10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2012

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             .

Commission File Number: 001-15181

FAIRCHILD SEMICONDUCTOR INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

Delaware	04-3363001
(State or other jurisdiction of incorporation or organization)	(I.R.S.Employer Identification No.)

3030 Orchard Parkway

San Jose, California 95134

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (408)822-2000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act).

Large Accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

The number of shares outstanding of each of the issuer’s classes of common stock as of the close of business on September 30, 2012:

Title of Each Class	Number of Shares
Common Stock	126,956,165

FAIRCHILD SEMICONDUCTOR INTERNATIONAL, INC. AND SUBSIDIARIES

INDEX

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Consolidated Balance Sheets as of September 30, 2012 and December 25, 2011		3
	Consolidated Statements of Operations for the Three and Nine Months Ended September  30, 2012 and September 25, 2011		4
	Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September  30, 2012 and September 25, 2011		5
	Consolidated Statements of Cash Flows for the Three and Nine Months Ended September  30, 2012 and September 25, 2011		6
	Notes to Consolidated Financial Statements (Unaudited)		7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		20
Item 3.	Quantitative and Qualitative Disclosures about Market Risk		30
Item 4.	Controls and Procedures		30
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings		31
Item 1A.	Risk Factors		32
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		44
Item 6.	Exhibits		44
Signature			46

2

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

FAIRCHILD SEMICONDUCTOR INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In millions)

(Unaudited)

	September 30, 2012			December 25, 2011
ASSETS
Current assets:
Cash and cash equivalents	$	385.6		$	423.3
Short-term marketable securities		0.1			0.2
Accounts receivable, net of allowances of $26.3 and $24.0 at September 30, 2012 and December 25, 2011, respectively		162.5			142.9
Inventories		242.3			234.2
Deferred income taxes, net of allowances		20.5			16.5
Other current assets		31.0			35.9
Total current assets		842.0			853.0
Property, plant and equipment, net		775.2			765.4
Deferred income taxes, net of allowances		20.5			17.1
Intangible assets, net		51.8			65.4
Goodwill		169.3			169.3
Long-term securities		28.4			32.3
Other assets		39.0			34.4
Total assets	$	1,926.2		$	1,936.9
LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	117.7		$	132.5
Accrued expenses and other current liabilities		82.9			125.7
Total current liabilities		200.6			258.2
Long-term debt, less current portion		300.1			300.1
Deferred income taxes		28.5			27.8
Other liabilities		30.3			26.3
Total liabilities		559.5			612.4
Commitments and contingencies (Note 11)
Temporary equity - deferred stock units		2.6			2.3
Stockholders’ equity:
Common stock		1.3			1.3
Additional paid-in capital		1,494.6			1,481.9
Accumulated deficit		(3.8	)		(42.0	)
Accumulated other comprehensive loss		(9.4	)		(12.4	)
Less treasury stock (at cost)		(118.6	)		(106.6	)
Total stockholders’ equity		1,364.1			1,322.2
Total liabilities, temporary equity and stockholders’ equity	$	1,926.2		$	1,936.9

See accompanying notes to unaudited consolidated financial statements.

3

FAIRCHILD SEMICONDUCTOR INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per share and percent data)

(Unaudited)

	Three Months Ended						Nine Months Ended
	September 30, 2012			September 25, 2011			September 30, 2012			September 25, 2011
Total revenue	$	358.8		$	403.2		$	1,072.5		$	1,249.4
Cost of sales		238.7			258.4			729.8			791.9
Gross margin		120.1			144.8			342.7			457.5
Gross margin %		33.5	%		35.9	%		32.0	%		36.6	%
Operating expenses:
Research and development		37.8			37.8			119.0			114.6
Selling, general and administrative		48.0			54.4			157.8			167.8
Amortization of acquisition-related intangibles		4.5			4.7			13.7			15.0
Restructuring and impairments		3.4			4.1			6.3			9.5
Charge for litigation		—			—			1.3			—
Total operating expenses		93.7			101.0			298.1			306.9
Operating income		26.4			43.8			44.6			150.6
Other expense, net		1.2			1.4			4.2			5.8
Income before income taxes		25.2			42.4			40.4			144.8
Provision for income taxes		0.5			6.6			2.2			20.6
Net income	$	24.7		$	35.8		$	38.2		$	124.2
Net income per common share:
Basic	$	0.19		$	0.28		$	0.30		$	0.98
Diluted	$	0.19		$	0.28		$	0.30		$	0.95
Weighted average common shares:
Basic		126.8			126.9			126.7			127.0
Diluted		128.8			129.9			129.1			130.8

See accompanying notes to unaudited consolidated financial statements.

4

FAIRCHILD SEMICONDUCTOR INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

(Unaudited)

	Three Months Ended						Nine Months Ended
	September 30, 2012			September 25, 2011			September 30, 2012			September 25, 2011
Net income	$	24.7		$	35.8		$	38.2		$	124.2
Other comprehensive income, net of tax:
Net change associated with hedging transactions		6.2			(8.6	)		8.6			(8.2	)
Net amount reclassified to earnings for hedging		(0.4	)		(1.1	)		(1.2	)		(1.5	)
Net change associated with fair value of securities		(0.4	)		(0.2	)		(4.4	)		0.9
Net change associated with pension transactions		—			—			—			—
Comprehensive income	$	30.1		$	25.9		$	41.2		$	115.4

See accompanying notes to unaudited consolidated financial statements.

5

FAIRCHILD SEMICONDUCTOR INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

	Nine Months Ended
	September 30, 2012			September 25, 2011
Cash flows from operating activities:
Net income	$	38.2		$	124.2
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		100.5			113.5
Non-cash stock-based compensation expense		18.4			19.0
Non-cash interest income		(0.4	)		(0.4	)
Non-cash financing expense		0.8			0.8
Non-cash write-off of deferred financing fees		—			2.1
Non-cash acquisition tax impact		—			0.1
Loss on disposal of property, plant, and equipment		1.2			1.0
Deferred income taxes, net		(6.7	)		(7.6	)
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable, net		(19.6	)		7.7
Inventories		(8.1	)		(26.7	)
Other current assets		6.1			(3.9	)
Current liabilities		(36.1	)		(12.3	)
Other assets and liabilities, net		10.0			5.2
Net cash provided by operating activities		104.3			222.7
Cash flows from investing activities:
Purchase of marketable securities		(0.5	)		(0.1	)
Sale of securities		0.3			—
Maturity of marketable securities		0.2			0.1
Capital expenditures		(122.4	)		(141.6	)
Purchase of molds and tooling		(1.9	)		(2.0	)
Acquisitions, net of cash acquired		—			(16.5	)
Net cash used in investing activities		(124.3	)		(160.1	)
Cash flows from financing activities:
Repayment of long-term debt		—			(320.6	)
Borrowing from Revolving Credit Facility		—			300.0
Proceeds from issuance of common stock and from exercise of stock options		4.4			35.4
Purchase of treasury stock		(12.0	)		(33.1	)
Shares withheld for employees taxes		(10.1	)		(10.3	)
Debt financing costs		—			(5.2	)
Net cash used in financing activities		(17.7	)		(33.8	)
Net change in cash and cash equivalents		(37.7	)		28.8
Cash and cash equivalents at beginning of period		423.3			404.6
Cash and cash equivalents at end of period	$	385.6		$	433.4

See accompanying notes to unaudited consolidated financial statements.

6

FAIRCHILD SEMICONDUCTOR INTERNATIONAL, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 – Basis of Presentation

The accompanying interim consolidated financial statements of Fairchild Semiconductor International, Inc. (the company) have been prepared in conformity with accounting principles generally accepted in the United States of America, consistent in all material respects with those applied in the company’s Annual Report on Form 10-K for the year ended December 25, 2011. The interim financial information is unaudited, but reflects all normal adjustments, which are, in the opinion of management, necessary to provide a fair statement of results for the interim periods presented. The financial statements should be read in conjunction with the financial statements in the company’s Annual Report on Form 10-K for the year ended December 25, 2011. Certain amounts for prior periods have been reclassified to conform to the current presentation. The results for the interim periods are not necessarily indicative of the results of operations that may be expected for the full year. The company’s fiscal calendar, in which each quarter ends on a Sunday, contains 53 weeks every seven years. This additional week is included in the first quarter of the year. The company’s results for the nine months ended September 30, 2012 and September 25, 2011 consists of 40 weeks and 39 weeks, respectively.

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Such estimates include the valuation of accounts receivable, inventories, goodwill, investments, intangible assets, and other long-lived assets, legal contingencies, and assumptions used in the calculation of income taxes and customer incentives, among others. These estimates and assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. The company adjusts such estimates and assumptions when facts and circumstances dictate. Illiquid credit markets, volatile equity and foreign currency markets, and declines in consumer spending have combined to increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in those estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods.

Note 2 – Financial Statement Details

	September 30, 2012		December 25, 2011
	(In millions)
Inventories
Raw materials	$	38.4	$	36.9
Work in process		142.7		135.2
Finished goods		61.2		62.1
	$	242.3	$	234.2

	September 30, 2012		December 25, 2011
	(In millions)
Property, plant and equipment
Land and improvements	$	24.7	$	24.0
Buildings and improvements		391.9		382.4
Machinery and equipment		1,769.5		1,732.0
Construction in progress		140.5		151.5
Total property, plant and equipment		2,326.6		2,289.9
Less accumulated depreciation		1,551.4		1,524.5
	$	775.2	$	765.4

7

	September 30, 2012		December 25, 2011
	(In millions)
Accrued expenses and other current liabilities
Payroll and employee related accruals	$	47.7	$	75.7
Taxes payable		15.8		23.5
Restructuring and impairments		3.8		2.7
Other		15.6		23.8
	$	82.9	$	125.7

	Three Months Ended						Nine Months Ended
	September 30, 2012			September 25, 2011			September 30, 2012			September 25, 2011
				(In millions)
Other expense, net
Interest expense	$	1.7		$	1.9		$	5.7		$	5.3
Interest income		(0.6	)		(0.7	)		(1.8	)		(2.0	)
Other (income) expense, net		0.1			0.2			0.3			2.5
Other expense, net	$	1.2		$	1.4		$	4.2		$	5.8

Prior to December 26, 2011, the company depreciated much of its machinery and equipment over an eight-year period. During the first quarter of 2012, the company completed an analysis of the useful life assumptions. In performing this analysis, the company examined the historical usage patterns for machinery and equipment at its wafer fabrication and assembly and test manufacturing facilities. As a result of this analysis, the company determined that, while the useful life of its assembly and test equipment was consistent with the eight year depreciation assumption, the wafer fabrication equipment remained in use beyond the eight-year life assigned to that asset category. The typical life was approximately ten years. At the time the analysis was performed, the company was unaware of any events which would result in a change from this historical pattern. Accordingly, the company determined that it would prospectively adjust the estimated useful life assumptions for machinery and equipment at the company’s wafer fabrication facilities from eight years to ten years to better align its depreciation expense with its actual historical experience. As a result, the company realized a reduction in its depreciation expense of approximately $4.2 million and $13.7 million in the third quarter and first nine months of 2012, respectively, when compared to depreciation expense under the previous useful life assumption.

In addition, the company reassessed the useful lives, which ranged from one to five years, of its molds and tooling equipment in the first quarter. The historical patterns of molds and tooling usage at its assembly and test manufacturing facilities were examined. Based upon the analysis, it was determined three years was the most appropriate life for these assets. This resulted in a net increase to depreciation expense of $0.7 million in the first quarter of 2012. Impacts on the second and third quarter were not material.

The impact of these change in estimates increased net income by $3.8 million or $0.03 per share in the quarter ended September 30, 2012 and by $11.9 million or $0.09 per share for the nine months ended September 30, 2012.

Note 3 – Computation of Net Income per Share

Basic net income per share is computed using the weighted average number of common shares outstanding during the period. Diluted net income per share is computed using the weighted average number of common shares outstanding during the period, plus the dilutive effect of potential future issuances of common stock relating to potentially dilutive securities. There is no dilution when a net loss exists. Potentially dilutive common equivalent securities consist of stock options, performance units (PUs), deferred stock units (DSUs) and restricted stock units (RSUs). In calculating diluted earnings per share, the dilutive effect of stock options is computed using the average market price for the respective period using the treasury share method. Certain potential shares of the company’s outstanding stock options were excluded because they were anti-dilutive, but could be dilutive in the future. The following table sets forth the computation of basic and diluted earnings per share.

8

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 25, 2011		September 30, 2012		September 25, 2011
	(In millions, except per share data)
Basic:
Net income	$	24.7	$	35.8	$	38.2	$	124.2
Weighted average shares outstanding		126.8		126.9		126.7		127.0
Net income per share	$	0.19	$	0.28	$	0.30	$	0.98
Diluted:
Net income	$	24.7	$	35.8	$	38.2	$	124.2
Basic weighted average shares outstanding		126.8		126.9		126.7		127.0
Assumed exercise of common stock equivalents		2.0		3.0		2.4		3.8
Diluted weighted average common and common equivalent shares		128.8		129.9		129.1		130.8
Net income per share	$	0.19	$	0.28	$	0.30	$	0.95
Anti-dilutive common stock equivalents, non-vested stock, DSUs, RSUs, and PUs		2.8		7.3		4.0		4.8

Note 4 – Supplemental Cash Flow Information

	Nine Months Ended
	September 30, 2012		September 25, 2011
	(In millions)
Cash paid for:
Income taxes, net	$	13.9	$	21.1
Interest	$	5.1	$	5.0

Note 5 – Fair Value

Fair Value of Financial Instruments. In accordance with the requirements of the Fair Value Measurements and Disclosures Topic of the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC), the company groups its financial assets and liabilities measured at fair value on a recurring basis in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. These levels are:

• Level 1 – Valuation is based upon quoted market price for identical instruments traded in active markets.

• Level 2 – Valuation is based on quoted market prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market.

• Level 3 – Valuation is generated from model-based techniques that use significant assumptions not observable in the market. Valuation techniques include use of discounted cash flow models and similar techniques.

In accordance with the requirements of the Fair Value Measurements and Disclosures Topic of the FASB ASC, it is the company’s policy to maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements. When available, the company uses quoted market prices to measure fair value. If market prices are not available, the fair value measurement is based on models that use primarily market based parameters including interest rate yield curves, option volatilities and currency rates. In certain cases where market rate assumptions are not available, the company is required to make judgments about assumptions market participants would use to estimate the fair value of a financial instrument. Changes in the underlying assumptions used, including discount rates and estimates of future cash flows could significantly affect the results of current or future values. The results may not be realized in an actual sale or immediate settlement of an asset or liability.

9

The assets and liabilities measured at fair value on a recurring basis include securities and derivatives. Financial instruments classified as Level 1 are securities traded on an active exchange as well as U.S. Treasury, and other U.S. government and agency-backed securities that are traded by dealers or brokers in active over-the-counter markets. Derivatives are classified as Level 2 financial instruments. Auction rate securities are classified as Level 3 financial instruments.

The fair value of securities is based on quoted market prices at the date of measurement, except for auction rate securities. The auction rate security market is no longer active and as a result there is no observable market data for these assets. Fair value estimates are based on judgments regarding current economic conditions, liquidity discounts and interest rate risks. These estimates involve significant uncertainties and judgments and cannot be determined with precision. As a result such calculated fair value estimates may not be realizable in a current sale or immediate settlement of the instrument. In addition, changes in the underlying assumptions used in the fair value measurement technique, including discount rates, liquidity risks and estimates of future cash flows could significantly affect these fair value estimates.

A discounted cash flow (DCF) calculation is performed to determine the estimated fair value of the auction rate securities. The assumptions used in preparing the DCF model included estimates for the amount and timing of future interest and principal payments and the rate of return required by investors to own these securities in the current environment. In making these assumptions, relevant factors that were considered included: the formula applicable to each security which defines the interest rate paid to investors in the event of a failed auction; forward projections of the interest rate benchmarks specified in such formulas; the likely timing of principal repayments; the probability of full repayment considering guarantees by third parties and additional credit enhancements provided through other means. The estimate of the rate of return required by investors to own these securities also considers the current reduced liquidity for auction rate securities. Inputs for DCF calculations are based upon publicly available data as well as the company’s own estimates. One major unobservable input to the valuation was the maturity assumption which ranged from twenty one to thirty three years for 2012 valuations and from four to ten years for 2011 valuations. Current maturity assumptions are at the contractual maturity. Any significant decreases in the maturity assumptions may result in higher fair values. The maturity assumptions are dependent on the individual auction rate security. The maturity assumptions were based on the terms of the underlying instrument and the potential for restructuring the auction rate security. Another unobservable input to the valuation was the discount rates, which ranged from libor plus 5% to libor plus 8% for the 2012 valuations. The discount rates assumptions are dependent on the individual auction rate security and are based on average adjusted yield on comparable bonds. Any significant increase or decrease to the discount rates could result in lower or higher fair values.

All of the company’s derivatives are traded in over-the-counter markets where quoted market prices are not readily available. For those derivatives, the company measures fair value using prices obtained from the counterparties with whom the company has traded. The counterparties price the derivatives based on models that use primarily market observable inputs, such as yield curves and option volatilities. Accordingly, the company classifies these derivatives as Level 2.

The company is exposed to credit-related losses in the event of non-performance by counterparties to hedging instruments. The counterparties to all derivative transactions are major financial institutions. However, this does not eliminate the company’s exposure to credit risk with these institutions. This credit risk is generally limited to the unrealized gains in such contracts should any of these counterparties fail to perform as contracted. The company considers the risk of counterparty default to be minimal.

10

The following table presents the balances of assets and liabilities measured at fair value on a recurring basis as of September 30, 2012.

	Total			Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)
	(In millions)
Foreign Currency Derivatives
Assets	$	2.1		$	—	$	2.1		$	—
Liabilities		(0.3	)		—		(0.3	)		—
	$	1.8		$	—	$	1.8		$	—
Securities
Marketable securities	$	2.7		$	2.7	$	—		$	—
Auction rate securities		25.8			—		—			25.8
	$	28.5		$	2.7	$	—		$	25.8

The following table summarizes the changes in level 3 securities measured at fair value on a recurring basis for the nine months ended September 30, 2012.

	Auction Rate Securities
	(In millions)
Balance at beginning of period	$	29.8
Total realized and unrealized gains or (losses)
Included in net income		—
Included in OCI		(4.4	)
Accretion of impairments included in net income		0.4
Sales		—
Purchases, issuances and settlements		—
Balance at end of period	$	25.8

Long term debt is carried at amortized cost. However, the company is required to estimate the fair value of long term debt under the Financial Instrument Topic of the FASB ASC. The carrying amount of the revolving facility is considered to approximate fair value as the interest rate on the loan is similar to current market rates. See Note 12 for more information on the credit facility.

	September 30, 2012				December 25, 2011
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
	(In millions)
Long-TermDebt:
Revolving Credit Facility	$	300.0	$	300.0	$	300.0	$	300.0

11

Note 6 – Derivatives

Derivatives. The company uses derivative instruments to manage exposures to changes in foreign currency exchange rates and interest rates. In accordance with the requirements of the Derivatives and Hedging Topic of the FASB ASC, the fair value of these hedges is recorded on the balance sheet. For the fair value of derivatives, see Note 5.

Foreign Currency Derivatives. The company uses currency forward and combination option contracts to hedge a portion of its forecasted foreign exchange denominated revenues and expenses. The company monitors its foreign currency exposures to maximize the overall effectiveness of its foreign currency hedge positions. Currencies hedged include the euro, Japanese yen, Philippine peso, Malaysian ringgit, Korean won and Chinese yuan. The company’s objectives for holding derivatives are to minimize the risks using the most effective methods to eliminate or reduce the impacts of these exposures. The maturities of the cash flow hedges are 18 months or less.

Changes in the fair value of derivative instruments related to time value are included in the assessment of hedge effectiveness. Hedge ineffectiveness, determined in accordance the Derivatives and Hedging Topic of the FASB ASC, did not have a material impact on earnings for the three and nine months ended September 30, 2012. No cash flow hedges were derecognized or discontinued during the three and nine months ended September 30, 2012.

Derivative gains and losses included in accumulated other comprehensive income (AOCI) are reclassified into earnings at the time the forecasted transaction is recognized. The company estimates that $1.2 million of net unrealized derivative losses included in AOCI will be reclassified into earnings within the next twelve months.

The company also uses currency forward and combination option contracts to offset the foreign currency impact of balance sheet translation. These derivatives have one month terms and the initial fair value, if any, and the subsequent gains or losses on the change in fair value are reported in earnings within the same income statement line as the impact of the foreign currency translation. From time to time, the company will also hedge the liability for an expected cash payment in foreign currency. These derivatives have terms that match the expected payment timing. The initial fair value, if any, and the subsequent gains or losses on the change in fair value are reported in earnings within the same income statement line as the change in value of the liability due to changes in currency value.

The tables below show the notional principal and the location and amounts of the derivative fair values in the consolidated balance sheet as of September 30, 2012 and December 25, 2011 as well as the location of derivative gains and losses in the statement of operations for the nine months ended September 30, 2012 and September 25, 2011. Pursuant to the Derivatives and Hedging Topic of the FASB ASC, the company nets the fair value of all derivative financial instruments with counterparties for which a master netting arrangement is utilized. The notional principal amounts for these instruments provide one measure of the transaction volume outstanding as of the end of the period and do not represent the amount of the company’s exposure to credit or market loss. The estimates of fair value are based on applicable and commonly used pricing models using prevailing financial market information as of September 30, 2012 and December 25, 2011. Although the following table reflects the notional principal and fair value of amounts of derivative financial instruments, it does not reflect the gains or losses associated with the exposures and transactions that these financial instruments are intended to hedge. The amounts ultimately realized upon settlement of these financial instruments, together with the gains and losses on the underlying exposures will depend on actual market conditions during the remaining life of the instruments.

The following tables present derivatives designated as hedging instruments under the Derivatives and Hedging Topic of the FASB ASC.

	As of Septemeber 30, 2012									As of December 25, 2011
	Balance Sheet Classification	Notional Amount		Fair Value			Amount of Gain (Loss) Recognized In AOCI			Balance Sheet Classification	Notional Amount		Fair Value			Amount of Gain (Loss) Recognized In AOCI
	(In millions)										(In millions)
Derivatives in Cash Flow Hedges
Foreign exchange contracts
Derivatives for forecasted revenues	Current assets	$	—	$	—		$	—		Current assets	$	60.3	$	0.9		$	0.9
Derivatives for forecasted revenues	Current liabilities		50.9		(0.3	)		(0.3	)	Current liabilities	$	—	$	—			—
Derivatives for forecasted expenses	Current assets		245.0		2.1			2.1		Current assets		33.6		—			—
Derivatives for forecasted expenses	Current liabilities		—		—			—		Current liabilities		224.4		(6.4	)		(6.4	)
Total foreign exchange contract derivatives		$	295.9	$	1.8		$	1.8			$	318.3	$	(5.5	)	$	(5.5	)

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	For the Nine Months Ended September 30, 2012					For the Nine Months Ended September 25, 2011
	Income Statement Classification of Gain (Loss)	Amount of Gain (Loss)  Recognized In Income		Amount of Gain (Loss)  Reclassified from AOCI		Income Statement Classification of Gain (Loss)	Amount of Gain (Loss) Recognized In Income			Amount of Gain (Loss) Reclassified from AOCI
Foreign Currency contracts	Revenue	$	1.2	$	1.2	Revenue	$	(3.0	)	$	(3.0	)
Foreign Currency contracts	Expenses		—		—	Expenses		4.5			4.5
		$	1.2	$	1.2		$	1.5		$	1.5

Gain (Loss) Recognized in OCI for Derivative Instruments (1)
	Nine Months Ended September  30, 2012
Foreign exchange contracts	$	7.3

(1) This amount is inclusive of both realized and unrealized gains and losses recognized in OCI.

The following tables present derivatives not designated as hedging instruments under Derivatives and Hedging Topic of the FASB ASC.

	As of September 30, 2012					As of December 25, 2011
	Balance Sheet Classification	Notional Amount		Fair Value		Balance Sheet Classification	Notional Amount		Fair Value
	(In millions)					(In millions)
Derivatives Not Designated as Hedging Instruments
Foreign Exchange Contracts	Current assets	$	16.5	$	0.0	Current assets	$	6.7	$	—
Foreign Exchange Contracts	Current liabilities		5.4		0.0	Current liabilities		44.9		0.1
Total derivatives, net		$	21.9	$	0.0		$	51.6	$	0.1

	For the Nine Months September 30, 2012			For the Nine Months Ended September 25, 2011
	Income Statement Classification of Gain (Loss)	Amount of Gain (Loss) Recognized In Income		Income Statement Classification of Gain (Loss)	Amount of Gain (Loss) Recognized In Income
		(In millions)		(In millions)
Derivatives Not Designated as Hedging Instruments
Foreign Exchange Contracts	Revenue	$	0.0	Revenue	$	(0.2	)
Foreign Exchange Contracts	Expenses		0.8	Expenses		(1.3	)
Net gain (loss) recognized in income		$	0.8		$	(1.5	)

Note 7 – Securities

The company invests excess cash in marketable securities consisting primarily of money markets, commercial paper, corporate notes and bonds, and U.S. government securities. While the company still holds auction rate securities, the company no longer actively invests in them.

All of the company’s securities are classified as available-for-sale. In accordance with the Investments – Debt and Equity Securities Topic of the FASB ASC, available-for-sale securities are carried at fair value with unrealized gains and losses included as a component of AOCI within stockholders’ equity, net of any related tax effect, if such gains and losses are considered temporary. Realized gains and losses on these investments are included in interest income and expense. Declines in value judged by management to be other-than-temporary and credit related are included in impairment of investments in the statement of operations. The noncredit component of impairment is included in AOCI. For the purpose of computing realized gains and losses, cost is identified on a specific identification basis. There were no material realized gains or losses on sales of securities in the first nine months of 2012 or 2011. Proceeds from the sales of securities in the first nine months of 2012 were $0.3 million. There were no sales of securities in 2011.

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Securities are summarized as of September 30, 2012:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Market Value
	(In millions)
Short-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	0.1	$	—	$	—	$	0.1
Total marketable securities	$	0.1	$	—	$	—	$	0.1

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Market Value
	(In millions)
Long-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	2.1	$	0.4	$	—		$	2.5
Corporate debt securities		0.1		—		—		$	0.1
Auction rate securities		36.2		—		(10.4	)		25.8
Total securities	$	38.4	$	0.4	$	(10.4	)	$	28.4

In aggregate, the auction rate securities have been in an unrealized loss position for over a year. The continued unrealized loss is attributable to the ongoing volatility in the global equities markets and uncertainty in the credit markets primarily from the European debt situation and other global economic uncertainty. However, the company does not intend to sell or believe it is more likely than not that the company would be required to sell the securities before a recovery of the amortized cost basis of the investment. In addition, as a result of the continued performance of the issue and its’ insurance guarantee, the company considers this decrease in fair value to be temporary in nature.

Securities are summarized as of December 25, 2011:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Market Value
	(In millions)
Short-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	0.2	$	—	$	—	$	0.2
Total marketable securities	$	0.2	$	—	$	—	$	0.2

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Market Value
	(In millions)
Long-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	1.8	$	0.4	$	—		$	2.2
Corporate debt securities		0.3		—		—		$	0.3
Auction rate securities		35.8		—		(6.0	)		29.8
Total securities	$	37.9	$	0.4	$	(6.0	)	$	32.3

The following table presents the amortized cost and estimated fair market value of available-for-sale securities by contractual maturity as of September 30, 2012.

	Amortized Cost		Market Value
	(In millions)
Due in one year or less	$	0.1	$	0.1
Due after one year through three years		0.4		0.4
Due after three years through ten years		1.1		1.4
Due after ten years	$	36.9	$	26.6
	$	38.5	$	28.5

As of September 30, 2012, auction rate securities with a market value of $25.8 million are included in the table above in contractual maturities due after ten years. The company’s auction rate securities are composed of approximately $16.8

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million of securities that are structured obligations of special purpose reinsurance entities associated with life insurance companies and $9.0 million of corporate debt securities issued by a special purpose financial services corporation that offers credit risk protection through writing credit derivatives. The company continues to accrue and receive interest on these securities based on a contractual rate.

The following table presents a roll forward of the amount related to credit losses recognized in earnings during the nine months ended September 30, 2012.

	Credit Losses Recognized in Earnings
	(In millions)
Balance at beginning of period	$	14.0
Accretion of impairments included in net income		(0.4	)
Balance at end of period	$	13.6

There is no portion of other-than-temporary impairment related to credit loss currently included in AOCI.

Note 8 – Segment Information

Fairchild is currently organized onto three reporting segments. The organization is an application based structure which corresponds with the way the company manages the business. The majority of the company’s activities are aligned into two focus areas; MCCC, which focuses on mobile and ultraportable products and PCIA, which focuses on power supply and motor control solutions. Each of these segments has a specific focus area, a small set of leading customers, and common technology requirements for their product groups. The third reporting segment, SDT, combines the management of multiple market products that provide generic solutions for standard diodes / transistors, standard linear, and infrared.

Effective the first day of 2012, the mature logic group was transferred from the MCCC reporting segment to SDT and the management of the ground fault interrupt (GFI) products was moved from MCCC to PCIA. Prior year numbers have been restated to reflect this change.

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The following table presents selected operating segment financial information for the three and nine months ended September 30, 2012 and September 25, 2011.

