SFAS No. 142,
amortization of goodwill recorded for business combinations consummated prior to
July 1, 2001 will cease, and intangible assets acquired prior to July 1, 2001
that do not meet the criteria for recognition under SFAS No. 141 will be
reclassified to goodwill. Companies are required to adopt SFAS No. 142 for
fiscal years beginning after December 15, 2001, but early adoption is permitted.
We will adopt SFAS No. 142 on April 1, 2002, the beginning of fiscal 2003, for
acquisitions consummated prior to July 1, 2001, and we are in the process of
determining the impact the adoption will have on our financial position and
results of operations.

CERTAIN FACTORS BEARING RISKS ON FUTURE OPERATING RESULTS

OUR FUTURE OPERATING RESULTS ARE SUBJECT TO FLUCTUATION. Our operating
results may fluctuate as a result of a wide variety of factors, including, but
not limited to, the following:

- cancellations or postponements of orders;

- shifts in the mix of our products and sales channels;

- changes in pricing policies by our suppliers;

- shortages of components or wafer fabrication capacity affecting us, our
customers or our suppliers;

- market acceptance of new and enhanced versions of our products;

- product obsolescence;

- shortage of skilled labor;

- future accounting pronouncements and changes in accounting policies;

- timing of acquisitions of other businesses and any associated charges;

- restructuring actions or other involuntary terminations;

- general economic trends; and

- pending legal proceedings.

Fiscal 2002 first quarter operating results were materially affected by
unusual charges, including the following:

- restructuring charges; and

- asset impairment charge.

Fiscal 2001 operating results were materially affected by unusual charges,
including the following:

- accrued minimum royalty fees to Agilent;

21
<Page>
- restructuring charges; and

- asset impairment charge.

OUR SALES HAVE BEEN NEGATIVELY AFFECTED BY THE CURRENT ECONOMIC SLOWDOWN,
AND IF THESE CONDITIONS PERSIST OR DETERIORATE, THEY MAY CONTINUE TO ADVERSELY
AFFECT OUR RESULTS OF OPERATIONS AND FINANCIAL POSITION. Beginning in the
second half of fiscal 2001, our operating results were significantly affected by
the continuing slowdown in information technology investments. Many of our
customers announced workforce reductions and delayed capital spending in
response to the economic slowdown. If the current economic conditions continue
to persist or deteriorate, our customers will likely further postpone capital
spending, which would continue to adversely affect our financial results.

WE MAY NOT MEET THE GOALS AND OBJECTIVES OF OUR RESTRUCTURING PLANS, WHICH
COULD ADVERSELY AFFECT OUR RESULTS OF OPERATIONS AND FINANCIAL POSITION. As a
result of the economic slowdown, in both the fourth quarter of fiscal 2001 and
first quarter of fiscal 2002, we implemented restructuring plans to reduce our
operating costs to match the current business environment. The plans included
primarily the reduction of our workforce and the consolidation of our
manufacturing operations to Singapore. The goals of the plans are to support
future growth opportunities, focus on investments that grow revenues and
increase operating margins. If we do not meet our restructuring objectives or if
the economic slowdown continues, we may have to implement additional plans in
order to reduce our operating costs, which could have an adverse effect on our
financial results.

IF DEMAND IN THE SERVER, NETWORK STORAGE AND DESKTOP MARKETS DECLINES, OUR
REVENUES MAY DECLINE. Historically, our growth has been supported by increasing
demand for systems that support:

- client/server applications;

- computer-aided engineering;

- Internet/intranet applications;

- data storage and digital content; and

- multimedia and video.

Our business or operating results could be adversely affected by a decline
for our products. In addition, other technologies may replace our existing
technologies and the acceptance of our technologies in the market may not be
widespread, which could adversely affect our revenues.

IF DEMAND FOR OUR CUSTOMERS' PRODUCTS DECLINES OR IF OUR CUSTOMERS DO NOT
CONTROL THEIR INVENTORIES EFFECTIVELY, OUR REVENUES MAY BE ADVERSELY
AFFECTED. The volume and timing of orders received during a quarter are
difficult to forecast. Our customers generally order based on their forecasts,
and they frequently encounter uncertain and changing demand for their products.
If demand falls below such forecasts or if our customers do not control their
inventories effectively, they may cancel or reschedule shipments previously
ordered from us. We have historically operated with a relatively small backlog
and have set our operating budget based on forecasts of future revenues. Because
much of our operating budget is relatively fixed in the short-term, if revenues
do not meet our expectations, then our financial results will be adversely
affected.

