Webcast and Conference Call

A conference call discussing the quarterly results will follow this press release at 7:30 a.m. Central time. An audio webcast will be available on Silicon Labs' website under Investor Relations ( www.silabs.com). A replay will be available after the call at the same website listed above or by calling 1 (855) 859-2056 or (404) 537-3406 (international) and entering conference ID 39717393. The replay will be available through August 28, 2015.

About Silicon Labs

Silicon Labs (NASDAQ: SLAB) is a leading provider of silicon, software and system solutions for the Internet of Things, Infrastructure, industrial automation, consumer and automotive markets. We solve the electronics industry’s toughest problems, providing customers with significant advantages in performance, energy savings, connectivity and design simplicity. Backed by our world-class engineering teams with strong software and mixed-signal design expertise, Silicon Labs empowers developers with the tools and technologies they need to advance quickly and easily from initial idea to final product. www.silabs.com

Forward-Looking Statements

This press release contains forward-looking statements based on Silicon Labs' current expectations. The words "believe," "estimate," "expect," "intend," "anticipate," "plan," "project," "will" and similar phrases as they relate to Silicon Labs are intended to identify such forward-looking statements. These forward-looking statements reflect the current views and assumptions of Silicon Labs and 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 that Silicon Labs may not be able to maintain its historical growth; quarterly fluctuations in revenues and operating results; difficulties developing new products that achieve market acceptance; dependence on a limited number of products and customers; intellectual property litigation risks; risks associated with acquisitions and divestitures; risks related to the successful completion of the development and implementation of Bluegiga’s technology; risks associated with the development of modules and the Company’s limited operating history with modules; risks that the acquisition may not yield the expected benefits due to the failure to properly integrate the acquired business and employees; risks that our competitors that supply products incorporated in Bluegiga’s modules may disrupt such supply; risks that the acquired business’ products and processes under development may fail to achieve market acceptance; risks of disputes regarding the acquired business and intellectual property; product liability risks; difficulties managing our distributors, manufacturers and subcontractors; inventory-related risks; difficulties managing international activities; risks that Silicon Labs may not be able to manage strains associated with its growth; credit risks associated with our accounts receivable; dependence on key personnel; stock price volatility; geographic concentration of manufacturers, assemblers, test service providers and customers in Asia that subjects Silicon Labs' business and results of operations to risks of natural disasters, epidemics, war and political unrest; debt-related risks; capital-raising risks; the competitive and cyclical nature of the semiconductor industry; average selling prices of products may decrease significantly and rapidly; information technology risks; conflict mineral risks and other factors that are detailed in the SEC filings of Silicon Laboratories Inc. Silicon Labs disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. References in this press release to Silicon Labs shall mean Silicon Laboratories Inc.

Note to editors: Silicon Laboratories, Silicon Labs, the “S” symbol, the Silicon Laboratories logo, the Silicon Labs logo, EFM32 and Simplicity Studio are trademarks of Silicon Laboratories Inc. All other product names noted herein may be trademarks of their respective holders.

Silicon Laboratories Inc.
Condensed Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
			Three Months Ended											Six Months Ended
			July 4, 2015					June 28, 2014						July 4, 2015					June 28, 2014
Revenues			$	164,856				$	154,918					$	328,561				$	300,609
Cost of revenues				67,428					56,255						134,764					114,841
Gross margin				97,428					98,663						193,797					185,768
Operating expenses:
Research and development				47,465					41,844						94,322					84,329
Selling, general and administrative				40,960					36,017						83,260					70,628
Operating expenses				88,425					77,861						177,582					154,957
Operating income				9,003					20,802						16,215					30,811
Other income (expense):
Interest income				166					200						358					502
Interest expense				(728	)				(780	)					(1,473	)				(1,578	)
Other income (expense), net				90					(6	)					498					61
Income before income taxes				8,531					20,216						15,598					29,796
Provision for income taxes				956					5,937						1,645					7,407
Net income			$	7,575				$	14,279					$	13,953				$	22,389
Earnings per share:
Basic			$	0.18				$	0.33					$	0.33				$	0.52
Diluted			$	0.17				$	0.32					$	0.32				$	0.51
Weighted-average common shares outstanding:
Basic				42,823					43,462						42,617					43,271
Diluted				43,461					44,218						43,305					44,137

Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share data)
Non-GAAP Income Statement Items			Three Months Ended July 4, 2015
			GAAP Measure				GAAP Percent of Revenue					Stock Compensation Expense				Intangible Asset Amortization				Acquisition Related Items				Termination Costs					Non- GAAP Measure				Non-GAAP Percent of Revenue
Revenues			$	164,856
Gross margin				97,428				59.1	%			$	229			$	390			$	1,324			$	--				$	99,371			60.3	%
Research and development				47,465				28.8	%				4,960				5,116				--				--					37,389			22.7	%
Selling, general and administrative				40,960				24.8	%				5,868				1,219				767				392					32,714			19.8	%
Operating income				9,003				5.5	%				11,057				6,725				2,091				392					29,268			17.8	%
Non-GAAP Earnings Per Share			Three Months Ended July 4, 2015
			GAAP Measure				Stock Compensation Expense*					Intangible Asset Amortization*				Acquisition Related Items*				Termination Costs*				Tax Impact of Adjustments					Non- GAAP Measure
Net income			$	7,575			$	11,057				$	6,725			$	2,091			$	392			$	(3,379	)			$	24,461
Diluted shares outstanding				43,461																										43,461
Diluted earnings per share			$	0.17																									$	0.56
* Represents pre-tax amounts

Unaudited Forward-Looking Statements Regarding Business Outlook
Business Outlook			Three Months Ending October 3, 2015
			High				Low
Estimated GAAP diluted earnings per share			$	0.10			$	0.04
Estimated non-GAAP charges				0.35				0.35
Estimated non-GAAP diluted earnings per share			$	0.45			$	0.39

Silicon Laboratories Inc.
Condensed Consolidated Balance Sheets
(In thousands, except per share data)
(Unaudited)
			July 4, 2015					January 3, 2015
Assets
Current assets:
Cash and cash equivalents			$	125,051				$	141,706
Short-term investments				147,556					193,489
Accounts receivable, net of allowances for doubtful accounts of $624 at July 4, 2015 and $786 at January 3, 2015				71,403					70,367
Inventories				60,746					52,631
Deferred income taxes				17,815					21,173
Prepaid expenses and other current assets				59,025					49,171
Total current assets				481,596					528,537
Long-term investments				7,179					7,419
Property and equipment, net				130,994					132,820
Goodwill				263,925					228,781
Other intangible assets, net				128,196					115,021
Other assets, net				24,041					29,983
Total assets			$	1,035,931				$	1,042,561
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable			$	34,553				$	38,922
Current portion of long-term debt				10,000					10,000
Accrued expenses				49,327					73,646
Deferred income on shipments to distributors				38,573					38,662
Income taxes				942					2,084
Total current liabilities				133,395					163,314
Long-term debt				74,562					77,500
Other non-current liabilities				41,761					43,691
Total liabilities				249,718					284,505
Commitments and contingencies
Stockholders' equity:
Preferred stock – $0.0001 par value; 10,000 shares authorized; no shares issued and outstanding				--					--
Common stock – $0.0001 par value; 250,000 shares authorized; 42,908 and 42,225 shares issued and outstanding at July 4, 2015 and January 3, 2015, respectively				4					4
Additional paid-in capital				44,152					29,501
Retained earnings				742,586					728,633
Accumulated other comprehensive loss				(529	)				(82	)
Total stockholders' equity				786,213					758,056
Total liabilities and stockholders' equity			$	1,035,931				$	1,042,561

Silicon Laboratories Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
			Six Months Ended
			July 4, 2015					June 28, 2014
Operating Activities
Net income			$	13,953				$	22,389
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation of property and equipment				6,029					6,427
Amortization of other intangible assets and other assets				14,697					8,839
Stock-based compensation expense				21,576					18,559
Income tax benefit from stock-based awards				2,781					377
Excess income tax benefit from stock-based awards				(2,056	)				(589	)
Deferred income taxes				3,892					4,665
Changes in operating assets and liabilities:
Accounts receivable				1,724					3,082
Inventories				(6,534	)				(123	)
Prepaid expenses and other assets				452					3,394
Accounts payable				(3,359	)				3,846
Accrued expenses				(1,027	)				19,697
Deferred income on shipments to distributors				(2,132	)				2,584
Income taxes				(7,171	)				(5,130	)
Other non-current liabilities				(5,622	)				(24,599	)
Net cash provided by operating activities				37,203					63,418
Investing Activities
Purchases of available-for-sale investments				(46,908	)				(117,744	)
Proceeds from sales and maturities of available-for-sale investments				92,759					61,803
Purchases of property and equipment				(4,714	)				(3,339	)
Purchases of other assets				(1,871	)				(2,726	)
Acquisition of business, net of cash acquired				(76,899	)				--
Net cash used in investing activities				(37,633	)				(62,006	)
Financing Activities
Proceeds from issuance of common stock, net of cash paid for withheld taxes				1,684					8,943
Excess income tax benefit from stock-based awards				2,056					589
Repurchases of common stock				(10,418	)				(10,954	)
Payment of acquisition-related contingent consideration				(4,464	)				--
Payments on debt				(5,083	)				(2,500	)
Net cash used in financing activities				(16,225	)				(3,922	)
Decrease in cash and cash equivalents				(16,655	)				(2,510	)
Cash and cash equivalents at beginning of period				141,706					95,800
Cash and cash equivalents at end of period			$	125,051				$	93,290