Avid Technology Initiates Cost Savings Measures

Business Wire, August 1, 2001

Business/Technology Editors

TEWKSBURY, Mass.--(BUSINESS WIRE)--Aug. 1, 2001

Avid Technology, Inc. (Nasdaq: AVID) today announced that it is implementing measures which are expected to result in annual cost savings of approximately $11 million. As a result, operating expenses, excluding amortization and restructuring, are expected to decline to approximately $56 million for the third quarter ending September 30, 2001 and approximately $55 million for the fourth quarter ending December 31, 2001. The savings will be achieved through consolidation of some operations and reductions of approximately 140 jobs worldwide. The company expects to take a charge of approximately $8 million in the current quarter in connection with the restructuring.

"Given the current economic environment, we recognize the need to carefully manage our expenses," said David Krall, Avid's president and chief executive officer. "We're taking these difficult but important steps to further improve our cost structure and profitability, while preserving our investments in the future. Our customers should see no adverse impact on either our product offerings or our level of support as a result of these measures.

"We remain committed to developing the products and services that allow creative professionals to collaborate on the creation, management, and distribution of digital media," Krall added. "As economic conditions improve, Avid will be even better positioned to deliver the integrated solutions that meet our customers' needs."

About Avid Technology, Inc.

Avid Technology, Inc. delivers the solutions that Make, Manage and Move Media(TM). As a recognized digital standard for professionals who Make the world's media--from video, audio and film to animation, special effects and streaming media--Avid's products are used to make more television and news shows, commercials, music videos and CDs, corporate/industrial productions and major motion pictures combined than any other nonlinear editing manufacturer in the world. Now, building on its Oscar(R), Grammy(R) and Emmy(R) award-winning heritage in creating content, Avid is extending its reach by redefining how digital media is shared, stored and distributed. To Manage today's increasingly rich collection of dynamic media, Avid provides powerful servers, networks and media tools to help customers search files, share media and collaborate on new productions, both locally and globally. Avid's solutions also empower users to easily Move media, whether on air, over cable or satellite or through the Internet. Like no other media company today, Avid's end-to-end solutions span the continuum of media creation, management and distribution. The company's corporate headquarters are located in Tewksbury, MA. More information about the company is available at www.avid.com.

The above release includes forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1996, including statements about Avid's intentions to implement cost savings measures. There are a number of factors that could cause actual events or results of operations to differ materially from those indicated by such forward-looking statements, such as market acceptance of Avid's products, further weakening of worldwide economic conditions and the other factors set forth under the caption "Certain Factors That May Affect Future Results" in Avid's Form 10-Q for the quarter ended March 31, 2001 and other filings with the Securities and Exchange Commission.

(c) 2001 Avid Technology, Inc. All rights reserved. Avid is a registered trademark and Make, Manage and Move Media is a trademark of Avid Technology, Inc. Oscar is a registered trademark and service mark of the Academy of Motion Picture Arts and Sciences. Emmy is a registered trademark of ATAS/NATAS. Grammy is a trademark of The National Academy of Recording Arts & Sciences, Inc. All other trademarks contained herein are the property of their respective owners.