IF WE DO NOT PROVIDE ADEQUATE SUPPORT DURING OUR CUSTOMERS' DESIGN AND
DEVELOPMENT STAGE, OR IF WE ARE UNABLE TO PROVIDE SUCH SUPPORT IN A TIMELY
MANNER, REVENUES MAY BE LOST TO OUR COMPETITION. Certain of our products are
designed to meet our customers' specifications and, to the extent we are not
able to meet these expectations in a timely manner or provide adequate support
during our customers' design and development stage, our customers may choose to
buy similar products from another company. As a result, our financial results
could be adversely affected.

22
<Page>
IF THERE IS A SHORTAGE OF COMPUTER COMPONENTS USED IN OUR CUSTOMERS'
PRODUCTS, OUR SALES MAY DECLINE, WHICH COULD ADVERSELY AFFECT OUR RESULTS OF
OPERATIONS AND FINANCIAL POSITION. If our customers are unable to purchase
certain components which are embedded into their products, their demand for our
products may decline. For example, beginning in the fourth quarter of fiscal
2000, we experienced the impact of other companies' chip supply shortages, which
reduced the demand for some of our SSG products. This negatively affected our
revenues in the first half of fiscal 2001. Similar shortages of computer
components used in our customers' products could adversely affect our sales and
financial results in future periods.

OUR RELIANCE ON INDUSTRY STANDARDS AND TECHNOLOGICAL CHANGES IN THE
MARKETPLACE MAY CAUSE OUR REVENUES TO FLUCTUATE OR DECLINE. The computer
industry is characterized by various, evolving standards and protocols. We
design our products to conform to certain industry standards and protocols such
as the following:

TECHNOLOGIES:

- ATA;

- Fibre channel;

- FireWire/1394;

- Infiniband;

- IP storage;

- PCI;

- RAID;

- SCSI;

- Ultra-DMA; and

- USB.

OPERATING SYSTEMS:

- Linux;

- Macintosh;

- Netware;

- Novell;

- OS/2;

- UNIX; and

- Windows (including Windows 2000 and Windows NT).

In particular, a majority of our revenues are currently derived from
products based on the SCSI standards. If consumer acceptance of these standards
declines, or if new standards emerge, and if we do not anticipate these changes
and develop new products, these changes could adversely affect our business and
financial results. For example, we believe that changes in consumers'
perceptions of the relative merits of SCSI-based products and products
incorporating lower cost solutions adversely affected our sales beginning in
fiscal 1998 and may continue to affect our future sales.

23
<Page>
IF OUR PRODUCTS DO NOT OPERATE EFFECTIVELY WITH OTHER PRODUCTS, IT COULD
NEGATIVELY AFFECT OUR REVENUES. We must design our products to operate
effectively with a variety of hardware and software products supplied by other
manufacturers, including the following:

- microprocessors;

- peripherals; and

- operating system software.

We depend on significant cooperation with these manufacturers to achieve our
design objectives and develop products that interoperate successfully. We
believe that generally we have good relationships with leading system,
peripheral, and microprocessor suppliers; however, these suppliers may, from
time to time, make it more difficult for us to design our products for
successful operability with their products. In addition, these suppliers may
decide to compete with us. If any of these events were to occur, our revenues
could be adversely affected.

OUR DEPENDENCE ON NEW PRODUCTS MAY CAUSE OUR REVENUES TO FLUCTUATE OR
DECLINE. Our future success significantly depends upon our completing and
introducing new products at competitive prices and performance levels in a
timely manner. The success of new product introductions depends on several
factors, including the following:

- defining products to meet customer needs;

- product costs;

- timely completion and introduction of new product designs;

- quality of new products;

- differentiation of new products from those of our competitors; and

- market acceptance of our products.

As a result, we believe that continued significant expenditures for research
and development will be required in the future. We may fail to identify new
product opportunities and may not develop and bring new products to market in a
timely manner. In addition, products or technologies developed by others may
render our products or technologies obsolete or noncompetitive, or our targeted
customers may not select our products for design or integration into their
products. The failure of any of our new product development efforts could have
an adverse effect on our business and financial results.

IF WE ARE UNABLE TO COMPETE EFFECTIVELY, OUR REVENUES COULD BE ADVERSELY
AFFECTED. The markets for all of our products are intensely competitive and are
characterized by the following:

- rapid technological advances;

- frequent new product introductions;

- evolving industry standards; and

- price erosion.

