David French, President, Chief Executive Officer John Kurtzweil, Senior Vice President, Chief Financial Officer

Jeremy Kwan, Piper Jaffray Jay Srivatsa, Roth Capital Partners Craig Hettenbach, Wachovia Securities Alex Kim, Thomas Wiesel Partners Nimal Vallipuram, FLM Securities Don Rode, S Squared Technology Jeff Bernstein, Manhasset Capital Management

John Kurtzweil, Senior Vice President, Chief Financial Officer: Thank you operator, and good afternoon. Joining me on today's call is David French, Cirrus Logic's President and Chief Executive Officer. Before I begin, I would like to remind you that during the course of this conference call, we'll make projections and other forward-looking statements regarding among other things, our estimates for the first quarter fiscal year 2007 revenues, gross margin levels, combined R&D and SG&A expenses, stock compensation expense as well as our estimates and assumptions regarding our future revenue growth and profitability. Please keep in mind that these statements are predictions that are subject to risks and uncertainties that may cause actual results to differ materially from our projection. By providing this information, we undertake no obligation to update or revise any projections or forward-looking statements, whether as a result of new developments or otherwise. Please refer to our press release issued today which is available on our website at http://www.cirrus.com/. Our latest Form 10-K for the year ended March 26, 2005, as well as our other filings made with the Securities & Exchange Commission for additional discussion of risk factors that could cause actual results to differ materially from our current expectations. I want to mention before we proceed that all financial numbers are prepared, unless noted, in accordance with Generally Accepted Accounting Principles. In addition, during our call, we'll be providing certain non-GAAP financial numbers, including our analog, mixed signal and embedded products revenue, operating expenses, net income and earnings per share. A reconciliation of non-GAAP financial information to the most directly comparable GAAP information is included in the financial statements and issued with the financial release published today, as well as on our website in the investor section at http://www.cirrus.com/. Non-GAAP financial information is not meant as a substitute for GAAP results, but is intended or included solely for informational and comparative purposes. We believe that certain non-GAAP financial information is useful to investors because it may enhance their understanding of the results and trends in our business. We also use certain non-GAAP financial information internally to evaluate and manage our operation. As a note, the non-financial information we use may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for the results prepared in accordance with GAAP. Now, I'll turn the call over to Dave French. David French, President, Chief Executive Officer: Thank you John, and thanks to all of who you are joining us here today. First, I would like to recap the results for the quarter which ended on March 25th. Total revenue was $42.2 million, gross margin was 58.1%. Operating expenses were $12.8 million and net income, again on the GAAP basis was $15.4 million. I would like to summarize first for you the key highlights from the fourth quarter of fiscal year 2006, and first and foremost, I'm pleased to report that our high-precision analog mixed signal and embedded products activity demonstrated healthy year-over-year revenue growth of 15% this quarter, with expanding gross margins. This resulted in a GAAP income this quarter of $0.17 per diluted share. We further increased our cash and marketable securities this quarter by approximately $11 million. Now, up to $243.5 million. Importantly, I would like also to provide those investors who track our ongoing business activities with non-GAAP fourth quarter results. And this is generally done by the analysts covering Cirrus Logic and contributing to First Call. When calculated on a non-GAAP basis, the company would have produced a net income per share of $0.08 based on 88.9 million diluted shares. This non-GAAP result compares favorably with the current First Call mean estimate of $0.06 net income per share. I would like to point out this non-GAAP number excludes a one-time, $7 million cash gain associated with amendments to an existing licensing agreement as well as $1.2 million benefit from certain international tax-related items. Later during this call, I'll provide more detail regarding our business operations and now John will review our financial results in more detail for the March quarter. John Kurtzweil, Senior Vice President, Chief Financial Officer: Thank you, Dave. Our net revenue in the March quarter was $42.2 million compared with $40.4 million in the March quarter one year ago. Of that $40.4 million, the revenue associated with our analog, mixed signal and embedded products was $36.8 million. Therefore, the revenue this quarter associated with our current product line has increased 15% year-over-year. Our revenue by product line was as follows. Mixed signal audio products contributed $20.2 million in the March quarter representing a 4% decline compared to the same quarter one year ago. Industrial products provided $10.1 million in the March quarter representing 78% year-over-year growth and embedded products were $11.9 million in the March quarter representing 17% year-over-year growth. Historical revenue breakdowns for these product lines maybe found on our website in the Investor section. We had no OEM customers representing more than 10% of revenue and one distributor Avnet contributing 26% of