Exhibit 99.1

FOR ADDITIONAL INFORMATION:
Investor Relations Contact:	Media/Editorial Contact:
Applied Micro Circuits Corporation	The Ardell Group
Debra Hart	Angela Edgerton
Phone: (858) 535-4217	Phone: (858) 792-2941
E-Mail: dhart@amcc.com	E-Mail: angela@ardellgroup.com

Wednesday, January 26, 2005

Company Press Release

APPLIED MICRO CIRCUITS CORPORATION ANNOUNCES

THIRD QUARTER FISCAL 2005 FINANCIAL RESULTS

SAN DIEGO—January 26, 2005—Applied Micro Circuits Corporation [NASDAQ: AMCC] today reported its financial results for the third quarter of fiscal 2005.

Net revenues for the third quarter of fiscal 2005 were $61.1 million compared to $61.1 million reported in the second quarter of fiscal 2005 and $38.2 million reported in the third quarter of fiscal 2004.

For the third quarter of fiscal 2005, on a generally accepted accounting principles (GAAP) basis, the net loss was $81.9 million or $(0.27) per share, compared with a net loss of $18.3 million or $(0.06) per share for the second quarter of fiscal 2005 and a net loss of $26.4 million or $(0.09) per share for the third quarter of fiscal 2004.

The pro forma net loss for the third quarter of fiscal 2005 was $4.1 million or $(0.01) per share, compared to the pro forma net loss of $4.1 million or $(0.01) per share in the second quarter of fiscal 2005 and the pro forma net loss of $7.1 million or $(0.02) per share in the third quarter of fiscal 2004.

Net revenues for the nine months ended December 31, 2004 were $189.6 million compared to $83.8 million reported for the nine months ended December 31, 2003.

The GAAP net loss for the nine months ended December 31, 2004 was $122.0 million or $(0.39) per share, compared to the net loss of $102.7 million or $(0.34) per share for the nine months ended December 31, 2003. The pro forma net loss for the nine months ended December 31, 2004 was $6.0 million or $(0.02) per share, compared with the pro forma net loss of $23.1 million or $(0.08) per share for the nine months ended December 31, 2003.

Commenting on the results, Tom Tullie, Chief Operating Officer, said, “The operating results we announced today are in-line with our expectations for the quarter. I am encouraged that our Communications, Storage and Embedded Products groups all saw sequential revenue growth. In addition, our recent actions to reduce operating expenses position us to achieve pro forma EPS profitability in the near future.”

AMCC reports its financial results in accordance with GAAP and additionally on a non-GAAP basis referred to as pro forma. These pro forma measures are not in accordance with, nor are they a substitute for, GAAP measures and may not be consistent with the presentation used by other companies. AMCC uses the pro forma financial measures to evaluate and manage the Company’s operations. AMCC is providing this information to investors to allow for the performance of additional financial analysis and because it is consistent with the financial models and estimates published by analysts who follow the Company.

During the third quarter ended December 31, 2004, AMCC recorded a $27.3 million charge for the impairment of purchased intangibles, a $28.9 million net charge for settlement of pending securities class-action litigation, and an $8.1 million charge for restructuring costs associated with the November workforce reduction.

The pro forma results exclude the following items which are required by GAAP: restructuring costs, amortization and impairments of purchased intangibles, excess inventory benefit, acquired in-process research and development charges, stock-based compensation charges related to acquired companies, litigation settlement costs, real estate gains, realized gains and losses on strategic equity investments, and payroll tax effects of stock option exercises. Income taxes are adjusted to an estimated pro forma effective tax rate. See the attached reconciliation of the GAAP net loss to the pro forma net income or loss, which quantifies the amounts excluded from pro forma basis results.

For More Information

AMCC management will be holding a conference call today, January 26, 2005, at 2:00 p.m. Pacific Time/5:00 p.m. Eastern Time to discuss additional details regarding the Company’s performance for the third quarter of fiscal 2005 and to provide guidance for the fourth quarter of fiscal 2005. You may access the conference call via any of the following:

Teleconference:	913-981-4910
Conference ID:	624714
Web Broadcast:	http://www.amcc.com
Replay:	719-457-0820
	(available for 7 days following the call)

AMCC Overview

AMCC provides the essential building blocks for the processing, moving and storing of information worldwide. The company blends systems and software expertise with high-performance, high-bandwidth silicon integration to deliver silicon, hardware and software

solutions for global wide area networks (WAN), embedded applications such as PowerPC and programmable SOC architectures, storage area networks (SAN), and high-growth storage markets such as Serial ATA (SATA), and RAID. AMCC’s corporate headquarters are located in San Diego, California. Sales and engineering offices are located throughout the world. For further information regarding AMCC, please visit our web site at http://www.amcc.com.