As we continue to broaden our product offerings into the server, network
storage and desktop environments, we have experienced, and expect to experience
in the future, significantly increased competition both from existing
competitors and from additional companies that may enter our markets. Some of
these companies have greater technical, marketing, manufacturing and financial
resources than we do. We cannot assure that we will have sufficient resources to
accomplish any of the following:

- meet growing product demand;

- make timely introductions of new leading-edge solutions;

24
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- compete successfully in the future against existing or potential
competitors;

- provide OEMs with design specifications in a timely manner; and

- prevent price competition from eroding margins.

COSTS ASSOCIATED WITH ACQUISITIONS OR PARTNERSHIPS MAY ADVERSELY AFFECT OUR
RESULTS OF OPERATIONS, WHICH COULD BE EXACERBATED IF WE ARE UNABLE TO INTEGRATE
THE ACQUIRED COMPANIES, PRODUCTS OR TECHNOLOGIES. In July 2001, we announced
our plan to acquire Platys Communications, Inc, a developer of IP storage
solutions. In fiscal 2000, we acquired Distributed Processing Technology, Corp.,
or DPT, to strengthen our position in the RAID market. In addition, we enter
into partnerships and strategic alliances from time to time with other
companies. As part of our overall strategy, we may continue to acquire or invest
in complementary companies, products or technologies and enter into partnerships
and strategic alliances with other companies. In order to be successful in these
activities, we must:

- assimilate the operations and personnel of the combined companies;

- minimize the potential disruption of our ongoing business;

- retain key technical and managerial personnel;

- integrate the acquired company into our strategic and financial plans;

- accurately assess the value of potential target businesses, products or
technologies;

- harmonize standards, controls, procedures and policies; and

- minimize the impairment of relationships with employees and customers.

The benefits of acquisitions or partnerships may prove to be less than
anticipated and may not outweigh the costs reported in our financial statements.
Completing any potential future acquisitions or partnerships could cause
significant diversions of management time and resources. If we acquire new
businesses, products or technologies in the future, we may be required to assume
contingent liabilities and amortize significant amounts of other intangible
assets. If we consummate any potential future acquisitions in which the
consideration consists of stock or other securities, our existing stockholders'
ownership may be significantly diluted. If we proceed with any potential future
acquisitions in which the consideration is cash, we may be required to use a
substantial portion of our available cash. We may not be successful in
overcoming these risks or any other problems encountered in connection with
these or other business combinations, investments or partnerships. These
transactions may adversely affect our business, financial position and operating
results.

WE DEPEND ON WAFER SUPPLIERS WHOSE FAILURE TO MEET OUR MANUFACTURING NEEDS
COULD NEGATIVELY AFFECT OUR OPERATIONS. Independent foundries manufacture to
our specifications all of the finished silicon wafers used for our products. We
currently purchase most of our wafers through our agreements with Taiwan
Semiconductor Manufacturing Co., or TSMC. The manufacture of semiconductor
devices is sensitive to a wide variety of factors, including the following:

- the availability of raw materials;

- the availability of manufacturing capacity;

- the level of contaminants in the manufacturing environment;

- impurities in the materials used; and

- the performance of personnel and equipment.

While we have been satisfied with the quality, yield and timeliness of wafer
deliveries to date, we cannot assure you that manufacturing problems may not
occur in the future. In addition, although we have various supply agreements
with our suppliers, a shortage of raw materials or production capacity could

25
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lead our wafer suppliers to allocate available capacity to other customers. Any
prolonged inability to obtain wafers with competitive performance and cost
attributes, adequate yields or timely deliveries from our foundries would delay
our production and our product shipments, and could have an adverse effect on
our business and financial results. We expect that our current suppliers will
continually seek to convert their fabrication process arrangements to smaller
wafer geometries and to more advanced process technologies. Such conversions
entail inherent technological risks that can affect yields and delivery times.
If for any reason our current suppliers are unable or unwilling to satisfy our
wafer needs, we will be required to identify and qualify additional foundries.
Additional wafer foundries may be unavailable, may take significant amounts of
time to qualify or may be unable to satisfy our requirements on a timely basis.