revenue. Gross margin for the March quarter was 58.1% compared with 55.1% gross margin in the December quarter, and 53.1% one year ago. This 300 basis point increase from the December quarter was primarily attributable to a richer mix of industrial and embedded processor product sales. Combined R&D and SG&A expense was $19.8 million in the March quarter compared to $21.2 million in the prior quarter. Included as a separate line item in the operating expenses was a $7 million gain resulting from a one-time payment associated with an amendment to an existing licensing agreement. Interest income for the fourth fiscal quarter was $2.5 million. Net income in the fourth fiscal quarter was $15.4 million, which included a $1.2 million international tax benefit. In the prior quarter, the company reported net income of $12.8 million as you may recall, the December quarter also included a favorable international tax benefit of $5.3 million. Now, I will review the reconciliation of our GAAP earnings of $15.4 million to our non-GAAP earnings of $7.2 million or $0.08 per diluted share based on 88.9 million diluted share. As mentioned earlier, we use certain non-GAAP financial numbers because we believe that this information assists us in the management of our business and provides more transparency, consistency and completeness to help understand the underlying results and business trends. As provided on our website, we arrived at our non-GAAP EPS at $0.08 per diluted share by excluding the $7 million gain associated with amendments to an existing licensing agreement and a $1.2 million benefit from certain international tax-related events from our GAAP statement of operations. Our employee head count at the end of March was 424 compared with 425 at the close of the December quarter. Now, on to the balance sheet. Total cash and marketable securities at the end of March increased to $243 million from $233 million at the end of the December quarter. Our total cash per diluted share increased by $0.12 and ended at $2.74 per diluted share. We ended the March quarter with $20.9 million in net receivables compared with $21.4 million at the end of the December quarter. DSOs or day sales outstanding were 45 days compared with 40 days in the December quarter. Inventory at the close of the March quarter was 18.7 million, up 1.7 million from December, which was slightly below what we forecasted in January 2006. Net inventory turns were 3.8 in March. Our capital expenditures were $1.3 million in the March quarter compared with $800,000 in the December quarter. Depreciation and amortization expense totaled $1.9 million compared with $1.8 million in the December quarter. And now Dave will discuss our business operations and guidance for the upcoming quarter. David French, President, Chief Executive Officer: Thank you, John. I'm pleased with our fiscal year 2006 performance. The Company has now consistently been profitable from operations while generating strong gross margins and cash flow. In fact, our cash position at the end of the fiscal year 2006 is $243 million, which is up $63.8 million from the end of fiscal year 2005, or one year earlier. We also made great progress in fiscal year 2006, driving towards our 20% operating profit model and I believe we're well positioned to continue that progress. I'm also pleased that we delivered strong Q4 earnings even though the March quarter has been historically our seasonally weakest sales quarter. Across our product lines, I'm particularly encouraged by our improved engineering execution and greater output from our R&D activities, which of course will serve as the engine for longer-term revenue growth. Now, I'll focus on the mixed signal audio products. Semiconductor components in this product line including data converters and interface devices are used in a wide array of consumer, professional, and automotive audio applications. This product line contributed $20.2 million of our March quarter revenue down 4% year-over-year. Results were slightly below our expectations as revenue was impacted by slightly softer demand in China. Nonetheless, I remain encouraged by our growth opportunities associated with new product sales in a number of consumer applications and particularly in digital television. In the past three months, we introduced four new mixed signal audio products. Chief among these is our first ever Class D power stage integrated circuit, a multi-channel product that delivers high quality audio with high energy efficiency. This product is a good value for home theatre systems and flat panel digital television applications. Increasingly, our customers are incorporating Class D or digital audio products into their digital TV design due to the smaller form factor and lower heat generation in Class D audio products as compared to traditional audio solution. In addition, we launched a new smaller form factors stereo analog-to-digital converter family. These products are the industry's smallest stereo analog-to-digital converters in the audio space and they offer cost-effective high performance audio solutions for digital television, automotive audio equipment and a variety of other consumer uses. Also, following on the success of our first low powered codec, introduced last summer, this quarter we introduced another low powered audio IC, an A-to-D converter which is targeted for portable application such as digital voice recorders and digital microphones. And in addition, we introduced new flagship volume control integrated circuit, which is targeted more towards the professional audio and very high-end consumer audio applications. With these new products, we're focusing on new design win activity worldwide, particularly in the