	Three Months Ended						Nine Months Ended
	September 30, 2012			September 25, 2011			September 30, 2012			September 25 2011
	(In millions)						(In millions)
Revenue and Operating Income:
MCCC
Total revenue	$	142.2		$	148.4		$	432.9		$	440.2
Operating income		30.1			26.7			82.1			79.2
PCIA
Total revenue		180.2			204.6			530.8			643.9
Operating income		36.6			56.9			95.5			184.9
SDT
Total revenue		36.4			50.2			108.8			165.3
Operating income		5.6			12.0			15.2			40.8
Corporate
Restructuring and impairments expense		(3.4	)		(4.1	)		(6.3	)		(9.5	)
Stock-based compensation expense		(4.2	)		(6.0	)		(18.4	)		(19.0	)
Selling, general and administrative expense		(38.4	)		(41.4	)		(122.5	)		(124.8	)
Charge for litigation		—			—			(1.3	)		—
Other		0.1			(0.3	)		0.3			(1.0	)
Total Consolidated
Total revenue	$	358.8		$	403.2		$	1,072.5		$	1,249.4
Operating income	$	26.4		$	43.8		$	44.6		$	150.6
Other expense, net	$	1.2		$	1.4		$	4.2		$	5.8
Income before income taxes	$	25.2		$	42.4		$	40.4		$	144.8

PCIA revenue for the three and nine months ended September 30, 2012 includes $3.0 and $7.0 million, respectively, of insurance proceeds related to business interruption claims for the company’s optoelectronics supply issues resulting from the Thailand floods in the fourth quarter of 2011.

Other in 2011 primarily consists of accelerated depreciation related to the previously planned closure of the Mountaintop facility.

Note 9 – Goodwill and Intangible Assets

The following table presents a summary of acquired intangible assets.

			As of September 30, 2012					As of December 25, 2011
	Period of Amortization		Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
			(In millions)
Identifiable intangible assets:
Developed technology		2 - 15 years	$	250.8	$	(225.0	)	$	250.7	$	(214.3	)
Customer base		8 - 10 years		81.6		(70.4	)		81.6		(68.5	)
Core technology		10 years		15.7		(3.6	)		15.7		(2.7	)
In Process R&D		10 years		2.8		(0.1	)		2.8		0.0
Assembled workforce		5 years		1.0		(1.0	)		1.0		(1.0	)
Process technology		5 years		1.6		(1.6	)		1.6		(1.6	)
Patents		4 years		5.9		(5.9	)		5.9		(5.8	)
Subtotal				359.4		(307.6	)		359.3		(293.9	)
Goodwill				169.3		0.0			169.3		0.0
Total			$	528.7	$	(307.6	)	$	528.6	$	(293.9	)

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The following table presents the carrying value of goodwill by reporting unit.

	MCCC			PCIA			SDT			Total
	(In millions)
Balance as of December 25, 2011
Goodwill	$	165.0		$	153.1		$	54.5		$	372.6
Accumulated Impairment Losses		0.0			(148.8	)		(54.5	)		(203.3	)
	$	165.0		$	4.3		$	0.0		$	169.3
Goodwill reallocation	($	3.0	)	$	3.0		$	0.0		$	0.0
Balance as of September 30, 2012
Goodwill	$	162.0		$	156.1		$	54.5		$	372.6
Accumulated Impairment Losses		0.0			(148.8	)		(54.5	)		(203.3	)
	$	162.0		$	7.3		$	0.0		$	169.3

During the first quarter of 2012, the company moved two small product groups from the MCCC organization to the PCIA and SDT organizations. Since this changed the company’s reporting units, goodwill was assigned to the reporting units affected using a relative fair value allocation. See footnote 8 for more information.

The following table presents the estimated amortization expense for intangible assets for the remainder of 2012 and for each of the five succeeding fiscal years.

Estimated Amortization Expense:	(In millions)
Remaining Fiscal 2012		4.5
Fiscal 2013		15.6
Fiscal 2014		7.5
Fiscal 2015		5.2
Fiscal 2016		5.5
Fiscal 2017		2.2

Note 10 – Restructuring and Impairments

During the three and nine months ended September 30, 2012, the company recorded restructuring and impairment charges, net of releases, of $3.4 million and $6.3 million, respectively. The detail of these charges is presented in the summary table below.

During the three and nine months ended September 25, 2011, the company recorded restructuring and impairment charges, net of releases, of $4.1 million and $9.5 million, respectively. The third quarter charges include $0.6 million of employee separation costs and $0.1 million of fab closure costs associated with the 2009 Infrastructure Realignment Program as well as $1.7 million of employee separation costs associated with the 2010 Infrastructure Realignment Program and $1.7 million in employee separation costs associated with the 2011 Infrastructure Realignment Program. In addition to the charges in the third quarter of 2011, there were charges in the first and second quarter of 2011 for $1.1 million of employee separation costs, $0.5 million of fab closure costs, and $0.1 million in reserve releases associated with the 2009 Infrastructure Realignment Program as well as $1.9 million in employee separation costs associated with the 2010 Infrastructure Realignment Program and $2.0 million in employee separations costs associated with the 2011 Infrastructure Realignment Program.

The 2012 Infrastructure Realignment Program includes costs for organizational changes in the company’s sales organization, manufacturing sites and manufacturing support organizations, the human resources function, executive management levels, and the MCCC and PCIA product lines as well as the termination of an IT systems lease and the final closure of a warehouse in Korea. The 2011 Infrastructure Realignment Program includes costs for organizational changes in the company’s supply chain management group, the website technology group, the quality organization, and other administrative groups. The 2011 program also includes costs to further improve the company’s manufacturing strategy and changes in the PCIA and MCCC groups as well as a primarily voluntary retirement program at our Mountaintop, Pennsylvania location. The 2010 Infrastructure Realignment Program includes costs to simplify and realign some

17

activities within the MCCC segment, costs for the continued refinement of the company’s manufacturing strategy, and costs associated with centralizing the company’s accounting functions. The 2009 Infrastructure Realignment Program included costs associated with the previously planned closure of the Mountaintop, Pennsylvania manufacturing facility and the four-inch manufacturing line in Bucheon, South Korea, both of which were announced in the first quarter of 2009. The 2009 Program also included charges for a smaller worldwide cost reduction plan to further right-size our company. The consolidation of the South Korea fabrication lines was completed in 2011. Also during 2011, the company decided to keep open the Mountain Top facility reversing the March 2009 announcement to close the site.

The following table presents a summary of the activity in the company’s accrual for restructuring and impairment costs for the quarterly periods ended April 1, 2012, July 1, 2012, and September 30, 2012.

	Accrual												Accrual
	Balance at		New		Cash			Reserve			Non-Cash		Balance at
	12/25/2011		Charges		Paid			Release			Items		4/1/2012
2010 Infrastructure Realignment Program:
Employee Separation Costs	$	1.0	$	—	$	(0.3	)	$	—		$	—	$	0.7
2011 Infrastructure Realignment Program:
Employee Separation Costs		1.7		1.0		(0.3	)		(0.1	)		—		2.3
2012 Infrastructure Realignment Program:
Employee Separation Costs		—		1.1		(0.5	)		—			—		0.6
Facility Closure Costs		—		0.4		(0.4	)		—			—		0.0
	$	2.7	$	2.5	$	(1.5	)	$	(0.1	)	$	—	$	3.6
	Accrual												Accrual
	Balance at		New		Cash			Reserve			Non-Cash		Balance at
	4/1/2012		Charges		Paid			Release			Items		7/1/2012
2010 Infrastructure Realignment Program:
Employee Separation Costs	$	0.7	$	—	$	(0.2	)	$	(0.1	)	$	—	$	0.4
2011 Infrastructure Realignment Program:
Employee Separation Costs		2.3		—		(0.9	)		—			—		1.4
2012 Infrastructure Realignment Program:
Employee Separation Costs		0.6		0.6		(0.8	)		—			—		0.4
	$	3.6	$	0.6	$	(1.9	)	$	(0.1	)	$	—	$	2.2
	Accrual												Accrual
	Balance at		New		Cash			Reserve			Non-Cash		Balance at
	7/1/2012		Charges		Paid			Release			Items		9/30/2012
2010 Infrastructure Realignment Program:
Employee Separation Costs	$	0.4	$	—	$	(0.1	)	$	—		$	—	$	0.3
2011 Infrastructure Realignment Program:
Employee Separation Costs		1.4		—		(0.3	)		—			—		1.1
2012 Infrastructure Realignment Program:
Employee Separation Costs		0.4		2.8		(1.5	)					—		1.8
Lease Termination Costs				0.6								—		0.6
	$	2.2	$	3.4	$	(1.9	)	$	—		$	—	$	3.8

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Note 11 – Contingencies

Patent Litigation with Power Integrations, Inc. There are four outstanding proceedings with Power Integrations.

POWI 1: On October 20, 2004, the company and our wholly owned subsidiary, Fairchild Semiconductor Corporation, were sued by Power Integrations, Inc. in the U.S. District Court for the District of Delaware. Power Integrations alleged that certain of the company’s pulse width modulation (PWM) integrated circuit products infringed four Power Integrations U.S. patents, and sought a permanent injunction preventing the company from manufacturing, selling or offering the products for sale in the U.S., or from importing the products into the U.S., as well as money damages for past infringement.

The trial in the case was divided into three phases. In the first phase of the trial that occurred in October of 2006, a jury returned a verdict finding that thirty-three of the company’s PWM products willfully infringed one or more of seven claims asserted in the four patents and assessed damages against the company. The company voluntarily stopped U.S. sales and importation of those products in 2007 and has been offering replacement products since 2006. Subsequent phases of the trial conducted during 2007 and 2008 focused on the validity and enforceability of the patents. In December of 2008, the judge overseeing the case reduced the jury’s 2006 damages award from $34 million to approximately $6.1 million and ordered a new trial on the issue of willfulness. Following the new trial held in June of 2009, the court found the company’s infringement to have been willful and in January 2011 the court awarded Power Integrations final damages in the amount of $12.2 million. We have challenged the final damages award, willfulness finding, and other issues on appeal. Power Integrations also appealed aspects of the trial court’s ruling, including damages. On January 11, 2012, the appeals were argued before the U.S. Court of Appeals for the Federal Circuit.

POWI 2: On May 23, 2008, Power Integrations filed another lawsuit against the company, Fairchild Semiconductor Corporation and our wholly owned subsidiary System General Corporation in the U.S. District Court for the District of Delaware, alleging infringement of three patents. Of the three patents asserted in that lawsuit, two were asserted against the company and Fairchild Semiconductor Corporation in the October 2004 lawsuit described above. In 2011, POWI added a fourth patent to this case.

On October 14, 2008, Fairchild Semiconductor Corporation and System General Corporation filed a patent infringement lawsuit against Power Integrations in the U.S. District Court for the District of Delaware, alleging that certain PWM integrated circuit products infringe one or more claims of two U.S. patents owned by System General. The lawsuit seeks monetary damages and an injunction preventing the manufacture, use, sale, offer for sale or importation of Power Integrations products found to infringe the asserted patents.

Both lawsuits were consolidated and heard together in Delaware District Court in a jury trial in April of 2012. On April 27, 2012, the jury found that Power Integrations infringed one of the two U.S. patents owned by System General and upheld the validity of both System General patents. In the same case, the jury found that the company infringed two of four U.S. patents asserted by Power Integrations and that the company had induced its customers to infringe the asserted patents. The jury also upheld the validity of the asserted Power Integrations patents. The verdict concluded the first phase of trial in the litigation. Willfulness and damages in the case will be determined in a second phase, which has yet to be scheduled and may occur after appeals of the first phase.

POWI 3: On November 4, 2009, Power Integrations filed a complaint for patent infringement against the company and two of the company’s subsidiaries in the United States District Court for the Northern District of California alleging that several of our products infringe three of Power Integrations’ patents. One of those patents has since been dropped from the case. The company intends to put on a vigorous defense against these claims. In the same lawsuit we have filed counterclaims against Power Integrations, alleging Power Integrations’ products infringe certain claims of one of our patents. Trial has yet to be scheduled in this case.

POWI 4: On February 10, 2010 Fairchild and System General filed a lawsuit in Suzhou, China against four Power Integrations entities and seven vendors. The lawsuit claims that Power Integrations violates certain Fairchild/System General patents. Fairchild is seeking an injunction against the Power Integrations products and over $17.0 million in damages. Power Integrations attempted to have the Fairchild/System General patents declared invalid in proceedings before the Chinese Patent Office. Based on the Patent Office’s ruling, three of the four patents asserted by Fairchild will continue in the case.

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Hearings comparable to a trial in U.S. litigation were held in January, May and July 2012. The company anticipates that the court will rule on the case before the end of 2012.

POWI 5: On May 1, 2012, Fairchild sued Power Integrations in United States District Court for the District of Delaware. The lawsuit accuses Power Integration’s LinkSwitch-PH LED power conversion products of violating three Fairchild patents. Power Integrations has counterclaimed against Fairchild asserting five Power Integrations patents.

Other Legal Claims. From time to time the company is involved in legal proceedings in the ordinary course of business. The company believes that there is no such ordinary-course litigation pending that could have, individually or in the aggregate, a material adverse effect on our business, financial condition, results of operations, or cash flows. Legal costs are expensed as incurred.

The company analyzes potential outcomes from current litigation in accordance with the Contingency Topic of the FASB ASC. Accordingly, the company analyzes such outcomes as loss contingencies, and divides them into three categories based on the possibility that the contingency will give rise to an actual loss. The first category represents contingencies for which management believes the possibility of loss is remote. For contingencies in this category, the company does not record a reserve or assess the range of possible losses. The second category represents contingencies for which losses are believed to be reasonably possible. For this category, the company assesses the range of possible losses but does not record a reserve. There are currently no contingencies in this category. The third category represents contingencies for which losses are believed to be probable. For this category, the company determines the range of losses and records a reserve reflecting the best estimate within the range. For contingencies within this category, the company currently believes the range of probable losses are approximately $14.0 million to $15.6 million and the best estimate of losses within this range to be $14.1 million as of September 30, 2012 and has recorded this amount as a reserve. The amount reserved is based upon assessments of the potential liabilities using analysis of claims and historical experience in defending and resolving such claims.

Note 12 – Long-Term Debt

Long-term debt consists of the following at:

	September 30,		December 25,
	2012		2011
	(In millions)
Revolving Credit Facility borrowings	$	300.0	$	300.0
Other		0.1		0.1
Total debt	$	300.1	$	300.1
Current portion of long-term debt		—		—
Long-term debt, less current portion	$	300.1	$	300.1

Note 13 – Subsequent Events

Subsequent to the end of the third quarter of 2012, the company tendered approximately $49.5 million of long term available-for-sale auction rate securities at a price equal to 47% of par value and 90% of book value. The company sold the securities for $23.3 million and incurred a realized loss of approximately $12.9 million which will be reflected in its fourth quarter results.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Except as otherwise indicated in this Quarterly Report on Form 10-Q, the terms “we,” “our,” the “company,” “Fairchild” and “Fairchild International” refer to Fairchild Semiconductor International, Inc. and its consolidated subsidiaries, including Fairchild Semiconductor Corporation, our principal operating subsidiary. We refer to individual subsidiaries where appropriate.

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Overview

Fairchild is positioned to capitalize on the growth potential in mobile wireless technologies and the transition to more efficient applications in the industrial, appliance, automotive and solar end markets. We have invested heavily in our mobile business over the last five years and have introduced a wide range of fast growing new products and a number of innovative application specific solutions that solve unique customer requirements. We believe our broad portfolio of innovative products coupled with our world class supply chain will continue to drive growth. We entered 2012 with the best pipeline of new products in our history. We have numerous design wins in our mobile business and we are also gaining traction in the mid-voltage market.

We strive to keep inventory as lean as possible while maintaining customer service. We prefer to maintain maximum flexibility by adjusting internal inventories in response to higher demand before adding more inventory to our distribution channels. While our goal is to manage our production output to maintain channel inventories within a target range of 7.5 to 8.5 weeks, at the end of the third quarter, our channel inventories were at 10.2 weeks excluding certain end of life inventory, which was a decrease of over one week from the end of 2011. Internal inventories at the end of the third quarter of 2012 were at $242.3 million, an increase of $8.1 million over the end of 2011.

Our fiscal calendar, in which each quarter ends on a Sunday, contains 53 weeks every seven years. This additional week is included is the first quarter of the year. Our results for the nine months ended September 30, 2012 and September 25, 2011 consist of 40 weeks and 39 weeks, respectively.

The Mobile, Computing, Consumer and Communication (MCCC) group’s main focus is to supply the mobile, computing, consumer and communication end market segments with innovative power and signal path solutions including our low voltage metal oxide semiconductor field effect transistors (MOSFETs), Power Management integrated circuits (IC’s), Mixed Signal Analog and Logic products. We seek to deliver exceptional product performance by optimizing silicon processes and application specific design to satisfy specific requirements for our customers. This enables us to deliver solutions with greater energy efficiency and in a smaller footprint than is commonly available. We expect a steady acceleration of new product sales especially for solutions addressing the smart phone and ultraportable market.

The Power Conversion, Industrial, and Automotive (PCIA) group’s focus is to capitalize on the growing demand for greater energy efficiency and higher power density for space savings in power supplies, consumer electronics, battery chargers, electric motors, industrial electronics and automobiles. We are a leader in power semiconductor devices, low standby power consumption designs, and power module technology that enable greater efficiency, greater power density, and better performance. Improving the efficiency of our customers’ products is vital to meeting new energy efficiency regulations. Effectively managing the power conversion and distribution in power supplies is one of the greatest opportunities we have to improve overall system efficiency. We believe the growing global focus on energy efficiency will continue to drive growth in this product line.

Standard Discrete and Standard Linear (SDT) products are core building block components for many electronic applications. This segment uses a simplified and focused operating model to make the selling and support of these products easier and more profitable. The right operational structure and part portfolio should enable our standard products group to continue to generate solid cash flow with minimal investment.

21

Results of Operations

The following table summarizes certain information relating to our operating results as derived from our unaudited consolidated financial statements.

	Three Months Ended								Nine Months Ended
	September 30,				September 25,				September 30,				September 25,
	2012				2011				2012				2011
	(Dollars in millions)
Total revenue	$	358.8	100.0	%	$	403.2	100.0	%	$	1,072.5	100.0	%	$	1,249.4	100.0	%
Gross margin		120.1	33.5	%		144.8	35.9	%		342.7	32.0	%		457.5	36.6	%
Operating expenses:
Research and development		37.8	10.5	%		37.8	9.4	%		119.0	11.1	%		114.6	9.2	%
Selling, general and administrative		48.0	13.4	%		54.4	13.5	%		157.8	14.7	%		167.8	13.4	%
Amortization of acquisition-related intangibles		4.5	1.3	%		4.7	1.2	%		13.7	1.3	%		15.0	1.2	%
Restructuring and impairments		3.4	0.9	%		4.1	1.0	%		6.3	0.6	%		9.5	0.8	%
Charge for litigation		—	0.0	%		—	0.0	%		1.3	0.1	%		—	0.0	%
Total operating expenses		93.7	26.1	%		101.0	25.0	%		298.1	27.8	%		306.9	24.6	%
Operating income		26.4	7.4	%		43.8	10.9	%		44.6	4.2	%		150.6	12.1	%
Other expense, net		1.2	0.3	%		1.4	0.3	%		4.2	0.4	%		5.8	0.5	%
Income before income taxes		25.2	7.0	%		42.4	10.5	%		40.4	3.8	%		144.8	11.6	%
Provision (benefit) for income taxes		0.5	0.1	%		6.6	1.6	%		2.2	0.2	%		20.6	1.6	%
Net income	$	24.7	6.9	%	$	35.8	8.9	%	$	38.2	3.6	%	$	124.2	9.9	%

Adjusted net income, adjusted gross margin, and free cash flow are also included in the table below. These are non-GAAP financial measures and should not be considered a replacement for GAAP results. We present adjusted results because we use them as additional measures of our operating performance. We believe the adjusted information is useful to investors because it illuminates underlying operational trends by excluding certain significant non-recurring or otherwise unusual transactions. Our criteria for adjusted results may differ from methods used by other companies and may not be comparable and should not be considered as alternatives to net income or loss, gross margin, or other measures of consolidated operations and cash flow data prepared in accordance with US GAAP as indicators of our operating performance or as alternatives to cash flow as a measure of liquidity.

22

	Three Months Ended										Nine Months Ended
	September 30,					September 25,					September 30,					September 25,
	2012					2011					2012					2011
	(Dollars in millions)
Non GAAP measures
Adjusted net income	$	32.3				$	44.5				$	58.2				$	150.4
Adjusted gross margin		120.1		33.5	%		145.0		36.0	%		342.7		32.0	%		458.2		36.7	%
Free cash flow		(17.5	)				19.4					(18.1	)				81.1
Reconciliation of Net Income to Adjusted Net Income
Net income	$	24.7				$	35.8				$	38.2				$	124.2
Adjustments to reconcile net income to adjusted net income:
Restructuring and impairments		3.4					4.1					6.3					9.5
Accelerated depreciation on assets related to fab closure		—					0.2					—					0.7
Write-off of deferred financing fees		—					—					—					2.1
Charge for litigation		—					—					1.3					—
Amortization of acquisition-related intangibles		4.5					4.7					13.7					15.0
Associated net tax effects of the above and other acquisition-related intangibles		(0.3	)				(0.3	)				(1.3	)				(1.1	)
Adjusted net income	$	32.3				$	44.5				$	58.2				$	150.4
Reconciliation of Gross Margin to Adjusted Gross Margin
Gross margin	$	120.1				$	144.8				$	342.7				$	457.5
Adjustments to reconcile gross margin to adjusted gross margin:
Accelerated depreciation on assets related to fab closure		—					0.2					—					0.7
Adjusted gross margin	$	120.1				$	145.0				$	342.7				$	458.2
Reconciliation of Operating Cash Flow to Free Cash Flow
Cash provided by operating activities	$	24.8				$	72.9				$	104.3				$	222.7
Capital expenditures		(42.3	)				(53.5	)				(122.4	)				(141.6	)
Free cash flow	$	(17.5	)			$	19.4				$	(18.1	)			$	81.1

Total Revenues

	Three Months Ended										Nine Months Ended
	September 30,		September 25,		$ Change			% Change			September 30,		September 25,		$ Change			% Change
	2012		2011		Inc (Dec)			Inc (Dec)			2012		2011		Inc (Dec)			Inc (Dec)
Revenue	$	358.8	$	403.2	$	(44.4	)		-11.0	%	$	1,072.5	$	1,249.4	$	(176.9	)		-14.2	%

Revenue in the third quarter and first nine months of 2012 included $3.0 million and $7.0 million of insurance proceeds related to business interruption claims for the company’s optoelectronics supply issues resulting from the Thailand floods in the fourth quarter of 2011. Despite an extra week in the first nine months of 2012 compared to the first nine months of 2011, revenue decreased in 2012. For the first nine months of 2012 compared to the same period in 2011, lower unit sales volume sold drove 5% of the decrease in revenue while the remaining 9% decline was driven by lower average selling prices. For the third quarter of 2012 compared to the third quarter of 2011, revenue decreased 11%, driven by a decline in average selling prices which was offset partially by an increase in unit sales in the PCIA segment.

Geographic revenue information is based on the customer location within the indicated geographic region. The following table presents, as a percentage of sales, geographic sales for the U.S., Other Americas, Europe, China, Taiwan, Korea and Other Asia/Pacific (which for our geographic reporting purposes includes Japan and Singapore) for the three months and nine months ended September 30, 2012. The increase in Other Asia/Pacific revenue was due to continued strong demand for mobile products including smart phones and tablets as well as a shift in sales to a major customers from their Korea location to Other Asia/Pacific.

23

	Three Months Ended						Nine Months Ended
	September 30,			September 25,			September 30,			September 25,
	2012			2011			2012			2011
U.S.		9	%		10	%		9	%		10	%
Other Americas		2			2			2			2
Europe		13			13			13			14
China		35			33			34			33
Taiwan		13			13			14			14
Korea		9			10			10			11
Other Asia/Pacific		19			19			18			16
Total		100	%		100	%		100	%		100	%

Gross Margin

	Three Months Ended												Nine Months Ended
	September 30,			September 25,			$ Change			% Change			September 30,			September 25,			$ Change			% Change
	2012			2011			Inc (Dec)			Inc (Dec)			2012			2011			Inc (Dec)			Inc (Dec)
Gross Margin $	$	120.1		$	144.8		$	(24.7	)		-17.1	%	$	342.7		$	457.5		$	(114.8	)		-25.1	%
Gross Margin %		33.5	%		35.9	%					-2.4	%		32.0	%		36.6	%					-4.7	%

Effective the first day of 2012, expected asset lives and amortization schedules for certain factory equipment was adjusted to better reflect actual performance of the tools, favorably impacting gross margin by approximately $4.2 million and $13.7 million in the third quarter and first nine months of 2012, respectively, when compared to depreciation expense under the previous useful life policy. In addition, we reassessed the lives of our molds and tooling equipment which caused an increase in depreciation expense of $0.7 million in first nine months of 2012 when compared to depreciation expense under the previous useful life policies.

The net favorable depreciation impact to gross margin was offset by decreased revenue and higher unit costs of inventory due to lower production rates in the third quarter and first nine months of 2012 as well as increased expenses from 8-inch conversion costs and higher inventory write downs in the first half of 2012 resulting in an overall decrease in gross margin for the third quarter and first nine months of 2012 as compared to the same periods in 2011.

Adjusted Gross Margin

	Three Months Ended												Nine Months Ended
	September 30,			September 25,			$ Change			% Change			September 30,			September 25,			$ Change			% Change
	2012			2011			Inc (Dec)			Inc (Dec)			2012			2011			Inc (Dec)			Inc (Dec)
Adjusted Gross Margin $	$	120.1		$	145.0		$	(24.9	)		-17.2	%	$	342.7		$	458.2		$	(115.5	)		-25.2	%
Adjusted Gross Margin %		33.5	%		36.0	%					-2.5	%		32.0	%		36.7	%					-4.7	%

There were no items adjusted out of gross margin in the third quarter and first nine months of 2012. Adjusted gross margin in the third quarter and first nine months of 2011 did not include accelerated depreciation related to the previously planned closure of the Mountain Top facility. See above reconciliation for detail.

Operating Expenses

	Three Months Ended										Nine Months Ended
	September 30,		September 25,		$ Change			% Change			September 30,		September 25,		$ Change			% Change
	2012		2011		Inc (Dec)			Inc (Dec)			2012		2011		Inc (Dec)			Inc (Dec)
Research and development	$	37.8	$	37.8	$	—			0.0	%	$	119.0	$	114.6	$	4.4			3.8	%
Selling, general and administrative	$	48.0	$	54.4	$	(6.4	)		-11.8	%	$	157.8	$	167.8	$	(10.0	)		-6.0	%

24

Operating expenses included an additional week of costs in the first nine months of 2012 as compared to the first nine months of 2011. Overall R&D expenses were flat for the third quarter of 2012 compared to the same period of 2011. Increases in R&D project spending were offset by decreases in variable compensation as we reversed expenses accrued in prior quarters. R&D expenses for the first nine months of 2012 increased as compared to the same periods in 2011 as we continue to invest in R&D programs and resources. Increased R&D was offset by the reversal of variable compensation expense. Selling and general and administration expenses (SG&A) expense decreased for the third quarter and first nine months of 2012 when compared to the same periods of 2011 driven primarily by a decrease in variable compensation and equity compensation as we do not believe we will meet our bonus or performance targets for 2012.

Restructuring and Impairment. During the three and nine months ended September 30, 2012, we recorded restructuring and impairment charges, net of releases, of $3.4 million and $6.3 million, respectively. The third quarter charges consist of $2.8 million of employee separation costs and $0.6 million of lease termination costs associated with the 2012 Infrastructure Realignment Program. In addition to the charges in the third quarter of 2012 there were charges in the first and second quarter of 2012 which included $1.0 million of employee separation costs associated with the 2011 Infrastructure Realignment Program as well as $1.7 million in employee separation costs and $0.4 million in facility closure costs associated with the 2012 Infrastructure Realignment Program.

During the three and nine months ended September 25, 2011, we recorded restructuring and impairment charges, net of releases, of $4.1 million and $9.5 million, respectively. The third quarter charges include $0.6 million of employee separation costs and $0.1 million of fab closure costs associated with the 2009 Infrastructure Realignment Program as well as $1.7 million in employee separation costs associated with the 2010 Infrastructure Realignment Program and $1.7 million in employee separation costs associated with the 2011 Infrastructure Realignment Program. In addition to the charges in the third quarter of 2011 there were charges in the first and second quarter of 2011 which included $1.1 million of employee separation costs, $0.5 million of fab closure costs, and $0.1 million in reserve releases associated with the 2009 Infrastructure Realignment Program as well as $1.9 million in employee separation costs associated with the 2010 Infrastructure Realignment Program and $2.0 million in employee separations costs associated with the 2011 Infrastructure Realignment Program.

The 2012 Infrastructure Realignment Program includes costs for organizational changes in the company’s sales organization, manufacturing sites and manufacturing support organizations, the human resources function, executive management levels, and the MCCC and PCIA product lines as well as the termination of an IT systems lease and the final closure of a warehouse in Korea. The 2011 Infrastructure Realignment Program includes costs for organizational changes in our supply chain management group, website technology group, quality organization, and other administrative groups. The 2011 program also includes costs to further improve our manufacturing strategy and changes in both the PCIA and MCCC groups as well as a primarily voluntary retirement program at our Mountaintop, Pennsylvania location. The 2010 Infrastructure Realignment Program includes costs to simplify and realign some activities within the MCCC segment, costs for the continued refinement of the company’s manufacturing strategy, and costs associated with centralizing our accounting functions.

The previously planned closure of the Mountaintop, Pennsylvania manufacturing facility and the closure of the four-inch manufacturing line in Bucheon, South Korea was announced in the first quarter of 2009 and the charges associated with those programs are included in the 2009 Infrastructure Realignment Program. The consolidation of the South Korea fabrication lines was completed in 2011. Also during the fourth quarter of 2011, the company decided to keep open the Mountain Top facility.

Charge for Litigation. In the second quarter of 2012, we increased our reserves for potential litigation outcomes by $1.0 million as a result of the ongoing developments in the POWI 2 litigation. In addition, we accrued $0.3 million in the second quarter of 2012 for an unrelated legal settlement.