IF OUR MANUFACTURING DEMAND OF SILICON WAFERS FALLS BELOW OUR PROJECTIONS,
WE MAY NOT BE ABLE TO FULLY UTILIZE OUR PREPAYMENTS TO TSMC, WHICH COULD
ADVERSELY AFFECT OUR RESULTS OF OPERATIONS AND FINANCIAL POSITION. From time to
time, we have entered into "take or pay" contracts that have committed us to
purchase specific wafer quantities over extended periods based on our projected
needs. In addition, we have made prepayments to TSMC in order to secure a
guaranteed wafer capacity. If our demand for wafer units falls below our
projections, we may not be able to fully utilize our prepayments. The unused
portion of the prepayments may be impaired and written off as an asset
impairment charge, which would adversely affect our financial results.

WE DEPEND ON SUBCONTRACTORS WHOSE FAILURE TO MEET OUR MANUFACTURING NEEDS
COULD NEGATIVELY AFFECT OUR RESULTS OF OPERATIONS. We rely on subcontractors
for the assembly and packaging of the integrated circuits included in our
products. We have no long-term agreements with our assembly and packaging
subcontractors. We have, from time to time, used board subcontractors to better
balance production runs and capacity. We cannot assure that such subcontractors
will continue to be able and willing to meet our requirements for such
components or services. Any significant disruption in supplies from, or
degradation in the quality of components or services supplied by, such
subcontractors could delay shipments and result in the loss of customers or
revenues, which could have an adverse effect on our financial results.

WE DEPEND ON THE EFFORTS OF OUR DISTRIBUTORS, WHICH IF REDUCED, WOULD
NEGATIVELY AFFECT OUR BUSINESS AND OUR RESULTS OF OPERATIONS. Our distributors
generally offer a diverse array of products from several different
manufacturers. Accordingly, we are at risk that these distributors may give
higher priority to selling products from other suppliers. A reduction in sales
efforts by our current distributors could adversely affect our business and
financial results. Our distributors may on occasion build inventories in
anticipation of substantial growth in sales, and when such growth does not occur
as rapidly as they anticipate, our distributors may subsequently decrease the
size of their product orders. If we decrease our price protection or
distributor-incentive programs, our distributors may also decrease their orders
from us. In addition, we may from time to time take actions to reduce levels of
products at distributors. These actions could reduce our revenues and negatively
affect our financial results.

OUR OPERATIONS DEPEND ON KEY PERSONNEL, THE LOSS OF WHOM COULD AFFECT OUR
BUSINESS AND REDUCE OUR FUTURE REVENUES. Our future success depends in large
part on the continued service of our key technical, marketing and management
personnel, and on our ability to continue to attract and retain qualified
employees, particularly those highly skilled engineers who are involved in the
design enhancement, manufacturing of existing products and the development of
new ones. The loss of key employees could adversely affect our business. Our
continued growth and future operating results will depend upon our ability to
attract, hire and retain significant numbers of qualified employees.

OUR INTERNATIONAL OPERATIONS INVOLVE RISKS, AND MAY NEGATIVELY AFFECT OUR
REVENUES AND RESULTS OF OPERATIONS. As a result of our fiscal 2001 fourth
quarter restructuring plan, we are consolidating our manufacturing facilities to
Singapore. Many of our subcontractors are primarily located in Asia and we have
sales offices and customers throughout Europe, Japan and other countries. Our
international operations and sales are subject to political and economic risks,
including political instability, currency controls, exchange rate fluctuations,
and changes in import/export regulations, tariffs and freight rates. We may use
forward

26
<Page>
exchange contracts to manage any exposure associated with certain foreign
currency-denominated commitments. In addition, because our primary wafer
supplier, TSMC, is located in Taiwan, we may be subject to certain risks
resulting from the political instability in Taiwan, including conflicts between
Taiwan and the People's Republic of China. These and other international risks
could negatively affect our business and financial results.

WE MAY ENCOUNTER NATURAL DISASTERS, WHICH MAY NEGATIVELY AFFECT OUR RESULTS
OF OPERATIONS AND FINANCIAL POSITION. Our corporate headquarters in California
are located near major earthquake faults. Any damage to our facilities as a
result of an earthquake, fire or any other natural disasters could have an
adverse effect on our business and financial results. Additionally, our primary
wafer supplier, TSMC, is located in Taiwan, which has experienced significant
earthquakes in the past. A severe earthquake could interrupt the manufacturing
process, which could affect its ability to supply wafers to us, which could
negatively affect our business and financial results.