growing digital television and portable product market. We expect to drive longer-term revenue opportunities as we continue to introduce new mixed signal audio products throughout the calendar year. And we have considerable analog and mixed signal engineering expertise right across a broad mix of development activities and we believe our commitment to innovation will fuel our future growth in these markets. Let me turn now to our industrial products. This product line includes integrated circuits designed into a variety of data acquisition, power metering and energy exploration applications. These products showed strong quarter-to-quarter revenue growth and generated our highest gross margins. During the March quarter, these products contributed $10.1 million of the company's revenue, up 78% year-over-year. As anticipated, revenue from our seismic product line was particularly strong due to solid demand for our products in a generally healthy overall global demand for geophysical exploration equipment. During the March quarter, we introduced two new products for power measurement applications, which provide highly optimized solutions for the growing power measurement markets, particularly in India and in Japan. We anticipate that further global expansion of power measurement IC uses will likely augment the long-term stability and revenue growth opportunities for our industrial products. To further strengthen our long-term commitment to increasing our participation in industrial markets, we also revitalized our portfolio of operational amplifiers or Op-Amps with the introduction of four new products. These Op-Amp ICs leverage our high precision delta sigma technology to deliver an ideal combination of high performance and low noise for scientific and industrial measurement applications. This new family of integrated circuits includes two products that offer particularly low power consumption, which is an important feature for newer generations, a battery powered portable instruments and personal monitoring applications. Overall, industrial products exceeded our expectations for revenue this quarter with our industry leading industrial technology expertise and our focus on new product development, we remain optimistic about our medium to long-term growth prospects within the industrial market. Finally, I would like to comment on our embedded product line, which represented $11.9 million of our March quarter sales, up 17% year-over-year. Products within this category include our general purpose ARM-based microprocessor, microcontrollers, network audio components and audio digital signal processors. One I like this quarter in this area was significant revenue contribution from our ARM9 based family of embedded processors. Products which feature our ARM based processors typically have very long design cycles, so this increasing revenue reflects design wins secured in many cases more than a year ago. Within the ARM9 product line, we also introduced a full featured reference design for network attached storage products, which are predicted by many to grow significantly over the next several years as consumers look to these products to manage their ever growing library of digital audio and photographic content. High definition television is well-known as one of the most exciting consumer applications worldwide and it not only provides better video but also delivers high quality audio capability which allows consumers to enjoy a full surround sound experience while watching television. As a result of this opportunity we have recently partnered with Genesis Microchip and developed a reference design for high-definition audio video receivers. This reference design allows consumer audio systems companies to simplify end user home theatre set-up. It enables cost-effective enjoyment of the full high-definition experience. In addition, Sharp and Hitachi are now shipping volume production of digital televisions which incorporate our audio digital signal processors. We're working closely with other DTV manufacturers to help them ramp into volume production this quarter. We anticipate that our longer-term growth prospects in this segment are good particularly as top tier OEMs look to differentiate their products, TV products at the retail level with audio features. I'm pleased that Cirrus Logic is now showing consistent profitability, generating good cash flow and achieving strong quarterly year-over-year growth from our mixed signal, embedded, and industrial products. I remain committed to drive towards our 20% operating profit model during fiscal year 2007. We are somewhat concerned, however, regarding the potential effects of higher energy costs on consumer spending. And so, despite historically strong seasonal trends during the June quarter for our business and more recently, a relatively healthy bookings month in April, we're forecasting modest revenue growth in the current quarter. Our guidance for Q1 of fiscal year 2007, which ends on June 24, 2006, is as follows: Revenue is expected to range between $44 and $48 million which is a sequential increase of 4% to 14% over the March quarter. Gross margin is anticipated to be between 56% and 58%. Combined R&D and SG&A expenses are expected to range between $22 and $24 million including share-based compensation expense of approximately $2 million. To recap, I'm pleased with our fourth quarter results. We beat First Call mean earnings estimates for the quarter with expanding gross margins and strong revenue growth year-over-year. Going forward, I believe we're positioned to generate consistently profitable results with high gross margins, resulting in strong free cash flow. And now, operator, we're ready for questions.

