Adaptec Reports Third Quarter Fiscal 2008 Results

Adaptec, Inc. (NASDAQ: ADPT), a global leader in storage solutions, today reported its financial results for the third quarter of fiscal 2008, which ended on December 31, 2007.

Net revenue for the Company's third quarter of fiscal 2008 was $41.2 million, compared with $60.7 million for the third quarter of fiscal 2007.

Income from continuing operations, net of taxes, computed on a generally accepted accounting principles (GAAP) basis, for the third quarter of fiscal 2008 was $1.1 million, or $0.01 per share, compared with income from continuing operations, net of taxes, of $5.1 million, or $0.04 per share, for the third quarter of fiscal 2007. GAAP net income for the third quarter of fiscal 2008 was $1.1 million, or $0.01 per share, compared with a net income of $6.4 million, or $0.05 per share, for the third quarter of fiscal 2007.

"Although we are not satisfied with the current revenue trajectory, we are very pleased with our product development efforts during the past few quarters. We have a broad array of award-winning products which we will expand further during our next fiscal quarter," said S. "Sundi" Sundaresh, President and CEO of Adaptec. "Furthermore, we remain focused on improving our operating model and maintaining the strength of our balance sheet. I am happy to note that the entire team is working diligently to brighten Adaptec's future."

Non-GAAP income from continuing operations, net of taxes, for the third quarter of fiscal 2008 was $4.6 million, or $0.04 per share, compared with non-GAAP loss from continuing operations, net of taxes, of ($5.1) million, or ($0.04) per share, for the third quarter of fiscal 2007. The non-GAAP results for all the periods presented, including, but not limited to, the third quarter of fiscal 2008, as defined below in the section "Use of Non-GAAP Financial Measures," differ from results measured under GAAP as they exclude stock-based compensation expense, expense associated with a management incentive program, amortization of acquisition-related intangible assets, restructuring costs, other charges or gains, and tax differences due to GAAP versus non-GAAP measurements. A complete reconciliation between GAAP and non-GAAP information referred to in this release is provided in the attached tables at the end of this press release.

Conference Call

The Adaptec third quarter fiscal 2008 earnings conference call is scheduled for 1:45 p.m. Pacific Time on January 30, 2008. Individuals may participate via webcast by visiting www.adaptec.com/investor 15 minutes prior to the call. An audio replay of the webcast will be available on Adaptec's investor relations website. A telephone replay of the teleconference will be available through February 12, 2008 by calling (888) 203-1112 in the U.S. or (719) 457-0820 internationally and referencing reservation number 4974545.

About Adaptec

Adaptec, Inc. (NASDAQ: ADPT) provides trusted storage solutions that reliably move, manage, and protect critical data and digital content. Adaptec's software and hardware-based solutions are delivered through leading original equipment manufacturers (OEMs) and channel partners to provide storage connectivity, data protection, and networked storage to enterprises, government organizations, medium and small businesses worldwide. More information is available at www.adaptec.com .

Safe Harbor Statement

This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. Forward-looking statements are statements regarding future events or the future performance of Adaptec, and include statements regarding our expectation of expanding our array of products. These forward-looking statements are based on current expectations, forecasts and assumptions and involve a number of risks and uncertainties that could cause actual results to differ materially from those anticipated by these forward-looking statements. These risks include: if we do not meet our restructuring objectives, we may have to continue to implement additional plans in order to reduce our operating costs; achieving necessary support from the contract manufacturers to whom we have outsourced manufacturing, assembly and packaging of our products; retaining key management; Adaptec's ability to launch new software products; difficulty in forecasting the volume and timing of customer orders; reduced demand in the server, network storage and desktop computer markets; our target markets' failure to accept, or delay in accepting, network storage and other advanced storage solutions, including our SAS, SATA and iSCSI lines of products; decline in consumer acceptance of our current products; the timing and volume of orders by OEM customers for storage products; our ability to control and manage costs associated with the delivery of new products; and the adverse effects of the intense competition we face in our business. For a more complete discussion of risks related to our business, reference is made to the section titled "Risk Factors" included in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2007 on file with the Securities and Exchange Commission. Adaptec assumes no obligation to update any forward-looking information that is included in this release.