Nordic Semiconductor — Earnings Release 2010

Jul 13, 2010

FOR IMMEDIATE RELEASE

Investor relations contact: Robert Giori

Phone: +47 93 40 91 88

Fax: +47 22 51 10 99

E-mail: Robert.Giori@nordicsemi.no

Website: www.nordicsemi.com

^{}[]

NORDIC

SEMICONDUCTOR

BUSINESS: NORDIC Q2 10 FINANCIAL RESULTS

Nordic Semiconductor reports record financial performance in Second Quarter 2010

Oslo, Norway, July 13, 2010 – Nordic Semiconductor today announced its financial results for the second quarter of 2010. The company reported high growth in revenue, operating profit and cash flow.

Q2 2010 financial highlights include:
- Total Revenue of MUSD 41.9 (MUSD 13.6)
- Operating Profit (EBIT) of MUSD 13.5 (MUSD 3.2)
- Order inflows of MUSD 59 (MUSD 19)
- Cash Flow from Operations of MUSD 9.4 (MUSD 4.8)
- Earnings per Share of USD 0.05 (USD 0.01)

"Nordic Semiconductor continues to strengthen its leadership position within the market for ultra low-power wireless solutions," commented Svenn-Tore Larsen, Chief Executive Officer. "By focusing on the needs of this market, the company has rapidly increased its sales while maintaining a lean and highly effective organization. All areas of our operations are performing very well, from sales and customer support to the development of our next generation of wireless solutions."

Revenue growth

Group revenue in Q2 2010 was MUSD 41.9, an increase of 209% from the prior year. The PC / Media controller business segment grew by 218% during Q2 2010 to MUSD 31.2, and represented 74% of the company's total revenues. The company notes that much of this revenue increase was driven by the ongoing conversion of wireless PC Peripherals vendors from older 27 MHz radio frequency technology to Nordic's 2.4 GHz components.

"Wireless PC peripherals manufacturers worldwide are today adopting Nordic's 2.4GHz technology due to its performance advantages and low energy requirements," explained Larsen. "Our system-on-chip solutions and reference designs offer excellent value to vendors looking to upgrade their products to the latest 2.4 GHz wireless solutions without the challenge and risk of integrating components from multiple suppliers."

Operating profit and cash flow

Nordic Semiconductor's revenue growth resulted in a strong improvement in profitability and cash flow. Operating profit (EBIT) increased to MUSD 13.5 from MUSD 3.2 in Q2 2009, while the company's free cash flow improved to MUSD 7.3 from MUSD 3.8 the prior year.

"Nordic Semiconductor has successfully grown its revenue without comparably increasing its overhead expenses due to its targeted product strategy and business model of outsourcing manufacturing and direct distribution," explained Robert Giori, Chief Financial Officer. "At the same time, our focus on working capital management has resulted in strong cash flow. With a cash balance of MUSD 29.0 and no debt, Nordic Semiconductor has a very solid foundation for further sustained growth."

---

Business Outlook

The company indicated a positive outlook for continued growth in 2010 and beyond. “Nordic Semiconductor’s recent order inflow will drive its sales for the remainder of the year. The company finished Q2 2010 with a record high order backlog of MUSD 88. Although the production environment remains tight, we are working closely with our suppliers to secure delivery of our order backlog throughout the second half of the year,” commented Larsen.

In 2011, the company expects its PC / Media controller business segment to continue to be a major source of revenue growth. “Major PC vendors are increasingly adopting wireless technology in original PC shipments, which significantly expands the market for wireless PC peripherals. In addition, we are seeing increased demand for RF-based remote controls to meet the connectivity requirements of new generations of home media and consumer electronics devices.”

Over the longer term, the company addressed numerous growth opportunities. “Nordic’s ultra-low power 2.4 GHz RF technology is well positioned to become the preferred wireless solution within many emerging product categories. Furthermore, we are confident that the release of the Bluetooth Low Energy standard will drive further market growth by opening mobile phone handsets and other Bluetooth devices for connectivity with low-energy wireless sensor and monitoring devices,” concluded Svenn-Tore Larsen.

A complete Q2 2010 financial report is attached in .pdf format.

For more information, please contact:
Robert Giori, Chief Financial Officer. +47 93 40 91 88

About Nordic Semiconductor:

Nordic Semiconductor ASA develops and sells integrated circuits and related solutions for short-range wireless communication. The company specializes in ultra-low power (ULP) components, based on its proprietary 2.4 GHz RF technology. All manufacturing of components is outsourced to specialist subcontractors. The company’s operations are managed according to an ISO 9001:2000-approved quality assurance system.

The company is headquarted in Trondheim and Oslo, Norway, with offices in the US, Hong Kong, Korea, Japan, Taiwan and the Philippines. The company is publicly traded on the Oslo Stock Exchange under the ticker NOD.