Q - Jeremy Kwan: Yes, good afternoon, this is actually Jeremy Kwan for Tore. There's just a question first on your -- the new Class D audio amps. I was wondering if you could talk about any design wins or any key customers you're working with more closely than others and also who you see as your main competitors in this arena? A - John Kurtzweil: We don't have any design wins that I think are the stage where we want to start talking about them more concretely. I've been talking about that product generating revenue most likely during calendar 2007. Not so much this year. I still believe that's probably true. I think there's some chances we'll get some noticeable revenue this year. And we're getting pretty good interest in that product as the cost structure and -- the system cost structure is pretty favorable and the audio quality is quite good. So, we'll talk more about that as customers get a little bit further along in what they're working on. There is a myriad of competitors in the -- that declare themselves to be digital amplifier power stage suppliers. There's not really a lot of high quality audio suppliers on that list. We've got tripasses out there with some pretty interesting products and Texas Instruments is out there, as well as a number of others. We think that the combination of low cost and very high -- very low system costs and very high audio performance will put us in a good position to win some designs. Q - Jeremy Kwan: And are you targeting ODM type applications initially or are your working with -- are you planning to go after the larger OEMs first? A - John Kurtzweil: Both in parallel, actually I think that the faster movers will be the ODMs, and the consumer OEMs maybe moving a little bit thereafter and then in the longer run, the big long-term opportunity there is automotive applications but that will take several years to pan out. Q - Jeremy Kwan: Great, and I guess moving on to the new Op-Amps. Is this also an area where you are -- I think you mentioned scientific instrumentation applications but is this something you can go after a couple of key customers or is it kind of more of a gradual ramp type of growth that we're looking at here. A - John Kurtzweil: This is still a niche family of Op-Amps. We're not selling for $0.05 here. We're selling high performance components into a number of applications where we already sell the converters, and I think it is an extension of our footprint in many cases in attacking in a pin compatible way some of the opportunities that are serviced at, what we think are relatively high prices compared to our cost by some of the big cap analog guys. It is more our business plan and marketing approach so that will be more broad-based and targeted account. We'll go after hundreds of customers worldwide through relatively technical sales process through our global demand creation team. Q - Jeremy Kwan: Great, and finally, I guess looking ahead, are there any upcoming products that you can kind of preview right now? Any specific applications or product segments that you're going to go after next? A - John Kurtzweil: Well, we talked about several new products in the industrial space, power metering and Op-Amps, we've talked about several audio products including the Class D. Very small form factor A-to-D converter which I think is going to be very interesting for audio input applications that require low cost. There's been a great discussion in the industry around integration of audio D-to-A converters in system chips, which we have indicated we believe is a good trend. It is much, much harder to integrate audio input or A-to-D converters into system chips. And we think that by doing the same thing in the A-to-D space that we pioneered many, many years ago in the D-to-A space with very small form factor, very high performance and quite low cost implementation, we have some pretty interesting opportunities to gain. Q - Jeremy Kwan: Great, thank you very much. A - John Kurtzweil: Thanks very much.

Our next question comes from the line of Jay Srivatsa with Roth Capital Partners, please go ahead. Q - Jay Srivatsa: Congratulations, Dave and John on beating the bottomline, especially the street numbers. A - John Kurtzweil: Thank you, Jay. Q - Jay Srivatsa: Couple of questions if I may. In terms of margins, you had a nice healthy growth in margins, however, you're guiding to a slightly lower margin into the June quarter. Could you give us some clarity on what the thinking there is? A - John Kurtzweil: Actually, gross margins, based on all the records I can see, we set a company record of all-time in terms of gross margin at 58%. I would like to think we're not at all done there in terms of driving some expansion. We've got several programs that have been coming to fruition that we've been talking about for a while. I'm quite pleased that that's the case. We've also been working on the pricing side of things particularly in distribution applications so there's still some room. We guided to the midpoint of our guidance on gross margin was slightly lower, consumer audio applications in March, particularly in China as I mentioned, were slow in March. So our mix was a little bit richer than what we had forecast and then what most people had assumed. I think that the consumer business will pick up. Already we've seen in April a bit of a pickup there. And that the percentage of the mix that will be in lower cost consumer applications and therefore slightly more -- not quite as great margins but still very good margins. Will be a little bit lower in total. That being said, of course, we've got a lot of activities going on to try to push the margins ever higher and we'll see how those programs work out. We've got a few things slowing down our overall margin expansion programs including the cost of energy which turns into freight costs for us. And the cost of oil-based raw materials which goes into piece part cost and factoring part of the process, so there's some issues working against us. I think that we've got room during fiscal year 2007 to improve margins even on a more normal annualized mix but with the shift of increasing consumers starting in June for the year, I thought it more prudent to guide a little bit less aggressively. Q - Jay Srivatsa: Fair enough. In terms of your relationship with Genesis and the Digital TV strategy, could you give us some sense on what the design cycle there? When could we expect some of the design wins -- designs that you're involved in to come to fruition and start to contribute to your revenue line? A - John Kurtzweil: We're talking to a number of accounts. We had one driving big OEM account which I don't think it's appropriate for me to mention them here by name but they're one of the top two or three guys worldwide in high performance home audio equipment. That really wanted to get in early on this HD craze and so they've got an audio position. AV receivers historically have really only been audio switching equipment. They haven't really done much with video. They're trying to get in on the video post processing opportunity to integrate that within equipment which has been sold as audio equipment and their brand name is strong enough where they've got a lot of ability to control channels to do that. They say they're going to generate revenue for us this calendar year. If they do, they're big enough company where it could be meaningful but I would hedge that and say that it seems more likely that for Father's Day and graduation and next year, that HD might become a little bit more significant. Q - Jay Srivatsa: Okay, final question on backlog, could you give us some sense on how it is looking and going into the June quarter? A - John Kurtzweil: Well, January was pretty good. March was pretty slow. March wasn't that good in China. And April's been pretty strong. We came into the quarter with a little bit less backlog than I would have normally expected if we were to see -- if we were thinking we would see normal seasonal sequential increases which are probably 10% or up. At least on my interpretation of what normal is. So, it's a little bit lower backlog coming in. As always we got a little bit more conservatively. April has been pretty good. So we feel that the trends are certainly quite good in China and worldwide. I remain a little bit concerned because we hear all this positive news coming out of, particularly domestic U.S. big box electronics retailers but the visibility other than with digital television backlog that they're putting on the Asian supplier community is very low based on what we see. So, it could be that they're waiting to buy as late as possible with the assumption that semiconductor and flat panel lead times are still quite short which I think is generally speaking, true. Our lead times are actually going up in many cases. So, we're trying to make sure that that's clear to people over there. But I would have liked to have seen a little bit more backlog, but if I look at the April trends, I feel pretty good. Q - Jay Srivatsa: Thank you very much. A - John Kurtzweil: Thanks a lot.

