8-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

________________________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)

March 14, 2012

LSI CORPORATION

(Exact name of registrant as specified in its charter)

DELAWARE	1-10317	94-2712976
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1621 Barber Lane

Milpitas, California 95035

(Address of principal executive offices, including zip code)

(408) 433-8000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[  ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01.  Regulation FD Disclosure.

On March 14, 2012, LSI Corporation issued a news release updating its guidance for the first quarter of fiscal year 2012.  A copy of the news release is furnished as Exhibit 99.1 to this Form 8-K and is incorporated by reference herein.

The news release contains non-GAAP financial information. Management believes that the presentation of non-GAAP net income (loss), non-GAAP gross margin, non-GAAP operating expenses, non-GAAP taxes, and non-GAAP net income (loss) per basic and diluted share provides important supplemental information to management and investors about financial and business trends relating to the company’s results of operations. Management believes that the use of these non-GAAP financial measures also provides consistency and comparability with our past financial reports.

Management has historically used these non-GAAP measures when evaluating operating performance because we believe that the inclusion or exclusion of the items described below provides an additional measure of our core operating results and facilitates comparisons of our core operating performance against prior periods and our business model objectives. We have chosen to provide this information to investors to enable them to perform additional analyses of past, present and future operating performance and as a supplemental means to evaluate our ongoing core operations. Externally, we believe that these non-GAAP measures continue to be useful to investors in their assessment of our operating performance and their valuation of the company.

Internally, these non-GAAP measures are significant measures used by management for purposes of:

• evaluating the core operating performance of the company;

• establishing internal budgets;

• calculating return on investment for development programs and growth initiatives;

• comparing performance with internal forecasts and targeted business models;

• strategic planning;

• evaluating and valuing potential acquisition candidates and how their operations compare to the company’s operations; and

• benchmarking performance externally against our competitors.

How we calculate our non-GAAP financial measures

Non-GAAP net income (loss), non-GAAP gross margin, non-GAAP operating expenses, non-GAAP taxes and non-GAAP net income (loss) per basic and diluted share are important to the company for the reasons noted above and exclude the following items:

• Stock-based compensation. Stock-based compensation relates primarily to LSI stock awards such as stock options and restricted stock units. Stock-based compensation is a non-cash expense that varies in amount from period to period and is dependent on market forces that are difficult to predict. As a result of this unpredictability, management excludes this item from its internal operating forecasts and models. Management believes that non-GAAP measures adjusted for stock-based compensation provide investors with a basis to measure the company’s core performance against the performance of other companies without the variability created by stock-based compensation.

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• Purchase accounting effect on inventory. This is an acquisition-related charge. It results from marking to fair value an acquired company’s inventory at the time of acquisition. This charge is not factored into management’s evaluation of potential acquisitions or our performance after completion of acquisitions, because it is not related to our core operating performance, and the frequency and amount of this type of charge can vary significantly based on the size and timing of our acquisitions. Excluding this data provides investors with a basis to compare the company against the performance of other companies without this variability.

• Amortization of acquisition-related intangibles. This relates to purchased technology in acquisitions such as existing technology, patents and trademarks. This charge is not factored into management’s evaluation of potential acquisitions or our performance after completion of acquisitions, because it is not related to our core operating performance, and the frequency and amount of this type of charge can vary significantly based on the size and timing of our acquisitions and the maturities of the businesses being acquired. Excluding this data provides investors with a basis to compare the company against the performance of other companies without this variability.

• Restructuring of operations and other items, net. This represents charges/losses and gains that are not directly related to the company’s ongoing or core business results. Management regularly excludes such items from internal operating forecasts and models because they are not considered a core operating activity for the company and because the frequency and variability in the nature of the charges can vary significantly from period to period. Excluding this data provides investors with a basis to compare the company against the performance of other companies without this variability.

• Goodwill and other intangible asset impairment charges. This item reflects the write down of goodwill and other intangible assets to their fair values. Because of the infrequent nature of this charge, management does not include this type of item in internal operating forecasts and models. Excluding this data provides investors with a basis to compare the company’s core operating results in different periods without this variability.

• Other charges and gains. Other charges and gains consist of gains or losses on investments and certain non-operating gains and losses that occur on an infrequent basis and vary greatly in amount. We do not regularly trade public equity securities nor do we typically use these securities to fund our ongoing operations. Management excludes these items because they do not affect our core operations. Excluding this data provides investors with a basis to compare the company against the performance of other companies without this variability.

