8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 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): July 11, 2008

Applied Micro Circuits Corporation

(Exact name of registrant as specified in its charter)

DELAWARE	000-23193	94-2586591
(State or other jurisdiction	(Commission File Number)	(I.R.S. Employer
of incorporation)		Identification No.)

215 Moffett Park Drive, Sunnyvale, California 94089

(Address of principal executive offices)

(408) 542-8600

(Registrant’s telephone number, including area code)

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

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

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

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

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

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

Item 1.01 Entry into a Material Definitive Agreement.

On July 11, 2008, Applied Micro Circuits Corporation (“AMCC”) entered into a patent purchase agreement (the “Patent Purchase Agreement”) with QUALCOMM Incorporated (“Qualcomm”). Pursuant to the agreement, AMCC has agreed to sell to Qualcomm a series of AMCC’s patents, patent applications and associated rights related to certain AMCC technologies (collectively, the “Assigned Patent Rights”) in consideration for an aggregate purchase price of $33 million. The purchase price will be paid by Qualcomm over the next three years.

Under the Patent Purchase Agreement, AMCC and its affiliates have retained a worldwide and non-exclusive right to manufacture and sell existing AMCC products that utilize technology covered by the patents.

The Patent Purchase Agreement includes customary representations, warranties and covenants by AMCC. Prior to the due date of the final purchase price payment, Qualcomm is permitted to withhold a portion of the total purchase price from its payment in the event of a breach by AMCC of the representations or warranties that have been made by AMCC under the Patent Purchase Agreement.

Item 8.01 Other Events.

AMCC intends to provide non-confidential details regarding the Patent Purchase Agreement in its regularly scheduled conference call to announce its unaudited financial results for the quarter ended June 30, 2008.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits.

99.1 AMCC Signs Major IP Monetization Contract press release dated July 15, 2008.

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.

	Applied Micro Circuits Corporation
Date: July 15, 2008	By:	/s/ Cynthia J. Moreland
		Cynthia J. Moreland
		Vice President and General Counsel

EX-99.1

Exhibit 99.1

Applied Micro Circuits Corporation Signs Major IP
Monetization Contract

Sunnyvale, CA — July 15, 2008 — Applied Micro Circuits Corporation (NASDAQ: AMCC), a global leader in embedded Power Architecture^® processing, optical transport and storage solutions announced it recently signed an agreement for the sale of certain patents which provides the Company with an “intellectual property revenue stream” totaling $33 million that will be payable over the next 3 years. A total of $3 million of this amount is to be received by the Company and reflected in its September quarter revenues. We believe this transaction validates AMCC’s IP Monetization Program and further enhances AMCC’s leadership position with key players in the industry.

AMCC is a company rich in intellectual property. During the last three years the strategic direction of the Company has changed in such a way that certain valuable patents are no longer core to its strategic direction. These patents relate to non-core products, foundry and other items that are not relevant to the Company’s product road maps. As such, AMCC has embarked on a program to monetize this intellectual property and to consider further productization of its strategic and non-strategic patents and related patent rights.

The specific terms of the transaction are confidential, but the Company retains a right to continue using the claimed inventions in the transferred patents in conducting its current and future business. The Company’s Chief Financial Officer, Bob Gargus, stated: “As a company, we have invested a large percentage of our revenues on research and development and this is a great way to improve our overall return from these investments. This is a project we started back in calendar 2006 when we broke out the non-focus revenues and began to analyze our patent portfolio in detail. This contract boosts our IP Monetization Program; a program that we hope will result in a sustainable long-term IP revenue stream in the next three-to-five years.”

AMCC’s IP Monetization Program involves the use of an elite group of specialists with deep technology backgrounds and broad market awareness. They are chartered to analyze multiple markets and technologies and architect next generation solutions that will be available to seed new opportunities. The group guides the Company in building an IP portfolio consisting of many broad patents with the goal of protecting these valuable solutions and staking a claim on the IP landscape before the Company’s competitors. We believe this helps ensure alignment with both our existing and targeted markets while adding a steady stream of new innovations and patents to the portfolio.

About AMCC

AMCC provides leadership semiconductor solutions to process, transport, and store digital information for the world’s wired and wireless networks. As a leading supplier of Power Architecture™ based processors and with world-class expertise in SONET and Ethernet protocol processing, PHY technology, Storage processors and RAID controllers our products are the foundation of the IP Communications Revolution. AMCC’s 3ware^® SAS and SATA RAID controllers deliver cost-effective, high-performance, high-capacity storage for enterprises and consumers worldwide in applications like disk-to-disk backup, near-line storage, network-attached storage (NAS), video, and high-performance computing. For further information regarding AMCC, please visit our website at http://www.amcc.com.

Forward Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as, anticipates, believes, should, anticipate, will or words of similar meaning. Such forward-looking statements, including statements relating to the Company’s anticipated future IP revenue stream, the

impact of this agreement on the Company’s reputation in its industry, the ability of the Company’s employees to develop new opportunities in the future and the Company’s goal to add new innovations and patents to its IP and product portfolio discussed in this press release, are subject to a number of risks and uncertainties. These risks include, but are not limited to, the risk that the Company may not be able to capitalize on some of the benefits expected to result from the agreement, risks that the Company may not be able to enter into other IP monetization transactions in the future on favorable terms, or at all, risks that the Company’s employees may not continue to develop new patents or innovate other IP or products in the future, risks relating to general economic conditions, as well as the risks and uncertainties set forth in the Company’s Annual Report on Form 10-K, and in the Company’s other SEC filings. As a result of these risks and uncertainties, actual results may differ materially from these forward-looking statements. The forward-looking statements contained in this press release are made as of the date hereof and AMCC does not assume any obligation to update any forward-looking statement, whether as a result of new information, future developments or otherwise.

AMCC and 3ware are registered trademarks of APPLIED MICRO CIRCUITS CORPORATION. Power Architecture is a trademark licensed by Power.org. All other trademarks are property of their respective owners.

SOURCE: Applied Micro Circuits Corporation

Corporate Contact

Applied Micro Circuits Corporation
Gilles Garcia
(o) 408-542 8687
(c) 408-786-4317
ggarcia@amcc.com