CYPRESS SEMICONDUCTOR CORPORATION

RECONCILIATION OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES (a)

(In thousands, except per-share data)

(Unaudited)

Table A: Revenue

Q3'16

Q2'16

GAAP revenue

$

523,845

$

450,127

Add: Revenue from Intellectual Property License

6,250

6,250

Non-GAAP revenue

$

530,095

$

456,377

Table B: GAAP to Non-GAAP reconciling items (Q3 2016)

Cost of
revenues

Research
and
development

SG&A

Amortization
of Intangible
assets

Impairment
related to
assets held
for sale

(Gain) related
to investment
in Deca
Technologies

Interest and
other
expense, net

Income tax
provision

GAAP [i]

$

325,225

$

95,411

$

92,179

$

54,849

$

35,259

$

(112,774)

$

21,157

$

(3,304)

[1] Stock based compensation, including costs related to modification of equity awards

4,852

12,581

9,880

—

—

—

—

—

[2] Changes in value of deferred compensation plan

113

365

785

—

—

—

(1,207)

—

[3] Merger, integration and related costs

192

1,937

10,390

—

—

—

—

—

[4] Inventory Step-up related to acquisition accounting

4,742

—

—

—

—

—

—

—

[5] Losses from equity method investments

—

—

—

—

—

—

4,233

—

[6] Imputed interest on convertible debt, equity component amortization on convertible debt and others

—

—

—

—

—

—

2,926

—

[7] Amortization of debt issuance costs

—

—

—

—

—

—

950

—

[8] Amortization of  Intangible assets

—

—

—

54,849

—

—

—

—

[9] (Gain) related to investment in Deca Technologies

—

—

—

—

—

(112,774)

—

—

[10] Impairment related to assets held for sale

—

—

—

—

35,259

—

—

—

[11] Restructuring costs, including executive severance

—

—

7,970

—

—

—

—

—

[12] Tax impact of Non-GAAP adjustments

—

—

(179)

—

—

—

(55)

(4)

Non - GAAP [ii]

$

315,326

$

80,528

$

63,333

$

—

$

—

$

—

$

14,310

$

(3,308)

Impact of reconciling items [ii - i]

$

(9,899)

$

(14,883)

$

(28,846)

$

(54,849)

$

(35,259)

$

112,774

$

(6,847)

$

(4)