This news release contains forward-looking statements, including, but not limited to, statements regarding the company’s expectations of future profitability and the magnitude of charges resulting from the settlement of pending litigation. These forward looking statements are only predictions based on current information and expectations and are subject to certain risks and uncertainties, including, but not limited to, customer demand for the Company’s products, the businesses of the Company’s major customers, reductions, rescheduling or cancellation of orders by the Company’s customers, successful and timely development of products, market acceptance of new products, integration of acquired businesses, manufacturing capacity and execution, the risk that the settlement will not be approved by the court or that the charges resulting from the settlement will be higher than expected due to inability to obtain the company’s insurers’ agreed upon contribution to the settlement and general economic conditions. More information about potential factors that could affect the Company’s business and financial results is included in the “Risk Factors” set forth in the Company’s Annual Report on Form 10-K for the year ended March 31, 2004, and the Company’s other filings with the Securities and Exchange Commission. Actual results could differ materially, as a result of such factors, from those set forth in the forward-looking statements.

-Financial Tables Follow-

APPLIED MICRO CIRCUITS CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

($ in thousands)

	Dec 31, 2004		March 31, 2004
	(unaudited)
ASSETS
Current assets:
Cash, cash equivalents and short-term investments	$	405,970	$	861,041
Accounts receivable, net		22,304		23,284
Inventories		19,847		8,490
Other current assets		46,623		16,208
Total current assets		494,744		909,023
Property and equipment, net		47,102		37,271
Other assets		1,999		1,616
Purchased intangibles		544,892		240,193
Total assets	$	1,088,737	$	1,188,103
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	14,164	$	18,164
Other current liabilities		109,657		49,089
Current portion of long-term debt & capital leases		103		303
Total current liabilities		123,924		67,556
Stockholders’ equity		964,813		1,120,547
Total liabilities and stockholders’ equity	$	1,088,737	$	1,188,103

APPLIED MICRO CIRCUITS CORPORATION

GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands, except per share data)

	Three months ended									Nine Months ended
	Dec 31, 2004			Sept 30, 2004			Dec 31, 2003			Dec 31, 2004			Dec 31, 2003
Net revenues	$	61,081		$	61,069		$	38,189		$	189,552		$	83,823
Cost of revenues		30,159			31,529			17,471			93,180			36,739
Gross profit		30,922			29,540			20,718			96,372			47,084
Operating expenses:
Research and development		31,411			31,702			30,052			94,103			85,280
Selling, general and administrative		15,887			15,298			13,493			45,563			34,892
Stock-based compensation:
Research and development		752			915			2,142			2,699			14,846
Selling, general and administrative		876			2,202			375			4,401			4,826
Amortization of purchased intangibles		1,833			1,962			689			5,352			689
Impairment of purchased intangibles		27,330			—			—			27,330			—
Acquired in-process research and development		—			—			16,100			13,400			21,800
Restructuring charges(benefits)		8,079			310			(200	)		8,389			23,298
Litigation settlement, net		28,900			—			—			28,900			—
Total operating expenses		115,068			52,389			62,651			230,137			185,631
Operating loss		(84,146	)		(22,849	)		(41,933	)		(133,765	)		(138,547	)
Interest and other income, net		4,780			4,530			15,493			14,591			35,807
Loss before income taxes		(79,366	)		(18,319	)		(26,440	)		(119,174	)		(102,740	)
Income tax expense		2,526			—			—			2,861			—
Net loss	$	(81,892	)	$	(18,319	)	$	(26,440	)	$	(122,035	)	$	(102,740	)
Basic and diluted loss per share:
Loss per share	$	(0.27	)	$	(0.06	)	$	(0.09	)	$	(0.39	)	$	(0.34	)
Shares used in calculating basic and diluted loss per share		307,729			310,128			306,823			309,792			305,273

APPLIED MICRO CIRCUITS CORPORATION

PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands, except per share data)

	Three months ended									Nine months ended
	Dec 31, 2004			Sept 30, 2004			Dec 31, 2003			Dec 31, 2004			Dec 31, 2003
Net revenues	$	61,081		$	61,069		$	38,189		$	189,552		$	83,823
Cost of revenues		23,761			23,823			14,132			72,219			30,920
Gross profit		37,320			37,246			24,057			117,333			52,903
Operating expenses:
Research and development		31,411			31,702			30,038			94,103			85,261
Selling, general and administrative		15,887			15,298			13,414			45,561			34,810
Total operating expenses		47,298			47,000			43,452			139,664			120,071
Operating loss		(9,978	)		(9,754	)		(19,395	)		(22,331	)		(67,168	)
Interest and other income, net		4,780			4,530			7,080			14,591			27,394
Loss before income taxes		(5,198	)		(5,224	)		(12,315	)		(7,740	)		(39,774	)
Income tax benefit		(1,144	)		(1,149	)		(5,171	)		(1,703	)		(16,703	)
Net loss	$	(4,054	)	$	(4,075	)	$	(7,144	)	$	(6,037	)	$	(23,071	)
Diluted loss per share:
Loss per share	$	(0.01	)	$	(0.01	)	$	(0.02	)	$	(0.02	)	$	(0.08	)
Shares used in calculating diluted loss per share		307,729			310,128			306,823			309,792			305,273

The above pro forma statements are based on the Company’s consolidated statements of operations for the periods presented. This pro forma information is not prepared in accordance with generally accepted accounting principles and may not be consistent with the presentation used by other companies. The pro forma operating results are used by the Company’s management to evaluate the operating performance of the Company and are also consistent with the financial models and estimates published by analysts who follow the Company. See the schedule of pro forma adjustments for a reconciliation of the pro forma results to the GAAP basis results.

