Synplicity Announces First Quarter 2008 Results

Synplicity and its officers and directors may be deemed to be participants in the solicitation of proxies from Synplicity’s shareholders with respect to the merger. A description of any interests that these officers and directors have in the merger will be available in the proxy statement. Additional, information concerning Synplicity’s directors and executive officers is set forth Synplicity’s Amendment No.1 to Annual Report on Form 10-K, which was filed with the SEC on April 4, 2008. These documents are available free of charge at the SEC’s web site at www.sec.gov or by going to Synplicity’s Investor Relations page on its corporate website at www.synplicity.com.

Synplicity is a registered trademark of Synplicity, Inc. All other brands or products are the trademarks or registered trademarks of their owners.

SYNPLICITY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)

	March 31,		December 31,
		2008		2007⁽¹⁾
Assets:	(unaudited)
Current assets:
Cash and cash equivalents and short-term investments	$	47,269	$	42,991
Restricted cash		2,700		2,700
Accounts receivable, net		12,037		15,513
Inventories		3,354		1,308
Prepaid expenses		2,471		1,807
Other current assets		823		724
Short-term deferred tax assets		3,872		2,701
Total current assets		72,526		67,744
Restricted cash		2,700		2,700
Property and equipment, net		3,652		3,206
Goodwill		9,098		9,098
Intangible assets, net		9,340		10,189
Other assets		1,370		1,340
Long-term deferred tax assets		7,136		7,073
Total assets	$	105,822	$	101,350

Liabilities and Shareholders ’ Equity:
Current liabilities:
Accounts payable	$	5,225	$	2,067
Accrued liabilities		2,732		1,715
Accrued compensation		4,926		5,258
Deferred revenue		19,061		18,616
Short-term other liabilities		99		36
Short-term deferred income taxes		1,614		922
Total current liabilities		33,657		28,614
Long-term other liabilities		279		427
Long-term deferred income taxes		1,558		2,317
Shareholders' equity:
Common stock		63,011		61,320
Retained earnings		6,981		8,837
Accumulated other comprehensive loss		336		(165	)
Total shareholders ’ equity		70,328		69,992
Total liabilities and shareholders ’ equity		105,822	$	101,350

⁽¹⁾ Derived from audited financial statements.

SYNPLICITY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)

	Three Months Ended
	March 31,
		2008			2007
Revenue:
License and systems	$	8,115		$	3,884
Maintenance		7,159			6,617
Bundled license and services		3,316			4,398
Total revenue		18,590			14,899
Cost of revenue: ⁽²⁾
Cost of license and systems		1,310			30
Cost of maintenance		501			382
Cost of bundled license and services		46			95
Amortization of intangible assets		550			248
Total cost of revenue		2,407			755
Gross profit		16,183			14,144
Operating expenses: ⁽²⁾
Research and development		6,899			5,795
Sales and marketing		7,434			6,213
General and administrative		2,332			2,059
Amortization of intangible assets		299			-
Costs related to pending acquisition		1,419			-
Total operating expenses		18,383			14,067
Income (loss) from operations		(2,200	)		77
Other income, net		122			885
Income (loss) before income taxes		(2,078	)		962
Income tax provision (benefit)		(222	)		308
Net income (loss)	$	(1,856	)	$	654
Net income (loss) per share:
Basic and diluted net income (loss) per share	$	(0.07	)	$	0.02
Shares used in basic per share calculation		26,442			26,720
Shares used in diluted per share calculation		26,442			27,719

⁽²⁾ Amortization of stock-based compensation expense relates to the following:
	Three Months Ended
	March 31,
Cost of maintenance	$	28		$	23
Research and development		344			394
Sales and marketing		224			233
General and administrative		213			229

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