25

Other Expense, net.

The following table presents a summary of other expense, net for the three months and nine months ended September 30, 2012 and September 25, 2011.

	Three Months Ended						Nine Months Ended
	September 30,			September 25,			September 30,			September 25,
	2012			2011			2012			2011
	(In millions)
Other expense, net
Interest expense	$	1.7		$	1.9		$	5.7		$	5.3
Interest income		(0.6	)		(0.7	)		(1.8	)		(2.0	)
Other (income) expense, net		0.1			0.2			0.3			2.5
Other expense, net	$	1.2		$	1.4		$	4.2		$	5.8

Interest expense. Interest expense in the third quarter decreased $0.2 million when compared to the same period in 2011, primarily due to lower interest rates. Interest expense for the first nine months of 2012 increased $0.5 million when compared to the same period in 2011, primarily due to higher interest rates offset by higher debt in the first quarter of 2011.

Interest income. Interest income in the third quarter and first nine months of 2012 remained fairly flat when compared to the same periods in 2011.

Other (income) expense, net. Other expense in the third quarter and first nine months of 2012 was down $2.3 million and $0.1 million when compared to the same periods of 2011. The higher level of expense in the first nine month of 2011 was caused by a $2.1 million write off of deferred financing fees associated with the pay down of our term loan in the second quarter of 2011.

Income Taxes. Income tax provision in the third quarter and first nine months of 2012 was $0.5 million and $2.2 million on income before taxes of $25.2 million and $40.4 million, respectively, as compared to income tax provisions of $6.6 million and $20.6 million on income before taxes of $42.4 million and $144.8 million, respectively, for the same time periods of 2011. The effective tax rate for the third quarter and first nine months of 2012 was 2.0% and 5.5% compared to 15.6% and 14.2% respectively, for the comparable periods of 2011. The change in effective tax rate is primarily due to shifts of income and loss among jurisdictions with differing tax rates and foreign currency revaluations of tax assets and liabilities. In the first nine months of 2012, the valuation allowance on our deferred tax assets decreased by $3.7 million. The overall decrease did not impact our results of operations.

In accordance with the Income Taxes Topic in the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC), deferred taxes have not been provided on undistributed earnings of foreign subsidiaries which are reinvested indefinitely. Certain non-U.S. earnings, which have been taxed in the U.S. but earned offshore, have and continue to be part of our repatriation plan. As of September 30, 2012, we have recorded a deferred tax liability of $1.9 million, with no impact to the consolidated statement of operations as we have a full valuation allowance against our net U.S. deferred tax assets.

Free Cash Flow

	Three Months Ended											Nine Months Ended
	September 30,			September 25,		$ Change			% Change			September 30,			September 25,		$ Change			% Change
	2012			2011		Inc (Dec)			Inc (Dec)			2012			2011		Inc (Dec)			Inc (Dec)
Free Cash Flow	$	(17.5	)	$	19.4	$	(36.9	)		-190.2	%	$	(18.1	)	$	81.1	$	(99.2	)		-122.3	%

Free cash flow is a non-GAAP financial measure. To determine free cash flow, we subtract capital expenditures from cash provided by operating activities. Free cash flow decreased in the third quarter and first nine months of 2012 as compared to the same period in 2011 as a result of lower net income partially offset in part by a decrease in capital expenditures. See Free Cash Flow reconciliation in results of operations section above.

26

Reportable Segments.

The following tables present comparative disclosures of revenue, gross margin, and operating income of our reportable segments.

	Three Months Ended
	September 30,											September 25,
	2012											2011
						Gross			Operating								Gross			Operating
	Revenue		% of total			Margin %			Income (loss)			Revenue		% of total			Margin %			Income (loss)
	(Dollars in millions)
MCCC		142.2		39.6	%		40.5	%		30.1			148.4		36.8	%		36.8	%		26.7
PCIA		180.2		50.2	%		31.0	%		36.6			204.6		50.7	%		38.0	%		56.9
SDT		36.4		10.1	%		20.9	%		5.6			50.2		12.5	%		27.9	%		12.0
Corporate (1)		0.0		0.0	%		0.0	%		(45.9	)		0.0		0.0	%		0.0	%		(51.8	)
Total		358.8		100.0	%		33.5	%		26.4			403.2		100.0	%		35.9	%		43.8

	Nine Months Ended
	September 30,											September 25,
	2012											2011
						Gross			Operating								Gross			Operating
	Revenue		% of total			Margin %			Income (loss)			Revenue		% of total			Margin %			Income (loss)
	(Dollars in millions)
MCCC	$	432.9		40.4	%		38.6	%	$	82.1		$	440.2		35.2	%		37.8	%	$	79.2
PCIA		530.8		49.5	%		29.7	%		95.5			643.9		51.5	%		38.7	%		184.9
SDT		108.8		10.1	%		19.7	%		15.2			165.3		13.2	%		28.2	%		40.8
Corporate (1)		0.0		0.0	%		0.0	%		(148.2	)		0.0		0.0	%		0.0	%		(154.3	)
Total	$	1,072.5		100.0	%		32.0	%	$	44.6		$	1,249.4		100.0	%		36.6	%	$	150.6

(1) The three and nine months ended September 30, 2012 includes $4.2 million and $18.4 million of stock-based compensation expense, $3.4 million and $6.3 million of restructuring and impairments expense, $0.1 million and $1.0 million of other costs which primarily consist of charges for litigation, and $38.4 million and $122.5 million of SG&A expenses, respectively. The three and nine months ended September 25, 2011 includes $6.0 million and $19.0 million of stock-based compensation expense, $4.1 million and $9.5 million of restructuring and impairments expense, $0.3 million and $1.0 million of other costs which primarily consist of accelerated depreciation related to the closure of the Mountaintop facility, and $41.4 million and $124.8 million of SG&A expenses, respectively.

MCCC

	Three Months Ended												Nine Months Ended
	September 30,			September 25,			$ Change			% Change			September 30,			September 25,			$ Change			% Change
	2012			2011			Inc (Dec)			Inc (Dec)			2012			2011			Inc (Dec)			Inc (Dec)
Revenue	$	142.2		$	148.4		$	(6.2	)		-4.2	%	$	432.9		$	440.2		$	(7.3	)		-1.7	%
Gross Margin $	$	57.6		$	54.6		$	3.0			5.5	%	$	167.2		$	166.2		$	1.0			0.6	%
Gross Margin %		40.5	%		36.8	%					3.7	%		38.6	%		37.8	%					0.9	%
Operating Income	$	30.1		$	26.7		$	3.4			12.7	%	$	82.1		$	79.2		$	2.9			3.7	%

MCCC revenue in the third quarter of 2012 was lower as compared to the same period in 2011 due to a decline in average selling prices due to competitive pricing pressure on existing products which was offset slightly by increased prices on newly introduced products. The decline in overall average selling prices was offset in part by increased unit sales on mobile products in the third quarter of 2012. Revenue for the first nine months of 2012 was also lower as compared to the same period in 2011 due to reduced sales of our low voltage MOSFET products, offset by continued strong sales of our mobile switch products. Overall average selling prices in first nine months of 2012 were also down slightly as compared to the same periods in 2011 as pricing pressure for our low voltage and mobile products was offset in part by the introduction of new mobile products. Gross margin improved in the third quarter and first nine months of 2012 as compared to 2011 was a result of continued shift toward mobile products that yield better margins as well as reduced variable compensation.

27

MCCC operating income increased in the third quarter and first nine months of 2012 as compared to 2011 as a result of higher gross margin, reduced variable compensation expense, and lower general and administrative expense (G&A) even with an additional week of costs during 2012. These decreases were offset in part by additional R&D investment in our mobile and MEMs businesses.

PCIA

	Three Months Ended												Nine Months Ended
	September 30,			September 25,			$ Change			% Change			September 30,			September 25,			$ Change			% Change
	2012			2011			Inc (Dec)			Inc (Dec)			2012			2011			Inc (Dec)			Inc (Dec)
Revenue	$	180.2		$	204.6		$	(24.4	)		-11.9	%	$	530.8		$	643.9		$	(113.1	)		-17.6	%
Gross Margin $	$	55.8		$	77.7		$	(21.9	)		-28.2	%	$	157.5		$	248.9		$	(91.4	)		-36.7	%
Gross Margin %		31.0	%		38.0	%					-7.0	%		29.7	%		38.7	%					-9.0	%
Operating Income	$	36.6		$	56.9		$	(20.3	)		-35.7	%	$	95.5		$	184.9		$	(89.4	)		-48.4	%

PCIA revenue in the third quarter and first nine months of 2012 included $3.0 million and $7.0 million of insurance proceeds related to the business interruption claims for the company’s optoelectronics supply issues resulting from flooding in Thailand in the fourth quarter of 2011. The revenue decrease in the third quarter and first nine months of 2012 as compared to the same periods of 2011 was primarily attributable to reduced market demand for our high voltage products and efforts to reduce channel inventory. The decreased revenue from high voltage products was mitigated in part by strong sales for our automotive and power conversion products. Lower gross margin was mainly a result of decreased revenue and increased 8 inch conversion costs in the first half of 2012.

Lower operating income was mainly due to decreased gross margin as well as increased R&D expense in high voltage and auto product lines. In addition, operating expenses included an additional week of costs in the first nine months of 2012 as compared to 2011. These increases were offset in part by lower selling, general and administrative expenses (SG&A) and reduced variable compensation expenses.

SDT

	Three Months Ended												Nine Months Ended
	September 30,			September 25,			$ Change			% Change			September 30,			September 25,			$ Change			% Change
	2012			2011			Inc (Dec)			Inc (Dec)			2012			2011			Inc (Dec)			Inc (Dec)
Revenue	$	36.4		$	50.2		$	(13.8	)		-27.5	%	$	108.8		$	165.3		$	(56.5	)		-34.2	%
Gross Margin $	$	7.6		$	14.0		$	(6.4	)		-45.7	%	$	21.4		$	46.6		$	(25.2	)		-54.1	%
Gross Margin %		20.9	%		27.9	%					-6.9	%		19.7	%		28.2	%					-8.4	%
Operating Income	$	5.6		$	12.0		$	(6.4	)		-53.3	%	$	15.2		$	40.8		$	(25.6	)		-62.7	%

SDT revenue in the third quarter and first nine months of 2012 decreased as compared to the same periods in 2011 as a result of strategic efforts to eliminate lower margin products and also reduced overall market demand. Lower average selling prices also contributed to the decrease in SDT revenue as compared to the third quarter and first nine months of 2011. Lower gross margin was due to lower revenue and higher overhead costs.

The decrease in operating income was primarily due to lower gross margin. R&D and sales and marketing expenses were also higher in the first nine months of 2012 as a result of increased investment in R&D and sales and marketing. In addition operating expenses included an additional week of costs in the first nine months of 2012 as compared to 2011. This increase was offset in part by reduced variable compensation costs.

Liquidity and Capital Resources

Our main sources of liquidity are our cash flows from operations, cash and cash equivalents and our revolving credit facility. As of September 30, 2012, $243.1 million of our $414.1 million cash and marketable securities balance is located in the United States. We believe that funds generated from operations, together with existing cash and funds from our revolving credit facility will be sufficient to meet our cash needs over the next twelve months.

Our Credit Facility consists of a $400.0 million revolving loan agreement of which $300.0 million was drawn as of September 30, 2012. After adjusting for outstanding letters of credit, we had $98.4 million available under the Credit Facility. This revolving borrowing capacity is available for working capital and general corporate purposes, including acquisitions. We had additional outstanding letters of credit of $1.9 million that do not fall under the senior credit facility. We also had $4.2 million of undrawn credit facilities at certain of our foreign subsidiaries. These outstanding amounts do not impact available borrowings under the senior credit facility.

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The Credit Facility includes restrictive covenants that place limitations on our ability to consolidate, merge, or enter into acquisitions, create liens or pay dividends, or make similar restricted payments, sell assets, invest in capital expenditures, and incur indebtedness. It also places limitations on our ability to modify our certificate of incorporation and bylaws, or enter into shareholder agreements, voting trusts or similar arrangements. In addition, the affirmative covenants in the Credit Facility also require our financial performance to comply with certain financial measures, as defined by the credit agreement. These financial covenants require us to maintain a minimum interest coverage ratio of 3.0 to 1.0 and a maximum leverage ratio of 3.25 to 1.0. It defines the interest coverage ratio as the ratio of the cumulative four quarter trailing consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) to consolidated cash interest expense and defines the maximum leverage ratio as the ratio of total consolidated debt to the cumulative four quarter trailing consolidated EBITDA. Consolidated EBITDA, as defined by the credit agreement excludes restructuring, non-cash equity compensation and other certain adjustments.

At September 30, 2012, we were in compliance with these covenants and we expect to remain in compliance with the covenants. This expectation is subject to various risks and uncertainties discussed more thoroughly in Item 1A, and include, among others, the risk that our assumptions and expectations about business conditions, expenses and cash flows for the remainder of the year may be inaccurate.

While our senior credit facility places restrictions on the payment of dividends, it does not restrict the subsidiaries of Fairchild Semiconductor Corporation, except to a limited extent, from paying dividends or making advances to Fairchild Semiconductor Corporation. As a result, we believe that funds generated from operations, together with existing cash and funds from our senior credit facility will be sufficient to meet our debt obligations, operating requirements, capital expenditures and research and development funding needs over the next twelve months. In the first nine months 2012, our capital expenditures totaled $122.4 million.

We frequently evaluate opportunities to sell additional equity or debt securities, obtain credit facilities from lenders or restructure our long-term debt to further strengthen our financial position. The sale of additional equity securities would cause dilution to our existing stockholders. Additional borrowing or equity investment may be required to fund future acquisitions.

During the first nine months of 2012, our cash provided by operating activities was $104.3 million compared to $222.7 million in the same period of 2011. The following table presents a summary of net cash provided by operating activities during the first nine months of 2012 and 2011.

	Nine Months Ended
	September 30,			September 25,
	2012			2011
	(In millions)
Net income	$	38.2		$	124.2
Depreciation and amortization		100.5			113.5
Non-cash stock-based compensation		18.4			19.0
Deferred income taxes, net		(6.7	)		(7.6	)
Other, net		1.6			3.6
Change in other working capital accounts		(47.7	)		(30.0	)
Net cash provided by operating activities	$	104.3		$	222.7

Cash provided by operating activities decreased $118.4 million during the first nine months of 2012 as compared to the same period of 2011 driven primarily by the decrease in net income and changes is other working capital accounts.

Cash used in investing activities during the first nine months of 2012 totaled $124.3 million compared to $160.1 million for the same period of 2011. The higher level of cash used in 2011 was driven by higher capital expenditures and the TranSiC acquisition of $16.5 million. There were no corresponding acquisitions in 2012. Capital expenditures were $122.4 million in the first nine months of 2012 compared to 141.6 million in the same time period of 2011, as there were higher capital expenditures related to 8 inch conversion projects in 2011 for our Salt Lake and Korean wafer manufacturing facilities.

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Cash used in financing activities totaled $17.7 million in the first nine months of 2012 compared to $33.8 million in the same period of 2011. In 2011, we purchased $21.1 million more in treasury stock and paid down $20.6 million in debt. These uses of cash were partially offset by $35.4 million in proceeds from the exercise of stock options. In 2012, we did not pay down debt and received proceeds of $4.4 million from the exercise of stock options. See details in the table below.

	Nine Months Ended
	September 30, 2012			September 25, 2011
	(In millions)
Cash Flows from financing activities
Net repayment of long term debt	$	—		$	(20.6	)
Proceeds from exercise of stock options		4.4			35.4
Purchase of treasury stock		(12.0	)		(33.1	)
Shares withheld for employee taxes		(10.1	)		(10.3	)
Debt financing costs		—			(5.2	)
Net cash provided by financing activities	$	(17.7	)	$	(33.8	)

As of September 30, 2012, we had $2.9 million of unrecognized tax benefits, compared to approximately $2.8 million at December 25, 2011. The timing of the expected cash outflow relating to the balance is not reliably determinable at this time.

Forward Looking Statements

This quarterly report contains “forward-looking statements” as that term is defined in Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by the use of forward-looking terminology such as “we believe,” “we expect,” “we intend,” “may,” “will,” “should,” “seeks,” “approximately,” “plans,” “estimates,” “anticipates,” or “hopeful,” or the negative of those terms or other comparable terms, or by discussions of our strategy, plans or future performance. All forward-looking statements in this report are made based on management’s current expectations and estimates, which involve risks and uncertainties, including those described below and more specifically in the Risk Factors section. Among these factors are the following: current economic uncertainty, including disruptions in the credit markets, as well as future economic conditions; changes in demand for our products; changes in inventories at our customers and distributors; changes in regional or global economic or political conditions (including as a result of terrorist attacks and responses to them); technological and product development risks, including the risks of failing to maintain the right to use some technologies or failing to adequately protect our own intellectual property against misappropriation or infringement; availability of manufacturing capacity; the risk of production delays; the inability to attract and retain key management and other employees; risks related to warranty and product liability claims; risks inherent in doing business internationally; changes in tax regulations or the migration of profits from low tax jurisdictions to higher tax jurisdictions; availability and cost of raw materials; competitors’ actions; loss of key customers, including but not limited to distributors; order cancellations or reduced bookings; changes in manufacturing yields or output; and significant litigation. Factors that may affect our operating results are described in the Risk Factors section in the quarterly and annual reports we file with the Securities and Exchange Commission. Such risks and uncertainties could cause actual results to be materially different from those in the forward-looking statements. Readers are cautioned not to place undue reliance on the forward-looking statements.

Recently Issued Financial Accounting Standards

There were no new standards issued in the first nine months of 2012 that had an impact on our financials or disclosures.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Reference is made to Part II, Item 7A, Quantitative and Qualitative Disclosure about Market Risk, in Fairchild Semiconductor International’s annual report on Form 10-K for the year ended December 25, 2011 and under the subheading “Quantitative and Qualitative Disclosures about Market Risk” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on page 52 of the Form 10-K. There were no material changes in the information we provided in our Form 10-K during the period covered by this Quarterly Report.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures designed to assure, as much as is reasonably possible, that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended, is communicated to management and recorded, processed, summarized and disclosed within the specified time periods. As of the end of the period covered by this report, our chief executive officer (CEO) and chief financial officer (CFO), with the participation of our management, have evaluated the effectiveness of our disclosure controls and procedures. Based on the evaluation, our CEO and CFO concluded that as of September 30, 2012, our disclosure controls and procedures are effective.

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Inherent Limitations on Effectiveness of Controls

The company’s management, including the CEO and CFO, does not expect that our disclosure controls or our internal control over financial reporting will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events. There can be no assurance that any control system will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become less effective if conditions change or compliance with policies or procedures deteriorates.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the first nine months of 2012 that have materially affected, or are reasonably likely to materially affect, internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

There are four outstanding proceedings with Power Integrations.

POWI 1: On October 20, 2004, we and our wholly owned subsidiary, Fairchild Semiconductor Corporation, were sued by Power Integrations, Inc. in the U.S. District Court for the District of Delaware. Power Integrations alleged that certain of our pulse width modulation (PWM) integrated circuit products infringed four Power Integrations U.S. patents, and sought a permanent injunction preventing us from manufacturing, selling or offering the products for sale in the U.S., or from importing the products into the U.S., as well as money damages for past infringement.

The trial in the case was divided into three phases. In the first phase of the trial that occurred in October of 2006, a jury returned a verdict finding that thirty-three of our PWM products willfully infringed one or more of seven claims asserted in the four patents and assessed damages against us. We voluntarily stopped U.S. sales and importation of those products in 2007 and have been offering replacement products since 2006. Subsequent phases of the trial conducted during 2007 and 2008 focused on the validity and enforceability of the patents. In December of 2008, the judge overseeing the case reduced the jury’s 2006 damages award from $34 million to approximately $6.1 million and ordered a new trial on the issue of willfulness. Following the new trial held in June of 2009, the court found our infringement to have been willful, and in January 2011 the court awarded Power Integrations final damages in the amount of $12.2 million. We have challenged the final damages award, willfulness finding and other issues on appeal. Power Integrations also appealed aspects of the trial court’s ruling, including damages. On January 11, 2012, the U.S. Court of Appeals for the Federal Circuit heard oral arguments on our appeal.

POWI 2: On May 23, 2008, Power Integrations filed another lawsuit against us, Fairchild Semiconductor Corporation and our wholly owned subsidiary System General Corporation in the U.S. District Court for the District of Delaware, alleging infringement of three patents. Of the three patents asserted in that lawsuit, two were asserted against us and Fairchild Semiconductor Corporation in the October 2004 lawsuit described above. In 2011, POWI added a fourth patent to this case.

On October 14, 2008, Fairchild Semiconductor Corporation and System General Corporation filed a patent infringement lawsuit against Power Integrations in the U.S. District Court for the District of Delaware, alleging that certain PWM integrated circuit products infringe one or more claims of two U.S. patents owned by System General. The lawsuit seeks monetary damages and an injunction preventing the manufacture, use, sale, offer for sale or importation of Power Integrations products found to infringe the asserted patents.

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Both lawsuits were consolidated and heard together in Delaware District Court in a jury trial in April of 2012. On April 27, 2012, the jury found that Power Integrations infringed one of the two U.S. patents owned by System General and upheld the validity of both System General patents. In the same case, the jury found that we infringed two of four U.S. patents asserted by Power Integrations and that we had induced our customers to infringe the asserted patents. The jury also upheld the validity of the asserted Power Integrations patents. The verdict concluded the first phase of trial in the litigation. Willfulness and damages in the case will be determined in a second phase, which has yet to be scheduled and may occur after appeals of the first phase.

POWI 3: On November 4, 2009, Power Integrations filed a complaint for patent infringement against us and two of our subsidiaries in the United States District Court for the Northern District of California alleging that several of our products infringe three of Power Integrations’ patents. One of those patents has since been dropped from the case. We intend to put on a vigorous defense against these claims. In the same lawsuit we have filed counterclaims against Power Integrations, alleging Power Integrations’ products infringe certain claims of one of our patents. Trial has yet to be scheduled in the case.

POWI 4: On February 10, 2010 Fairchild and System General filed a lawsuit in Suzhou, China against four Power Integrations entities and seven vendors. The lawsuit claims that Power Integrations violates certain Fairchild/System General patents. Fairchild is seeking an injunction against the Power Integration products and over $17.0 million in damages. Power Integrations attempted to have the Fairchild/System General patents declared invalid in proceedings before the Chinese Patent Office. Based on the Patent Office’s ruling, three of three of the four patents asserted by Fairchild will continue in the case.

Hearings comparable to a trial in U.S. litigation were held in January, May and July 2012 and we anticipate that the court will rule on the case before the end of 2012.

POWI 5: On May 1, 2012, we sued Power Integrations in United States District Court for the District of Delaware. The lawsuit accuses Power Integration’s LinkSwitch-PH LED power conversion products of violating three of our patents. Power Integrations has counterclaimed against us asserting five Power Integrations patents.

Other Legal Claims. From time to time we are involved in legal proceedings in the ordinary course of business. We believe that there is no such ordinary-course litigation pending that could have, individually or in the aggregate, a material adverse effect on our business, financial condition, results of operations or cash flows.

We analyze potential outcomes from current litigation in accordance with the Contingency Topic of the FASB ASC. Accordingly, we analyze such outcomes as loss contingencies, and divide them into three categories based on the possibility that the contingency will give rise to an actual loss. The first category represents contingencies for which we believe the possibility of a loss is remote. For contingencies in this category, we do not record a reserve or assess the range of possible losses. The second category represents contingencies for which losses are believed to be reasonably possible. For this category, we assess the range of possible losses but do not record a reserve. There are currently no contingencies in this category. The third category represents contingencies for which losses are believed to be probable. For this category, we determine the range of probable losses and record a reserve reflecting the best estimate within the range. For contingencies within this category, we currently believe the range of probable losses is approximately $14.0 million to $15.6 million. We believe the best estimate of losses within this range to be $14.1 million as of September 30, 2012 and have recorded this amount as a reserve. The amount reserved is based upon assessments of the potential liabilities using analysis of claims and historical experience in defending and resolving such claims.

Item 1A. Risk Factors

A description of the risk factors associated with our business is set forth below. We review and update our risk factors each quarter. The description set forth below includes any changes to and supersedes the description of the risk factors associated with our business previously disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 25, 2011. The risks described below are not the only ones facing us. Additional risks not currently known to us or that we currently believe are immaterial also may impair our business operations and financial condition.

The price of our common stock has fluctuated widely in the past and may fluctuate widely in the future.

Our common stock is traded on The New York Stock Exchange and its price has fluctuated significantly in recent years. Additionally, our stock has experienced and may continue to experience significant price and volume fluctuations that could adversely affect its market price without regard to our operating performance. We believe that factors such as

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quarterly fluctuations in financial results, earnings below analysts’ estimates and financial performance and other activities of other publicly traded companies in the semiconductor industry could cause the price of our common stock to fluctuate substantially. In addition, our common stock, the stock market in general and the market for shares of semiconductor industry-related stocks in particular have experienced extreme price fluctuations which have often been unrelated to the operating performance of the affected companies. Similar fluctuations in the future could adversely affect the market price of our common stock.

We maintain a backlog of customer orders that is subject to cancellation, reduction or delay in delivery schedules, which may result in lower than expected revenues.

We manufacture products primarily pursuant to purchase orders for current delivery or to forecast, rather than pursuant to long-term supply contracts. The semiconductor industry is occasionally subject to double booking and rapid changes in customer outlooks or unexpected build ups of inventory in the supply channel as a result of shifts in end market demand and macro economic conditions. Accordingly, many of these purchase orders or forecasts may be revised or canceled without penalty. As a result, we must commit resources to the manufacture of products without binding purchase commitments from customers. Even in cases where our standard terms and conditions of sale or other contractual arrangements do not permit a customer to cancel an order without penalty, we may from time to time accept cancellations to maintain customer relationships or because of industry practice, custom or other factors. Our inability to sell products after we devote significant resources to them could have a material adverse effect on both our levels of inventory and revenues. While we currently believe our inventory levels are appropriate for the current economic environment, continued global economic uncertainty may result in lower than expected demand. When we anticipate increasing demand in our markets, lower than anticipated demand may impact our customers’ target inventory levels. During 2011 channel inventory increased. We are focusing on reducing channel inventories in 2012; however our current business forecasting is still qualified by the risk that our backlog may deteriorate as a result of customer cancellations.

Downturns in the highly cyclical semiconductor industry or changes in end user market demands could reduce the profitability and overall value of our business, which could cause the trading price of our stock to decline or have other adverse effects on our financial position.

The semiconductor industry is highly cyclical, and the value of our business may decline as a result of market response to this cyclicality. As we have experienced in the past, uncertainty in global economic conditions may continue to negatively affect us and the rest of the semiconductor industry, by causing us to experience backlog cancellations, higher inventory levels and reduced demand for our products. We may experience renewed, possibly severe and prolonged, downturns in the future as a result of this cyclicality. Even as demand increases following such downturns, our profitability may not increase because of price competition and supply shortages that historically accompany recoveries in demand. In addition, we may experience significant fluctuations in our profitability as a result of variations in sales, product mix, end user markets, the costs associated with the introduction of new products, and our efforts to reduce excess inventories that may have built up as a result of any of these factors. The markets for our products depend on continued demand for consumer electronics such as personal computers, cellular telephones, tablet devices, digital cameras, and automotive, household and industrial goods. Deteriorating global economic conditions may cause these end user markets to experience decreases in demand that could adversely affect our business and future prospects.

Our failure to execute on our cost reduction initiatives and the impact of such initiatives could adversely affect our business.

We continue to take cost reduction initiatives to keep pace with the evolving economic and competitive conditions. These actions include closing our four-inch manufacturing line in South Korea and converting to 8 inch wafers in Salt Lake City, Utah, Bucheon, South Korea and South Portland, Maine. Additionally, we initiated several insourcing programs to replace higher-cost outside subcontractors with internal manufacturing, we lowered our materials costs and implemented workforce reductions in an effort to simplify operations, improve productivity and reduce costs.

We cannot guarantee that we will successfully implement any of these actions, or if these actions and other actions we may take will help reduce costs. Because restructuring activities involve changes to many aspects of our business, the cost reductions could adversely impact productivity and sales to an extent we have not anticipated. Even if we fully execute and implement these activities and they generate the anticipated cost savings, there may be other unforeseeable and unintended factors or consequences that could adversely impact our profitability and business.

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We may not be able to develop new products to satisfy changing customer demands or we may develop the wrong products.

Our success is largely dependent upon our ability to innovate and create revenues from new product introductions. Failure to develop new technologies, or react to changes in existing technologies, could materially delay development of new products and lead to decreased revenues and a loss of market share to our competitors. The semiconductor industry is characterized by rapidly changing technologies and industry standards, together with frequent new product introductions. Our financial performance depends on our ability to identify important new technology advances and to design, develop, manufacture, assemble, test, market and support new products and enhancements on a timely and cost-effective basis. While new products often command higher prices and higher profit margins, we may not successfully identify new product opportunities and develop and bring new products to market or succeed in selling them for use in new customer applications in a timely and cost-effective manner. Products or technologies developed by other companies may render our products or technologies obsolete or noncompetitive. Many of our competitors are larger, older and more established companies with greater engineering and research and development resources than us. If we fail to identify a fundamental shift in technologies or in our product markets such failure could have material adverse effects on our competitive position within the industry. In addition, to remain competitive, we must continue our efforts to reduce die sizes, develop new packages and improve manufacturing yields. We cannot assure you that we can accomplish these goals.

If some original equipment manufacturers do not design our products into their equipment, our revenue may be adversely affected.

