Date: 06/02/2009

Centillium acquisition add up to the TranSwitch revenue growth in 4Q08

TranSwitch Corporation net revenues for the 4th quarter of year 2008 were approximately $15.0 million, which included approximately two months of revenue contribution from product lines acquired through the Centillium transaction. The GAAP net loss was ($5.7) million, or ($0.04) per basic and diluted common share. This compares with net revenues of approximately $10.5 million and a GAAP net loss of ($3.0) million, or ($0.02) per basic and diluted common share during the third quarter of 2008, and net revenues of approximately $7.2 million and a net loss of ($5.6) million, or ($0.04) per basic and diluted common share, during the fourth quarter of 2007.

For the twelve months ended December 31, 2008, the Company posted net revenues of approximately $41.9 million and a GAAP net loss of ($18.5) million, or ($0.13) per basic and diluted common share, compared with net revenues of approximately $32.6 million and a GAAP net loss of ($19.7) million, or ($0.15) per basic and diluted common share in 2007. During the fourth quarter of 2008, TranSwitch reported a GAAP gross profit of $8.0 million, or a gross margin of 53% on total revenues. The non-GAAP gross profit for the fourth quarter was $8.7 million, or a gross margin of 58%.

"In the fourth quarter, TranSwitch recorded revenues generally in line with our prior guidance despite the quarter being disrupted by unprecedented worldwide economic turmoil," stated Dr. Santanu Das, President and CEO. "We also completed the acquisition of Centillium Communications in the fourth quarter."

"Contemporaneously with this acquisition, we announced and completed a company-wide restructuring aimed at having operating expense levels for the combined company at roughly the same operating expense level of TranSwitch on a stand-alone basis prior to the transaction," continued Dr. Das. "We are happy to report that the restructurings as well as the Centillium integration are now mostly behind us."

TranSwitch projects revenues for the first quarter 2009 to be around $14.5 million.