Our next question comes from the line of Craig Hettenbach with Wachovia Securities, please go ahead. Q - Craig Hettenbach: Thank you. If you look within the industrial business, can you talk about trends you're seeing in seismic? I know that business can be a little lumpy but just what the order outlook has been there as well as for some of the new power meter and products? A - John Kurtzweil: Yeah. Industrial product line has been an area of great investment for us the last couple of years, great attention now and quite a bit of fanfare of late. One of the positive attributes or artifacts of higher energy prices are a lot of wealth going into much of many of our clients in that area. But backlog and seismic, without getting into numbers which I don't really have in front of me and we don't tend to break out, is stronger than it's historically been. We've got orders that are out further in time than we've traditionally had. And that's, I think a good sign that our customers are feeling good about their business but also helping us in recognizing that our lead times on building this--those types of products are pretty long. And then of course everything there is quite highly proprietary. But, so, we've got better backlog, better visibility, feels good to have that. Now, the revenue line on that business isn't huge. Although the earnings impact can be pretty big on any revenue follow through because the margins are pretty strong. In power meter activity, it is kind of tough to predict but in India which is a pretty big digital meter, residential meter application opportunity, in Japan, which is more of a commercial metering opportunity that we've created some semi-dedicated products for each of those areas this past quarter generates some growth opportunity this year not more than $5 million year-over-year and probably less than that. But so compared to the seismic growth opportunity, it is a little bit smaller but I think it is a good, long-term business opportunity for us that should show continuing growth for the next couple or few years, I think. Q - Craig Hettenbach: Great, and then in the area of MP3 players, any update on design activity or step in progressing as expected on your end? A - John Kurtzweil: We have a lot of exciting designs. We have good feedback from some brands that I've been talking about for awhile now. A couple of the designs that were ready to go to production, they haven't really bought as much as I was hoping. They bought as much as we forecasted but not as much as I was hoping. I think there is a little bit of turmoil in terms of the end consumer markets in Asia. In terms of what price points people can hit. What level of performance people are willing to pay what prices for. It is a highly competitive space. We've seen a lot of noise for the system chip companies of late that remind me it is great to be an analog company. But I think we've still got a good chances of a few to several million dollars of growth year-over-year compared to last year in that area. I'm not sure who is going to come from. We have interesting Japanese designs and that they don't like me to talk about specifically. We've got some interesting Korean designs that we have talked about some good designs in Hong Kong. I don't know how fast that's going to ramp. We have had good technical feedback on the product -- initial product offering we've got out there. Eliminating some of those big capacities because we've got the ground center outputs which is really helpful in reducing systems cost. And I think that's becoming more and more important for our customer community as the system chip, SOC companies continue to bludgeon themselves to death with pricing. Q - Craig Hettenbach: Okay, and then last one if I could, great to see you able to hold operating margins flat in a seasonably down quarter. Looking out over the next four to six quarters, can you differentiate between leveraging top line growth versus other opportunities you see to kind of squeeze operating costs? A - John Kurtzweil: Yeah sot of three things. There's sales increase which falls to a very good rate as I think everyone knows is pretty obvious. There's gross margin expansion which I mentioned earlier we're not done there, we saw a really top this quarter to a record level. I think through the year, we've got some good opportunity for some room there. Spending, we haven't taken any big moves to decrease spending further. We did hold it flat, of course. We've got some efficiencies that we continue to find in running our company more smoothly. We had some right way things go on this last quarter in terms of some tape outs that moved out of the quarter into the subsequent quarter and things like that. But we probably won't make any big moves on spending in the first half of this calendar year and if revenue picks up in the second half, we probably won't make any moves in the second half, but I think we can hold it pretty much flat and slightly down through the year on a year-over-year basis for sure in dollar terms. Q - Craig Hettenbach: Excellent. Thanks. A - John Kurtzweil: Thanks very much.