We depend on our ability to have original equipment manufacturers (OEMs), or their contract manufacturers, choose our products. Frequently, an OEM will incorporate or specifically design our products into the products it produces. In such cases the OEM may identify our products, with the products of a limited number of other vendors, as approved for use in particular OEM applications. Without “design wins,” we may only be able to sell our products to customers as a secondary source, if at all. If an OEM designs another supplier’s product into one of its applications, it is more difficult for us to achieve future design wins for that application because changing suppliers involves significant cost, time, effort and risk for the OEM. Even if a customer designs in our products, we are not guaranteed to receive future sales from that customer. We may be unable to achieve these “design wins” because of competition or a product’s functionality, size, electrical characteristics or other aspect of its design or price. Additionally, we may be unable to service expected demand from the customer. In addition, achieving a design win with a customer does not ensure that we will receive significant revenue from that customer and we may be unable to convert design into actual sales.

We depend on demand from the consumer, original equipment manufacturer, contract manufacturing, industrial, automotive and other markets we serve for the end market applications which incorporate our products. Reduced consumer or corporate spending due to increased energy and commodity prices or other economic factors could affect our revenues.

If we provide revenue, margin or earnings per share guidance, it is generally based on certain assumptions we make concerning the health of the overall economy and our projections of future consumer and corporate spending. If our projections of these expenditures are inaccurate or based upon erroneous assumptions, our revenues, margins and earnings per share could be adversely affected. For example, beginning in the third quarter of 2011, we observed progressively weakening order rates which we attributed to uncertainty and deterioration of global economic conditions. While order rates and profitability are beginning to improve, we cannot be certain that a change in consumer demand or a deepening financial crisis in Europe will not have an adverse effect on our business.

Our failure to protect our intellectual property rights could adversely affect our future performance and growth.

Failure to protect our intellectual property rights may result in the loss of valuable technologies. We rely on patent, trade secret, trademark and copyright law to protect such technologies. These laws are subject to legislative and regulatory change or through changes in court interpretations of those laws and regulations. For example, there have been recent developments in the laws and regulations governing the issuance and assertion of patents in the U.S., including modifications to the rules governing patent prosecution. There have also been court rulings on the issues of willfulness, obviousness and injunctions, that may affect our ability to obtain patents and/or enforce our patents against others. Some of our technologies are not covered by any patent or patent application. With respect to our intellectual property generally, we cannot assure you that:

• the patents owned by us or numerous other patents which third parties license to us will not be invalidated, circumvented, challenged or licensed to other companies; or

• any of our pending or future patent applications will be issued within the scope of the claims sought by us, if at all.

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In addition, effective patent, trademark, copyright and trade secret protection may be unavailable, limited or not applied for in some countries. We cannot assure that we will be able to effectively enforce our intellectual property rights in every country in which our products are sold or manufactured.

We also seek to protect our proprietary technologies, including technologies that may not be patented or patentable, in part by confidentiality agreements and, if applicable, inventors’ rights agreements with our collaborators, advisors, employees and consultants. We cannot assure you that these agreements will not be breached, that we will have adequate remedies for any breach or that such persons or institutions will not assert rights to intellectual property arising out of such research. We have non-exclusive licenses to some of our technology from National Semiconductor, Infineon, Samsung Electronics and other companies. These companies may license such technologies to others, including our competitors or may compete with us directly. In addition, National Semiconductor and Infineon have limited royalty-free, worldwide license rights to some of our technologies. National Semiconductor was purchased by Texas Instruments in 2011. If necessary or desirable, we may seek licenses under patents or intellectual property rights claimed by others. However, we cannot assure you that we will obtain such licenses or that the terms of any offered licenses will be acceptable to us. The failure to obtain a license from a third party for technologies we use could cause us to incur substantial liabilities and to suspend the manufacture or shipment of products or our use of processes requiring the technologies.

Our failure to obtain or maintain the right to use some technologies may negatively affect our financial results.

Our future success and competitive position depend in part upon our ability to obtain or maintain proprietary technologies used in our principal products. From time to time we are required to defend against claims by competitors and others of intellectual property infringement. Claims of intellectual property infringement and litigation regarding patent and other intellectual property rights are commonplace in the semiconductor industry and are frequently time consuming and costly. From time to time, we may be notified of claims that we may be infringing patents issued to other companies. Such claims may relate both to products and manufacturing processes. We may engage in license negotiations regarding these claims from time to time. Even though we maintain procedures to avoid infringing others’ rights as part of our product and process development efforts, it is impossible to be aware of every possible patent which our products may infringe, and we cannot assure you that we will be successful in our efforts to avoid infringement claims. Furthermore, even if we conclude our products do not infringe another’s patents, others may not agree. We have been and are involved in lawsuits, and could become subject to other lawsuits, in which it is alleged that we have infringed upon the patent or other intellectual property rights of other companies. For example, since October 2004, we have been in litigation with Power Integrations, Inc. See Item 3, Legal Proceedings. Our involvement in this litigation and future intellectual property litigation, or the costs of avoiding or settling litigation by purchasing licenses rights or by other means, could result in significant expense to our company, adversely affecting sales of the challenged products or technologies and diverting the efforts and attention of our technical and management personnel, whether or not such litigation is resolved in our favor. We may decide to settle patent infringement claims or litigation by purchasing license rights from the claimant, even if we believe we are not infringing, in order to reduce the expense of continuing the dispute or because we are not sufficiently confident that we would eventually prevail. In the event of an adverse outcome as a defendant in any such litigation, we may be required to:

• pay substantial damages;

• indemnify our customers for damages they might suffer if the products they purchase from us violate the intellectual property rights of others;

• stop our manufacture, use, sale or importation of infringing products;

• expend significant resources to develop or acquire non-infringing technologies;

• discontinue manufacturing processes; or

• obtain licenses to the intellectual property we are found to have infringed.

We cannot assure you that we would be successful in such development or acquisition or that such licenses would be available under reasonable terms. Any such development, acquisition or license could require the expenditure of substantial time and other resources.

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We may not be able to consummate future acquisitions or successfully integrate acquisitions into our business.

We have made numerous acquisitions of various sizes since we became an independent company in 1997 and we plan to pursue additional acquisitions of related businesses. The costs of acquiring and integrating related businesses, or our failure to integrate them successfully into our existing businesses, could result in our company incurring unanticipated expenses and losses. In addition, we may not be able to identify or finance additional acquisitions or realize any anticipated benefits from acquisitions we do complete.

We are constantly evaluating acquisition opportunities and consolidation possibilities and are frequently conducting due diligence or holding preliminary discussions with respect to possible acquisition transactions, some of which could be significant.

If we acquire another business, the process of integrating an acquired business into our existing operations may result in unforeseen operating difficulties and may require us to use significant financial resources on the acquisition that may otherwise be needed for the ongoing development or expansion of existing operations. Some of the risks associated with acquisitions include:

• unexpected losses of key employees, customers or suppliers of the acquired company;

• conforming the acquired company’s standards, processes, procedures and controls with our operations;

• coordinating new product and process development;

• hiring additional management and other critical personnel;

• inability to realize anticipated synergies;

• negotiating with labor unions; and

• increasing the scope, geographic diversity and complexity of our operations.

In addition, we may encounter unforeseen obstacles or costs in the integration of other businesses we acquire.

Possible future acquisitions could result in the incurrence of additional debt, contingent liabilities and amortization expenses related to intangible assets, all of which could have a material adverse effect on our financial condition and operating results.

We may face risks associated with dispositions of assets and businesses.

From time to time we may dispose of assets and businesses in an effort to grow our more profitable product lines. When we do so, we face certain risks associated with these exit activities, including but not limited the risk that we will disrupt service to our customers, the risk of inadvertently losing other business not related to the exit activities, the risk that we will be unable to effectively continue, terminate, modify and manage supplier and vendor relationships, and the risk that we may be subject to consequential claims from customers or vendors as a result of eliminating, or transferring the production of affected products or the renegotiation of commitments related to those products.

We depend on suppliers for timely deliveries of raw materials of acceptable quality. Production time and product costs could increase if we were to lose a primary supplier or if we experience a significant increase in the prices of our raw materials. Product performance could be affected and quality issues could develop as a result of a significant degradation in the quality of raw materials we use in our products.

Our manufacturing processes use many raw materials, including silicon wafers, gold, copper lead frames, mold compound, ceramic packages and various chemicals and gases. Our manufacturing operations depend upon our ability to obtain adequate supplies of raw materials on a timely basis. Our results of operations could be adversely affected if we were unable to obtain adequate supplies of raw materials in a timely manner or if the costs of raw materials increased significantly. If the prices of these raw materials rise significantly we may be unable to pass on our increased operating expenses to our customers. This could result in decreased profit margins for the products in which the materials are used. Results could also be adversely affected if there is a significant degradation in the quality of raw materials used in our products, or if the raw materials give rise to compatibility or performance issues in our products, any of which could lead

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to an increase in customer returns or product warranty claims. Although we maintain rigorous quality control systems, errors or defects may arise from a supplied raw material and be beyond our detection or control. For example, some phosphorus-containing mold compound received from one supplier and incorporated into our products in the past resulted in a number of claims for damages from customers. We purchase some of our raw materials such as silicon wafers, lead frames, mold compound, ceramic packages and chemicals and gases from a limited number of suppliers on a just-in-time basis. From time to time, suppliers may extend lead times, limit supplies or increase prices due to capacity constraints or other factors. We subcontract a minority of our wafer fabrication needs, primarily to Taiwan Semiconductor Manufacturing Company, Advanced Semiconductor Manufacturing Corporation, Central Semiconductor Manufacturing Corporation, Jilin Magic Semiconductor, Macronix International Co. Ltd., and Phenitec Semiconductor. In order to maximize our production capacity, some of our back-end assembly and testing operations are also subcontracted. Primary back-end subcontractors include , Advance Semiconductor Engineering, Inc., AIC Semicondutor Sdn Bhd, Amkor Technology, AUK Semiconductor PTE, Ltd, GEM Services, Inc., Greatek Electronics, Inc., Hana Microelectronics Ltd, Liteon, Inc., Tak Cheong Electronics (Holdings) Co. Ltd, United Test and Assembly Center Thai Ltd., and Vigilant Technology Company, Ltd. Our operations and ability to satisfy customer obligations could be adversely affected if our relationships with these subcontractors were disrupted or terminated.

Delays in expanding capacity at existing facilities, implementing new production techniques, or incurring problems associated with technical equipment malfunctions, all could adversely affect our manufacturing efficiencies.

Our manufacturing efficiency is an important factor in our profitability, and we cannot assure you that we will be able to maintain our manufacturing efficiency or increase manufacturing efficiency to the same extent as our competitors. Our manufacturing processes are highly complex, require advanced and costly equipment and are continuously being modified in an effort to improve yields and product performance. Impurities or other difficulties in the manufacturing process can lower yields. We are constantly looking for ways to expand capacity or improve efficiency at our manufacturing facilities. For example, we are in the final stages of converting our facilities in South Korea and Utah from 6 inch wafers to 8 inch wafers. As is common in the semiconductor industry, we may experience difficulty in completing transitions to new manufacturing processes at existing facilities. As a consequence, we have suffered delays in product deliveries or reduced yields in the past and may experience such delays again in the future.

We may experience delays or problems in bringing new manufacturing capacity to full production. Such delays, as well as possible problems in achieving acceptable yields, or product delivery delays relating to existing or planned new capacity could result from, among other things, capacity constraints, construction delays, upgrading or expanding existing facilities or changing our process technologies, any of which could result in a loss of future revenues. Our operating results could also be adversely affected by the increase in fixed costs and operating expenses related to increases in production capacity if revenues do not increase proportionately.

We rely on subcontractors to reduce production costs and to meet manufacturing demands, which may adversely affect our results of operations.

Many of the processes we use in manufacturing our products are complex requiring, among other things, a high degree of technical skill and significant capital investment in advanced equipment. In some circumstances, we may decide that it is more cost effective to have some of these processes performed by qualified third party subcontractors. In addition, we may utilize a subcontractor to fill unexpected customer demand for a particular product or process or to guaranty supply of a particular product that may be in great demand. More significantly, as a result of the expense incurred in qualifying multiple subcontractors to perform the same function, we may designate a subcontractor as a single source for supplying a key product or service. If a single source subcontractor were to fail to meet our contractual requirements, our business could be adversely affected and we could incur production delays and customer cancellations as a result. We would also be required to qualify other subcontractors, which would be time consuming and cause us to incur additional costs. In addition, even if we qualify alternate subcontractors, those subcontractors may not be able to meet our delivery, quality or yield requirements, which could adversely affect our results of operations. In addition to these operational risks, some of these subcontractors are smaller businesses that may not have the financial ability to acquire the advanced tools and equipment necessary to fulfill our requirements. In some circumstances, we may find it necessary to provide financial support to our subcontractors in the form of advance payments, loans, loan guarantees, equipment financing and similar financial arrangements. In those situations, we could be adversely impacted if the subcontractor failed to comply with its financial obligations to us.

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Compliance with new regulations regarding the use of “conflict minerals” could limit the supply and increase the cost of certain metals used in manufacturing our products.

Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the Dodd-Frank Act), requires the SEC to promulgate new disclosure requirements for manufacturers of products containing certain minerals which are mined from the Democratic Republic of Congo and adjoining countries. These “conflict minerals” are commonly found in metals used in the manufacture of semiconductors. Manufacturers are also required to disclose their efforts to prevent the sourcing of such minerals and metals produced from them. The new disclosure rules will take effect in May of 2014, one full fiscal year after the promulgation of the SEC’s final rules. The implementation of these new regulations may limit the sourcing and availability of some of the metals used in the manufacture of our products. The regulations may also reduce the number of suppliers who provide conflict-free metals, and may affect our ability to obtain products in sufficient quantities or at competitive prices. Finally, some of our customers may elect to disqualify us as a supplier if we are unable to verify that the metals used in our products free of conflict minerals.

A significant portion of our sales are made to distributors who can terminate their relationships with us with little or no notice. The termination of a distributor could reduce sales and result in inventory returns.

Distributors accounted for 61% of our net sales for the nine months ended September 30, 2012. Our top five distributors worldwide accounted for 22% of our net sales for the nine months ended September 30, 2012. As a general rule, we do not have long-term agreements with our distributors, and they may terminate their relationships with us with little or no advance notice. Distributors generally offer competing products. The loss of one or more of our distributors, or the decision by one or more of them to reduce the number of our products they offer or to carry the product lines of our competitors, could have a material adverse effect on our business, financial condition and results of operations. The termination of a significant distributor, whether at our or the distributor’s initiative, or a disruption in the operations of one or more of our distributors, could reduce our net sales in a given quarter and could result in an increase in inventory returns.

The semiconductor business is very competitive, especially in the markets we serve, and increased competition could reduce the value of an investment in our company.

We participate in the standard component or “multi-market” segment of the semiconductor industry. While the semiconductor industry is generally highly competitive, the “multi-market” segment is particularly so. Our competitors offer equivalent or similar versions of many of our products, and customers may switch from our products to our competitors’ products on the basis of price, delivery terms, product performance, quality, reliability and customer service or a combination of any of these factors. Competition is especially intense in the multi-market semiconductor segment because it is relatively easy for customers to switch between suppliers of more standardized, multi-market products like ours. In the past we have experienced decreases in prices during “down” cycles in the semiconductor industry, and this may occur again as a result of the recent downturn in global economic conditions. Even in strong markets, price pressures may emerge as competitors attempt to gain a greater market share by lowering prices. We compete in a global market and our competitors are companies of various sizes in various countries around the world. Many of our competitors are larger than us and have greater financial resources available to them. As such, they tend to have a greater ability to pursue acquisition candidates and can better withstand adverse economic or market conditions. Additionally, companies with whom we do not currently compete may introduce new products that may cause them to compete with us in the future.

We may not be able to attract or retain the technical or management employees necessary to remain competitive in our industry.

Our continued success depends on our ability to attract, motivate and retain skilled personnel, including technical, marketing, management and staff personnel. In the semiconductor industry, the competition for qualified personnel, particularly experienced design engineers and other technical employees, is intense, particularly when the business cycle is improving. During such periods competitors may try to recruit our most valuable technical employees. While we devote a great deal of our attention to designing competitive compensation programs aimed at accomplishing this goal, specific elements of our compensation programs may not be competitive with those of our competitors and there can be no assurance that we will be able to retain our current personnel or recruit the key personnel we require.

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If we must reduce our use of equity awards to compensate our employees, our competitiveness in the employee marketplace could be adversely affected. Our results of operations could vary as a result of changes in our stock-based compensation programs.

Like most technology companies, we have a history of using employee stock based incentive programs to recruit and retain our workforce in a competitive employment marketplace. Our success will depend in part upon the continued use of stock options, restricted stock units, deferred stock units and performance-based equity awards as a compensation tool. While this is a routine practice in many parts of the world, foreign exchange and income tax regulations in some countries make this practice more and more difficult. Such regulations tend to diminish the value of equity compensation to our employees in those countries. With regard to all equity based compensation, our current practice is to seek stockholder approval for increases in the number of shares available for grant under the Fairchild Semiconductor 2007 Stock Plan as well as other amendments that may be adopted from time to time which require stockholder approval. If these proposals do not receive stockholder approval, we may not be able to grant stock options and other equity awards to employees at the same levels as in the past, which could adversely affect our ability to attract, retain and motivate qualified personnel, and we may need to increase cash compensation in order to attract, retain and motivate employees, which could adversely affect our results of operations. Additionally, since 2009 we have relied almost exclusively on grants of restricted stock units and performance based equity awards in place of stock options. While we believe that our compensation policies are competitive with our peers, we cannot provide any assurance that we have not, and will not continue in the future to lose opportunities to recruit and retain key employees as a result of these changes.

Changes in forecasted stock-based compensation expense could impact our gross margin percentage, research and development expenses, marketing, general and administrative expenses and our tax rate.

We may face product warranty or product liability claims that are disproportionately higher than the value of the products involved.

Our products are typically sold at prices that are significantly lower than the cost of the equipment or other goods in which they are incorporated. For example, our products that are incorporated into a personal computer may be sold for several dollars, whereas the personal computer might be sold by the computer maker for several hundred dollars. Although we maintain rigorous quality control systems, we manufacture and sell approximately 16 billion individual semiconductor devices per year to customers around the world, and in the ordinary course of our business we receive warranty claims for some of these products that are defective or that do not perform to published specifications. Since a defect or failure in our product could give rise to failures in the goods that incorporate them (and consequential claims for damages against our customers from their customers), we may face claims for damages that are disproportionate to the revenues and profits we receive from the products involved. We attempt, through our standard terms and conditions of sale and other customer contracts, to limit our liability by agreeing only to replace the defective goods or refund the purchase price. Nevertheless, we have received claims for other charges, such as for labor and other costs of replacing defective parts or repairing the products into which the defective products are incorporated, lost profits and other damages. In addition, our ability to reduce such liabilities, whether by contracts or otherwise, may be limited by the laws or the customary business practices of the countries where we do business. And, even in cases where we do not believe we have legal liability for such claims, we may choose to pay for them to retain a customer’s business or goodwill or to settle claims to avoid protracted litigation. Our results of operations and business could be adversely affected as a result of a significant quality or performance issue in our products, if we are required or choose to pay for the damages that result. For example, from 2001 to 2008 we received claims from a number of customers seeking damages resulting from certain products manufactured with a phosphorus-containing mold compound, and we were named in lawsuits relating to these mold compound claims.

Our operations and business could be significantly harmed by natural disasters.

Our manufacturing facilities in China, South Korea, Malaysia, the Philippines and many of the third party contractors and suppliers that we currently use are located in countries that are in seismically active regions of the world where earthquakes and other natural disasters, such as floods and typhoons may occur. While we take precautions to mitigate these risks, we cannot be certain that they will be adequate to protect our facilities in the event of a major earthquake, flood, typhoon or other natural disaster. Although we maintain insurance for some of the damage that may be caused by natural disasters, our insurance coverage may not be sufficient to cover all of our potential losses and would not cover us for lost business. As a result, a natural disaster in one of these regions could severely disrupt the operation of our business and have a material adverse effect on our financial condition and results of operations.

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Natural disasters could affect our supply chain or our customer base which, in turn, could have a negative impact on our business, the cost of and demand for our products and our results of operations.

While the earthquake and tsunami in Japan and flooding in Thailand did not materially impact us, the occurrence of natural disasters in certain regions, could have a negative impact on our supply chain, our ability to deliver products, the cost of our products and the demand for our products. These events could cause consumer confidence and spending to decrease or result in increased volatility to the U.S. and worldwide economies. Any such occurrences could have a material adverse effect on our business, our results of operations and our financial condition.

Our international operations subject our company to risks not faced by domestic competitors.

Through our subsidiaries we maintain significant operations and facilities in the Philippines, Malaysia, China, South Korea and Singapore. We have sales offices and customers around the world. Approximately 76% of our revenues in first nine months of 2012 were from Asia. The following are some of the risks inherent in doing business on an international level:

• economic and political instability;

• foreign currency fluctuations;

• transportation delays;

• trade restrictions;

• changes in laws and regulations relating to, amongst other things, import and export tariffs, taxation, environmental regulations, land use rights and property,

• work stoppages; and

• the laws of, including tax laws, and the policies of the U.S. toward, countries in which we manufacture our products.

We acquired significant operations and revenues when we acquired a business from Samsung Electronics and, as a result, are subject to risks inherent in doing business in Korea, including political risk, labor risk and currency risk.

We have significant operations and sales in South Korea and are subject to risks associated with doing business there. Korea accounted for approximately 10% of our revenue for the nine months ended September 30, 2012.

Relations between South Korea and North Korea have been tense over most of South Korea’s history, and more recent concerns over North Korea’s nuclear capability, and relations between the U.S. and North Korea, have created a global security issue that may adversely affect Korean business and economic conditions. We cannot assure you as to whether or when this situation will be resolved or change abruptly as a result of current or future events. An adverse change in economic or political conditions in South Korea or in its relations with North Korea could have a material adverse effect on our Korean subsidiary and our company. In addition to other risks disclosed relating to international operations, some businesses in South Korea are subject to labor unrest.

Our Korean sales are increasingly denominated primarily in U.S. dollars while a significant portion of our Korean operations’ costs of goods sold and operating expenses are denominated in South Korean won. Although we have taken steps to fix the costs subject to currency fluctuations and to balance won revenues and won costs as much as possible, a significant change in this balance, coupled with a significant change in the value of the won relative to the dollar, could have a material adverse effect on our financial performance and results of operations (see Item 7a, Quantitative and Qualitative Disclosures about Market Risk).

A change in foreign tax laws or a difference in the construction of current foreign tax laws by relevant foreign authorities could result in us not recognizing any anticipated benefits.

Some of our foreign subsidiaries have been granted preferential income tax or other tax holidays as an incentive for locating in those jurisdictions. A change in the foreign tax laws or in the construction of the foreign tax laws governing

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these tax holidays, or our failure to comply with the terms and conditions governing the tax holidays, could result in us not recognizing the anticipated benefits we derive from them, which would decrease our profitability in those jurisdictions. While we continue to monitor the tax holidays, the income tax laws governing the tax holidays, and our compliance with the terms and conditions of the tax holidays there is still a risk that we may not be able to recognize the anticipated benefits of these tax holidays.

We have significantly expanded our manufacturing operations in China and, as a result, will be increasingly subject to risks inherent in doing business in China, which may adversely affect our financial performance.

We expect a significant portion of our production from our Suzhou, China facility will be exported out of China, however, we are hopeful that a significant portion of our future revenue will result from the Chinese markets in which our products are sold, and from demand in China for goods that include our products. Our ability to operate in China may be adversely affected by changes in that country’s laws and regulations, including those relating to taxation, foreign exchange restrictions, import and export tariffs, environmental regulations, land use rights, property and other matters. In addition, our results of operations in China are subject to the economic and political situation there. We believe that our operations in China are in compliance with all applicable legal and regulatory requirements. However, there can be no assurance that China’s central or local governments will not impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures. Changes in the political environment or government policies could result in revisions to laws or regulations or their interpretation and enforcement, increased taxation, restrictions on imports, import duties or currency revaluations. In addition, a significant destabilization of relations between China and the U.S. could result in restrictions or prohibitions on our operations or the sale of our products in China. The legal system of China relating to foreign trade is relatively new and continues to evolve. There can be no certainty as to the application of its laws and regulations in particular instances. Enforcement of existing laws or agreements may be sporadic and implementation and interpretation of laws inconsistent. Moreover, there is a high degree of fragmentation among regulatory authorities resulting in uncertainties as to which authorities have jurisdiction over particular parties or transactions.

We are subject to many environmental laws and regulations that could affect our operations or result in significant expenses.

Increasingly stringent environmental regulations restrict the amount and types of pollutants that can be released from our operations into the environment. While the cost of compliance with environmental laws has not had a material adverse effect on our results of operations historically, compliance with these and any future regulations could require significant capital investments in pollution control equipment or changes in the way we make our products. In addition, because we use hazardous and other regulated materials in our manufacturing processes, we are subject to risks of liabilities and claims, regardless of fault, resulting from our use, transportation, emission, discharge, storage, recycling or disposal of hazardous materials, including personal injury claims and civil and criminal fines, any of which could be material to our cash flow or earnings. For example:

• we currently are remediating contamination at some of our operating plant sites;

• we have been identified as a potentially responsible party at a number of Superfund sites where we (or our predecessors) disposed of wastes in the past; and

• significant regulatory and public attention on the impact of semiconductor operations on the environment may result in more stringent regulations, further increasing our costs.

Although most of our known environmental liabilities are covered by indemnification agreements with Raytheon Company, National Semiconductor Corporation, Samsung Electronics and Intersil Corporation, these indemnities are limited to conditions that occurred prior to the consummation of the transactions through which we acquired facilities from those companies. National Semiconductor was purchased by Texas Instruments in 2011. Moreover, we cannot assure you that their indemnity obligations to us for the covered liabilities will be available, or, if available, adequate to protect us.

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Our senior credit facility limits our flexibility and places restrictions on the manner in which we run our operations.

At September 30, 2012 we had total debt of $300.1 million and the ratio of this debt to equity was approximately 0.2 to 1. As of September 30, 2012, our credit facility consists of a $400 million in a revolving line of credit. Adjusted for outstanding letters of credit, we had up to $98.4 million available under the revolving loan portion of the senior credit facility. In addition, there is a $150 million uncommitted incremental revolving loan feature. Despite the significant reductions we have made in our long-term debt, we continue to carry indebtedness which could have significant consequences on our operations. For example, it could:

• require us to dedicate a portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures, research and development efforts and other general corporate purposes;

• increase the amount of our interest expense, because our borrowings are at variable rates of interest, which, if interest rates increase, could result in higher interest expense;

• increase our vulnerability to general adverse economic and industry conditions;

• limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

• restrict us from making strategic acquisitions, introducing new technologies or exploiting business opportunities;

• make it more difficult for us to satisfy our obligations with respect to the instruments governing our indebtedness;

• place us at a competitive disadvantage compared to our competitors that have less indebtedness; or

• limit, along with the financial and other restrictive covenants in our debt instruments, among other things, our ability to borrow additional funds, dispose of assets, repurchase stock or pay cash dividends. Failing to comply with those covenants could result in an event of default which, if not cured or waived, could have a material adverse effect on our business, financial condition and results of operations.

We may not be able to generate the necessary amount of cash to service our indebtedness, which may require us to refinance our indebtedness or default on our scheduled debt payments. Our ability to generate cash depends on many factors beyond our control.

Our historical financial results have been, and we anticipate that our future financial results may be subject to substantial fluctuations. While we currently have sufficient cash flow to satisfy all of our current obligations, we cannot assure you that our business will continue to generate sufficient cash flow from operations to enable us to pay our indebtedness or to fund our other liquidity needs in the future. Further, we can make no assurances that our currently anticipated cost savings and operating improvements will be realized on schedule or at all, or that future borrowings will be available to us under our senior credit facility in an amount sufficient to satisfy our liquidity needs. In addition, because our senior credit facility has a variable interest rate, our cost of borrowing will increase if market interest rates increase. If we are unable to meet our expenses and debt obligations, we may need to refinance all or a portion of our indebtedness on or before maturity, sell assets or raise equity. We cannot assure you that we would be able to renew or refinance any of our indebtedness, sell assets or raise equity on commercially reasonable terms or at all, which could cause us to default on our obligations and impair our liquidity. Restrictions imposed by the credit agreement relating to our senior credit facility restrict or prohibit our ability to engage in or enter into some business operating and financing arrangements, which could adversely affect our ability to take advantage of potentially profitable business opportunities.

The operating and financial restrictions and covenants in the credit agreement relating to our senior credit facility may limit our ability to finance our future operations or capital needs or engage in other business activities that may be in our interests. The credit agreement imposes significant operating and financial restrictions on us that affect our ability to incur additional indebtedness or create liens on our assets, pay dividends, sell assets, engage in mergers or acquisitions, make investments or engage in other business activities. These restrictions could place us at a disadvantage relative to our competitors many of which are not subject to such limitations.

In addition, the senior credit facility also requires us to maintain specified financial ratios. Our ability to meet those financial ratios can be affected by events beyond our control, and we cannot assure you that we will meet those ratios. As of September 30, 2012, we were in compliance with these ratios. A breach of any of these covenants, ratios or restrictions

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could result in an event of default under the senior credit facility. Upon the occurrence of an event of default under the senior credit facility, the lenders could elect to declare all amounts outstanding under the senior credit facility, together with accrued interest, to be immediately due and payable. If we were unable to repay those amounts, the lenders could proceed against our assets, including any collateral granted to them to secure the indebtedness. If the lenders under the senior credit facility accelerate the payment of the indebtedness, we cannot assure you that our assets would be sufficient to repay in full that indebtedness and our other indebtedness.

We have investments in auction rate securities that subject us to market risk which could adversely affect our liquidity and financial results.

