“IDT’s resilient business model was highlighted during our fiscal third quarter of 2009 as we delivered strong bottom line results despite a 17% sequential decline in revenue. We exceeded the high end of our December 8, 2008 earnings projections, largely due to our variable expense structure,” said Ted Tewksbury, president and chief executive officer of IDT. “Despite widespread weakness in the semiconductor sector and the broader economy, we continue to build critical skills, capabilities and new products to add value to our customers’ applications and propel revenue growth when demand improves. At the same time, we remain committed to controlling costs and delivering solid operating margins for our investors. Today, we are announcing a reduction of approximately seven% of our global workforce which reflects a structured approach to improve our strategic focus and realign our expenses with a softer demand environment.”

The following highlights the company’s financial performance on both a GAAP and non-GAAP basis. The GAAP results include certain costs, charges, gains and losses in accordance with GAAP which are excluded from non-GAAP results based on management’s determination that they are not directly reflective of on-going operations. Non-GAAP results are not in accordance with GAAP and may not be comparable to non-GAAP information provided by other companies. Non-GAAP information should be considered a supplement to, and not a substitute for, financial statements prepared in accordance with GAAP.

GAAP net loss for the fiscal third quarter of 2009 was $345.3 million or a loss of $2.06 per diluted share, versus GAAP net income of $13.4 million or approximately $0.07 per diluted share in same period one year ago. As a result of the current economic environment and decline in the market value of the company, IDT has conducted an interim goodwill and intangible asset impairment analysis which will result in an estimated non-cash charge of $339.1 million. Fiscal third quarter 2009 GAAP results also include $19.7 million in amortization of intangibles, $9.0 million of stock-based compensation, $5.6 million of in-process R&D related to the Silicon Optix transaction, and a $3.0 million asset impairment charge.

Non-GAAP net income for the fiscal third quarter of 2009 was $30.1 million or $0.18 per diluted share, compared with non-GAAP net income of $46.7 million or $0.25 per diluted share reported in the same period one year ago.

GAAP gross profit for the fiscal third quarter of 2009 was $69.7 million, versus GAAP gross profit of $88.3 million in the same period one year ago. Non-GAAP gross profit for the fiscal third quarter of 2009 was $84.3 million, compared with non-GAAP gross profit of $105.2 million reported in the same period one year ago.

GAAP R&D expense for the fiscal third quarter of 2009 was $37.2 million, compared with GAAP R&D expense of $40.6 million in the same period one year ago. Non-GAAP R&D expense for the fiscal third quarter of 2009 was $31.6 million, compared with non-GAAP R&D expense of $35.7 million in the same period one year ago.

GAAP SG&A expense for the fiscal third quarter of 2009 was $30.9 million, compared with GAAP SG&A expense of $38.9 million in the same period one year ago. Non-GAAP SG&A expense for the fiscal third quarter of 2009 was $21.8 million, compared with non-GAAP SG&A expense of $24.9 million in the same period one year ago.

Recent Highlights:

The company has announced its:

DisplayPort compatible receiver, PanelPort, was included in EDN magazine’s Hot 100 Products.

PanelPort solution, an embedded DisplayPort compliant receiver and timing controller device, has been chosen by CPT (Chunghwa Picture Tubes Ltd.) for inclusion in its 14W flat panel display for notebooks.

Introduced PCI Express (PCIe) switching and timing solutions and Intel-validated Double Data Rate 3 (DDR3) registers which support Intel Xeon processor based on Nehalem.

Launched two new PCIe Gen2 switching solutions that are optimized for computing and embedded applications. It also announced PCIe timing solutions, including fan-out buffers, zero-delay buffers, clocks and jitter attenuators.

PCIe switching solution has been chosen by ASUS for use on its newest high-end Intel processor-based motherboard.

Introduced a new series of devices in the company’s industry-leading portfolio of flexible, low-power, asynchronous dual-ports for high-end handsets.