Non-GAAP income tax expense/benefit also is adjusted for the additional amount of tax expense or benefit that the company would accrue if it used non-GAAP results instead of GAAP results in the calculation of its tax liability. For the quarter ended April 1, 2012, we expect non-GAAP tax expense to exclude a one-time benefit related to the release of valuation allowance resulting from the net deferred tax liabilities created from the acquisition of SandForce.

We use non-GAAP net income computed as described above as the numerator in the calculation of non-GAAP net income per basic and diluted share. We calculate the basic and diluted share amounts used in the denominator in accordance with GAAP rules, using non-GAAP net income rather than GAAP net income.

Limitations of relying on non-GAAP financial measures

Some of the limitations of relying on non-GAAP financial measures include:

• Stock-based compensation. LSI’s stock-based incentive plans are important components of our employee incentive compensation arrangements and are reflected in our GAAP results. Stock-based compensation should be considered for a complete view of the costs of our compensation arrangements.

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• Purchase accounting effect on inventory. Acquisitions have been an important part of our business strategy and the corresponding acquisition-related charges reflect the costs of choosing acquisitions as a form of growth strategy.

• Amortization of acquisition-related intangibles. Acquisitions have been an important part of our business strategy and the corresponding acquisition-related charges reflect the costs of choosing acquisitions as a form of growth strategy.

• Restructuring of operations and other items, net. This item reflects charges for severance, exit costs associated with leased facilities, asset impairment charges and gains on sales of assets that are no longer strategic. While no longer strategic to the future of the company, such items reflect the costs of decisions made as part of running a business and are critical to a complete view of our historical results.

• Goodwill and other intangible asset impairment charges. This amount should be included for a complete view of our historical performance including the impact of declines of the value of our assets.

• Other charges and gains. These amounts should be included for a complete view of our historical performance even though they are not related to our core operations.

• Non-GAAP income tax expense/benefit. This item includes adjustments for the additional amount of tax expense or benefit that the company would accrue if it used non-GAAP results instead of GAAP results in the calculation of its tax liability. For the first quarter of 2012, it is also expected to exclude a one-time benefit related to an acquisition.  The limitation in using this measure is that it does not include the effect of all the items excluded from non-GAAP financial measures.

All supplemental non-GAAP financial measures should be read in conjunction with the comparable information presented in accordance with generally accepted accounting principles in the United States of America.

Item 9.01.  Financial Statements and Exhibits.

Exhibit No.	Description
99.1	News Release issued March 14, 2012.*

___________________________

*           Furnished, not filed.

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SIGNATURES

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 hereunto duly authorized.

	LSI CORPORATION
By:	/s/ Bryon Look
	Bryon Look Executive Vice President, Chief Financial Officer and Chief Administrative Officer

Date: March 14, 2012

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EX-99.1

NEWS RELEASE

LSI Updates First Quarter Guidance

Updated guidance represents 15% sequential revenue growth at midpoint

MILPITAS, Calif., March 14, 2012 – LSI Corporation (NYSE: LSI) today updated its business outlook for the first quarter ending April 1, 2012, reflecting a stronger than expected hard disk drive market recovery and ramp of flash-based products. LSI executives will provide additional details in an analyst meeting today, March 14, in New York City.

Updated First Quarter 2012 Business Outlook

Projected revenues: In the range of $585 million to $615 million, up from $550 million to $590 million

Income from continuing operations per share:1,4,5

GAAP2                                                      In the range of $0.06 to $0.10 per share

Non-GAAP3                                             In the range of $0.12 to $0.16 per share

“We are benefiting from better than expected strength in the hard disk drive market in the quarter as our team has done a great job working with our customers to meet this additional demand,” said Abhi Talwalkar, LSI president and CEO. “This revised guidance reflects strength in our hard disk drive business as well as upside in our projections for our flash-based products.”

1 On May 6, 2011, LSI completed the sale of its external storage systems business. The financial results of the external storage systems business have been classified as discontinued operations in LSI’s financial statements. Our ongoing business is referred to as “continuing operations.”

2 Generally Accepted Accounting Principles.

3 Excludes goodwill and other intangible asset impairment, stock-based compensation, amortization of acquisition-related intangibles, purchase accounting effect on inventory, restructuring of operations and other items, net, and gain/loss on sale/write-down of investments. It also excludes the income tax effect associated with the above-mentioned items and the tax benefit discussed in note 5. It also excludes, in the case of non-GAAP net income, gain from the sale of the external storage systems business.