As of September 30, 2012, we owned auction rate securities with a par value of $49.5 million and market value of $25.8 million. We originally purchased these securities believing them to be safe, short-term and highly liquid investments. However, as a result of the systemic failure of the auction rate securities market, these securities are no longer liquid. While we continue to accrue and receive interest on these securities at the contractual rate, there can be no assurance that there will ever be an active market for our auction rate securities. Uncertainties in the credit and capital markets could lead to further downgrades of our auction rate securities and additional impairments. Additionally, auction failures have limited our ability to fully recover the par value of our investment in the short term and even if we hold the securities to maturity, the long-term value of the auction rate securities may potentially be impacted by issuer defaults. We do not anticipate that the lack of liquidity or future downgrades and impairments will materially impact our ability to fund our working capital needs, capital expenditures or other business requirements.

Security breaches and other disruptions could compromise the integrity of our information and expose us to liability, which would cause our business and reputation to suffer.

We routinely collect and store sensitive data, including intellectual property and other proprietary information about our business and that of our customers, suppliers and business partners. The secure processing, maintenance and transmission of this information is critical to our operations and business strategy. Despite our security measures, our information technology and infrastructure may be vulnerable to attacks by hackers or breached due to employee error, malfeasance or other disruptions. Any such breach could compromise our networks and the information stored there could be accessed, publicly disclosed, lost or stolen. Any such access, disclosure or other loss of information could result in legal claims or proceedings and liability under laws that protect the privacy of personal information. It could also result in regulatory penalties, disrupt our operations and the services we provide to customers, damage our reputation and cause a loss of confidence in our products and services, which could adversely affect our business/operating margins, revenues and competitive position.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Period	Total Number of Shares (or Units) Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs
July 2, 2012 - July 29, 2012		100,000	$	12.84		—		—
August 30, 2012 - August 26, 2012		—		—		—		—
August 27, 2012 - September 30, 2012		—		—		—		—
Total		100,000		12.84		—		—

All of these shares were purchased by the company in open-market transactions and were authorized by the Board of Directors. The purchase of these shares satisfied the conditions of the safe harbor provided by the Securities Exchange Act of 1934.

For the majority of restricted stock units granted, the number of shares issued on the date the restricted stock units vest is net of the minimum statutory withholding requirements that we pay in cash to the appropriate taxing authorities on behalf of our employees. Although these withheld shares are not issued or considered common stock repurchases and are not included in the table above, the cash paid for taxes is treated in the same manner as common stock repurchases in our financial statements, as they reduce the number of shares that would have been issued upon vesting.

Item 6. Exhibits

Exhibit No.	Description
10.1	Employment Agreement with Vijay Ullal.
10.2	Executive Severance Policy.
31.01	Section 302 Certification of the Chief Executive Officer.
31.02	Section 302 Certification of the Chief Financial Officer.
32.01	Certification, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by Mark S. Thompson.
32.02	Certification, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by Mark S. Frey.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101. DEF	XBRL Taxonomy Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

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Items 3, 4 and 5 are not applicable and have been omitted.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Fairchild Semiconductor International, Inc.
Date: November 9, 2012		/s/ Robin A. Sawyer
		Robin A. Sawyer
		Vice President, Corporate Controller
		(Principal Accounting Officer)

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EX-10.1

Exhibit 10.1

[Fairchild Semiconductor Letterhead]

August 31, 2012

Via Email

Vijay Ullal

Dear Vijay:

On behalf of Fairchild Semiconductor, I am pleased to offer you the position of President and Chief Operating Officer, reporting to me. I hope that you are as excited as we are for you to become a member of the Fairchild team. This letter describes the terms and conditions of our offer and applicable company plans and policies in greater detail.

1. Base Salary.

Your initial base salary will be $450,000 per year, which is $37,500 per month, to be paid bi-weekly. You will be eligible for base salary increases in accordance with the company’s annual performance review cycle.

2. Incentive Bonus.

You will participate in the Enhanced Fairchild Incentive Plan (EFIP), our annual cash bonus award program, at a target participation level of 120%. EFIP awards to Section 16 officers are made under the cash incentive award provisions of the Fairchild Semiconductor 2007 Stock Plan (“Stock Plan”). This award will provide an opportunity for you to receive an annual cash bonus of up to 180% of your annual cash compensation, based on achievement of financial performance goals. The company sets goals at the corporate level (likely to remain based on EBIT) and at the individual officer level (your goals are likely to be substantially the same as those of the CEO). Depending on the achievement of these goals, the cash incentive amount, if any, is between 50% and 150% of a participant’s target participation level (in your case, this means the amount of your bonus could be between 60% and 180% of your annual base compensation). The goals for 2013 have yet to be determined.

3. Equity Awards.

On your start date you will received an award (“RSU Grant”) of 150,000 restricted stock units (“RSUs”), representing 150,000 shares of Fairchild Semiconductor common stock, which will vest over the three years following your start date. You will be eligible to receive subsequent, annual grants of RSUs, performance stock units and other equity awards consistent with our annual equity award program, which currently grants awards in February-March of each year. All grants are governed by the terms and conditions of the Stock Plan and standard award agreements under the Stock Plan. The award agreement for your initial grant of 150,000 RSUs is enclosed as Attachment 1.

4. Vacation.

You will be entitled to four weeks (160 hours) of paid vacation per year, which accrue ratably over the course of the year.

Vijay Ullal

August 31, 2012

Page 2

5. Severance in Case of Involuntary Termination.

You will participate in the company’s Executive Severance Policy, which is enclosed as Attachment 2 (as supplemented and modified in application to you by the applicable terms of this letter agreement, the “Severance Policy”) at the level of President. Under the Severance Policy, if your employment is terminated by the company for any reason other than Cause (as defined below), you will be entitled to a lump-sum payment of 15 months’ base salary, continued medical coverage for you and your eligible dependents for 15 months following termination and full vesting of your RSU Grant.

You will also be entitled to the severance payment set forth in the Severance Policy (the “Severance Payment”) if your employment with Fairchild Semiconductor and its affiliates is terminated by you for Good Reason. “Good Reason” under the Severance Policy means your resignation following the occurrence of one or more of the following without your consent: (a) a material reduction in your title, authority, duties or responsibilities; (b) any material reduction in your base salary or target incentive compensation opportunity; (c) a requirement that you relocate your principal place of employment to a location more than 20 miles from the prior location of your principal place of employment, (d) a material breach by Fairchild Semiconductor of this letter agreement or the Severance Policy, or purported amendment or termination of the Severance Policy that would result in a material reduction in the rights to which you would otherwise be entitled pursuant thereto, or (e) your having to report to anyone other than the chief executive officer of Fairchild Semiconductor or its board of directors. You may not resign for Good Reason without first providing Fairchild Semiconductor with written notice within 90 days of the initial existence of the condition that you believe constitutes Good Reason specifically identifying the acts or omissions constituting the grounds for Good Reason and providing a reasonable cure period of not less than 30 days following the date of such notice. For purposes of this “Good Reason” definition, the term “Fairchild Semiconductor” will be interpreted to include any subsidiary, parent, affiliate or successor of Fairchild Semiconductor International, Inc., if applicable.

For purposes of the Severance Policy and this letter agreement, “Cause” means that you have (a) willfully breached or habitually neglected (following written notice from Fairchild Semiconductor) your duties as Chief Operating Officer of Fairchild Semiconductor, including but not limited to any fiduciary duty owed by you to Fairchild Semiconductor, or (b) committed material act(s) of malfeasance, misappropriation of Fairchild Semiconductor’s property, willful misconduct, fraud, embezzlement or other act(s) of moral turpitude that caused material harm to Fairchild Semiconductor or that would prevent the effective performance of your duties to Fairchild Semiconductor or resulted in your material personal profit, or (c) engaged in any act or omission in the course of your employment with Fairchild Semiconductor that materially injured the business or reputation of Fairchild Semiconductor. In each of cases (a), (b) and (c), if the act or circumstance giving rise to the termination for Cause is capable of being cured, then the termination for Cause will be valid only if such act or circumstance continues uncured for a period of 30 days following written notice to you specifying such act or circumstance as a means for termination for Cause as provided herein.

If your employment with Fairchild Semiconductor is terminated by Fairchild Semiconductor without Cause or by you for Good Reason prior to the third anniversary of the Grant Date (as defined in the agreement governing your RSU Grant (the “RSU Agreement”)), then any Restricted Stock Units that are not Vested Restricted Stock Units (each as defined in the RSU Agreement) will immediately vest in full and be settled in accordance with Section 4 of the RSU Agreement.

Vijay Ullal

August 31, 2012

Page 3

The release of claims described in the Severance Policy will be provided to you promptly upon your termination of employment and will be substantially in the form attached to this letter agreement as Attachment 3.

Section 409A.

a. No severance pay or benefits to be paid or provided to you, if any, pursuant to the Severance Policy or this letter agreement that, when considered together with any other severance payments or separation benefits, are considered deferred compensation under Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations and guidance applicable thereto (“Section 409A”) (such payments or separation benefits, the “Deferred Payments”) will be paid or otherwise provided until you have a “separation from service” within the meaning of Section 409A. Similarly, no severance payable to you, if any, pursuant to the Severance Policy or this letter agreement that otherwise would be exempt from Section 409A pursuant to Treasury Regulation Section 1.409A 1(b)(9) will be payable until you has a “separation from service” within the meaning of Section 409A.

b. Any severance payments or benefits under the Severance Policy or this letter agreement that would be considered Deferred Payments will be paid on, or, in the case of installments, will not commence until, the sixtieth (60th) day following your separation from service, or, if later, such time as required by paragraph 4(c). Except as required by paragraph 5(c) hereof, any installment payments that would have been made to you during the sixty (60) day period immediately following your separation from service but for the preceding sentence will be paid to you on the sixtieth (60th) day following your separation from service and the remaining payments will be made as provided in the Severance Policy and this agreement.

c. If you are a “specified employee” within the meaning of Section 409A at the time of your termination (other than due to death), then the Deferred Payments, if any, that are payable within the first six (6) months following your separation from service, will become payable on the first payroll date that occurs on or after the date six (6) months and one (1) day following the date of your separation from service. All subsequent Deferred Payments, if any, will be payable in accordance with the payment schedule applicable to each payment or benefit. Notwithstanding anything herein to the contrary, if you die following your separation from service, but before the date that is six (6) months after your separation from service, then any payments delayed in accordance with this paragraph will be payable in a lump sum as soon as administratively practicable after the date of your death and all other Deferred Payments will be payable in accordance with the payment schedule applicable to each payment or benefit. Each payment and benefit payable under the Severance Policy and this agreement is intended to constitute a separate payment under Section 1.409A-2(b)(2) of the Treasury Regulations.

d. Any amount paid under the Severance Policy or this agreement that satisfies the requirements of the “short-term deferral” rule set forth in Section 1.409A-1(b)(4) of the Treasury Regulations will not constitute Deferred Payments for purposes of clause (a) above.

Vijay Ullal

August 31, 2012

Page 4

e. The foregoing provisions are intended to comply with the requirements of Section 409A so that none of the severance payments and benefits to be provided under the Severance Policy or this agreement will be subject to the additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so comply. The parties hereto agree to work together in good faith to consider amendments to the Severance Policy and this agreement and to take such reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition before actual payment to you under Section 409A.

6. Change in Control.

The Stock Plan and Severance Plan include provisions that apply in the event of a change in control. .

Stock Plan. Under section 12 of the Stock Plan, in the event of a change in control (as defined in the plan), all of your initial RSUs and any other equity awards you have at the time will vest in full, whether or not your employment is affected by the change in control. Under our standard performance stock unit award agreement, any performance units that have yet to be scored (i.e., units for which the performance measurement period is ongoing at the time) would vest in full, assuming achievement of performance goals at the 100% level.

Severance Plan. Under the Severance Plan, in the event of a change in control, the company must require the acquiring company or successor to assume all of the company’s obligations for the severance benefits described above. If the acquiring company or successor fails to assume those obligations, then the closing of the change-in-control transaction would be treated as a not-for-cause termination event, triggering payment of severance benefits under the Severance Policy (in your case, the benefits described in section 5 above).

7. Indemnification.

You are entitled to indemnification under our corporate bylaws and under directors’ and officers’ liability insurance that the company purchases for your benefit. The indemnification provisions of our bylaws provide you rights to indemnification from the company to the maximum extent permitted by Delaware law. As an officer, you are entitled to indemnification from the company (again, to the extent permitted by law) as a matter of right (i.e., not subject to the company’s discretion), for all legal proceedings, including criminal and civil litigation as well as threatened proceedings, administrative proceedings and investigations, if you are a party or otherwise involved by virtue of the fact that you are an officer of the company. Under the bylaws, you are entitled to reimbursement of expenses as incurred, indemnification rights are deemed contract rights, and any changes to the bylaws cannot operate retroactively to your detriment. In cases where indemnification from the company is not permitted by law, or otherwise not available to you, the company maintains directors’ and officers’ liability insurance coverage for your benefit. This description of your rights to indemnification is qualified by reference to the actual terms and conditions of the bylaws. In addition, in the event of any litigation, threat of litigation, claim or dispute between you and any third party arising as a result of the commencement of your employment with Fairchild Semiconductor or your entering into this letter agreement, the company agrees to retain outside counsel acceptable to you to represent you in such matter, at the company’s expense. In this connection you represent to the company that, to the best of your knowledge, your employment by us or your

Vijay Ullal

August 31, 2012

Page 5

entering into this agreement will not breach any duties you may owe to any third party, or breach any agreement to which you are a party, or violate the rights of any third party.

8. Confidentiality and Trade Secrets of Former Employers.

We want to be sure to respect the rights of your former employer, Maxim Integrated Products, Inc., in its trade secrets and other confidential information. A separate letter to you on this subject will be provided to you for your acknowledgement.

9. Form Employment Agreement.

Enclosed as Attachment 4 is our standard form employment agreement, which covers, among other things, your employment-at-will status, your obligation to protect Fairchild trade secrets and confidential information, the disclosure of pre-existing intellectual property and your assignment to Fairchild of intellectual property rights in any of your inventions while employed by the company.

10. Medical/Dental, Life and Disability Insurance and Other Benefits.

You will be entitled to participate in benefits generally available to our officers and employees, including medical and dental insurance, vision care, life insurance, accidental death and dismemberment insurance, disability insurance, long-term care insurance, our 401(k) plan and other programs.

Lastly, please note that the terms and conditions of the plans and policies described above are subject to change in accordance with those terms and conditions.

If you have any questions regarding this offer, please do not hesitate to contact me, Paul Delva or Kevin London .

Vijay Ullal

August 31, 2012

Page 6

Please acknowledge your understanding of the terms and conditions of our employment offer as outlined above, and confirm your start date of September 10, 2012, by signing below. Please return this page to me at your earliest convenience.

Everyone has very much enjoyed getting to know you during the interview process, and the board and I are thrilled to offer you this opportunity in our organization. We believe this is a great fit, and expect that you will make a tremendous positive impact in the continued transformation of the company.

Sincerely, FAIRCHILD SEMICONDUCTOR CORPORATION
By:	/s/ Mark S. Thompson
	Mark S. Thompson Chairman, President and Chief Executive Officer

Acknowledged and Agreed:
/s/ Vijay Ullal	9/12/12
Vijay Ullal	Date

Attachments:

1. RSU Award Agreement

2. Executive Severance Policy and Designation Form

3. Form of Release Under Severance Policy

4. Form Employment Agreement

Attachment 3 – Form of Release

[Date]

[Name of Employee]

Dear [Name]:

This letter confirms our conversation regarding your departure from Fairchild and the Severance Benefits we will provide you upon our receipt of proper documentation from you under this release letter agreement (“the Release Letter Agreement”).

1. Severance Benefits; Payment of Final Pay and Other Benefits. You hereby acknowledge that your last day with Fairchild is _____________. In consideration for your agreement in this Release Letter Agreement and upon our receipt of appropriate documentation to confirm the effectiveness of your release of claims as provided herein and upon receipt of all Fairchild property in your possession, Fairchild agrees to provide to you with the severance benefits (“Severance Benefits”) described in the Fairchild Semiconductor Executive Severance Policy (as supplemented and modified in application to you by the applicable terms and conditions of the definitive letter agreement pursuant to which you first became employed by the company, the “Severance Policy”). You acknowledge and agree that Fairchild is not required to provide the Severance Benefits to you, under the Severance Policy or otherwise, unless you effectively release all claims against Fairchild, which you hereby agree to do. Fairchild will also pay you, regardless whether you release all claims against Fairchild, any salary, wages and accrued vacation which remain unpaid as of your last work day at Fairchild and any other benefits to which you may be entitled under Fairchild’s benefit plans in accordance with the benefit plan documents.

2. Release. For and in consideration of Fairchild’s agreement to pay you the Severance Benefits, you, for yourself and anyone who may claim through you, including, but not

limited to, your personal representatives, heirs, and assigns, do hereby irrevocably and unconditionally release and forever discharge Fairchild and its affiliated corporations and each of their agents, directors, officers, employees, representatives, attorneys and its and their predecessors, successors, heirs, executors, administrators and assigns, and all persons acting by, through, under or in concert with any of them (collectively “Releasees”), or any of them, of and from any and all actions, causes of action, suits, liabilities, claims, demands and expenses (including attorneys’ fees) of any nature whatsoever, both at law and in equity, now existing or which may result from the existing state of things, which you now have or ever had against Releasees from the beginning of time to the present day, including without limiting the generality of the foregoing, claims by you which are unknown at the present time, and including, without limitation, any and all claims arising out of or related to your employment with Fairchild, Fairchild’s termination of your employment or its decision to lay you off from your job at Fairchild, or any alleged violation by Fairchild or any of Releasees of any federal, state or local statutes, ordinances or common laws, including, but not limited to, all employment discrimination claims under Title VII of the Civil Rights Act of 1964, 42, U.S.C. §2000e et seq., the Civil Rights Act of 1991, 42 U.S.C. §1981, Executive Order 11246, as amended, the Rehabilitation Act of 1973, the Equal Pay Act, the Maine Human Rights Act, the California Fair Employment and Housing Act or other state statute relating to employment discrimination, the Age Discrimination in Employment Act, the Americans with Disabilities Act or the Maine Whistleblower Protection Act or other state whistleblower protection statute, the California Wage and Hour Orders, the California Labor Code, and the California Unemployment Insurance Code; excepting only those obligations of Fairchild contained in this Release Letter Agreement, any worker’s compensation benefits or claims to which you may be entitled under any state worker’s compensation laws, and any benefits to which you are entitled under the terms of any benefits plans other than the Severance Policy. In making the releases set forth herein,

each party acknowledges the party’s familiarity with Section 1542 of the California Civil Code and hereby waives any and all rights the party may now or in the future have under said section, which section provides as follows:

“A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor.”

For the purpose of implementing a full and complete release and discharge, the parties acknowledge that this Release Letter Agreement is intended to include all claims which they do not know or suspect exist at the time of the execution of this Release Letter Agreement.

3. Covenants. You waive your right to file any charge or complaint arising out of your employment with or separation from Fairchild before any federal, state, or local court or any state or local administrative agency, except where such waivers are prohibited by law. This Release Letter Agreement, however, does not prevent you from filing a charge with the Equal Employment Opportunity Commission or any Department of Fair Employment and Housing concerning claims of discrimination, although you waive your right to recover any damages or other relief in any claim or suit brought by or through the Equal Employment Opportunity Commission, any Department of Fair Employment and Housing or any other state or local agency on behalf of you under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans With Disabilities Act, any Fair Employment and Housing Act or any other federal or state discrimination law, except where prohibited by law. You confirm that you have not filed, caused to be filed, or are a party to any claim, charge, complaint, or action against Fairchild in any forum or form except as required by law. In the event that any such claim, charge, complaint, or action is filed and you obtain a judgment, it is the intent of

the parties that all payments made to you hereunder shall be offset against any judgment you obtain.

4. Employee Representations. You warrant and represent that you have been advised of your right to discuss all aspects of this Release Letter Agreement with a lawyer of your choice and paid for by you; that you have been given the opportunity and have been encouraged to do so; that you have availed yourself of this right to the full extent that you wished to do so. You further represent that you have carefully read and fully understand all of the provisions and effects of this Release Letter Agreement, that you are voluntarily entering into this Release Letter Agreement, and that neither Fairchild, nor its agents, representatives or attorneys, have made any representations concerning the terms or effects of this Release Letter Agreement other than those contained herein. You further represent that you have been given a reasonable period of time of at least forty-five (45) days to consider signing this Release Letter Agreement.

5. Employee Right to Revoke. You understand that you have the right to revoke this Release Letter Agreement for a period of seven (7) days after the date of execution, with such revocation limited to claims under the Age Discrimination in Employment Act. Any revocation must be received by __________ of Fairchild at ______________, by _________, local time, of the seventh day following execution of this Release Letter Agreement. If you revoke the release as to Age Discrimination in Employment Act claims, you understand and agree that the release remains valid as to all other claims released herein. In the event of a revocation of an Age Discrimination in Employment Act release, you agree that you will not receive any Severance Benefits under the Fairchild Severance Policy other than the Vision Benefits which will constitute consideration for the other released claims. Attached to this Release Letter Agreement is a description of (i) any class, unit or group of individuals covered by the employment reorganization in the past twelve months; and (ii) the job, title and ages of all individuals eligible or selected for reorganization and the ages of all individuals in the same job

classification or organizational unit who are not eligible or who were not selected for the reorganization. By your signature on this Release Letter Agreement, you acknowledge your receipt of this list and that you understand its contents.

6. Applicable Law. This Release Letter Agreement is deemed to have been executed and delivered within the State of California, and the rights and obligations of the parties hereto shall be construed and enforced in accordance with, and governed by, the laws of the State of California without regard to conflict of law rules.

7. Partial Invalidity. Should any provision of this Release Letter Agreement be declared or be determined by any court to be invalid, the validity of the remaining parts, terms and provisions shall not be affected thereby, and said invalid part, term or provision shall be deemed not to be part of this Release Letter Agreement.

8. Confidentiality and Non-Compete. You agree and understand that you remain bound by any confidentiality agreement and/or covenant not to compete which you have signed at any time and which remains in full force and effect.

Please sign and return a copy of this letter to me indicating your agreement to the terms described above. This Release Letter Agreement provided to you on July 18, 2012 shall expire if not signed by you and returned to me by 5:00 P.M. local time on September 3, 2012.

Sincerely,

FAIRCHILD SEMICONDUCTOR CORPORATION

Seen and Agreed to this ___ day of ____________, 20__

PLEASE READ CAREFULLY. THIS GENERAL RELEASE INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. YOU ARE ADVISED, IF YOU SO CHOOSE, TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTING THIS AGREEMENT.

[Name]

EMPLOYMENT AGREEMENT

In consideration of my employment (or continued employment, as the case may be) by Fairchild Semiconductor Corporation, its affiliates, divisions, subsidiaries, successors and assigns (hereinafter referred to as “the Company”), I hereby acknowledge and agree as follows:

A. EMPLOYMENT AT WILL

I acknowledge that my employment with the Company is at-will and can be terminated at the option of either party, with or without cause, and with or without notice. Nothing contained in this agreement shall limit or otherwise alter the foregoing.

B. OUTSIDE ACTIVITIES

1. I certify that I have no other agreements, relationships, or commitments to any other person or entity that conflict with my obligations to the Company. I will disclose to the Company, in writing, prior to accepting employment with the Company, any and all consulting or professional services I am presently performing for other parties.

2. I will obtain written permission from an officer of the Company prior to accepting any offer to perform future consulting or professional services related to or connected with a business, or products or projects which are similar to those of the Company.

C. RELOCATION

Not applicable.

D. PROTECTION OF TRADE SECRETS AND CONFIDENTIAL INFORMATION

1. I understand that the Company has and will develop, compile and own certain trade secrets, confidential and proprietary information and know-how that are valuable and unknown to the Company’s competitors. This information may include inventions, unissued patents, manufacturing or processing techniques, processes, formulas, data, including software products, matter relating to research and development programs, products, customers, suppliers, sales or business practices of the Company (collectively known as “Confidential Information”). Confidential Information includes all information and know-how, whether or not in writing, that has or could have commercial value, and also includes all information of which the unauthorized disclosure could be detrimental to the interests of the Company, whether or not such information is identified as confidential. I agree at all times during and after my employment by the Company, to hold in strictest confidence, and not to use for my own purposes, and not to publish or to disclose to any person, firm or corporation, without the prior express written authorization of an officer of the Company, any Confidential Information which I may in any way acquire, learn or develop during or by reason of my employment with the Company, except as such use or disclosure may be required in connection with my work for the Company.

2. I agree that all notes, books, engineering records, correspondence, drawings, files, memos, reports, sketches, laboratory notebooks, organizational charts, telephone lists, computer disks or memory or any other materials containing or relating to Confidential Information or Inventions which may come into my possession, shall be the exclusive property of the Company to be used only in the performance of Company duties. I agree that upon leaving the employ of the Company, I will return all of these materials to the Company prior to my departure. I recognize that the unauthorized taking, using or disclosing of any of the Company’s trade secrets is a crime under state and federal law and could result in civil liability to the Company.

3. Except with the written consent of an officer of the Company, I agree that I will not, either during the period of my employment, or for a period of one year following the termination of my employment with the Company, interfere with the business of the Company by inducing an employee to leave the Company’s employ or by inducing a vendor or consultant to sever their relationship with the company. Because information relating to the identities, key contact personnel, preferences, needs and circumstances of the Company’s customers are trade secrets that necessarily are and will be used by the me in the solicitation of business from the Company’s customers, I agree that for a period of one year following the termination of my employment with the Company, I will not solicit business of any customer of the Company for services or products similar to those sold by the Company unless I first obtain the written consent of an officer of the company.

4. I agree not to use or disclose any proprietary information or trade secrets of others, including all prior employers, in my work at the company. Should a situation arise in which I believe that my job duties may lead to the use or disclosure of proprietary information or trade secrets of another, I agree to notify the local human resources director or the legal department immediately. I represent and warrant that I have returned all property and confidential information belonging to my prior employers and that, in working for the Company, I will comply with all valid agreements with prior employers.

E. INVENTIONS

1. I will disclose promptly to the Company, in writing, all inventions, ideas, developments, materials and discoveries, including software products, which during the period of my employment with the Company I have or which I may conceive, develop, make or reduce to practice, either solely or jointly with others (collectively “make or made”) whether patented, the subject of a patent application, patentable or not, including but not limited to processes, methods, formulae, software, techniques, as well as improvements thereof or know-how related thereto, that:

a. relate to any subject matter with which my work for the Company may relate or be concerned, whether or not made during normal business hours; or

b. relate to, or are connected with the business, products or projects of the company; or

c. involve the use of the Company’s time, material, facilities or proprietary information.

The foregoing are collectively referred to herein as the “Inventions”. Any inventions, ideas, developments, materials and discoveries, including software products, in which I retain ownership or an interest, which I make or made before or during my employment by the Company and whose subject matter would otherwise make it an Invention, but which is not an Invention for whatever reason, are collectively referred to herein as the “Employee Owned Inventions”.

2. I will keep complete and current written records of all Inventions I make during the period of time I am employed by Company properly witnessed for use as Invention records and to submit such records to Company when requested or upon termination of my employment with Company.

3. I agree that all Inventions which I make during the period of time I am employed by Company are the sole and exclusive property of Company and I will assign, and do hereby assign, my entire right, title and interest in such Inventions to Company. Company’s ownership and the foregoing assignment shall apply, without limitation, to all rights under the patent, copyright, and trade secret laws of any jurisdiction relating to the Inventions.

4. If for any reason under any law of any jurisdiction, including without limitation Section 2870 of the Labor Code of the State of California, all or any portion of the foregoing grant of rights is held unenforceable, I agree to grant, and do hereby grant to the Company, a worldwide, irrevocable, fully paid up right and license in perpetuity with the right to sublicense others, to practice the Invention and to make, have made, use, offer for sale, sell, lease or otherwise dispose of, without restriction, any products incorporating the Invention.

5. At all times during and after my employment by the Company, and at no expense to me, I agree to execute and deliver such assignments, affidavits, oaths and other documents, and to perform such other acts (including appearance as a witness in any contest) as may be requested by the Company to obtain or uphold, for the benefit of the Company, patents and/or copyrights in any and all countries for all Inventions, whether or not I am an inventor thereof, said Inventions to be and remain the property of the Company or its nominees. In the event that the Company is unable for any reason whatsoever to secure my signature to any document reasonably necessary or appropriate for any of the foregoing purposes (including renewals, extensions, continuations, divisions or continuations in part) in a timely manner, I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents as my agents and attorneys-in-fact to act for me and on my behalf, but only for the purpose of executing and filing any such document and doing all other lawfully permitted acts to accomplish the foregoing purposes with the same legal force and effect as if executed by me.

6. I agree to abide by the foregoing provisions in all respects; specifically, that I will not withhold Inventions conceived or reduced to practice during employment for my own use after employment, that I will not impart to subsequent employers any Confidential Information or trade secrets, and that I will not induce or encourage other employees of the Company to violate the terms of their Employment Agreements.

7.      Are you the inventor of any published and/or issued patent applications? (Check One)	Yes
	No
8.      Are you the inventor of any unissued and unpublished patent applications? (Check One)	Yes
	No

9. I agree that should a situation arise in which I believe that my job duties may lead to the use of technology claimed or sought to be claimed in a patent issued to or applied for or under preparation naming me as an inventor, or of which I am otherwise aware, I will notify my supervisor and the legal department immediately. I understand that patent applications that are unissued and unpublished may be trade secrets, and agree to abide by all provisions in Section D in notifying my supervisor and the legal department.

10. I agree that if the Company incorporates into a product, process, a machine or otherwise uses an Employee Owned Invention, I agree to grant, and do hereby grant to the Company, a royalty-free, worldwide, irrevocable, fully paid up right and license in perpetuity, to practice the Employee Owned Invention and to make, have made, use, offer for sale, sell, lease or otherwise dispose of any products incorporating the Employee Owned Invention, without restriction, to the extent of my ownership or interest. This license is transferable in whole or in part with the sale of all or substantially all of the business or the assets of the business to which the Employee Owned Invention relates.

