Volterra Reports Fourth Quarter Results, Record Annual Net Revenue and Tenth Consecutive...

Volterra Reports Fourth Quarter Results, Record Annual Net Revenue and Tenth
Consecutive Year of Growth

FREMONT, Calif., Jan. 24, 2011 (GLOBE NEWSWIRE) -- Volterra Semiconductor
Corporation (Nasdaq:VLTR), a leading provider of high-performance analog and
mixed-signal power management semiconductors, today reported financial results
for its fourth quarter and fiscal year ended December 31, 2010.

For the full year 2010, Volterra reported record annual net revenue of $153.6
million, an increase of 46% from annual net revenue of $104.9 million in 2009.
GAAP net income was $28.4 million, or $1.10 per share (diluted), for the fiscal
year ended December 31, 2010, an increase of 160% from GAAP net income of $10.9
million, or $0.45 per share (diluted), for the fiscal year ended December 31,
2009. Non-GAAP net income was $35.1 million, or $1.35 per share (diluted), for
the fiscal year ended December 31, 2010, an increase of 115% from non-GAAP net
income of $16.3 million, or $0.67 per share (diluted), for the fiscal year ended
December 31, 2009.

Net revenue for the fourth quarter of 2010 was $35.5 million, a 4% increase over
net revenue of $34.2 million for the fourth quarter of 2009, and a 14% decrease
from net revenue of $41.6 million for the third quarter of 2010. GAAP net income
was $3.4 million, or $0.13 per share (diluted), for the fourth quarter of 2010,
a 51% decrease from GAAP net income of $7.0 million, or $0.28 per share
(diluted), for the fourth quarter of 2009 and a 59% decrease from GAAP net
income of $8.4 million, or $0.32 per share (diluted), for the third quarter of
2010.

Volterra also reported net income and basic and diluted net income per share on
a non-GAAP basis. Non-GAAP net income excludes the effect of stock-based
compensation expense, net of tax. Non-GAAP net income was $5.4 million, or $0.21
per share (diluted), for the fourth quarter of 2010, a 36% decrease from
non-GAAP net income of $8.4 million, or $0.34 per share (diluted), for the
fourth quarter of 2009 and a 46% decrease from non-GAAP net income of $10.2
million, or $0.39 per share (diluted), for the third quarter of 2010.

"We are happy to be able to report Volterra's tenth consecutive year of revenue
growth and our seventh consecutive profitable year," said Volterra President and
CEO Jeff Staszak. "We continue to be well positioned to take advantage of
opportunities for growth in our major market segments."

Earnings Conference Call

Volterra will be conducting a conference call today at 2:30 p.m. (PST). To
access the conference call, investors can dial (877) 941-2927 approximately ten
minutes prior to the initiation of the teleconference. International and local
participants can dial (480) 629-9724. Investors should reference Volterra. A
digital replay of the conference call will be available until midnight on
Monday, January 31, 2011. To access the replay, investors should dial (800)
406-7325 or (303) 590-3030 and enter access code 4398392#. A webcast of the
conference call also will be available from the Investors section of the
Company's website at: http://www.volterra.com until midnight on Monday, February
21, 2011.

About Volterra Semiconductor Corporation

Volterra Semiconductor Corporation, headquartered in Fremont, CA, designs,
develops, and markets leading edge silicon solutions for low-voltage power
delivery. The Company's product portfolio is focused on advanced switching
regulators for the computer, datacom, storage, and portable markets. Volterra
operates as a fabless semiconductor company utilizing world-class foundries for
silicon supply. The company is focused on creating products with high
intellectual property content that match specific customer needs. For more
information, please visit http://www.volterra.com.

Non-GAAP Financial Measures

Volterra provides all information required in accordance with generally accepted
accounting principles (GAAP), but it believes that evaluating its financial
results may be difficult if limited to reviewing only GAAP financial measures.
Volterra's management believes the non-GAAP information provided is useful to
investors and other users of its financial information and its inclusion with
our financial results is warranted for several reasons:

* it can enhance the understanding of Volterra's financial performance by
adjusting for special, non-recurring items that may obscure results and trends
in our core operating performance, particularly in reconciling differences
between reported income and actual cash flows;

* it can provide consistency in reviewing Volterra's historical performance
between periods, as well as allowing for better comparisons of Volterra's
performance with similar companies in Volterra's industry;

* it allows users to evaluate the results of the business using the same
financial measures that management uses to evaluate and manage Volterra's
internal planning, budgeting and operations; and

* it provides investors with additional information used by management, its
board of directors and committees thereof, to determine management compensation.