4 Revised net income ranges reflect the change in share count from approximately 575 million shares to 590 million shares. The change in share count is driven by the increase in our stock price, which increases the dilutive effect of stock options and restricted stock unit awards included in the diluted share count calculation.

5The company has not yet finalized the allocation of the purchase consideration to assets acquired and liabilities assumed in the recently completed acquisition of SandForce. However, the company expects that in accounting for the SandForce purchase, it will recognize a one-time tax benefit of approximately $41.7 million in the first quarter of 2012 for GAAP purposes only. This tax benefit is due to the release of a valuation allowance resulting from the net deferred tax liabilities created from the acquisition, and will be excluded from our non-GAAP results.

Updated First Quarter 2012 Business Outlook Detail

	GAAP2	Special Items	Non-GAAP3
Revenue	$585 million to $615 million		$585 million to $615 million
Gross Margin	~45%	~$40 million	~52%
Operating Expenses	~$268 million	~$45 million	~$223 million
Net Other Income	~$11 million	~$6 million	~$5 million
Tax	Benefit of ~$33 million	Benefit of ~$42 million	Provision of ~$9 million
Income from Continuing Operations Per Share	$0.06 to $0.10	~($0.06)	$0.12 to $0.16
Diluted Share Count*	590 million		590 million

*The change in share count is driven by the increase in our stock price, which increases the dilutive effect of stock options and restricted stock unit awards included in the diluted share count calculation.

LSI Analyst Day Event Information

LSI executives will provide additional insight into the company’s strategy and key drivers of financial performance at the LSI 2012 Analyst Day Event in New York City, starting at 8:30 a.m. (EDT).

“Today we will highlight the growth drivers for the company and demonstrate how our multi-year investment strategy has positioned LSI to benefit from the tremendous global growth in data as well as from inflection points like cloud computing, mega datacenters, mobile networks and flash,” continued Talwalkar.

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At LSI’s event for investors and securities analysts, executive presentations and topics will include:

Abhi Talwalkar, President and CEO:

The new LSI, including company strategy and vision and key market trends.

Jeff Richardson, Chief Operating Officer:

Product and market overview with a focus on networking, SAS and hard disk drives.

Greg Huff, Chief Strategy Officer:

LSI’s growth opportunity with flash-based products.

Bryon Look, Chief Financial Officer:

Long-term financial goals and strategies as well as updated business model targets.

Investors and others may access a live video webcast of the presentations beginning at 8:30 a.m. EDT by visiting the LSI website at http://www.lsi.com/webcast. Afterwards, a replay of the webcast will be available on the LSI website at www.lsi.com/webcast.

Forward-Looking Statements: This news release contains forward-looking statements that are based on the current opinions and estimates of management. These statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated in the forward-looking statements. Factors that could cause LSI’s actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to: our ability to successfully integrate and manage the SandForce business and retain its key employees; our ability to achieve anticipated synergies and to develop integrated new products following our acquisition of SandForce; our ability to eliminate costs related to the external storage systems business that we sold in 2011; our ability to repurchase our common stock at prices we believe to be advantageous; the impact of the recent flooding in Thailand; our reliance on major customers and suppliers; our ability to keep up with rapid technological change; our ability to compete successfully in competitive markets; fluctuations in the timing and volumes of customer demand; the unavailability of appropriate levels of manufacturing capacity; and general industry and macro-economic conditions. For additional information, see the documents filed by LSI with the Securities and Exchange Commission, and specifically the risk factors set forth in the company’s most recent report on Form 10-K. LSI disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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About LSI

LSI Corporation (NYSE: LSI) designs semiconductors and software that accelerate storage and networking in datacenters and mobile networks. Our technology is the intelligence critical to enhanced application performance, and is applied in solutions created in collaboration with our partners. More information is available at www.lsi.com.

LSI and the LSI & Design logo are trademarks or registered trademarks of LSI Corporation.

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For more information, contact:

Investor Relations Contact:                                                                                    Media Relations Contact:

Sujal Shah                                                                                                                   Greg Thomas

610-712-5471                                                                                                               408-433-4236

sujal.shah@lsi.com                                                                          greg.thomas@lsi.com

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