WE MAY EXPERIENCE VOLATILE FLUCTUATIONS IN OUR STOCK PRICE. The stock
market in general, and the market for shares of technology companies in
particular, has from time to time experienced extreme price fluctuations. Often,
these changes have been unrelated to the operating performance of the affected
companies. In addition, factors such as technological innovations or new product
introductions by us, our competitors or our customers may have a significant
effect on the market price of our common stock. Furthermore, quarter-to-quarter
fluctuations in our results of operations caused by changes in customer demand,
changes in the microcomputer and peripherals markets or other factors may have a
significant effect on the market price of our common stock. In addition, general
market conditions and international economic factors unrelated to our
performance may affect our stock price. These and other conditions and factors
that generally affect the market for shares of technology companies could cause
the price of our common stock to fluctuate substantially over short periods.

IF THE CARRYING VALUE OF OUR LONG-LIVED ASSETS IS NOT RECOVERABLE, AN
IMPAIRMENT LOSS MUST BE RECOGNIZED WHICH COULD ADVERSELY AFFECT OUR RESULTS OF
OPERATIONS AND FINANCIAL POSITION. Certain events or changes in circumstances
would mandate us to access the recoverability of the carrying amount of our
long-lived assets. For example, in the third quarter of fiscal 2001, we
evaluated the warrant costs associated with the warrants issued to Agilent and
determined that the future undiscounted cash flows would be insufficient to
recover any of the carrying value of the warrant costs. As such, we wrote off
the carrying balance of the warrant costs. We will continue to evaluate the
recoverability of the carrying amount of our long-lived assets, and we may incur
additional impairment charges which could adversely affect our financial
results.

WE HOLD A MINORITY INTEREST IN CERTAIN NONPUBLIC COMPANIES, AND IF THESE
COMPANIES FACE FINANCIAL DIFFICULTIES IN THEIR OPERATIONS, OUR INVESTMENTS COULD
BE IMPAIRED. We continue to hold a minority interest in certain privately held
companies that acquired our divested business lines in fiscal 1999. These
investments are inherently risky because these companies are still in the
development stage and depend on third parties for financing to support their
ongoing operations. In addition, the markets for their technologies or products
are typically in the early stages and may never develop. If these companies do
not have adequate cash funding to support their operations, or if they encounter
difficulties developing their technologies or products, especially in the recent
economic downtown, our investments in these companies may be impaired, which
could adversely affect our financial results. For example, we recorded an
impairment charge in the first quarter of fiscal 2002 related to a decline in
the values of certain minority investments deemed to be other than temporary.

IF WE ARE UNABLE TO PROTECT AND ENFORCE OUR INTELLECTUAL PROPERTY RIGHTS, WE
MAY BE UNABLE TO COMPETE EFFECTIVELY. Although we actively maintain and defend
our intellectual property rights, we may be unable to adequately protect our
proprietary rights. In addition, the laws of certain territories in which our
products are or may be developed, manufactured or sold, including Asia and
Europe, may not protect our products and intellectual property rights to the
same extent as the laws of the United States.

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<Page>
Despite our efforts, we may be unable to prevent third parties from
infringing upon or misappropriating our intellectual property, which could harm
our business and ability to compete effectively. We have from time to time
discovered counterfeit copies of our products being manufactured or sold by
others. Although we have programs to detect and deter the counterfeiting of our
products, significant availability of counterfeit products could reduce our
revenues and damage our reputation and goodwill with customers.

THIRD PARTIES MAY ASSERT INFRINGEMENT CLAIMS AGAINST US, WHICH MAY BE
EXPENSIVE TO DEFEND AND COULD ADVERSELY AFFECT OUR BUSINESS AND RESULTS OF
OPERATIONS. From time to time, third parties may assert exclusive patent,
copyright and other intellectual property rights to our key technologies. For
example, we entered into a patent cross-license agreement with a third party in
May 2000. Under this agreement, we will pay the third party a patent settlement
fee in return for a release from infringement claims prior to January 1, 2000.
In addition, we will pay a patent license fee for the use of certain of the
third party's patents through June 30, 2004, and we granted the third party a
license to use all of our patents for the same period.

We cannot assure you that third parties will not assert other infringement
claims against us in the future, that assertions by third parties will not
result in costly litigation or that we would prevail in such litigation or be
able to license any valid and infringed patents from third parties on
commercially reasonable terms. Litigation, regardless of the outcome, could
result in substantial costs to us and diversion of our resources. Any
infringement claims or other litigation against or by us could adversely affect
our business and financial results.