Volterra's management reports and uses calculations of (i) non-GAAP gross margin
and non-GAAP gross margin as a percent of revenue, which represents gross margin
excluding the effect of stock-based compensation; (ii) non-GAAP income from
operations (and its components, non-GAAP research and development expense,
non-GAAP selling, general, and administrative expense, non-GAAP total operating
expenses, and including non-GAAP gross margin as indicated above) as well as
non-GAAP operating margin as a percent of revenue which represent income from
operations and its components excluding the effect of stock-based compensation
and special items such as restructuring charges, net of tax; (iii) non-GAAP
annual effective tax rate and the associated non-GAAP income tax expense, which
represents the effective tax rate without the effect of stock-based compensation
and income tax expense recalculated excluding the effect of stock-based
compensation and special items on non-GAAP income before tax; and (iv) non-GAAP
net income (and its components listed above), non-GAAP net margin as a percent
of revenue, and non-GAAP diluted net income per share, which represents net
income and diluted net income per share excluding the effect of stock-based
compensation expense and special items such as restructuring charges, net of
tax.

Investors should note that the non-GAAP financial measures used by Volterra may
not be the same non-GAAP financial measures, and may not be calculated in the
same manner, as that of other companies. Whenever Volterra discloses such a
non-GAAP financial measure, it provides a reconciliation of non-GAAP financial
measures to what it believes to be the most closely applicable GAAP financial
measure. A reconciliation of GAAP net income to non-GAAP net income is included
in the financial statements portion of this release and at the Investors section
of our website at www.volterra.com. Investors are encouraged to review the
related GAAP financial measures and the reconciliation of these non-GAAP
financial measures to their most directly comparable GAAP financial measure.
Volterra does not provide a non-GAAP reconciliation for non-GAAP estimates on a
forward-looking basis, as it believes it is unable to provide a meaningful or
accurate calculation or estimation of stock based compensation or income tax
expenses or other special items without unreasonable effort.

Forward-Looking Statements:

This press release regarding financial results for the fiscal year and quarter
ended December 31, 2010 contains forward-looking statements based on current
expectations of Volterra. The words "expect," "will," "should," "would,"
"anticipate," "project," "outlook," "believe," "intend," and similar phrases as
they relate to future events are intended to identify such forward-looking
statements. These forward-looking statements reflect the current views and
assumptions of Volterra but are subject to various risks and uncertainties that
could cause actual results to differ materially from expectations. Among the
factors that could cause actual results to differ materially from those in the
forward-looking statements are the following: risks related to our ability to
maintain revenue growth or other financial results; risks related to our
dependence on a limited number of customers; risks related to the limited
markets we operate in and the limited number of products we sell; risks related
to the quality of our products or the management of our inventory; risks related
to our relationship with our vendors and contractors; intellectual property
litigation risk; and other factors detailed in our filings with the Securities
and Exchange Commission, including the annual report on Form 10-K filed on March
3, 2010 and the Form 10-Q filed on November 3, 2010. You are cautioned not to
place undue reliance on these forward-looking statements, which speak only as of
the date of this press release. All forward-looking statements are qualified in
their entirety by this cautionary statement, and Volterra undertakes no
obligation to revise or update any forward-looking statements to reflect events
or circumstances after the date hereof, except as required by law.

VOLTERRA SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

Three Months Ended Twelve Months Ended

December 31, December 31,

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

2010 2009 2010 2009

----------- ----------- -----------
----------
(Unaudited) (Unaudited) (Unaudited)
(Audited)

Net revenue $ 35,543 $ 34,186 $ 153,634 $
104,937

Cost of revenue * 14,262 12,634 59,185
42,250
----------- ----------- -----------
----------

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

Gross margin 21,281 21,552 94,449
62,687
----------- ----------- -----------
----------

----------- ----------- -----------
----------
Operating expenses:

Research and development * 9,719 7,444 34,984
26,557
Selling, general and

administrative * 6,503 5,628 24,664
19,731

Litigation ** 1,499 1,631 6,026
5,225
----------- ----------- -----------
----------

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

Total operating expenses 17,721 14,703 65,674
51,513
----------- ----------- -----------
----------

----------- ----------- -----------
----------
Income from operations 3,560 6,849 28,775
11,174
Non-operating (expense)

income, net (14) (36) 37
(5)
----------- ----------- -----------
----------

----------- ----------- -----------
----------
Income before income taxes 3,546 6,813 28,812
11,169

Income tax expense (benefit) 139 (145) 372
229
----------- ----------- -----------
----------

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

Net income $ 3,407 $ 6,958 $ 28,440 $
10,940
=========== =========== ===========
==========

Net income per share:

Basic $ 0.14 $ 0.30 $ 1.18 $
0.48
----------- ----------- -----------
----------

Diluted $ 0.13 $ 0.28 $ 1.10 $
0.45
----------- ----------- -----------
----------

Weighted average shares

outstanding:

Basic 24,292 23,267 24,195
22,968
=========== =========== ===========
==========

Diluted 25,766 24,977 25,878
24,383
=========== =========== ===========
==========

* Includes stock-based

compensation expense as

follows:

Cost of revenue $ 132 $ 126 $ 568 $
425
Research and development 1,035 776 3,454
2,705
Selling, general, and

administrative 739 620 2,596
2,303
----------- ----------- -----------
----------

Total stock-based

compensation expense $ 1,906 $ 1,522 $ 6,618 $
5,433
=========== =========== ===========
==========

** Litigation expenses were

previously included in

Selling, general and

administrative expenses in

2009.