F. MISCELLANEOUS

1. Injunctive Relief. Because my breach of this Agreement may cause the Company irreparable harm which cannot adequately be compensated with money, I agree that the Company will be entitled to injunctive relief to enforce this Agreement, in addition to damages and other available remedies.

2. Amendments. This Agreement may not be amended except by an instrument in writing signed by both parties. This Agreement shall be binding on the heirs, executors, administrators, and other legal representatives and assigns of Employee, and is for the benefit of the Company and its successors and assigns.

3. Governing Law. This agreement shall be governed by the laws of the State of California.

4. Severability. If a court finds any provision of this Agreement invalid or unenforceable as applied to any circumstance, the remainder of this Agreement shall be interpreted so as best to effect the intent of the parties. The parties further agree that any provision found to be invalid or unenforceable shall be replaced with a provision that will achieve, to the extent possible, the purpose of the void or unenforceable provision.

5. Entire Understanding. This Agreement expresses the entire understanding of the parties about the described subject matter.

/s/ Vijay Ullal	Dated:	9/12/12
Signature of Employee
Vijay Ullal	at:	San Jose
Employee (Print Name Clearly)

Witness: /s/ Paul D. Delva

EX-10.2

Exhibit 10.2

EXECUTIVE SEVERANCE POLICY

Eligibility Executives (1) in job grades 6 (Director) to 1 (President) who (2) are designated by the CEO, or by the VP-HR with the CEO’s approval, as participants in this policy and who (3) agree to be bound by all of the restrictions, conditions and limitations under the policy, will be entitled to severance payments and other benefits under this policy. Participation or cessation of participation by a Section 16 officer will require the approval of the compensation committee.

Severance Benefit Participating executives whose employment is terminated by the company for any reason other than “Cause” (as defined below) will be paid the greater of (1) the amount due under the company’s basic severance policy or (2) the amount set forth below corresponding to the executive’s job grade at the time of termination, in a lump sum within 10 business days following the effective date of termination, provided, that, as a condition to receiving such severance payment, the participating executive shall be required to execute a release of all claims arising out of the executive’s employment or the termination thereof, including without limitation any claim of discrimination under U.S. state or federal law or any non-U.S. law, but excluding claims for indemnification from the company under any indemnification agreement with the company, its certificate of incorporation or bylaws, or claims under applicable directors’ and officers’ insurance policies.

Job Grade-Rank	Benefit (as multiples of monthly base salary)
Section 16 Officers	12 months
1-President	15 months
2-Executive Vice President	12 months
3-Senior Vice President	12 months
4-Vice President	9 months
5-Senior Director	9 months
6-Director	9 months

Amounts paid under this provision will be net of (i.e., will include) any severance or other payments required to be paid pursuant to applicable law or regulation.

Termination of employment by the executive for any reason will not entitle the executive to any benefits under this policy.

Medical Benefit Participating executives will receive company-paid COBRA (or other applicable) medical coverage for themselves and eligible dependents for the time period corresponding to the job grade at termination set forth above.

“Cause” “Cause” under this policy means that the executive has:

(i) willfully breached or habitually neglected the duties of the executive’s position with the company, including but not limited to any fiduciary duty owed to the company or its stockholders, or

(ii) committed act(s) of dishonesty, malfeasance, misappropriation of the company’s property, willful misconduct, fraud, embezzlement, bad faith, misrepresentation, or other act(s) of moral turpitude that would prevent the effective performance of the executive’s duties to the company or resulted in the executive’s personal profit, or

(iii) engaged in any act or omission in the course of the executive’s employment with the company that materially injured the business or reputation of the company.

Successors The company will require any successor (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of the company’s business or assets, to assume the obligations of the company under this policy and to agree expressly to perform the obligations under this policy for the express benefit of executives then participating in the policy, in the same manner and to the same extent as the company would be required to perform it in the absence of a succession. The company’s failure to obtain such agreement prior to the effectiveness of a succession shall be treated, as to each such participating executive, as the termination of such executive’s employment without Cause and shall entitle each such executive to all of the compensation and benefits to which the executive would have been entitled under this policy if the company had terminated the executive’s employment for any reason other than Cause, on the date when such succession becomes effective. For all purposes under this policy, the term “company” shall include any successor to the company’s business or assets that executes and delivers the assumption agreement described in this paragraph, or that becomes bound by this policy by operation of law.

Non-Compete; Non-Solicit To receive benefits under the policy, participating executives must agree, in a form suitable to the company (1) not to compete with the company for the period of their employment and for 12 months thereafter (except in California or other jurisdictions where non-competes are unenforceable) and (2) not to solicit for employment during the period of employment and for 12 months thereafter any employee of the company.

Right to Amend The company will have the right to amend the policy to reduce, modify or eliminate the severance benefit or other terms and conditions of the policy in the company’s sole discretion, but not following a Change of Control (as defined under the Fairchild Semiconductor 2007 Stock Plan) and provided that such modification affects all similarly situated participants equally.

Binding Effect Subject to the company’s right to amend before a Change of Control, as described above, this policy is legally binding on the company and its successors, including any acquiring or successor company (whether by the purchase or stock, assets or by operation of law). This policy will be effective only to the extent permitted by applicable law or regulation.

Adopted 5 December 2006

Amended 4 September 2007

Amended 25 August 2012

(Amended plan document ratified 30 October 2012)

2

EX-31.01

Exhibit 31.01

CERTIFICATION

I, Mark S. Thompson, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Fairchild Semiconductor International, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 9, 2012	/s/ Mark S. Thompson
	Mark S. Thompson
	Chairman and Chief Executive Officer

EX-31.02

Exhibit 31.02

CERTIFICATION

I, Mark S. Frey, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Fairchild Semiconductor International, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	November 9, 2012	/s/ Mark S. Frey
		Mark S. Frey
		Executive Vice President,
		Chief Financial Officer and Treasurer

EX-32.01

Exhibit 32.01

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of Fairchild Semiconductor International, Inc. (the “company”) on Form 10-Q for the period ended September 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Mark S. Thompson, Chief Executive Officer of the company, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of the operations of the company.

/s/ Mark S. Thompson

Mark S. Thompson

Chief Executive Officer

November 9, 2012

EX-32.02

Exhibit 32.02

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of Fairchild Semiconductor International, Inc. (the “company”) on Form 10-Q for the period ended September 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Mark S. Frey, Chief Financial Officer of the company, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of the operations of the company.

/s/ Mark S. Frey

Mark S. Frey

Chief Financial Officer

November 9, 2012

XML

Schedule of Changes in Level Three Securities (Detail) (Fair Value, Significant Unobservable Inputs (Level 3), USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012
Fair Value, Significant Unobservable Inputs (Level 3)
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance at beginning of period	$ 29.8
Total realized and unrealized gains or (losses) Included in net income
Total realized and unrealized gains or (losses) included in OCI	(4.4)
Accretion of impairments included in net income	0.4
Sales
Purchases, issuances and settlements
Balance at end of period	$ 25.8

XML

Schedule of Estimated Amortization Expense for Intangible Assets (Detail) (USD $) In Millions, unless otherwise specified	Sep. 30, 2012
Schedule of Estimated Amortization Expense for Intangible Assets and Unfavorable Lease Liability [Line Items]
Remaining Fiscal 2012	$ 4.5
Fiscal 2013	15.6
Fiscal 2014	7.5
Fiscal 2015	5.2
Fiscal 2016	5.5
Fiscal 2017	$ 2.2

XML

Schedule of Roll Forward of Amount Related to Credit Losses Recognized in Earnings (Detail) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Line Items]
Balance at beginning of period	$ 14.0
Accretion of impairments included in net income	(0.4)
Balance at end of period	$ 13.6

XML

Restructuring and Impairments - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended				9 Months Ended
	Sep. 30, 2012	Jul. 01, 2012	Apr. 01, 2012	Sep. 25, 2011	Sep. 30, 2012	Sep. 25, 2011
Restructuring Cost and Reserve [Line Items]
Restructuring and impairment charges, net of releases	$ 3.4	$ 0.6	$ 2.5	$ 4.1	$ 6.3	$ 9.5
2009 Infrastructure Realignment Program
Restructuring Cost and Reserve [Line Items]
Employee separation costs				0.5		0.6
Fab closure costs				0.1		0.1
Reserve release						1.7
2010 Infrastructure Realignment Program
Restructuring Cost and Reserve [Line Items]
Employee separation costs				1.9		1.7
2011 Infrastructure Realignment Program
Restructuring Cost and Reserve [Line Items]
Employee separation costs				$ 2.0		$ 1.1

XML

Summary of Securities (Detail) (USD $) In Millions, unless otherwise specified	Sep. 30, 2012	Dec. 25, 2011
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items]
Market Value	$ 28.5
Short-term Investments
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items]
Amortized Cost	0.1	0.2
Market Value	0.1	0.2
Short-term Investments | U.S. Treasury securities and obligations of U.S. government agencies
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items]
Amortized Cost	0.1	0.2
Market Value	0.1	0.2
Long-Term Investments
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items]
Amortized Cost	38.4	37.9
Gross Unrealized Gains	0.4	0.4
Gross Unrealized Losses	(10.4)	(6.0)
Market Value	28.4	32.3
Long-Term Investments | U.S. Treasury securities and obligations of U.S. government agencies
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items]
Amortized Cost	2.1	1.8
Gross Unrealized Gains	0.4	0.4
Market Value	2.5	2.2
Long-Term Investments | Corporate Debt Securities
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items]
Amortized Cost	0.1	0.3
Market Value	0.1	0.3
Long-Term Investments | Auction Rate Securities
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items]
Amortized Cost	36.2	35.8
Gross Unrealized Losses	(10.4)	(6.0)
Market Value	$ 25.8	$ 29.8

XML

Schedule of Other Expense Net (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 25, 2011	Sep. 30, 2012	Sep. 25, 2011
Components of Other Income (Expense) [Line Items]
Interest expense	$ 1.7	$ 1.9	$ 5.7	$ 5.3
Interest income	(0.6)	(0.7)	(1.8)	(2.0)
Other (income) expense, net	0.1	0.2	0.3	2.5
Other expense, net	$ 1.2	$ 1.4	$ 4.2	$ 5.8

XML

Contingencies - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	9 Months Ended	1 Months Ended			9 Months Ended		9 Months Ended			9 Months Ended				9 Months Ended
	Sep. 30, 2012 LegalMatter	Jan. 31, 2011 POWI 1	Dec. 31, 2008 POWI 1	Oct. 31, 2006 POWI 1	Sep. 30, 2012 POWI 1 Patent	Oct. 20, 2004 POWI 1 Patent	Sep. 30, 2012 POWI 2 Patent	Apr. 27, 2012 POWI 2 Power Integrations Patent	Apr. 27, 2012 POWI 2 System General Patent	Sep. 30, 2012 POWI 3 Patent	Sep. 30, 2012 POWI 4 Patent	May 01, 2012 Powi5 Patent	May 01, 2012 Powi5 Power Integrations Patent	Sep. 30, 2012 Probable Loss	Sep. 30, 2012 Probable Loss Minimum	Sep. 30, 2012 Probable Loss Maximum
Loss Contingencies [Line Items]
Number of outstanding proceedings with power integrations	4
Number of patents in lawsuit					4	4	3	2	4	3	3	5	3
Number of phases in trial					3
Number of products in violation					33
Number of claims in lawsuit					7		1
Damages awarded for infringement of the patents		$ 12.2	$ 6.1	$ 34.0
Number of patents infringed								1	2
Number of company entities included in complaint										2	4
Number of patents dropped from case										1
Number of vendors included in lawsuit											7
Assessed damages for infringement of Fairchild patents											17.0
Litigation reserve														$ 14.1	$ 14.0	$ 15.6
Number of categories of contingencies														Three

XML

Securities (Tables)

9 Months Ended

Sep. 30, 2012

Summary Of Securities

Securities are summarized as of September 30, 2012:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Market Value
	(In millions)
Short-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	0.1	$	—	$	—	$	0.1
Total marketable securities	$	0.1	$	—	$	—	$	0.1

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Market Value
	(In millions)
Long-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	2.1	$	0.4	$	—		$	2.5
Corporate debt securities		0.1		—		—		$	0.1
Auction rate securities		36.2		—		(10.4	)		25.8
Total securities	$	38.4	$	0.4	$	(10.4	)	$	28.4

Securities are summarized as of December 25, 2011:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Market Value
	(In millions)
Short-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	0.2	$	—	$	—	$	0.2
Total marketable securities	$	0.2	$	—	$	—	$	0.2

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Market Value
	(In millions)
Long-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	1.8	$	0.4	$	—		$	2.2
Corporate debt securities		0.3		—		—		$	0.3
Auction rate securities		35.8		—		(6.0	)		29.8
Total securities	$	37.9	$	0.4	$	(6.0	)	$	32.3

Schedule Of Available-For-Sale Securities By Contractual Maturity

The following table presents the amortized cost and estimated fair market value of available-for-sale securities by contractual maturity as of September 30, 2012.

	Amortized Cost		Market Value
	(In millions)
Due in one year or less	$	0.1	$	0.1
Due after one year through three years		0.4		0.4
Due after three years through ten years		1.1		1.4
Due after ten years	$	36.9	$	26.6
	$	38.5	$	28.5

Schedule Of Roll Forward Of Amount Related To Credit Losses Recognized In Earnings

The following table presents a roll forward of the amount related to credit losses recognized in earnings during the nine months ended September 30, 2012.

	Credit Losses Recognized in Earnings
	(In millions)
Balance at beginning of period	$	14.0
Accretion of impairments included in net income		(0.4	)
Balance at end of period	$	13.6

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Schedule of Selected Operating Segment Financial Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 25, 2011	Sep. 30, 2012	Sep. 25, 2011
Segment Reporting Information [Line Items]
Restructuring and impairments expense	$ (3.4)	$ (4.1)	$ (6.3)	$ (9.5)
Stock-based compensation expense			(18.4)	(19.0)
Selling, general and administrative expense	(48.0)	(54.4)	(157.8)	(167.8)
Charge for litigation			(1.3)
Total revenue	358.8	403.2	1,072.5	1,249.4
Operating income (loss)	26.4	43.8	44.6	150.6
Other expense, net	1.2	1.4	4.2	5.8
Income before income taxes	25.2	42.4	40.4	144.8
MCCC
Segment Reporting Information [Line Items]
Total revenue	142.2	148.4	432.9	440.2
Operating income (loss)	30.1	26.7	82.1	79.2
PCIA
Segment Reporting Information [Line Items]
Total revenue	180.2	204.6	530.8	643.9
Operating income (loss)	36.6	56.9	95.5	184.9
SDT
Segment Reporting Information [Line Items]
Total revenue	36.4	50.2	108.8	165.3
Operating income (loss)	5.6	12.0	15.2	40.8
Corporate
Segment Reporting Information [Line Items]
Restructuring and impairments expense	(3.4)	(4.1)	(6.3)	(9.5)
Stock-based compensation expense	(4.2)	(6.0)	(18.4)	(19.0)
Selling, general and administrative expense	(38.4)	(41.4)	(122.5)	(124.8)
Charge for litigation			(1.3)
Other	$ 0.1	$ (0.3)	$ 0.3	$ (1.0)

XML

Schedule of Derivatives Designated as Hedging Instruments (Detail) (USD $) In Millions, unless otherwise specified	9 Months Ended		12 Months Ended
	Sep. 30, 2012	Sep. 25, 2011	Dec. 25, 2011
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized In Income	$ 0.8	$ (1.5)
Designated as Hedging Instrument
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount	295.9		318.3
Fair Value	1.8		(5.5)
Amount of Gain (Loss) Recognized In AOCI	1.8		(5.5)
Amount of Gain (Loss) Recognized In Income	1.2	1.5
Amount of Gain (Loss) Reclassified from AOCI	1.2	1.5
Designated as Hedging Instrument | Derivatives For Forecasted Revenues | Current Assets
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount			60.3
Fair Value			0.9
Amount of Gain (Loss) Recognized In AOCI			0.9
Designated as Hedging Instrument | Derivatives For Forecasted Revenues | Current Liabilities
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount	50.9
Fair Value	(0.3)
Amount of Gain (Loss) Recognized In AOCI	(0.3)
Designated as Hedging Instrument | Derivatives For Forecasted Expenses | Current Assets
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount	245.0		33.6
Fair Value	2.1
Amount of Gain (Loss) Recognized In AOCI	2.1
Designated as Hedging Instrument | Derivatives For Forecasted Expenses | Current Liabilities
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount			224.4
Fair Value			(6.4)
Amount of Gain (Loss) Recognized In AOCI			(6.4)
Designated as Hedging Instrument | Foreign Currency Contracts | Revenue
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized In Income	1.2	(3.0)
Amount of Gain (Loss) Reclassified from AOCI	1.2	(3.0)
Designated as Hedging Instrument | Foreign Currency Contracts | Expenses
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized In Income		4.5
Amount of Gain (Loss) Reclassified from AOCI		$ 4.5

XML

Fair Value - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2012	Sep. 25, 2011
Minimum
Fair Value Of Financial Instrument [Line Items]
Fair value input assumption, contractual maturity	21 years	4 years
Fair value input assumption, discount rate	5.00%
Maximum
Fair Value Of Financial Instrument [Line Items]
Fair value input assumption, contractual maturity	33 years	10 years
Fair value input assumption, discount rate	8.00%

XML

Schedule of Carrying Value of Goodwill by Reporting Unit (Detail) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Dec. 25, 2011
Goodwill [Line Items]
Goodwill reallocation	$ 0
Goodwill, Gross	372.6	372.6
Accumulated Impairment Losses	(203.3)	(203.3)
Goodwill, Net	169.3	169.3
MCCC
Goodwill [Line Items]
Goodwill reallocation	(3.0)
Goodwill, Gross	162.0	165.0
Accumulated Impairment Losses	0	0
Goodwill, Net	162.0	165.0
PCIA
Goodwill [Line Items]
Goodwill reallocation	3.0
Goodwill, Gross	156.1	153.1
Accumulated Impairment Losses	(148.8)	(148.8)
Goodwill, Net	7.3	4.3
SDT
Goodwill [Line Items]
Goodwill reallocation	0
Goodwill, Gross	54.5	54.5
Accumulated Impairment Losses	(54.5)	(54.5)
Goodwill, Net	$ 0	$ 0

XML

Schedule of Available for Sale Securities by Contractual Maturity (Detail) (USD $) In Millions, unless otherwise specified	Sep. 30, 2012
Investments Classified by Contractual Maturity Date [Line Items]
Due in one year or less, amortized cost	$ 0.1
Due after one year through three years, amortized cost	0.4
Due after three years through ten years, amortized cost	1.1
Due after ten years, amortized cost	36.9
Total, amortized cost	38.5
Due in one year or less, market value	0.1
Due after one year through three years, market value	0.4
Due after three years through ten years, market value	1.4
Due after ten years, market value	26.6
Market Value	$ 28.5

XML

Computation of Net Income per Share

9 Months Ended

Sep. 30, 2012

Computation of Net Income per Share

Note 3 – Computation of Net Income per Share

Basic net income per share is computed using the weighted average number of common shares outstanding during the period. Diluted net income per share is computed using the weighted average number of common shares outstanding during the period, plus the dilutive effect of potential future issuances of common stock relating to potentially dilutive securities. There is no dilution when a net loss exists. Potentially dilutive common equivalent securities consist of stock options, performance units (PUs), deferred stock units (DSUs) and restricted stock units (RSUs). In calculating diluted earnings per share, the dilutive effect of stock options is computed using the average market price for the respective period using the treasury share method. Certain potential shares of the company’s outstanding stock options were excluded because they were anti-dilutive, but could be dilutive in the future. The following table sets forth the computation of basic and diluted earnings per share.

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 25, 2011		September 30, 2012		September 25, 2011
	(In millions, except per share data)
Basic:
Net income	$	24.7	$	35.8	$	38.2	$	124.2
Weighted average shares outstanding		126.8		126.9		126.7		127.0
Net income per share	$	0.19	$	0.28	$	0.30	$	0.98
Diluted:
Net income	$	24.7	$	35.8	$	38.2	$	124.2
Basic weighted average shares outstanding		126.8		126.9		126.7		127.0
Assumed exercise of common stock equivalents		2.0		3.0		2.4		3.8
Diluted weighted average common and common equivalent shares		128.8		129.9		129.1		130.8
Net income per share	$	0.19	$	0.28	$	0.30	$	0.95
Anti-dilutive common stock equivalents, non-vested stock, DSUs, RSUs, and PUs		2.8		7.3		4.0		4.8

XML

Schedule of Gain Loss Recognized in OCI for Derivative Instruments (Detail) (Foreign Exchange Contracts, USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012
Foreign Exchange Contracts
Derivative Instruments, Gain (Loss) [Line Items]
Gain (Loss) Recognized in OCI for Derivative Instruments	$ 7.3	[1]

[1] This amount is inclusive of both realized and unrealized gains and losses recognized in OCI

XML

Long-Term Debt (Tables)

9 Months Ended

Sep. 30, 2012

Schedule Of Long-Term Debt

Long-term debt consists of the following at:

	September 30,		December 25,
	2012		2011
	(In millions)
Revolving Credit Facility borrowings	$	300.0	$	300.0
Other		0.1		0.1
Total debt	$	300.1	$	300.1
Current portion of long-term debt		—		—
Long-term debt, less current portion	$	300.1	$	300.1

XML

Restructuring and Impairments (Tables)

9 Months Ended

Sep. 30, 2012

Summary Of Restructuring And Impairment Costs

The following table presents a summary of the activity in the company’s accrual for restructuring and impairment costs for the quarterly periods ended April 1, 2012, July 1, 2012, and September 30, 2012.

	Accrual												Accrual
	Balance at		New		Cash			Reserve			Non-Cash		Balance at
	12/25/2011		Charges		Paid			Release			Items		4/1/2012
2010 Infrastructure Realignment Program:
Employee Separation Costs	$	1.0	$	—	$	(0.3	)	$	—		$	—	$	0.7
2011 Infrastructure Realignment Program:
Employee Separation Costs		1.7		1.0		(0.3	)		(0.1	)		—		2.3
2012 Infrastructure Realignment Program:
Employee Separation Costs		—		1.1		(0.5	)		—			—		0.6
Facility Closure Costs		—		0.4		(0.4	)		—			—		0.0
	$	2.7	$	2.5	$	(1.5	)	$	(0.1	)	$	—	$	3.6
	Accrual												Accrual
	Balance at		New		Cash			Reserve			Non-Cash		Balance at
	4/1/2012		Charges		Paid			Release			Items		7/1/2012
2010 Infrastructure Realignment Program:
Employee Separation Costs	$	0.7	$	—	$	(0.2	)	$	(0.1	)	$	—	$	0.4
2011 Infrastructure Realignment Program:
Employee Separation Costs		2.3		—		(0.9	)		—			—		1.4
2012 Infrastructure Realignment Program:
Employee Separation Costs		0.6		0.6		(0.8	)		—			—		0.4
	$	3.6	$	0.6	$	(1.9	)	$	(0.1	)	$	—	$	2.2
	Accrual												Accrual
	Balance at		New		Cash			Reserve			Non-Cash		Balance at
	7/1/2012		Charges		Paid			Release			Items		9/30/2012
2010 Infrastructure Realignment Program:
Employee Separation Costs	$	0.4	$	—	$	(0.1	)	$	—		$	—	$	0.3
2011 Infrastructure Realignment Program:
Employee Separation Costs		1.4		—		(0.3	)		—			—		1.1
2012 Infrastructure Realignment Program:
Employee Separation Costs		0.4		2.8		(1.5	)					—		1.8
Lease Termination Costs				0.6								—		0.6
	$	2.2	$	3.4	$	(1.9	)	$	—		$	—	$	3.8

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Summary of Restructuring and Impairment Costs (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended				9 Months Ended
	Sep. 30, 2012	Jul. 01, 2012	Apr. 01, 2012	Sep. 25, 2011	Sep. 30, 2012	Sep. 25, 2011
Restructuring Cost and Reserve [Line Items]
Accrual Balance, Beginning balance	$ 2.2	$ 3.6	$ 2.7		$ 2.7
New Charges	3.4	0.6	2.5	4.1	6.3	9.5
Cash Paid	(1.9)	(1.9)	(1.5)
Reserve Release		(0.1)	(0.1)
Non-Cash Items
Accrual Balance, Ending balance	3.8	2.2	3.6		3.8
2010 Infrastructure Realignment Program | Employee Separation Costs
Restructuring Cost and Reserve [Line Items]
Accrual Balance, Beginning balance	0.4	0.7	1.0		1.0
Cash Paid	(0.1)	(0.2)	(0.3)
Reserve Release		(0.1)
Non-Cash Items
Accrual Balance, Ending balance	0.3	0.4	0.7		0.3
2011 Infrastructure Realignment Program | Employee Separation Costs
Restructuring Cost and Reserve [Line Items]
Accrual Balance, Beginning balance	1.4	2.3	1.7		1.7
New Charges			1.0
Cash Paid	(0.3)	(0.9)	(0.3)
Reserve Release			(0.1)
Non-Cash Items
Accrual Balance, Ending balance	1.1	1.4	2.3		1.1
2012 Infrastructure Realignment Program | Employee Separation Costs
Restructuring Cost and Reserve [Line Items]
Accrual Balance, Beginning balance	0.4	0.6
New Charges	2.8	0.6	1.1
Cash Paid	(1.5)	(0.8)	(0.5)
Non-Cash Items
Accrual Balance, Ending balance	1.8	0.4	0.6		1.8
2012 Infrastructure Realignment Program | Facility Closure Costs
Restructuring Cost and Reserve [Line Items]
New Charges			0.4
Cash Paid			(0.4)
Non-Cash Items
Accrual Balance, Ending balance			0
2012 Infrastructure Realignment Program | Lease Termination Costs
Restructuring Cost and Reserve [Line Items]
New Charges	0.6
Non-Cash Items
Accrual Balance, Ending balance	$ 0.6				$ 0.6

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Schedule of Derivatives not Designated as Hedging Instruments (Detail) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Sep. 25, 2011	Dec. 25, 2011
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount	$ 21.9		$ 51.6
Fair Value	0		0.1
Amount of Gain (Loss) Recognized In Income	0.8	(1.5)
Foreign Exchange Contracts | Current Assets
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount	16.5		6.7
Fair Value	0
Foreign Exchange Contracts | Current Liabilities
Derivative Instruments, Gain (Loss) [Line Items]
Notional Amount	5.4		44.9
Fair Value	0		0.1
Foreign Exchange Contracts | Revenue
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized In Income	0	(0.2)
Foreign Exchange Contracts | Expenses
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain (Loss) Recognized In Income	$ 0.8	$ (1.3)

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Schedule of Inventories Net (Detail) (USD $) In Millions, unless otherwise specified	Sep. 30, 2012	Dec. 25, 2011
Schedule of Inventory [Line Items]
Raw materials	$ 38.4	$ 36.9
Work in process	142.7	135.2
Finished goods	61.2	62.1
Inventories	$ 242.3	$ 234.2

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Schedule of Property Plant and Equipment (Detail) (USD $) In Millions, unless otherwise specified	Sep. 30, 2012	Dec. 25, 2011
Property, Plant and Equipment [Line Items]
Land and improvements	$ 24.7	$ 24.0
Buildings and improvements	391.9	382.4
Machinery and equipment	1,769.5	1,732.0
Construction in progress	140.5	151.5
Total property, plant and equipment	2,326.6	2,289.9
Less accumulated depreciation	1,551.4	1,524.5
Property, plant and equipment	$ 775.2	$ 765.4

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Financial Statement Details

9 Months Ended

Sep. 30, 2012

Financial Statement Details

Note 2 – Financial Statement Details

	September 30, 2012		December 25, 2011
	(In millions)
Inventories
Raw materials	$	38.4	$	36.9
Work in process		142.7		135.2
Finished goods		61.2		62.1
	$	242.3	$	234.2

	September 30, 2012		December 25, 2011
	(In millions)
Property, plant and equipment
Land and improvements	$	24.7	$	24.0
Buildings and improvements		391.9		382.4
Machinery and equipment		1,769.5		1,732.0
Construction in progress		140.5		151.5
Total property, plant and equipment		2,326.6		2,289.9
Less accumulated depreciation		1,551.4		1,524.5
	$	775.2	$	765.4

	September 30, 2012		December 25, 2011
	(In millions)
Accrued expenses and other current liabilities
Payroll and employee related accruals	$	47.7	$	75.7
Taxes payable		15.8		23.5
Restructuring and impairments		3.8		2.7
Other		15.6		23.8
	$	82.9	$	125.7

	Three Months Ended						Nine Months Ended
	September 30, 2012			September 25, 2011			September 30, 2012			September 25, 2011
				(In millions)
Other expense, net
Interest expense	$	1.7		$	1.9		$	5.7		$	5.3
Interest income		(0.6	)		(0.7	)		(1.8	)		(2.0	)
Other (income) expense, net		0.1			0.2			0.3			2.5
Other expense, net	$	1.2		$	1.4		$	4.2		$	5.8

Prior to December 26, 2011, the company depreciated much of its machinery and equipment over an eight-year period. During the first quarter of 2012, the company completed an analysis of the useful life assumptions. In performing this analysis, the company examined the historical usage patterns for machinery and equipment at its wafer fabrication and assembly and test manufacturing facilities. As a result of this analysis, the company determined that, while the useful life of its assembly and test equipment was consistent with the eight year depreciation assumption, the wafer fabrication equipment remained in use beyond the eight-year life assigned to that asset category. The typical life was approximately ten years. At the time the analysis was performed, the company was unaware of any events which would result in a change from this historical pattern. Accordingly, the company determined that it would prospectively adjust the estimated useful life assumptions for machinery and equipment at the company’s wafer fabrication facilities from eight years to ten years to better align its depreciation expense with its actual historical experience. As a result, the company realized a reduction in its depreciation expense of approximately $4.2 million and $13.7 million in the third quarter and first nine months of 2012, respectively, when compared to depreciation expense under the previous useful life assumption.

