Zarlink Revises Guidance for Third Quarter Fiscal 2008

    OTTAWA, Nov. 20 /CNW Telbec/ - Zarlink Semiconductor Inc. (NYSE/TSX:ZL)
today issued revised guidance for its Fiscal 2008 third quarter ending
December 28th, 2007.
    On October 24, 2007 Zarlink had projected third quarter revenues of
between US$55 million and US$58 million and a net loss of US$0.08 and US$0.10
per share. The Company now expects Fiscal 2008 third quarter revenue will be
between US$48 million and US$51 million. The revised guidance is the result of
a broader than anticipated softening of the telecommunication market.
    Zarlink had anticipated seasonal softness in the residential cable
gateway market. At the time, Zarlink expected that normal turns business would
partially offset the seasonal softness. However, this seasonal softness is
both broader and deeper than expected, and slowing deployment of new wireless
and next-generation wireline equipment is impacting the ramp of Zarlink's new
telecommunications products.
    Based on the revised revenue guidance, Zarlink now expects a net loss of
US$0.13 to US$0.15 per share in the third quarter. This earnings forecast
includes approximately US$0.02 per share of non-cash foreign exchange loss on
Zarlink's Canadian dollar denominated debenture, based on an assumed exchange
rate of CDN$1.00 to US$1.03.
    "We are confident that we are making the right technology choices as we
rebuild Zarlink, and our key customers are continuing to invest in programs
that require our next-generation networking products," said Kirk K. Mandy,
President and CEO, Zarlink Semiconductor. "Presently, our revenue is impacted
by seasonal softness, compounded by inventory concerns in our sales channels
and the supply chains of our major customers. However, we do not believe that
these inventory levels will lead to a prolonged downturn for our
telecommunications products."

    About Zarlink Semiconductor

    For over 30 years, Zarlink Semiconductor has delivered semiconductor
solutions that drive the capabilities of voice, enterprise, broadband and
wireless communications. The Company's success is built on its technology
strengths including voice and data networks, optoelectronics and ultra
low-power communications. For more information, visit

    Shareholders and other individuals wishing to receive, free of charge,
copies of the reports filed with the U.S. Securities and Exchange Commission
and Regulatory Authorities, should visit the Company's web site at or contact Investor Relations.

    Certain statements in this press release constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements involve known and unknown risks,
uncertainties, and other factors which may cause the actual results,
performance or achievements of the Company to be materially different from any
future results, performance, or achievements expressed or implied by such
forward-looking statements. Such risks, uncertainties and assumptions include,
among others, the following: our dependence on the successful development and
market introduction of new products; our ability to successfully integrate
Legerity and any businesses acquired in the future; our reliance on key
personnel; any potential undisclosed liabilities associated with the Legerity
acquisition; the potential adverse effect on critical reference design
partners who may object to the Legerity acquisition; our ability to continue
to operate profitably and generate positive cash flows in the future; our
dependence on our foundry suppliers and third-party subcontractors; order
cancellations and deferrals by our customers; and other factors referenced in
our Annual Report on Form 20-F. Investors are encouraged to consider the risks
detailed in this filing.

    Zarlink and the Zarlink Semiconductor logo are trademarks of Zarlink
    Semiconductor Inc.

For further information:

For further information: Ed Goffin, Media Relations, (613) 270-7112,; Mike McGinn, Investor Relations, (613) 270-7210,

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