ALTERA CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

Three Months Ended

Six Months Ended

(In thousands, except per share amounts)

June 28,

2013

March 29,

2013

June 29,

2012

June 28,

2013

June 29,

2012

Net sales

$

421,759

$

410,501

$

464,831

$

832,260

$

848,585

Cost of sales

135,104

126,083

141,315

261,187

256,149

Gross margin

286,655

284,418

323,516

571,073

592,436

Operating expense

Research and development expense

95,489

87,717

92,143

183,206

174,227

Selling, general, and administrative expense

77,869

78,600

71,796

156,469

141,581

Amortization of acquisition-related intangible assets

915

213

213

1,128

426

Total operating expense

174,273

166,530

164,152

340,803

316,234

Operating margin ⁽¹⁾

112,382

117,888

159,364

230,270

276,202

Compensation (benefit)/expense — deferred compensation plan

(160)

3,422

(2,313)

3,262

3,423

Loss/(gain) on deferred compensation plan securities

160

(3,422)

2,313

(3,262)

(3,423)

Interest income and other

(2,778)

(1,659)

(1,415)

(4,437)

(3,222)

Gain reclassified from other comprehensive income

(42)

(54)

(69)

(96)

(171)

Interest expense

3,389

2,465

2,116

5,854

3,053

Income before income taxes

111,813

117,136

158,732

228,949

276,542

Income tax expense/(benefit)

10,304

(3,053)

(3,947)

7,251

(1,971)

Net income

101,509

120,189

162,679

221,698

278,513

Other comprehensive (loss)/income:

Unrealized (loss)/gain on investments:

Unrealized holding (loss)/gain on investments arising during period, net of tax of ($47), ($5), $8 ($41) and $66

(9,031)

(1)

2,799

(9,032)

3,103

Less: Reclassification adjustments for gain on investments included in net income, net of tax of $5, $5, $1, $10 and $6

(37)

(49)

(3)

(86)

(23)

(9,068)

(50)

2,796

(9,118)

3,080

Unrealized gain on derivatives:

Unrealized gain on derivatives arising during period, net of tax of $34 and $42

—

—

63

—

77

Less: Reclassification adjustments for gain on derivatives included in net income, net of tax of $23 and $50

—

—

(42)

—

(92)

—

—

21

—

(15)

Other comprehensive (loss)/income

(9,068)

(50)

2,817

(9,118)

3,065

Comprehensive income

$

92,441

$

120,139

$

165,496

$

212,580

$

281,578

Net income per share:

Basic

$

0.32

$

0.38

$

0.51

$

0.69

$

0.87

Diluted

$

0.31

$

0.37

$

0.50

$

0.69

$

0.85

Shares used in computing per share amounts:

Basic

320,472

319,867

321,218

320,175

321,898

Diluted

323,527

323,021

325,285

323,279

326,172

Cash dividends paid per common share

$

0.10

$

0.10

$

0.08

$

0.20

$

0.16

Tax rate

9.2

%

(2.6)

%

(2.5)

%

3.2

%

(0.7)

%

% of Net sales:

Gross margin

68.0

%

69.3

%

69.6

%

68.6

%

69.8

%

Research and development

22.6

%

21.4

%

19.8

%

22.0

%

20.5

%

Selling, general, and administrative

18.5

%

19.1

%

15.4

%

18.8

%

16.7

%

Operating margin ⁽¹⁾

26.6

%

28.7

%

34.3

%

27.7

%

32.5

%

Net income

24.1

%

29.3

%

35.0

%

26.6

%

32.8

%