In addition, the company reassessed the useful lives, which ranged from one to five years, of its molds and tooling equipment in the first quarter. The historical patterns of molds and tooling usage at its assembly and test manufacturing facilities were examined. Based upon the analysis, it was determined three years was the most appropriate life for these assets. This resulted in a net increase to depreciation expense of $0.7 million in the first quarter of 2012. Impacts on the second and third quarter were not material.

The impact of these change in estimates increased net income by $3.8 million or $0.03 per share in the quarter ended September 30, 2012 and by $11.9 million or $0.09 per share for the nine months ended September 30, 2012.

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Schedule of Accrued Expenses and Other Current Liabilities (Detail) (USD $) In Millions, unless otherwise specified	Sep. 30, 2012	Dec. 25, 2011
Other Liabilities [Line Items]
Payroll and employee related accruals	$ 47.7	$ 75.7
Taxes payable	15.8	23.5
Restructuring and impairments	3.8	2.7
Other	15.6	23.8
Accrued expenses and other current liabilities	$ 82.9	$ 125.7

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Fair Value of Long Term Debt (Detail) (USD $) In Millions, unless otherwise specified	Sep. 30, 2012	Dec. 25, 2011
Debt Instrument [Line Items]
Estimated Fair Value of Revolving Credit Facility borrowings	$ 300.0	$ 300.0
Carrying Amount of Revolving Credit Facility borrowings	$ 300.0	$ 300.0

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Goodwill and Intangible Asset - Additional Information (Detail)	3 Months Ended
	Apr. 01, 2012
Goodwill And Intangible Assets [Line Items]
Number of product groups moved from MCC organization	2

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CONSOLIDATED BALANCE SHEETS (USD $) In Millions, unless otherwise specified	Sep. 30, 2012	Dec. 25, 2011
Current assets:
Cash and cash equivalents	$ 385.6	$ 423.3
Short-term marketable securities	0.1	0.2
Accounts receivable, net of allowances of $26.3 and $24.0 at September 30, 2012 and December 25, 2011, respectively	162.5	142.9
Inventories	242.3	234.2
Deferred income taxes, net of allowances	20.5	16.5
Other current assets	31.0	35.9
Total current assets	842.0	853.0
Property, plant and equipment, net	775.2	765.4
Deferred income taxes, net of allowances	20.5	17.1
Intangible assets, net	51.8	65.4
Goodwill	169.3	169.3
Long-term securities	28.4	32.3
Other assets	39.0	34.4
Total assets	1,926.2	1,936.9
Current liabilities:
Accounts payable	117.7	132.5
Accrued expenses and other current liabilities	82.9	125.7
Total current liabilities	200.6	258.2
Long-term debt, less current portion	300.1	300.1
Deferred income taxes	28.5	27.8
Other liabilities	30.3	26.3
Total liabilities	559.5	612.4
Commitments and contingencies (Note 11)
Temporary equity - deferred stock units	2.6	2.3
Stockholders' equity:
Common stock	1.3	1.3
Additional paid-in capital	1,494.6	1,481.9
Accumulated deficit	(3.8)	(42.0)
Accumulated other comprehensive loss	(9.4)	(12.4)
Less treasury stock (at cost)	(118.6)	(106.6)
Total stockholders' equity	1,364.1	1,322.2
Total liabilities, temporary equity and stockholders' equity	$ 1,926.2	$ 1,936.9

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Securities - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2012 Y
Investment Holdings [Line Items]
Proceeds from the sales of securities	$ 0.3	$ 0.3
Investments, market value	26.6	26.6
Minimum maturity duration of contractual maturities of auction rate securities, years		10
Auction Rate Securities
Investment Holdings [Line Items]
Investments, market value	25.8	25.8
Auction Rate Securities | Structured Obligations Of Special Purpose Reinsurance Entities
Investment Holdings [Line Items]
Investments, market value	16.8	16.8
Auction Rate Securities | Corporate Debt Securities
Investment Holdings [Line Items]
Investments, market value	$ 9.0	$ 9.0

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CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Sep. 25, 2011
Cash flows from operating activities:
Net income	$ 38.2	$ 124.2
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	100.5	113.5
Non-cash stock-based compensation expense	18.4	19.0
Non-cash interest income	(0.4)	(0.4)
Non-cash financing expense	0.8	0.8
Non-cash write-off of deferred financing fees		2.1
Non-cash acquisition tax impact		0.1
Loss on disposal of property, plant, and equipment	1.2	1.0
Deferred income taxes, net	(6.7)	(7.6)
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable, net	(19.6)	7.7
Inventories	(8.1)	(26.7)
Other current assets	6.1	(3.9)
Current liabilities	(36.1)	(12.3)
Other assets and liabilities, net	10.0	5.2
Net cash provided by operating activities	104.3	222.7
Cash flows from investing activities:
Purchase of marketable securities	(0.5)	(0.1)
Sale of securities	0.3
Maturity of marketable securities	0.2	0.1
Capital expenditures	(122.4)	(141.6)
Purchase of molds and tooling	(1.9)	(2.0)
Acquisitions, net of cash acquired		(16.5)
Net cash used in investing activities	(124.3)	(160.1)
Cash flows from financing activities:
Repayment of long-term debt		(320.6)
Borrowing from Revolving Credit Facility		300.0
Proceeds from issuance of common stock and from exercise of stock options	4.4	35.4
Purchase of treasury stock	(12.0)	(33.1)
Shares withheld for employees taxes	(10.1)	(10.3)
Debt financing costs		(5.2)
Net cash used in financing activities	(17.7)	(33.8)
Net change in cash and cash equivalents	(37.7)	28.8
Cash and cash equivalents at beginning of period	423.3	404.6
Cash and cash equivalents at end of period	$ 385.6	$ 433.4

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Subsequent Events - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Sep. 30, 2012
Subsequent Event [Line Items]
Long term available for sale auction rate securities	$ 49.5
Sale of available for sale auction rate securities	23.3
Loss on sale of available for sale auction rate securities	$ 12.9
Available-for-sale Securities
Subsequent Event [Line Items]
Available for sale auction rate securities, percentage of par value	47.00%
Available for sale auction rate securities, percentage of book value	90.00%

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Schedule of Computation of Basic and Diluted Earnings Per Share (Detail) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 25, 2011	Sep. 30, 2012	Sep. 25, 2011
Earnings Per Share Disclosure [Line Items]
Net income	$ 24.7	$ 35.8	$ 38.2	$ 124.2
Basic weighted average shares outstanding	126.8	126.9	126.7	127.0
Net income per share, Basic	$ 0.19	$ 0.28	$ 0.30	$ 0.98
Assumed exercise of common stock equivalents	2.0	3.0	2.4	3.8
Diluted weighted average common and common equivalent shares	128.8	129.9	129.1	130.8
Net income per share, Diluted	$ 0.19	$ 0.28	$ 0.30	$ 0.95
Anti-dilutive common stock equivalents, non-vested stock, DSUs, RSUs, and PUs	2.8	7.3	4.0	4.8

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Supplemental Cash Flow Information (Tables)

9 Months Ended

Sep. 30, 2012

Schedule Of Supplemental Cash Flow Information

	Nine Months Ended
	September 30, 2012		September 25, 2011
	(In millions)
Cash paid for:
Income taxes, net	$	13.9	$	21.1
Interest	$	5.1	$	5.0

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Schedule of Supplemental Cash Flow Information (Detail) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Sep. 25, 2011
Cash Flow Supplemental Disclosures [Line Items]
Income taxes, net	$ 13.9	$ 21.1
Interest	$ 5.1	$ 5.0

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Derivatives (Tables)

9 Months Ended

Sep. 30, 2012

Schedule Of Derivatives Designated As Hedging Instruments

The following tables present derivatives designated as hedging instruments under the Derivatives and Hedging Topic of the FASB ASC.

	As of Septemeber 30, 2012									As of December 25, 2011
	Balance Sheet Classification	Notional Amount		Fair Value			Amount of Gain (Loss) Recognized In AOCI			Balance Sheet Classification	Notional Amount		Fair Value			Amount of Gain (Loss) Recognized In AOCI
	(In millions)										(In millions)
Derivatives in Cash Flow Hedges
Foreign exchange contracts
Derivatives for forecasted revenues	Current assets	$	—	$	—		$	—		Current assets	$	60.3	$	0.9		$	0.9
Derivatives for forecasted revenues	Current liabilities		50.9		(0.3	)		(0.3	)	Current liabilities	$	—	$	—			—
Derivatives for forecasted expenses	Current assets		245.0		2.1			2.1		Current assets		33.6		—			—
Derivatives for forecasted expenses	Current liabilities		—		—			—		Current liabilities		224.4		(6.4	)		(6.4	)
Total foreign exchange contract derivatives		$	295.9	$	1.8		$	1.8			$	318.3	$	(5.5	)	$	(5.5	)

Schedule Of Derivatives Designated As Hedging Instruments - Income Statement

	For the Nine Months Ended September 30, 2012					For the Nine Months Ended September 25, 2011
	Income Statement Classification of Gain (Loss)	Amount of Gain (Loss)  Recognized In Income		Amount of Gain (Loss)  Reclassified from AOCI		Income Statement Classification of Gain (Loss)	Amount of Gain (Loss) Recognized In Income			Amount of Gain (Loss) Reclassified from AOCI
Foreign Currency contracts	Revenue	$	1.2	$	1.2	Revenue	$	(3.0	)	$	(3.0	)
Foreign Currency contracts	Expenses		—		—	Expenses		4.5			4.5
		$	1.2	$	1.2		$	1.5		$	1.5

Schedule Of Gain (Loss) Recognized In OCI For Derivative Instruments

Gain (Loss) Recognized in OCI for Derivative Instruments (1)
	Nine Months Ended September  30, 2012
Foreign exchange contracts	$	7.3

(1) This amount is inclusive of both realized and unrealized gains and losses recognized in OCI.

Schedule Of Derivatives Not Designated As Hedging Instruments

The following tables present derivatives not designated as hedging instruments under Derivatives and Hedging Topic of the FASB ASC.

	As of September 30, 2012					As of December 25, 2011
	Balance Sheet Classification	Notional Amount		Fair Value		Balance Sheet Classification	Notional Amount		Fair Value
	(In millions)					(In millions)
Derivatives Not Designated as Hedging Instruments
Foreign Exchange Contracts	Current assets	$	16.5	$	0.0	Current assets	$	6.7	$	—
Foreign Exchange Contracts	Current liabilities		5.4		0.0	Current liabilities		44.9		0.1
Total derivatives, net		$	21.9	$	0.0		$	51.6	$	0.1

	For the Nine Months September 30, 2012			For the Nine Months Ended September 25, 2011
	Income Statement Classification of Gain (Loss)	Amount of Gain (Loss) Recognized In Income		Income Statement Classification of Gain (Loss)	Amount of Gain (Loss) Recognized In Income
		(In millions)		(In millions)
Derivatives Not Designated as Hedging Instruments
Foreign Exchange Contracts	Revenue	$	0.0	Revenue	$	(0.2	)
Foreign Exchange Contracts	Expenses		0.8	Expenses		(1.3	)
Net gain (loss) recognized in income		$	0.8		$	(1.5	)

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Basis of Presentation

9 Months Ended

Sep. 30, 2012

Basis of Presentation

Note 1 – Basis of Presentation

The accompanying interim consolidated financial statements of Fairchild Semiconductor International, Inc. (the company) have been prepared in conformity with accounting principles generally accepted in the United States of America, consistent in all material respects with those applied in the company’s Annual Report on Form 10-K for the year ended December 25, 2011. The interim financial information is unaudited, but reflects all normal adjustments, which are, in the opinion of management, necessary to provide a fair statement of results for the interim periods presented. The financial statements should be read in conjunction with the financial statements in the company’s Annual Report on Form 10-K for the year ended December 25, 2011. Certain amounts for prior periods have been reclassified to conform to the current presentation. The results for the interim periods are not necessarily indicative of the results of operations that may be expected for the full year. The company’s fiscal calendar, in which each quarter ends on a Sunday, contains 53 weeks every seven years. This additional week is included in the first quarter of the year. The company’s results for the nine months ended September 30, 2012 and September 25, 2011 consists of 40 weeks and 39 weeks, respectively.

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Such estimates include the valuation of accounts receivable, inventories, goodwill, investments, intangible assets, and other long-lived assets, legal contingencies, and assumptions used in the calculation of income taxes and customer incentives, among others. These estimates and assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. The company adjusts such estimates and assumptions when facts and circumstances dictate. Illiquid credit markets, volatile equity and foreign currency markets, and declines in consumer spending have combined to increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in those estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods.

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CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Millions, unless otherwise specified	Sep. 30, 2012	Dec. 25, 2011
Accounts receivable, allowances	$ 26.3	$ 24.0

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Contingencies

9 Months Ended

Sep. 30, 2012

Contingencies

Note 11 – Contingencies

Patent Litigation with Power Integrations, Inc. There are four outstanding proceedings with Power Integrations.

POWI 1: On October 20, 2004, the company and our wholly owned subsidiary, Fairchild Semiconductor Corporation, were sued by Power Integrations, Inc. in the U.S. District Court for the District of Delaware. Power Integrations alleged that certain of the company’s pulse width modulation (PWM) integrated circuit products infringed four Power Integrations U.S. patents, and sought a permanent injunction preventing the company from manufacturing, selling or offering the products for sale in the U.S., or from importing the products into the U.S., as well as money damages for past infringement.

The trial in the case was divided into three phases. In the first phase of the trial that occurred in October of 2006, a jury returned a verdict finding that thirty-three of the company’s PWM products willfully infringed one or more of seven claims asserted in the four patents and assessed damages against the company. The company voluntarily stopped U.S. sales and importation of those products in 2007 and has been offering replacement products since 2006. Subsequent phases of the trial conducted during 2007 and 2008 focused on the validity and enforceability of the patents. In December of 2008, the judge overseeing the case reduced the jury’s 2006 damages award from $34 million to approximately $6.1 million and ordered a new trial on the issue of willfulness. Following the new trial held in June of 2009, the court found the company’s infringement to have been willful and in January 2011 the court awarded Power Integrations final damages in the amount of $12.2 million. We have challenged the final damages award, willfulness finding, and other issues on appeal. Power Integrations also appealed aspects of the trial court’s ruling, including damages. On January 11, 2012, the appeals were argued before the U.S. Court of Appeals for the Federal Circuit.

POWI 2: On May 23, 2008, Power Integrations filed another lawsuit against the company, Fairchild Semiconductor Corporation and our wholly owned subsidiary System General Corporation in the U.S. District Court for the District of Delaware, alleging infringement of three patents. Of the three patents asserted in that lawsuit, two were asserted against the company and Fairchild Semiconductor Corporation in the October 2004 lawsuit described above. In 2011, POWI added a fourth patent to this case.

On October 14, 2008, Fairchild Semiconductor Corporation and System General Corporation filed a patent infringement lawsuit against Power Integrations in the U.S. District Court for the District of Delaware, alleging that certain PWM integrated circuit products infringe one or more claims of two U.S. patents owned by System General. The lawsuit seeks monetary damages and an injunction preventing the manufacture, use, sale, offer for sale or importation of Power Integrations products found to infringe the asserted patents.

Both lawsuits were consolidated and heard together in Delaware District Court in a jury trial in April of 2012. On April 27, 2012, the jury found that Power Integrations infringed one of the two U.S. patents owned by System General and upheld the validity of both System General patents. In the same case, the jury found that the company infringed two of four U.S. patents asserted by Power Integrations and that the company had induced its customers to infringe the asserted patents. The jury also upheld the validity of the asserted Power Integrations patents. The verdict concluded the first phase of trial in the litigation. Willfulness and damages in the case will be determined in a second phase, which has yet to be scheduled and may occur after appeals of the first phase.

POWI 3: On November 4, 2009, Power Integrations filed a complaint for patent infringement against the company and two of the company’s subsidiaries in the United States District Court for the Northern District of California alleging that several of our products infringe three of Power Integrations’ patents. One of those patents has since been dropped from the case. The company intends to put on a vigorous defense against these claims. In the same lawsuit we have filed counterclaims against Power Integrations, alleging Power Integrations’ products infringe certain claims of one of our patents. Trial has yet to be scheduled in this case.

POWI 4: On February 10, 2010 Fairchild and System General filed a lawsuit in Suzhou, China against four Power Integrations entities and seven vendors. The lawsuit claims that Power Integrations violates certain Fairchild/System General patents. Fairchild is seeking an injunction against the Power Integrations products and over $17.0 million in damages. Power Integrations attempted to have the Fairchild/System General patents declared invalid in proceedings before the Chinese Patent Office. Based on the Patent Office’s ruling, three of the four patents asserted by Fairchild will continue in the case.

Hearings comparable to a trial in U.S. litigation were held in January, May and July 2012. The company anticipates that the court will rule on the case before the end of 2012.

POWI 5: On May 1, 2012, Fairchild sued Power Integrations in United States District Court for the District of Delaware. The lawsuit accuses Power Integration’s LinkSwitch-PH LED power conversion products of violating three Fairchild patents. Power Integrations has counterclaimed against Fairchild asserting five Power Integrations patents.

Other Legal Claims. From time to time the company is involved in legal proceedings in the ordinary course of business. The company believes that there is no such ordinary-course litigation pending that could have, individually or in the aggregate, a material adverse effect on our business, financial condition, results of operations, or cash flows. Legal costs are expensed as incurred.

The company analyzes potential outcomes from current litigation in accordance with the Contingency Topic of the FASB ASC. Accordingly, the company analyzes such outcomes as loss contingencies, and divides them into three categories based on the possibility that the contingency will give rise to an actual loss. The first category represents contingencies for which management believes the possibility of loss is remote. For contingencies in this category, the company does not record a reserve or assess the range of possible losses. The second category represents contingencies for which losses are believed to be reasonably possible. For this category, the company assesses the range of possible losses but does not record a reserve. There are currently no contingencies in this category. The third category represents contingencies for which losses are believed to be probable. For this category, the company determines the range of losses and records a reserve reflecting the best estimate within the range. For contingencies within this category, the company currently believes the range of probable losses are approximately $14.0 million to $15.6 million and the best estimate of losses within this range to be $14.1 million as of September 30, 2012 and has recorded this amount as a reserve. The amount reserved is based upon assessments of the potential liabilities using analysis of claims and historical experience in defending and resolving such claims.

XML

Document and Entity Information	9 Months Ended
	Sep. 30, 2012
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q3
Trading Symbol	FCS
Entity Registrant Name	FAIRCHILD SEMICONDUCTOR INTERNATIONAL INC
Entity Central Index Key	0001036960
Current Fiscal Year End Date	--12-30
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	126,956,165

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Long-Term Debt

9 Months Ended

Sep. 30, 2012

Long-Term Debt

Note 12 – Long-Term Debt

Long-term debt consists of the following at:

	September 30,		December 25,
	2012		2011
	(In millions)
Revolving Credit Facility borrowings	$	300.0	$	300.0
Other		0.1		0.1
Total debt	$	300.1	$	300.1
Current portion of long-term debt		—		—
Long-term debt, less current portion	$	300.1	$	300.1

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CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 25, 2011	Sep. 30, 2012	Sep. 25, 2011
Total revenue	$ 358.8	$ 403.2	$ 1,072.5	$ 1,249.4
Cost of sales	238.7	258.4	729.8	791.9
Gross margin	120.1	144.8	342.7	457.5
Gross margin %	33.50%	35.90%	32.00%	36.60%
Operating expenses:
Research and development	37.8	37.8	119.0	114.6
Selling, general and administrative	48.0	54.4	157.8	167.8
Amortization of acquisition-related intangibles	4.5	4.7	13.7	15.0
Restructuring and impairments	3.4	4.1	6.3	9.5
Charge for litigation			1.3
Total operating expenses	93.7	101.0	298.1	306.9
Operating income	26.4	43.8	44.6	150.6
Other expense, net	1.2	1.4	4.2	5.8
Income before income taxes	25.2	42.4	40.4	144.8
Provision for income taxes	0.5	6.6	2.2	20.6
Net income	$ 24.7	$ 35.8	$ 38.2	$ 124.2
Net income per common share:
Basic	$ 0.19	$ 0.28	$ 0.30	$ 0.98
Diluted	$ 0.19	$ 0.28	$ 0.30	$ 0.95
Weighted average common shares:
Basic	126.8	126.9	126.7	127.0
Diluted	128.8	129.9	129.1	130.8

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Derivatives

9 Months Ended

Sep. 30, 2012

Derivatives

Note 6 – Derivatives

Derivatives. The company uses derivative instruments to manage exposures to changes in foreign currency exchange rates and interest rates. In accordance with the requirements of the Derivatives and Hedging Topic of the FASB ASC, the fair value of these hedges is recorded on the balance sheet. For the fair value of derivatives, see Note 5.

Foreign Currency Derivatives. The company uses currency forward and combination option contracts to hedge a portion of its forecasted foreign exchange denominated revenues and expenses. The company monitors its foreign currency exposures to maximize the overall effectiveness of its foreign currency hedge positions. Currencies hedged include the euro, Japanese yen, Philippine peso, Malaysian ringgit, Korean won and Chinese yuan. The company’s objectives for holding derivatives are to minimize the risks using the most effective methods to eliminate or reduce the impacts of these exposures. The maturities of the cash flow hedges are 18 months or less.

Changes in the fair value of derivative instruments related to time value are included in the assessment of hedge effectiveness. Hedge ineffectiveness, determined in accordance the Derivatives and Hedging Topic of the FASB ASC, did not have a material impact on earnings for the three and nine months ended September 30, 2012. No cash flow hedges were derecognized or discontinued during the three and nine months ended September 30, 2012.

Derivative gains and losses included in accumulated other comprehensive income (AOCI) are reclassified into earnings at the time the forecasted transaction is recognized. The company estimates that $1.2 million of net unrealized derivative losses included in AOCI will be reclassified into earnings within the next twelve months.

The company also uses currency forward and combination option contracts to offset the foreign currency impact of balance sheet translation. These derivatives have one month terms and the initial fair value, if any, and the subsequent gains or losses on the change in fair value are reported in earnings within the same income statement line as the impact of the foreign currency translation. From time to time, the company will also hedge the liability for an expected cash payment in foreign currency. These derivatives have terms that match the expected payment timing. The initial fair value, if any, and the subsequent gains or losses on the change in fair value are reported in earnings within the same income statement line as the change in value of the liability due to changes in currency value.

The tables below show the notional principal and the location and amounts of the derivative fair values in the consolidated balance sheet as of September 30, 2012 and December 25, 2011 as well as the location of derivative gains and losses in the statement of operations for the nine months ended September 30, 2012 and September 25, 2011. Pursuant to the Derivatives and Hedging Topic of the FASB ASC, the company nets the fair value of all derivative financial instruments with counterparties for which a master netting arrangement is utilized. The notional principal amounts for these instruments provide one measure of the transaction volume outstanding as of the end of the period and do not represent the amount of the company’s exposure to credit or market loss. The estimates of fair value are based on applicable and commonly used pricing models using prevailing financial market information as of September 30, 2012 and December 25, 2011. Although the following table reflects the notional principal and fair value of amounts of derivative financial instruments, it does not reflect the gains or losses associated with the exposures and transactions that these financial instruments are intended to hedge. The amounts ultimately realized upon settlement of these financial instruments, together with the gains and losses on the underlying exposures will depend on actual market conditions during the remaining life of the instruments.

The following tables present derivatives designated as hedging instruments under the Derivatives and Hedging Topic of the FASB ASC.

	As of Septemeber 30, 2012									As of December 25, 2011
	Balance Sheet Classification	Notional Amount		Fair Value			Amount of Gain (Loss) Recognized In AOCI			Balance Sheet Classification	Notional Amount		Fair Value			Amount of Gain (Loss) Recognized In AOCI
	(In millions)										(In millions)
Derivatives in Cash Flow Hedges
Foreign exchange contracts
Derivatives for forecasted revenues	Current assets	$	—	$	—		$	—		Current assets	$	60.3	$	0.9		$	0.9
Derivatives for forecasted revenues	Current liabilities		50.9		(0.3	)		(0.3	)	Current liabilities	$	—	$	—			—
Derivatives for forecasted expenses	Current assets		245.0		2.1			2.1		Current assets		33.6		—			—
Derivatives for forecasted expenses	Current liabilities		—		—			—		Current liabilities		224.4		(6.4	)		(6.4	)
Total foreign exchange contract derivatives		$	295.9	$	1.8		$	1.8			$	318.3	$	(5.5	)	$	(5.5	)

	For the Nine Months Ended September 30, 2012					For the Nine Months Ended September 25, 2011
	Income Statement Classification of Gain (Loss)	Amount of Gain (Loss)  Recognized In Income		Amount of Gain (Loss)  Reclassified from AOCI		Income Statement Classification of Gain (Loss)	Amount of Gain (Loss) Recognized In Income			Amount of Gain (Loss) Reclassified from AOCI
Foreign Currency contracts	Revenue	$	1.2	$	1.2	Revenue	$	(3.0	)	$	(3.0	)
Foreign Currency contracts	Expenses		—		—	Expenses		4.5			4.5
		$	1.2	$	1.2		$	1.5		$	1.5

Gain (Loss) Recognized in OCI for Derivative Instruments (1)
	Nine Months Ended September  30, 2012
Foreign exchange contracts	$	7.3

(1) This amount is inclusive of both realized and unrealized gains and losses recognized in OCI.

The following tables present derivatives not designated as hedging instruments under Derivatives and Hedging Topic of the FASB ASC.

	As of September 30, 2012					As of December 25, 2011
	Balance Sheet Classification	Notional Amount		Fair Value		Balance Sheet Classification	Notional Amount		Fair Value
	(In millions)					(In millions)
Derivatives Not Designated as Hedging Instruments
Foreign Exchange Contracts	Current assets	$	16.5	$	0.0	Current assets	$	6.7	$	—
Foreign Exchange Contracts	Current liabilities		5.4		0.0	Current liabilities		44.9		0.1
Total derivatives, net		$	21.9	$	0.0		$	51.6	$	0.1

	For the Nine Months September 30, 2012			For the Nine Months Ended September 25, 2011
	Income Statement Classification of Gain (Loss)	Amount of Gain (Loss) Recognized In Income		Income Statement Classification of Gain (Loss)	Amount of Gain (Loss) Recognized In Income
		(In millions)		(In millions)
Derivatives Not Designated as Hedging Instruments
Foreign Exchange Contracts	Revenue	$	0.0	Revenue	$	(0.2	)
Foreign Exchange Contracts	Expenses		0.8	Expenses		(1.3	)
Net gain (loss) recognized in income		$	0.8		$	(1.5	)

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Fair Value

9 Months Ended

Sep. 30, 2012

Fair Value

Note 5 – Fair Value

Fair Value of Financial Instruments. In accordance with the requirements of the Fair Value Measurements and Disclosures Topic of the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC), the company groups its financial assets and liabilities measured at fair value on a recurring basis in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. These levels are:

• Level 1 – Valuation is based upon quoted market price for identical instruments traded in active markets.

• Level 2 – Valuation is based on quoted market prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market.

• Level 3 – Valuation is generated from model-based techniques that use significant assumptions not observable in the market. Valuation techniques include use of discounted cash flow models and similar techniques.

In accordance with the requirements of the Fair Value Measurements and Disclosures Topic of the FASB ASC, it is the company’s policy to maximize the use of observable inputs and minimize the use of unobservable inputs when developing fair value measurements. When available, the company uses quoted market prices to measure fair value. If market prices are not available, the fair value measurement is based on models that use primarily market based parameters including interest rate yield curves, option volatilities and currency rates. In certain cases where market rate assumptions are not available, the company is required to make judgments about assumptions market participants would use to estimate the fair value of a financial instrument. Changes in the underlying assumptions used, including discount rates and estimates of future cash flows could significantly affect the results of current or future values. The results may not be realized in an actual sale or immediate settlement of an asset or liability.

The assets and liabilities measured at fair value on a recurring basis include securities and derivatives. Financial instruments classified as Level 1 are securities traded on an active exchange as well as U.S. Treasury, and other U.S. government and agency-backed securities that are traded by dealers or brokers in active over-the-counter markets. Derivatives are classified as Level 2 financial instruments. Auction rate securities are classified as Level 3 financial instruments.

The fair value of securities is based on quoted market prices at the date of measurement, except for auction rate securities. The auction rate security market is no longer active and as a result there is no observable market data for these assets. Fair value estimates are based on judgments regarding current economic conditions, liquidity discounts and interest rate risks. These estimates involve significant uncertainties and judgments and cannot be determined with precision. As a result such calculated fair value estimates may not be realizable in a current sale or immediate settlement of the instrument. In addition, changes in the underlying assumptions used in the fair value measurement technique, including discount rates, liquidity risks and estimates of future cash flows could significantly affect these fair value estimates.

A discounted cash flow (DCF) calculation is performed to determine the estimated fair value of the auction rate securities. The assumptions used in preparing the DCF model included estimates for the amount and timing of future interest and principal payments and the rate of return required by investors to own these securities in the current environment. In making these assumptions, relevant factors that were considered included: the formula applicable to each security which defines the interest rate paid to investors in the event of a failed auction; forward projections of the interest rate benchmarks specified in such formulas; the likely timing of principal repayments; the probability of full repayment considering guarantees by third parties and additional credit enhancements provided through other means. The estimate of the rate of return required by investors to own these securities also considers the current reduced liquidity for auction rate securities. Inputs for DCF calculations are based upon publicly available data as well as the company’s own estimates. One major unobservable input to the valuation was the maturity assumption which ranged from twenty one to thirty three years for 2012 valuations and from four to ten years for 2011 valuations. Current maturity assumptions are at the contractual maturity. Any significant decreases in the maturity assumptions may result in higher fair values. The maturity assumptions are dependent on the individual auction rate security. The maturity assumptions were based on the terms of the underlying instrument and the potential for restructuring the auction rate security. Another unobservable input to the valuation was the discount rates, which ranged from libor plus 5% to libor plus 8% for the 2012 valuations. The discount rates assumptions are dependent on the individual auction rate security and are based on average adjusted yield on comparable bonds. Any significant increase or decrease to the discount rates could result in lower or higher fair values.

