SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

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¨ Definitive Proxy Statement

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¨ Soliciting Material Pursuant to §240.14a-12

EXAR CORPORATION

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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      Common Stock

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¨ Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

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The following is supplementary information provided to Institutional Shareholders Services.

Historical Performance

Market Capitalization (in millions)

Ticker 09/ 19/ 05 5-Year High % of 5-Year High

AMCC $858 $ 26,670 3%

MSPD 220 1,080 20

PMCS 1,620 34,401 5

TXCC 175 6,128 3

VTSS 468 16,610 3

Median 468 16,610 3

EXAR $ 593 $ 2,400 25%

Source: Factset as of September 19, 2005

Note: MSPD completed its initial public offering on June 23, 2003.

REVENUE BREAKDOWN

FY 04

23%

20%

57%

FY 06 Q1

36%

4%

60%

FY 05

29%

63%

8%

Transmission

Serial

Video & Imaging

EXPANDED PEER COMPARISON

+40%

+20%

0%

-20%

-40%

-60%

-80%

-100%

EXAR CP

as of 11-Oct-2005

EXAR CRUS LU CTLM VTSS

EXAR

Cirrus Logic

Lucent

Centillium

Vitesse

Jan01

Jan02

Jan03

Jan04

Jan05

Copyright 2005 Yahoo! Inc.

http://finance.yahoo.com/

EXPANDED PEER COMPARISON

+40%

+20%

0%

-20%

-40%

-60%

-80%

-100%

EXAR CP

as of 11-Oct-2005

EXAR Broadcom Agere PMC Sierra AMCC

EXAR

BRCM

AGR

PMCS

AMCC

Jan01

Jan02

Jan03

Jan04

Jan05

Copyright 2005 Yahoo! Inc.

http://finance.yahoo.com/

EXPANDED PEER COMPARISON

+40%

+20%

0%

-20%

-40%

-60%

-80%

-100%

EXAR CP

as of 11-Oct-2005

EXAR IDTI Mind-speed Conexant Transwitch

EXAR

MSPD

IDTI

CNXT

TXCC

Jan01

Jan02

Jan03

Jan04

Jan05

Copyright 2005 Yahoo! Inc.

http://finance.yahoo.com/