Our next question comes from the line of Jason Pflaum with Thomas Wiesel Partners, please go ahead. Q - Alex Kim: Hey guys, this is actually Alex Kim calling in for Jason. A - John Kurtzweil: Yeah. Q - Alex Kim: I just want to talk about gross margins again. I know that we've visited it a couple of different times. Maybe you can help me reconcile the gross margin uptick from December to March. Obviously nice gross margin expansion from 55 to 58 and, maybe we can start there? And then also want to get your opinion on the potential of maybe even hitting 60% by end of year this year, this fiscal year? A - John Kurtzweil: Yeah. On the second part of that question, of course we're only guiding one quarter right now. So, I'll be pretty vague or only qualitative on medium to longer term indications. But we've been working on getting to the most cost-effective way. First, we've been working on test cost reductions and we've been working on transitions to lower cost replacements for earlier generation products as well as new products coming out of pretty good gross margins. All those things continued to work out as we anticipated and that would have given us 1 to 200 basis point lift on the current quarter sequentially over last quarter right as planned. In addition, as I mentioned, I was disappointed on the top line for some of the lower cost products in China for consumer during the March quarter. And for whatever set of reasons and so I ended up with a richer mix, and that probably gave us another 100 basis points with benefit. Probably because the richer mix was fueled on the positive side, on the negative side by the lowest margin stuff going down a little bit more than we expected and on the positive side, by the industrial business particularly seismic products over achieving this last quarter and therefore, you got a little replacement mechanism there that drives gross margins up a little bit further. That being said, I think that--I think we've got some room to continue to drive the margins even on a more normal mix of products through the rest of the year. Through continuing to focus on getting to the lowest cost wafers, getting the cost reduced versions of previously existing products into production and in customer shops, fully qualified. We've worked some pricing things as well. So, in terms of getting to 60, I'm not guiding to 60. We've got 56 to 58 this quarter. But… Q - Alex Kim: --you have been confident in your longer term target of 60% because I know that you've revisited that--or had talked about the 60% target in the past. A - John Kurtzweil: I still think that we'll either get very close or above 60% or we'll grow faster than what people think. It will be one of those two in my mind. Q - Alex Kim: Okay, great. A - John Kurtzweil: But not in the next three to six months. Q - Alex Kim: Okay, great. Just a question on the linearity of the June quarter. I know that you said that you saw a strong April. I'm just trying to get a sense of--is it more back end loaded typically when looking at your numbers historically? A - John Kurtzweil: June? The quarter? Yes, it is usually pretty back-end loaded. Usually sentiment internally is improving through the quarter. In that visibility is lowest at the beginning of the quarter and usually we feel better and better through the quarter. Now, we of course typically rig some of that trend into the plans but the June quarter will be a little bit back-end loaded. We're not planning on it being anymore than normal, however. Q - Alex Kim: Okay and just one final question on your product portfolio specifically on DTVs. What percent of your business represents--does that represent? As I recall, it used to be around 5%. How do you see that tracking throughout the year? Is it more of a fiscal year '08 story or is it something where you can see meaningful top line in '07? A - John Kurtzweil: Digital TVs you're asking about? Q - Alex Kim: Yeah. A - John Kurtzweil: Yeah actually, historically, it has been more like a million bucks a quarter in which the last couple or few quarters, in March it was more than double that. We've indicated that there is a $10 million, $15 million opportunity in that application arena this year off about sub $500 million last year. Could be as high as 20. Most people don't think it is likely to grow that fast but that's the kind of range of expectations we talk about internally. Q - Alex Kim: Okay, thanks, guys. A - John Kurtzweil: Thank you.