All of the company’s derivatives are traded in over-the-counter markets where quoted market prices are not readily available. For those derivatives, the company measures fair value using prices obtained from the counterparties with whom the company has traded. The counterparties price the derivatives based on models that use primarily market observable inputs, such as yield curves and option volatilities. Accordingly, the company classifies these derivatives as Level 2.

The company is exposed to credit-related losses in the event of non-performance by counterparties to hedging instruments. The counterparties to all derivative transactions are major financial institutions. However, this does not eliminate the company’s exposure to credit risk with these institutions. This credit risk is generally limited to the unrealized gains in such contracts should any of these counterparties fail to perform as contracted. The company considers the risk of counterparty default to be minimal.

The following table presents the balances of assets and liabilities measured at fair value on a recurring basis as of September 30, 2012.

	Total			Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)
	(In millions)
Foreign Currency Derivatives
Assets	$	2.1		$	—	$	2.1		$	—
Liabilities		(0.3	)		—		(0.3	)		—
	$	1.8		$	—	$	1.8		$	—
Securities
Marketable securities	$	2.7		$	2.7	$	—		$	—
Auction rate securities		25.8			—		—			25.8
	$	28.5		$	2.7	$	—		$	25.8

The following table summarizes the changes in level 3 securities measured at fair value on a recurring basis for the nine months ended September 30, 2012.

	Auction Rate Securities
	(In millions)
Balance at beginning of period	$	29.8
Total realized and unrealized gains or (losses)
Included in net income		—
Included in OCI		(4.4	)
Accretion of impairments included in net income		0.4
Sales		—
Purchases, issuances and settlements		—
Balance at end of period	$	25.8

Long term debt is carried at amortized cost. However, the company is required to estimate the fair value of long term debt under the Financial Instrument Topic of the FASB ASC. The carrying amount of the revolving facility is considered to approximate fair value as the interest rate on the loan is similar to current market rates. See Note 12 for more information on the credit facility.

	September 30, 2012				December 25, 2011
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
	(In millions)
Long-TermDebt:
Revolving Credit Facility	$	300.0	$	300.0	$	300.0	$	300.0

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Fair Value (Tables)

9 Months Ended

Sep. 30, 2012

Schedule Of Fair Value Of Assets And Liabilities

The following table presents the balances of assets and liabilities measured at fair value on a recurring basis as of September 30, 2012.

	Total			Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)
	(In millions)
Foreign Currency Derivatives
Assets	$	2.1		$	—	$	2.1		$	—
Liabilities		(0.3	)		—		(0.3	)		—
	$	1.8		$	—	$	1.8		$	—
Securities
Marketable securities	$	2.7		$	2.7	$	—		$	—
Auction rate securities		25.8			—		—			25.8
	$	28.5		$	2.7	$	—		$	25.8

Schedule Of Changes In Level 3 Securities

The following table summarizes the changes in level 3 securities measured at fair value on a recurring basis for the nine months ended September 30, 2012.

	Auction Rate Securities
	(In millions)
Balance at beginning of period	$	29.8
Total realized and unrealized gains or (losses)
Included in net income		—
Included in OCI		(4.4	)
Accretion of impairments included in net income		0.4
Sales		—
Purchases, issuances and settlements		—
Balance at end of period	$	25.8

Schedule Of Fair Value Of Long-Term Debt

	September 30, 2012				December 25, 2011
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
	(In millions)
Long-TermDebt:
Revolving Credit Facility	$	300.0	$	300.0	$	300.0	$	300.0

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Subsequent Events

9 Months Ended

Sep. 30, 2012

Subsequent Events

Note 13 – Subsequent Events

Subsequent to the end of the third quarter of 2012, the company tendered approximately $49.5 million of long term available-for-sale auction rate securities at a price equal to 47% of par value and 90% of book value. The company sold the securities for $23.3 million and incurred a realized loss of approximately $12.9 million which will be reflected in its fourth quarter results.

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Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2012

Goodwill and Intangible Assets

Note 9 – Goodwill and Intangible Assets

The following table presents a summary of acquired intangible assets.

			As of September 30, 2012					As of December 25, 2011
	Period of Amortization		Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
			(In millions)
Identifiable intangible assets:
Developed technology		2 - 15 years	$	250.8	$	(225.0	)	$	250.7	$	(214.3	)
Customer base		8 - 10 years		81.6		(70.4	)		81.6		(68.5	)
Core technology		10 years		15.7		(3.6	)		15.7		(2.7	)
In Process R&D		10 years		2.8		(0.1	)		2.8		0.0
Assembled workforce		5 years		1.0		(1.0	)		1.0		(1.0	)
Process technology		5 years		1.6		(1.6	)		1.6		(1.6	)
Patents		4 years		5.9		(5.9	)		5.9		(5.8	)
Subtotal				359.4		(307.6	)		359.3		(293.9	)
Goodwill				169.3		0.0			169.3		0.0
Total			$	528.7	$	(307.6	)	$	528.6	$	(293.9	)

The following table presents the carrying value of goodwill by reporting unit.

	MCCC			PCIA			SDT			Total
	(In millions)
Balance as of December 25, 2011
Goodwill	$	165.0		$	153.1		$	54.5		$	372.6
Accumulated Impairment Losses		0.0			(148.8	)		(54.5	)		(203.3	)
	$	165.0		$	4.3		$	0.0		$	169.3
Goodwill reallocation	($	3.0	)	$	3.0		$	0.0		$	0.0
Balance as of September 30, 2012
Goodwill	$	162.0		$	156.1		$	54.5		$	372.6
Accumulated Impairment Losses		0.0			(148.8	)		(54.5	)		(203.3	)
	$	162.0		$	7.3		$	0.0		$	169.3

During the first quarter of 2012, the company moved two small product groups from the MCCC organization to the PCIA and SDT organizations. Since this changed the company’s reporting units, goodwill was assigned to the reporting units affected using a relative fair value allocation. See footnote 8 for more information.

The following table presents the estimated amortization expense for intangible assets for the remainder of 2012 and for each of the five succeeding fiscal years.

Estimated Amortization Expense:	(In millions)
Remaining Fiscal 2012		4.5
Fiscal 2013		15.6
Fiscal 2014		7.5
Fiscal 2015		5.2
Fiscal 2016		5.5
Fiscal 2017		2.2

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Securities

9 Months Ended

Sep. 30, 2012

Securities

Note 7 – Securities

The company invests excess cash in marketable securities consisting primarily of money markets, commercial paper, corporate notes and bonds, and U.S. government securities. While the company still holds auction rate securities, the company no longer actively invests in them.

All of the company’s securities are classified as available-for-sale. In accordance with the Investments – Debt and Equity Securities Topic of the FASB ASC, available-for-sale securities are carried at fair value with unrealized gains and losses included as a component of AOCI within stockholders’ equity, net of any related tax effect, if such gains and losses are considered temporary. Realized gains and losses on these investments are included in interest income and expense. Declines in value judged by management to be other-than-temporary and credit related are included in impairment of investments in the statement of operations. The noncredit component of impairment is included in AOCI. For the purpose of computing realized gains and losses, cost is identified on a specific identification basis. There were no material realized gains or losses on sales of securities in the first nine months of 2012 or 2011. Proceeds from the sales of securities in the first nine months of 2012 were $0.3 million. There were no sales of securities in 2011.

Securities are summarized as of September 30, 2012:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Market Value
	(In millions)
Short-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	0.1	$	—	$	—	$	0.1
Total marketable securities	$	0.1	$	—	$	—	$	0.1

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Market Value
	(In millions)
Long-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	2.1	$	0.4	$	—		$	2.5
Corporate debt securities		0.1		—		—		$	0.1
Auction rate securities		36.2		—		(10.4	)		25.8
Total securities	$	38.4	$	0.4	$	(10.4	)	$	28.4

In aggregate, the auction rate securities have been in an unrealized loss position for over a year. The continued unrealized loss is attributable to the ongoing volatility in the global equities markets and uncertainty in the credit markets primarily from the European debt situation and other global economic uncertainty. However, the company does not intend to sell or believe it is more likely than not that the company would be required to sell the securities before a recovery of the amortized cost basis of the investment. In addition, as a result of the continued performance of the issue and its’ insurance guarantee, the company considers this decrease in fair value to be temporary in nature.

Securities are summarized as of December 25, 2011:

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Market Value
	(In millions)
Short-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	0.2	$	—	$	—	$	0.2
Total marketable securities	$	0.2	$	—	$	—	$	0.2

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Market Value
	(In millions)
Long-term available for sale securities:
U.S. Treasury securities and obligations of U.S. government agencies	$	1.8	$	0.4	$	—		$	2.2
Corporate debt securities		0.3		—		—		$	0.3
Auction rate securities		35.8		—		(6.0	)		29.8
Total securities	$	37.9	$	0.4	$	(6.0	)	$	32.3

The following table presents the amortized cost and estimated fair market value of available-for-sale securities by contractual maturity as of September 30, 2012.

	Amortized Cost		Market Value
	(In millions)
Due in one year or less	$	0.1	$	0.1
Due after one year through three years		0.4		0.4
Due after three years through ten years		1.1		1.4
Due after ten years	$	36.9	$	26.6
	$	38.5	$	28.5

As of September 30, 2012, auction rate securities with a market value of $25.8 million are included in the table above in contractual maturities due after ten years. The company’s auction rate securities are composed of approximately $16.8 million of securities that are structured obligations of special purpose reinsurance entities associated with life insurance companies and $9.0 million of corporate debt securities issued by a special purpose financial services corporation that offers credit risk protection through writing credit derivatives. The company continues to accrue and receive interest on these securities based on a contractual rate.

The following table presents a roll forward of the amount related to credit losses recognized in earnings during the nine months ended September 30, 2012.

	Credit Losses Recognized in Earnings
	(In millions)
Balance at beginning of period	$	14.0
Accretion of impairments included in net income		(0.4	)
Balance at end of period	$	13.6

There is no portion of other-than-temporary impairment related to credit loss currently included in AOCI.

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Segment Information

9 Months Ended

Sep. 30, 2012

Segment Information

Note 8 – Segment Information

Fairchild is currently organized onto three reporting segments. The organization is an application based structure which corresponds with the way the company manages the business. The majority of the company’s activities are aligned into two focus areas; MCCC, which focuses on mobile and ultraportable products and PCIA, which focuses on power supply and motor control solutions. Each of these segments has a specific focus area, a small set of leading customers, and common technology requirements for their product groups. The third reporting segment, SDT, combines the management of multiple market products that provide generic solutions for standard diodes / transistors, standard linear, and infrared.

Effective the first day of 2012, the mature logic group was transferred from the MCCC reporting segment to SDT and the management of the ground fault interrupt (GFI) products was moved from MCCC to PCIA. Prior year numbers have been restated to reflect this change.

The following table presents selected operating segment financial information for the three and nine months ended September 30, 2012 and September 25, 2011.

	Three Months Ended						Nine Months Ended
	September 30, 2012			September 25, 2011			September 30, 2012			September 25 2011
	(In millions)						(In millions)
Revenue and Operating Income:
MCCC
Total revenue	$	142.2		$	148.4		$	432.9		$	440.2
Operating income		30.1			26.7			82.1			79.2
PCIA
Total revenue		180.2			204.6			530.8			643.9
Operating income		36.6			56.9			95.5			184.9
SDT
Total revenue		36.4			50.2			108.8			165.3
Operating income		5.6			12.0			15.2			40.8
Corporate
Restructuring and impairments expense		(3.4	)		(4.1	)		(6.3	)		(9.5	)
Stock-based compensation expense		(4.2	)		(6.0	)		(18.4	)		(19.0	)
Selling, general and administrative expense		(38.4	)		(41.4	)		(122.5	)		(124.8	)
Charge for litigation		—			—			(1.3	)		—
Other		0.1			(0.3	)		0.3			(1.0	)
Total Consolidated
Total revenue	$	358.8		$	403.2		$	1,072.5		$	1,249.4
Operating income	$	26.4		$	43.8		$	44.6		$	150.6
Other expense, net	$	1.2		$	1.4		$	4.2		$	5.8
Income before income taxes	$	25.2		$	42.4		$	40.4		$	144.8

PCIA revenue for the three and nine months ended September 30, 2012 includes $3.0 and $7.0 million, respectively, of insurance proceeds related to business interruption claims for the company’s optoelectronics supply issues resulting from the Thailand floods in the fourth quarter of 2011.

Other in 2011 primarily consists of accelerated depreciation related to the previously planned closure of the Mountaintop facility.

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Restructuring and Impairments

9 Months Ended

Sep. 30, 2012

Restructuring and Impairments

Note 10 – Restructuring and Impairments

During the three and nine months ended September 30, 2012, the company recorded restructuring and impairment charges, net of releases, of $3.4 million and $6.3 million, respectively. The detail of these charges is presented in the summary table below.

During the three and nine months ended September 25, 2011, the company recorded restructuring and impairment charges, net of releases, of $4.1 million and $9.5 million, respectively. The third quarter charges include $0.6 million of employee separation costs and $0.1 million of fab closure costs associated with the 2009 Infrastructure Realignment Program as well as $1.7 million of employee separation costs associated with the 2010 Infrastructure Realignment Program and $1.7 million in employee separation costs associated with the 2011 Infrastructure Realignment Program. In addition to the charges in the third quarter of 2011, there were charges in the first and second quarter of 2011 for $1.1 million of employee separation costs, $0.5 million of fab closure costs, and $0.1 million in reserve releases associated with the 2009 Infrastructure Realignment Program as well as $1.9 million in employee separation costs associated with the 2010 Infrastructure Realignment Program and $2.0 million in employee separations costs associated with the 2011 Infrastructure Realignment Program.

The 2012 Infrastructure Realignment Program includes costs for organizational changes in the company’s sales organization, manufacturing sites and manufacturing support organizations, the human resources function, executive management levels, and the MCCC and PCIA product lines as well as the termination of an IT systems lease and the final closure of a warehouse in Korea. The 2011 Infrastructure Realignment Program includes costs for organizational changes in the company’s supply chain management group, the website technology group, the quality organization, and other administrative groups. The 2011 program also includes costs to further improve the company’s manufacturing strategy and changes in the PCIA and MCCC groups as well as a primarily voluntary retirement program at our Mountaintop, Pennsylvania location. The 2010 Infrastructure Realignment Program includes costs to simplify and realign some activities within the MCCC segment, costs for the continued refinement of the company’s manufacturing strategy, and costs associated with centralizing the company’s accounting functions. The 2009 Infrastructure Realignment Program included costs associated with the previously planned closure of the Mountaintop, Pennsylvania manufacturing facility and the four-inch manufacturing line in Bucheon, South Korea, both of which were announced in the first quarter of 2009. The 2009 Program also included charges for a smaller worldwide cost reduction plan to further right-size our company. The consolidation of the South Korea fabrication lines was completed in 2011. Also during 2011, the company decided to keep open the Mountain Top facility reversing the March 2009 announcement to close the site.

The following table presents a summary of the activity in the company’s accrual for restructuring and impairment costs for the quarterly periods ended April 1, 2012, July 1, 2012, and September 30, 2012.

	Accrual												Accrual
	Balance at		New		Cash			Reserve			Non-Cash		Balance at
	12/25/2011		Charges		Paid			Release			Items		4/1/2012
2010 Infrastructure Realignment Program:
Employee Separation Costs	$	1.0	$	—	$	(0.3	)	$	—		$	—	$	0.7
2011 Infrastructure Realignment Program:
Employee Separation Costs		1.7		1.0		(0.3	)		(0.1	)		—		2.3
2012 Infrastructure Realignment Program:
Employee Separation Costs		—		1.1		(0.5	)		—			—		0.6
Facility Closure Costs		—		0.4		(0.4	)		—			—		0.0
	$	2.7	$	2.5	$	(1.5	)	$	(0.1	)	$	—	$	3.6
	Accrual												Accrual
	Balance at		New		Cash			Reserve			Non-Cash		Balance at
	4/1/2012		Charges		Paid			Release			Items		7/1/2012
2010 Infrastructure Realignment Program:
Employee Separation Costs	$	0.7	$	—	$	(0.2	)	$	(0.1	)	$	—	$	0.4
2011 Infrastructure Realignment Program:
Employee Separation Costs		2.3		—		(0.9	)		—			—		1.4
2012 Infrastructure Realignment Program:
Employee Separation Costs		0.6		0.6		(0.8	)		—			—		0.4
	$	3.6	$	0.6	$	(1.9	)	$	(0.1	)	$	—	$	2.2
	Accrual												Accrual
	Balance at		New		Cash			Reserve			Non-Cash		Balance at
	7/1/2012		Charges		Paid			Release			Items		9/30/2012
2010 Infrastructure Realignment Program:
Employee Separation Costs	$	0.4	$	—	$	(0.1	)	$	—		$	—	$	0.3
2011 Infrastructure Realignment Program:
Employee Separation Costs		1.4		—		(0.3	)		—			—		1.1
2012 Infrastructure Realignment Program:
Employee Separation Costs		0.4		2.8		(1.5	)					—		1.8
Lease Termination Costs				0.6								—		0.6
	$	2.2	$	3.4	$	(1.9	)	$	—		$	—	$	3.8

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Financial Statement Details - Additional Information (Detail) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2012
Additional Financial Information [Line Items]
Increase (decrease) in depreciation expense	$ 4.2	$ 13.7
Change in estimates effect on increase in net income	3.8	11.9
Change in estimates effect on increase in net income per share	$ 0.03	$ 0.09
Molds And Tooling Equipment
Additional Financial Information [Line Items]
Increase (decrease) in depreciation expense		$ 0.7
Other long term assets, estimated useful life		3 years
Molds And Tooling Equipment | Minimum
Additional Financial Information [Line Items]
Other long term assets, estimated useful life		1 year
Molds And Tooling Equipment | Maximum
Additional Financial Information [Line Items]
Other long term assets, estimated useful life		5 years
Machinery and equipment at wafer fabrication facilities
Additional Financial Information [Line Items]
Estimated useful life		10 years
Previous Policy | Machinery and Equipment
Additional Financial Information [Line Items]
Estimated useful life		8 years

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Summary of Acquired Intangible Assets (Detail) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Dec. 25, 2011
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Gross Carrying Amount	$ 359.4	$ 359.3
Goodwill	169.3	169.3
Identifiable intangible assets, Accumulated Amortization	(307.6)	(293.9)
Identifiable intangible assets, including goodwill, Gross Carrying Amount	528.7	528.6
Developed Technology
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Gross Carrying Amount	250.8	250.7
Identifiable intangible assets, Accumulated Amortization	(225.0)	(214.3)
Developed Technology | Minimum
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Period of Amortization	2 years
Developed Technology | Maximum
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Period of Amortization	15 years
Customer Base
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Gross Carrying Amount	81.6	81.6
Identifiable intangible assets, Accumulated Amortization	(70.4)	(68.5)
Customer Base | Minimum
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Period of Amortization	8 years
Customer Base | Maximum
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Period of Amortization	10 years
Core Technology
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Period of Amortization	10 years
Identifiable intangible assets, Gross Carrying Amount	15.7	15.7
Identifiable intangible assets, Accumulated Amortization	(3.6)	(2.7)
In Process R&D
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Period of Amortization	10 years
Identifiable intangible assets, Gross Carrying Amount	2.8	2.8
Identifiable intangible assets, Accumulated Amortization	(0.1)	0
Assembled Workforce
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Period of Amortization	5 years
Identifiable intangible assets, Gross Carrying Amount	1.0	1.0
Identifiable intangible assets, Accumulated Amortization	(1.0)	(1.0)
Process Technology
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Period of Amortization	5 years
Identifiable intangible assets, Gross Carrying Amount	1.6	1.6
Identifiable intangible assets, Accumulated Amortization	(1.6)	(1.6)
Patents
Finite-Lived Intangible Assets [Line Items]
Identifiable intangible assets, Period of Amortization	4 years
Identifiable intangible assets, Gross Carrying Amount	5.9	5.9
Identifiable intangible assets, Accumulated Amortization	$ (5.9)	$ (5.8)

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Computation of Net Income per Share (Tables)

9 Months Ended

Sep. 30, 2012

Schedule Of Computation Of Basic And Diluted Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share.

	Three Months Ended				Nine Months Ended
	September 30, 2012		September 25, 2011		September 30, 2012		September 25, 2011
	(In millions, except per share data)
Basic:
Net income	$	24.7	$	35.8	$	38.2	$	124.2
Weighted average shares outstanding		126.8		126.9		126.7		127.0
Net income per share	$	0.19	$	0.28	$	0.30	$	0.98
Diluted:
Net income	$	24.7	$	35.8	$	38.2	$	124.2
Basic weighted average shares outstanding		126.8		126.9		126.7		127.0
Assumed exercise of common stock equivalents		2.0		3.0		2.4		3.8
Diluted weighted average common and common equivalent shares		128.8		129.9		129.1		130.8
Net income per share	$	0.19	$	0.28	$	0.30	$	0.95
Anti-dilutive common stock equivalents, non-vested stock, DSUs, RSUs, and PUs		2.8		7.3		4.0		4.8

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Segment Information (Tables)

9 Months Ended

Sep. 30, 2012

Schedule Of Selected Operating Segment Financial Information

The following table presents selected operating segment financial information for the three and nine months ended September 30, 2012 and September 25, 2011.

	Three Months Ended						Nine Months Ended
	September 30, 2012			September 25, 2011			September 30, 2012			September 25 2011
	(In millions)						(In millions)
Revenue and Operating Income:
MCCC
Total revenue	$	142.2		$	148.4		$	432.9		$	440.2
Operating income		30.1			26.7			82.1			79.2
PCIA
Total revenue		180.2			204.6			530.8			643.9
Operating income		36.6			56.9			95.5			184.9
SDT
Total revenue		36.4			50.2			108.8			165.3
Operating income		5.6			12.0			15.2			40.8
Corporate
Restructuring and impairments expense		(3.4	)		(4.1	)		(6.3	)		(9.5	)
Stock-based compensation expense		(4.2	)		(6.0	)		(18.4	)		(19.0	)
Selling, general and administrative expense		(38.4	)		(41.4	)		(122.5	)		(124.8	)
Charge for litigation		—			—			(1.3	)		—
Other		0.1			(0.3	)		0.3			(1.0	)
Total Consolidated
Total revenue	$	358.8		$	403.2		$	1,072.5		$	1,249.4
Operating income	$	26.4		$	43.8		$	44.6		$	150.6
Other expense, net	$	1.2		$	1.4		$	4.2		$	5.8
Income before income taxes	$	25.2		$	42.4		$	40.4		$	144.8

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Segment Information - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2012
Segment Reporting Information [Line Items]
Number of reportable segments		3
PCIA
Segment Reporting Information [Line Items]
Insurance proceeds related to business interruption claims resulting from the Thailand floods	$ 3.0	$ 7.0

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Derivatives - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012 M
Derivative [Line Items]
Net unrealized derivative losses included in AOCI that will be reclassified into earnings within the next twelve months	1.2
Balance Sheet Translation Hedges
Derivative [Line Items]
Duration of currency forward and combination option contracts, in months	1
Maximum
Derivative [Line Items]
Maturities of the cash flow hedges, in months	18 months

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Millions, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 25, 2011	Sep. 30, 2012	Sep. 25, 2011
Net income	$ 24.7	$ 35.8	$ 38.2	$ 124.2
Other comprehensive income, net of tax:
Net change associated with hedging transactions	6.2	(8.6)	8.6	(8.2)
Net amount reclassified to earnings for hedging	(0.4)	(1.1)	(1.2)	(1.5)
Net change associated with fair value of securities	(0.4)	(0.2)	(4.4)	0.9
Net change associated with pension transactions
Comprehensive income	$ 30.1	$ 25.9	$ 41.2	$ 115.4

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Supplemental Cash Flow Information

9 Months Ended

Sep. 30, 2012

Supplemental Cash Flow Information

Note 4 – Supplemental Cash Flow Information

	Nine Months Ended
	September 30, 2012		September 25, 2011
	(In millions)
Cash paid for:
Income taxes, net	$	13.9	$	21.1
Interest	$	5.1	$	5.0

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Schedule of Long Term Debt (Detail) (USD $) In Millions, unless otherwise specified	Sep. 30, 2012	Dec. 25, 2011
Debt Instrument [Line Items]
Revolving Credit Facility borrowings	$ 300.0	$ 300.0
Other	0.1	0.1
Total debt	300.1	300.1
Current portion of long-term debt
Long-term debt, less current portion	$ 300.1	$ 300.1

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Goodwill and Intangible Assets (Tables)

9 Months Ended

Sep. 30, 2012

Summary Of Acquired Intangible Assets

The following table presents a summary of acquired intangible assets.

			As of September 30, 2012					As of December 25, 2011
	Period of Amortization		Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
			(In millions)
Identifiable intangible assets:
Developed technology		2 - 15 years	$	250.8	$	(225.0	)	$	250.7	$	(214.3	)
Customer base		8 - 10 years		81.6		(70.4	)		81.6		(68.5	)
Core technology		10 years		15.7		(3.6	)		15.7		(2.7	)
In Process R&D		10 years		2.8		(0.1	)		2.8		0.0
Assembled workforce		5 years		1.0		(1.0	)		1.0		(1.0	)
Process technology		5 years		1.6		(1.6	)		1.6		(1.6	)
Patents		4 years		5.9		(5.9	)		5.9		(5.8	)
Subtotal				359.4		(307.6	)		359.3		(293.9	)
Goodwill				169.3		0.0			169.3		0.0
Total			$	528.7	$	(307.6	)	$	528.6	$	(293.9	)

Schedule Of Carrying Value Of Goodwill By Reporting Unit

The following table presents the carrying value of goodwill by reporting unit.

	MCCC			PCIA			SDT			Total
	(In millions)
Balance as of December 25, 2011
Goodwill	$	165.0		$	153.1		$	54.5		$	372.6
Accumulated Impairment Losses		0.0			(148.8	)		(54.5	)		(203.3	)
	$	165.0		$	4.3		$	0.0		$	169.3
Goodwill reallocation	($	3.0	)	$	3.0		$	0.0		$	0.0
Balance as of September 30, 2012
Goodwill	$	162.0		$	156.1		$	54.5		$	372.6
Accumulated Impairment Losses		0.0			(148.8	)		(54.5	)		(203.3	)
	$	162.0		$	7.3		$	0.0		$	169.3

Schedule Of Estimated Amortization Expense For Intangible Assets

The following table presents the estimated amortization expense for intangible assets for the remainder of 2012 and for each of the five succeeding fiscal years.

Estimated Amortization Expense:	(In millions)
Remaining Fiscal 2012		4.5
Fiscal 2013		15.6
Fiscal 2014		7.5
Fiscal 2015		5.2
Fiscal 2016		5.5
Fiscal 2017		2.2

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Schedule of Fair Value of Assets and Liabilities (Detail) (Fair Value Measurements, Recurring, USD $) In Millions, unless otherwise specified	Sep. 30, 2012
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	$ 2.1
Liabilities	(0.3)
Total foreign currency derivatives	1.8
Securities	28.5
Marketable Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities	2.7
Auction Rate Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities	25.8
Fair Value, Quoted Prices In Active Markets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets
Total foreign currency derivatives
Securities	2.7
Fair Value, Quoted Prices In Active Markets (Level 1) | Marketable Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities	2.7
Fair Value, Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets	2.1
Liabilities	(0.3)
Total foreign currency derivatives	1.8
Securities
Fair Value, Significant Other Observable Inputs (Level 2) | Marketable Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities
Fair Value, Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets
Total foreign currency derivatives
Securities	25.8
Fair Value, Significant Unobservable Inputs (Level 3) | Marketable Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities
Fair Value, Significant Unobservable Inputs (Level 3) | Auction Rate Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Securities	$ 25.8

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Financial Statement Details (Tables)

9 Months Ended

Sep. 30, 2012

Schedule Of Inventories, Net

	September 30, 2012		December 25, 2011
	(In millions)
Inventories
Raw materials	$	38.4	$	36.9
Work in process		142.7		135.2
Finished goods		61.2		62.1
	$	242.3	$	234.2

Schedule Of Property, Plant And Equipment

	September 30, 2012		December 25, 2011
	(In millions)
Property, plant and equipment
Land and improvements	$	24.7	$	24.0
Buildings and improvements		391.9		382.4
Machinery and equipment		1,769.5		1,732.0
Construction in progress		140.5		151.5
Total property, plant and equipment		2,326.6		2,289.9
Less accumulated depreciation		1,551.4		1,524.5
	$	775.2	$	765.4

Schedule Of Accrued Expenses And Other Current Liabilities

	September 30, 2012		December 25, 2011
	(In millions)
Accrued expenses and other current liabilities
Payroll and employee related accruals	$	47.7	$	75.7
Taxes payable		15.8		23.5
Restructuring and impairments		3.8		2.7
Other		15.6		23.8
	$	82.9	$	125.7

Schedule Of Other Expense, Net

	Three Months Ended						Nine Months Ended
	September 30, 2012			September 25, 2011			September 30, 2012			September 25, 2011
				(In millions)
Other expense, net
Interest expense	$	1.7		$	1.9		$	5.7		$	5.3
Interest income		(0.6	)		(0.7	)		(1.8	)		(2.0	)
Other (income) expense, net		0.1			0.2			0.3			2.5
Other expense, net	$	1.2		$	1.4		$	4.2		$	5.8