WE MAY BE ENGAGED IN LEGAL PROCEEDINGS THAT COULD NEGATIVELY AFFECT OUR
BUSINESS OPERATIONS OR FINANCIAL POSITION. From time to time we are subject to
litigation or claims that could negatively affect our business operations and
financial position. For instance, a class action lawsuit is pending in the
United States District Court for the Northern District of California against us
and certain of our current and former officers and directors. This lawsuit
alleges that we made false and misleading statements at various times during the
period between April 1997 and January 1998 in violation of federal securities
laws. Our motion to dismiss the complaint was granted in April 2000. The
plaintiffs filed an amended complaint in July 2000. In October 2000, we filed a
motion to dismiss the amended complaint. We believe this lawsuit is without
merit and we intend to defend ourselves vigorously. However, any disputes,
including this lawsuit, could cause us to incur unforeseen expenses, could
occupy a significant amount of our management's time and attention, and could
negatively affect our business operations and financial position.

IF WE REPATRIATE CASH FROM OUR FOREIGN SUBSIDIARIES, WE MAY INCUR ADDITIONAL
INCOME TAXES WHICH COULD NEGATIVELY AFFECT OUR RESULTS OF OPERATIONS AND
FINANCIAL POSITION. Our cash and cash equivalents are held principally in both
the United States and in our subsidiary in Singapore. From time to time we may
need additional cash flow to support our operations, which may require us to
repatriate our cash from Singapore to the United States. We will incur
additional income taxes from the repatriation, which could negatively affect our
financial results.

WE MAY BE SUBJECT TO A HIGHER EFFECTIVE TAX RATE THAT COULD NEGATIVELY
AFFECT OUR RESULTS OF OPERATIONS AND FINANCIAL POSITION. Our effective tax rate
is benefited by a Singapore tax holiday relating to certain of our products. The
terms of the tax holiday provide that profits derived from certain products will
be exempt from tax through fiscal 2005, subject to certain conditions. If we do
not continue to meet the conditions and requirements of the tax holiday in
Singapore, our effective tax rate will increase, which would adversely affect
our financial results.

WE MAY BE REQUIRED TO PAY ADDITIONAL FEDERAL INCOME TAXES WHICH COULD
NEGATIVELY AFFECT OUR RESULTS OF OPERATIONS AND FINANCIAL POSITION. On
June 27, 2000, we received a statutory notice of deficiency from the Internal
Revenue Service, or IRS, with respect to our federal income tax returns for
fiscal 1994 through 1996. We filed a Petition with the United States Tax Court
on September 25, 2000, contesting the asserted deficiencies. On December 15,
2000, we received a statutory notice of deficiency from the IRS with respect

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to our federal income tax return for fiscal 1997. We filed a Petition with the
United States Tax Court on March 14, 2001, contesting the asserted deficiencies.
In addition, the IRS is currently auditing our federal income tax returns for
fiscal 1998 and 1999, for which no proposed adjustments have been received.
While we believe we have meritorious defenses against the asserted deficiencies
and any proposed adjustments and that sufficient taxes have been provided, the
final outcome of these matters could adversely affect our results of operations
and financial position.

OUR SPIN-OFF OF ROXIO REQUIRES US TO PERFORM CERTAIN OBLIGATIONS UNDER THE
TRANSITIONAL SERVICE AGREEMENT, WHICH, IF NOT SATISFACTORILY PERFORMED, COULD
CAUSE US TO BE HELD LIABLE FOR RESULTING LOSSES SUFFERED BY ROXIO. In
May 2001, we completed the spin-off of Roxio, our Software segment. As part of
the separation, we entered into a transitional service agreement with Roxio to
support ongoing Roxio operations relating to information technology systems,
supply chain management, product order administration, and legal, finance and
accounting. These services generally have a term of one year following the
separation. If we do not satisfactorily perform our obligations under the
agreement, we may be held liable for any resulting losses suffered by Roxio.