Q - Nimal Vallipuram: Yeah, hi, John, hi, Dave. Thanks for giving me the chance. Just getting back to some of the product announcement you detailed at the beginning of the call in the DTV as well as the low power application arena. Without getting into details, can you give us an idea when roughly would those markets be somewhat meaningful markets for Cirrus going forward? A - John Kurtzweil: Well, DTV is already meaningful. I keep track of a lot of different application arenas on a trend basis, kind of not with a precise tracking system because we don't have the ability to distinguish always what our customers are using the products for because they go on a wide variety of application but we get a feel for that. DTV kind of crossed the threshold of meaning about two or three quarters ago when it got over $1 million a quarter in total revenue generation apparently for TVs in total. This quarter in March started this past quarter, it was over $2 million. That's meaningful. It is not huge. So, I don't know about the new business opportunities there. If you look at the new A-to-D converter, we got this low--small form factor A-to-D converter which I think will get good traction in calendar '07, not calendar '06. We're targeting branded OEMs first on that, on that product. And I think that we've got a good opportunity to get some good designs in production in calendar '07 but not so much this year. On the class D power amps--power stage product, we're pushing both major OEMs as well as some of the OEM activity. Probably cannot expect meaningful revenues this year although we're trying to put something on. Probably more calendar 2007, as well. But we've got the existing business. We've got A-to-D converters today. We've got D-to-A converters today, we've got in many cases speed interface devices on some of the higher priced TVs. We've got embedded digital signal processors in a lot of the Japanese brand of domestic product over there. And some of the bigger stuff shipping into the U.S., I think. A lot of existing business that we think will ramp pretty aggressively during the current year as well. Q - Nimal Vallipuram: Just, if I may, one follow-up question. In terms of Apple iPod, it looks like Apple has changed their audio processor from one vendor to another vendor. Are there any chances that you would be in play with them when it comes to their low power application as well which is I think now dominated by Wolfson or someone? A - John Kurtzweil: Yeah. We're always in play. On the one hand but we just haven't generated any revenue in that class of application. We have businesses and a good relationship at Apple. We're not in any of the iPod devices themselves. We're working on some of the related equipment there. I don't think it is easy to forecast if you're going to get any bigger business there. Even if they give us some indication of that, they usually would like us to be pretty quiet about it. Q - Nimal Vallipuram: Let me ask you one final question. On the longer term margin implication, you have done very well mixing the higher margin industrial business as well as the audio consumer electronics and the audio business. I mean I'm aware that you're in the mixed signal and analog arena which tends to carry much more margins stability than the more digital product which goes into consumer electronics items. But once your consumer electronics items start to the DTV and the local application and all the other products start to ramp up, what is going to be the margin implication there? Would you be able to maintain the kind of margin you have an increase on it? Or invariably, because of the consumer electronics market which is price sensitive, some of these products might have to face some sort of margin erosion than what you had based in the past? A - David French: I understand the question. It is kind of a modeling question. Not so much a forecast. In that regard, I can gladly discuss that. I think the industrial opportunity that we face and all revenue in the industrial area this year will go--will grow much faster than anybody anticipates our total revenue will grow this year. So, on a year-over-year basis, I understand what you're saying, our mixed trends are positive without really any question, unless the consumer business for us which means the whole company, grows faster than 20% this year in which case, then your question starts to become more important of a trend factor. If we grow more than 20%, I'm going to feel pretty good no matter what. But even that notwithstanding, I think we can keep the gross margins going up. Our cost reduction trend on high volume applications and our ability to bring out new lower cost versions of existing equipment or products through a number of years in a number of different cycles has been pretty good. I think the organization now with the greater focus on analog and mixed signal is--they're performing better and better. I think they've got room to improve but I think they're getting better and better and I think they can hang in there with the consumer side of the business driving flat to up gross margins in consumer in total. Q - Nimal Vallipuram: Thanks a lot, Dave. That really helps. I appreciate it. Congratulations on a good quarter. A - David French: Thanks very much.

Our next question comes from the line of Don Rode, with S Squared Technology, please go ahead. Q - Don Rode: Yeah, hi, Dave, hi, John. Couple of housekeeping, depreciation and amortization, the quarter if you have it? A - David French: $1.8, $1.9 million. Q - Don Rode: And CapEx? A - David French: $1.3. Q - Don Rode: Okay, and John, cash flow from operations in the quarter? A - John Kurtzweil: Cash flow from operations was about $3 million. A - David French: Almost four maybe. Q - Don Rode: Okay, so $3 to $4 then that $7 million was just kind of a payment. A - David French: Yeah. Q - Don Rode: Okay, going forward, assuming that you get toward the mid-point of the guidance which sounds conservative, your cash flow from operations should improve--there shouldn't be any meaningful changes in receivables or inventories? A - David French: Don, I don't see much change on balance sheet. A - John Kurtzweil: Other than the increasing cash from operations but I'm trying to push inventory down--up this quarter $2 million to $3 million. And we've got an assumption that gets baked in that receivables will also go up a little bit, maybe $2 million or $3 million based on increasing revenue and normal linearity or lack of linearity during the June quarter or any quarter for that matter. However, I think payables will also be going up through the quarter by significant margin as we've been cranking for the June and September quarters are usually pretty good for us. So, I think that cash flow should resemble the P&L this quarter on a GAAP basis. Q - Don Rode: Which based on this next question I can ask you every single call at $2.74 a share. At this point in time you're kind of a bank with a third of the offering, with one half interest income and one half of operating income. Assuming you continue to generate cash like this, this turns out to be somewhat closer to $3.00 a share by the end of the year. Just curious if you guys have any other thoughts regarding that particular conundrum. A - John Kurtzweil: Well, I think assessment is pretty conservative. If we keep doing what we're doing, it probably goes up faster than that. But we have no explicit statement. I think we're getting pretty fair returns on the cash now at least which is…. Q - Don Rode: Yeah, 5% is better than 1%. A - John Kurtzweil: Which is at least good to see. We're evaluating, as always, with the board discussing various alternatives. We have not announced any particular intent nor do we feel a great sense of urgency to move in that direction but we are having a lot of thoughtful discussion on that front. Q - Don Rode: Great. Thanks very much. Good quarter. A - John Kurtzweil: Thanks, Don.