VOLTERRA SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

SEPARATE PRESENTATION OF LITIGATION AND SALES, GENERAL AND
ADMINISTRATIVE EXPENSE
(In thousands, except per share amounts)

(Unaudited)

Three Months Ended
Twelve Months Ended

December 31,
December 31,
------------------
--------------------

2010 2009
2010 2009
-------- --------
--------- ---------
GAAP

Selling, general and administrative with litigation $ 8,002 $ 7,259
$ 30,690 $ 24,956

Litigation * 1,499 1,631
6,026 5,225
-------- --------
--------- ---------
Selling, general and administrative without litigation $ 6,503 $ 5,628
$ 24,664 $ 19,731

December 31,
December 31,
------------------
--------------------

2010 2009
2010 2009
-------- --------
--------- ---------
Non-GAAP (excluding effect of stock-based compensation)

Selling, general and administrative with litigation $ 7,263 $ 6,639
$ 28,094 $ 22,653

Litigation * 1,499 1,631
6,026 5,225
-------- --------
--------- ---------
Selling, general and administrative without litigation $ 5,764 $ 5,008
$ 22,068 $ 17,428

* Litigation expenses were previously included in Selling, general and
administrative expenses in
2009.

VOLTERRA SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In thousands, except per share amounts)
(Unaudited)

Three Months Ended December 31,
2010
Effect of
Stock-based

GAAP Compensation Non-GAAP
--------- ------------ ---------

Gross margin $ 21,281 $ (132) $ 21,413
Gross margin % 59.9% -0.3% 60.2%

Operating expenses:
Research and development $ 9,719 $ 1,035 $ 8,684
Selling, general and
administrative 6,503 739 5,764

Litigation 1,499 -- 1,499
--------- ------------ ---------

Total operating
expenses $ 17,721 $ 1,774 $ 15,947

Income from operations $ 3,560 $ (1,906) $ 5,466
Operating margin % 10.0% -5.4% 15.4%

Annual effective tax rate 1.3% 0.3% 1.0%
Income tax expense $ 139 $ (126) $ 13

Net income $ 3,407 $ (2,032) $ 5,439
Diluted net income per
share $ 0.13 $ (0.08) $ 0.21

Three Months Ended December 31,
2009
Effect of
Stock-based

GAAP Compensation Non-GAAP
--------- ------------ ---------

Gross margin $ 21,552 $ (126) $ 21,678
Gross margin % 63.0% -0.4% 63.4%

Operating expenses:
Research and development $ 7,444 $ 776 $ 6,668
Selling, general and
administrative 5,628 620 5,008

Litigation * 1,631 -- 1,631
--------- ------------ ---------

Total operating
expenses $ 14,703 $ 1,396 $ 13,307

Income from operations $ 6,849 $ (1,522) $ 8,371
Operating margin % 20.0% -4.5% 24.5%

Annual effective tax rate 2.1% 0.2% 1.9%
Income tax benefit $ (145) $ 41 $ (104)

Net income $ 6,958 $ (1,481) $ 8,439
Diluted net income per
share $ 0.28 $ (0.06) $ 0.34

* Litigation expenses were
previously included in
Selling, general and
administrative expenses in
2009.

VOLTERRA SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

December September December
31, 30, 31,

2010 2010 2009
----------- ---------- ----------
(Unaudited) (Audited)
Assets
Current assets:
Cash, cash equivalents
and short-term
investments $ 99,827 $ 96,928 $ 73,776
Accounts receivable, net 19,437 21,599 15,534
Inventory 15,391 12,750 10,284
Prepaid expenses and
other current assets 2,693 2,388 1,829
----------- ---------- ----------

----------- ---------- ----------
Total current assets 137,348 133,665 101,423
Property and equipment,
net 7,125 7,274 4,656

Other assets 1,734 1,883 363
----------- ---------- ----------

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

Total assets $ 146,207 $ 142,822 $ 106,442
=========== ========== ==========

Liabilities and
Stockholders' Equity
Current liabilities:
Accounts payable $ 4,107 $ 4,546 $ 3,591

Accrued liabilities 11,826 11,543 9,506
----------- ---------- ----------

----------- ---------- ----------
Total current
liabilities 15,933 16,089 13,097

Lease incentives 528 576 445
Other long-term
liabilities 1,337 1,288 1,097
----------- ---------- ----------

----------- ---------- ----------
Total liabilities 17,798 17,953 14,639
Stockholders' equity:
Common stock 27 27 26
Additional paid-in
capital 134,656 129,781 115,035
Retained earnings
(accumulated deficit) 22,562 19,155 (5,878)

Treasury stock (28,836) (24,094) (17,380)
----------- ---------- ----------

----------- ---------- ----------
Total stockholders'
equity 128,409 124,869 91,803
----------- ---------- ----------

----------- ---------- ----------
Total liabilities and
stockholders' equity $ 146,207 $ 142,822 $ 106,442
=========== ========== ==========

CONTACT: For investor information:
Heidi Flannery, Investor Relations
(510) 743-1718
investor@volterra.com