THERE MAY BE POTENTIAL SUBSEQUENT TAX LIABILITIES THAT COULD NEGATIVELY
AFFECT OUR RESULTS OF OPERATIONS. Pursuant to our distribution of the Roxio's
common stock, we have received an opinion from PricewaterhouseCoopers, LLP, or
PwC, that the transaction would qualify as tax-free to us and to our
stockholders under Section 355 of the Internal Revenue Code. IRS regulations
provide that if another entity acquires a controlling interest in Roxio's or our
common stock within two years of the distribution, a presumption will arise that
the acquisition was made in connection with the distribution, causing the
distribution to become taxable. The validity of the PwC opinion relating to the
qualification of the distribution as a tax-free transaction is subject to
factual representations and assumptions. We are not aware of any facts or
circumstances that would cause such representations and assumptions to be
untrue. In addition, the opinion of PwC is not binding on the IRS. If we or
Roxio fails to conform to the requirements set forth in the IRS regulations, it
could cause the distribution to be taxable to us and to our stockholders, and
our financial results could be adversely affected.

WE MAY HAVE POTENTIAL BUSINESS CONFLICTS OF INTEREST WITH ROXIO WITH RESPECT
TO OUR PAST AND ONGOING RELATIONSHIPS, AND WE MAY NOT RESOLVE THESE CONFLICTS ON
TERMS FAVORABLE TO US. Conflicts of interest may arise between Roxio and us in
a number of areas relating to our past and ongoing relationship, including:

- labor, tax, employee benefits, indemnification and other matters arising
from the separation;

- intellectual property matters;

- employee retention and recruiting;

- the nature, quality and pricing of transitional services we have agreed to
provide to Roxio; and

- business opportunities that may be attractive to both Roxio and us.

These and other business conflicts could adversely affect the growth of our
business in the future.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For financial market risks related to changes in interest rates and foreign
currency exchange rates, reference is made to "Quantitative and Qualitative
Disclosures About Market Risk" in Part II, Item 7A, of our Annual Report on
Form 10-K for the year ended March 31, 2001.

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<Page>
PART II. OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(A) EXHIBITS:

<Table>
<Caption>
NUMBER EXHIBIT DESCRIPTION
- ------ -------------------

2.1 First Amended and Restated Master Separation and
Distribution Agreement between Adaptec, Inc. and
Roxio, Inc., dated February 28, 2001

2.2 General Assignment and Assumption Agreement between
Adaptec, Inc. and Roxio, Inc., dated May 5, 2001

2.3 Indemnification and Insurance Matters Agreement between
Adaptec, Inc. and Roxio, Inc., dated May 5, 2001

2.4 Master Patent Ownership and License Agreement between
Adaptec, Inc. and Roxio, Inc., dated May 5, 2001

2.5 Master Technology Ownership and License Agreement between
Adaptec, Inc. and Roxio, Inc., dated May 5, 2001

2.6 Master Confidential Disclosure Agreement between
Adaptec, Inc. and Roxio, Inc., dated May 5, 2001

2.7 Master Transitional Services Agreement between
Adaptec, Inc. and Roxio, Inc., dated May 5, 2001

2.8 Employee Matters Agreement between Adaptec, Inc. and
Roxio, Inc., dated May 5, 2001

2.9 Tax Sharing Agreement between Adaptec, Inc. and
Roxio, Inc., dated May 5, 2001

2.10 Real Estate Matters Agreement between Adaptec, Inc. and
Roxio, Inc., dated May 5, 2001

2.11 Manufacturing Services Agreement between Adaptec, Inc. and
Roxio, Inc., dated May 5, 2001

2.12 International Asset Transfer Agreement between Adaptec Mfg
(S) Pte Ltd. and Roxio CI Ltd., dated May 5, 2001

2.13 Letter of Agreement between Adaptec, Inc. and Roxio, Inc.,
dated May 5, 2001
</Table>

(B) REPORTS ON FORM 8-K:

On May 4, 2001, we filed a report on Form 8-K to disclose under Item 5 our
May 1, 2001 press release regarding Roxio's Form 10 Registration Statement and
other additional information on our Roxio spin-off.

On May 18, 2001, we filed a report on Form 8-K to disclose under Item 5 the
completion of our Roxio spin-off and the distribution of the Roxio's common
stock.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

ADAPTEC, INC.

<Table>

By: /s/ DAVID A. YOUNG
---------------------------------------
David A. Young Date: August 13, 2001
VICE PRESIDENT AND CHIEF FINANCIAL OFFICER (PRINCIPAL
FINANCIAL OFFICER)

By: /s/ KENNETH B. AROLA
---------------------------------------
Kenneth B. Arola Date: August 13, 2001
VICE PRESIDENT AND CORPORATE CONTROLLER
(PRINCIPAL ACCOUNTING OFFICER)
</Table>