Our next question comes from the line of Jeff Bernstein with Manhasset Capital Management, please go ahead. Q - Jeffery Bernstein: Yeah, hi, guys. Can you just talk about what the sequential growth in industrial was, it looks like it was pretty high sequentially and how to think about that going forward? I know this is a strong industrial quarter. A - John Kurtzweil: Yeah. We did 10 off of--if I'm remembering correctly in the high 7's the previous quarter. What do we have there for December? A - David French: It was 8.8. A - John Kurtzweil: Sorry, 8.8 so 10.1 off of 8.8. So, whatever that is. 16% I think. No, not even 14% maybe. And on a sequential basis, it looks like June is a little bit up but not a lot. There's no discernible seasonal pattern in the industrial business in total. We've looked at it in a lot of different ways. U.S. distribution and customer line appears to be pretty good. It's very difficult to understand customer inventory because the customers are all pretty small in that space and it is very difficult to anticipate seismic where the customers do buy enough in terms of what are their order patterns going to be. That being said, they're giving us a little bit better backlog which makes me feel quite good about June at least being flat, maybe slightly up. And maybe a little bit more than that. But I don't know how I would model it will more than that. I think the annual operating plan that we're working on internally is not very aggressive relative to recent ordering patterns. So, we've got to continue to look at that a little more closely. Q - Jeffery Bernstein: Okay, and then on the DVD audio business, where are we on that? What's going on with integration, et cetera? A - John Kurtzweil: Yeah, everybody's big argument is integrated D-to-A converters and DVD players which that was the big thing last year. It didn't happen actually, we had a pretty good business level last year. Down from the previous year but still pretty good revenue numbers for the year, $10 million, $15 million I think total. Current year, our expectation is that for DVD players, audio deck business goes down half again give or take a little bit. And everybody's talking about they've got a great integrated D-to-A converter and all of this kind of stuff. That being said, we've got some pretty good low cost products in that space and audio output devices are tough to do in (indiscernible) I can tell you that. So, I think it will go down a little bit but it will continue to be a little bit of a revenue generator for us. Q - Jeffery Bernstein: And was that some of the weakness in the quarter and is that kind of coming back or – A - John Kurtzweil: I think that was part of it. There is a lot of consumer other that manufacturers in China, consumer other meaning we don't know what it is being used for. We don't have reason to believe that it is DVD player we don't have reason to believe necessarily that it is TV or anything like that, but a lot of other consumer devices could be home theatre system, could be other boxes. That was pretty slow in China in general this past quarter. It is in the DAC product portfolio, so that was the definite area where it was down. It doesn't seem like it is the guys building DVD players so much. We expected that to be down going in. Q - Jeffery Bernstein: Okay, and so that China electronics other, is that sort of part of the back end loading in the June time period, is that when you see those kinds of guys come back? A - John Kurtzweil: Well, a little bit more understanding on the situation. We've been working since two years ago, counting to 2004 in the June quarter, we sold more in the inventory in the channel than we wanted to. Of course, I think the whole China electronics sector did. But we check that very, very closely. We wanted, during the March quarter, to further reduce channel inventory. Our customer's inventory of semiconductor components during the March quarter in China in particular. We were successful in doing that. That had a negative drag on our revenue during the March quarter. Relative to if inventory stayed flat out there. I feel pretty good about that and a lot of that is just not--just agreeing not to ship anymore product in to our distributors unless they have that demand really clearly identified, and then winning them off the inventory that they had in place at the end of December. Where all of that goes, it is hard to tell but DACs are definitely the product line, D-to-A converters were that was a big addition. Q - Jeffery Bernstein: That's great. Thanks very much. A - John Kurtzweil: Thanks very much.

I'm showing that there are no further questions at this time. Back to you, Mr. French for any closing remarks. David French, President, Chief Executive Officer: Okay, thank you operator and thanks to all of you for your time and for your questions here and your interest in Cirrus Logic. We hope to catch up with you at many of the upcoming conferences in the near term here. We have got a couple in particular, Piper Jaffray's 8th annual hardware and communications conference May 11th in New York, Citigroup's 7th annual semiconductor conference June 1, I think it is in Boston. We'll be at those two conferences. Thank you again for your time and attention here today.

Ladies and gentlemen, that does conclude today's Cirrus Logic Fourth Quarter and Full Year Fiscal 2006 Financial Results Conference Call. We thank you for your participation and for using AT&T Teleconferencing. You may now disconnect.