APPLIED MICRO CIRCUITS CORPORATION

RECONCILIATION OF GAAP TO PRO FORMA NET INCOME/LOSS

(unaudited)

(in thousands)

	Three months ended									Nine months ended
	Dec 31, 2004			Sept 30, 2004			Dec 31, 2003			Dec 31, 2004			Dec 31, 2003
GAAP net loss	$	(81,892	)	$	(18,319	)	$	(26,440	)	$	(122,035	)	$	(102,740	)
Adjustments:
Stock-based compensation related to acquired companies		1,975			3,246			2,670			7,731			20,214
Amortization of purchased intangibles		7,884			9,539			3,865			25,682			7,008
Impairments of purchased intangibles		27,330			—			—			27,330			—
Restructuring costs(benefits)		8,079			310			(200	)		8,389			23,298
Litigation settlement, net		28,900			—			—			28,900			—
Gain on the sale of real estate		—			—			(7,551	)		—			(7,551	)
Realized gains on strategic equity investments		—			—			(862	)		—			(862	)
Excess inventory benefit		—			—			—			—			(1,053	)
Acquired in-process research and development		—			—			16,100			13,400			21,800
Payroll taxes on certain stock option exercises		—			—			103			2			112
Income tax adjustments		3,670			1,149			5,171			4,564			16,703
Total GAAP to pro forma adjustments		77,838			14,244			19,296			115,998			79,669
Pro forma net loss	$	(4,054	)	$	(4,075	)	$	(7,144	)	$	(6,037	)	$	(23,071	)
Per share reconciliation:
GAAP loss per share	$	(0.27	)	$	(0.06	)	$	(0.09	)	$	(0.39	)	$	(0.34	)
GAAP to pro forma adjustments		0.26			0.05			0.07			0.37			0.26
Pro forma loss per share	$	(0.01	)	$	(0.01	)	$	(0.02	)	$	(0.02	)	$	(0.08	)

APPLIED MICRO CIRCUITS CORPORATION

SCHEDULE OF SELECTED PRO FORMA ADJUSTMENTS

(unaudited)

(in thousands)

The following schedule reconciles selected line items from the GAAP basis statements of operations to the pro forma statements of operations:

	Three months ended									Nine months ended
	Dec 31, 2004			Sept 30, 2004			Dec 31, 2003			Dec 31, 2004			Dec 31, 2003
GROSS PROFIT:
GAAP gross profit	$	30,922		$	29,540		$	20,718		$	96,372		$	47,084
Amortization of purchased intangibles		6,051			7,577			3,176			20,330			6,319
Excess inventory charge (benefit)		—			—			—			—			(1,053	)
Stock-based compensation related to acquired companies		347			129			153			631			542
Payroll taxes on certain stock option exercises		—			—			10			—			11
Pro forma gross profit	$	37,320		$	37,246		$	24,057		$	117,333		$	52,903
OPERATING EXPENSES:
GAAP operating expenses	$	115,068		$	52,389		$	62,651		$	230,137		$	185,631
Amortization of purchased intangibles		1,833			1,962			689			5,352			689
Impairment of purchased intangibles		27,330			—			—			27,330			—
Acquired in-process research and development		—			—			16,100			13,400			21,800
Stock-based compensation related to acquired companies		1,628			3,117			2,517			7,100			19,672
Restructuring costs (benefits)		8,079			310			(200	)		8,389			23,298
Litigation settlement, net		28,900			—			—			28,900			—
Payroll taxes on certain stock option exercises		—			—			93			2			101
Pro forma operating expenses	$	47,298		$	47,000		$	43,452		$	139,664		$	120,071
INTEREST AND OTHER INCOME, NET
GAAP interest and other income, net	$	4,780		$	4,530		$	15,493		$	14,591		$	35,807
Gain on the sale of real estate		—			—			(7,551	)		—			(7,551	)
Realized gains on strategic equity investments		—			—			(862	)		—			(862	)
Pro forma interest and other income, net	$	4,780		$	4,530		$	7,080		$	14,591		$	27,394
INCOME TAX BENEFIT:
GAAP income tax expense	$	2,526		$	—		$	—		$	2,861		$	—
Income tax adjustments		(3,670	)		(1,149	)		(5,171	)		(4,564	)		(16,703	)
Pro forma income tax benefit	$	(1,144	)	$	(1,149	)	$	(5,171	)	$	(1,703	)	$	(16,703	)