Exhibit 99.1

PRESS RELEASE

Contact:

Kevin S. Bauer Vice President and CFO 510-668-7100 For Release October 28, 2010  

Exar Corporation Reports Fiscal 2011 Second Quarter Results

Fremont, California, October 28, 2010 – Exar Corporation (Nasdaq: EXAR) today reported financial results for its fiscal 2011 second quarter ended September 26, 2010.

Net sales for the second quarter of fiscal 2011 were $37.2 million compared to net sales of $39.6 million for the prior quarter and $31.6 million for the second quarter of fiscal 2010.

The GAAP gross margin for the second quarter of fiscal 2011 was 46.4% compared to 47.5% for the prior quarter and 44.6% in the second quarter of fiscal 2010.

On a non-GAAP basis, gross margin for the second quarter of fiscal 2011 was 50.8% compared to 52.1% for the prior quarter and 51.5% in the second quarter of fiscal 2010.

The GAAP net loss for the second quarter of fiscal 2011 was $4.5 million, or $0.10 net loss per share, compared to a net loss of $7.4 million, or $0.17 net loss per share, in the prior quarter, and a net loss of $8.2 million, or $0.19 net loss per share, for the second quarter of fiscal 2010.

On a non-GAAP basis, net income was breakeven for the second quarter of fiscal 2011, compared to a net loss of $0.8 million, or $0.02 net loss per share, in the previous quarter and a net loss of $2.7 million, or $0.06 net loss per share, in the second quarter of fiscal 2010.

The Company ended the second quarter of fiscal 2011 with cash, cash equivalents and short-term marketable securities of $208.2 million.

“While our second quarter 2011 revenue was impacted by lower demand from telecommunications and networking customers, continued strength from the industrial segment enabled positive EBITDA and breakeven net income both on a non-GAAP basis,” said Pete Rodriguez, the Company’s president and chief executive officer. “During the quarter, we continued to build a strong foundation of design wins for our leading products, we significantly reduced operating expenses and we made progress on several operational initiatives that will positively impact gross margin in the next fiscal year.”

For the third quarter of fiscal 2011 ending December 26, 2010, the Company projects that net sales will be between $36 million and $38 million. The non-GAAP gross margin is currently expected to be between 49% and 51%. Operating expenses are currently expected to be between $20.5 million and $21.5 million on a non-GAAP basis.

The Company’s statements about its future financial performance or operating plans are based on current information and expectations and the Company undertakes no duty to update such statements. These statements are forward-looking and actual results could differ materially due to various risks and uncertainties, some of which are described herein.

Results Conference Call

The Company invites investors, financial analysts, and the general public to listen to its conference call discussing the Company’s financial results for the second quarter of fiscal 2011, today, Thursday, October 28, 2010 at 1:30 p.m. PDT. To access the conference call, please dial (800) 700-7860 by 1:20 p.m. PDT and use conference ID number 174874. In addition, a live webcast will also be available.

To access the webcast, please go to the Company’s Investor Relations Homepage at: http://www.exar.com. A replay of the call will be available starting at 3:00 p.m. PDT the day of the call until 11:59 p.m. PDT on November 4, 2010. To access the replay, please dial (800) 475-6701 and use conference ID number 174874.

Product Line Highlights:

Interface

http://www.exar.com/Common/Content/News.aspx?id=8180

Communications

http://www.exar.com/Common/Content/News.aspx?id=7952

DataCom and Storage

http://www.exar.com/Common/Content/News.aspx?id=8126

Power Management

http://www.exar.com/Common/Content/News.aspx?id=7902

http://www.exar.com/Common/Content/News.aspx?id=8154

Safe Harbor Statement

The Company’s statements about its future financial performance, changes in gross margins, net sales and operating expenses, operational initiatives, resource allocation and its impact on future performance and product development initiatives, design win conversion, distribution and OEM trends, supply chain issues, among others, are forward-looking statements that involve risks and uncertainties. These risks and uncertainties include global financial volatility, economic recession, and industry and market conditions, such as customer and distributor relationships; limited visibility associated with customer or distributor demand for the Company’s products; the possible loss of, or decrease in orders from, an important customer; cash balances; vendor capacity, quality or throughput constraints; successful integration of acquired businesses; possible disruption in commercial activities as a consequence of terrorist activity, natural disasters, armed conflict or health issues; successful development, market acceptance and demand for the Company’s products, including those for which the Company has achieved design wins; competitive factors, such as pricing or competing solutions; customer ordering patterns; accounting considerations related to impairment analyses or acquisition related issues; the level of inventories maintained at the Company’s OEMs and distributors; and the Company’s successful execution of internal performance plans, as well as the other risks detailed from time to time in the Company’s SEC reports, including the Annual Report on Form 10-K for the year ended March 28, 2010 and the Quarterly Report on Form 10-Q for the period ended June 27, 2010.

Generally Accepted Accounting Principles

The Company reports its financial results in accordance with GAAP. Additionally, the Company supplements reported GAAP financials with non-GAAP measures which are included in related press releases and reports furnished to the SEC, copies of which are available at the Company’s website: http://www.exar.com or the SEC’s website at: http://www.sec.gov. For the periods presented, we are disclosing non-GAAP gross profit, non-GAAP gross margin, non-GAAP research and development expenses, non-GAAP selling, general and administrative expenses, non-GAAP operating expenses, non-GAAP operating loss, non-GAAP net income (loss), and non-GAAP diluted earnings (loss) per share, which are adjusted to exclude from our GAAP results all stock-based compensation expense, amortization of acquired intangible assets, fair value adjustment of acquired inventories, acquisition-related costs, separation costs of executive officers, impairment charges on investments, and income tax effects. These non-GAAP measures are presented in part to enhance the understanding of the Company’s historical financial performance and comparability between reporting periods. The Company believes the non-GAAP presentation, when shown in conjunction with the corresponding GAAP measures, provide relevant and useful information to analysts, investors, management and other interested parties following the semiconductor industry. For its internal purposes, the Company uses the foregoing non-GAAP measures to evaluate performance across reporting periods, determine certain employee benefits as well as plan for and forecast the Company’s future periods. These non-GAAP measures are not in accordance with, or an alternative for measures prepared in accordance with GAAP, and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. The Company believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the Company’s results of operations as determined in accordance with GAAP. These measures should only be used to evaluate the Company’s results of operations in conjunction with the corresponding GAAP measures.

About Exar

Exar Corporation delivers highly differentiated silicon, software and subsystem solutions for industrial, consumer, and enterprise applications. For nearly 40 years, Exar’s comprehensive knowledge of end-user markets along with the underlying analog/mixed signal and digital technologies has enabled innovative solutions that meet the needs of the evolving connected world. Exar’s technology portfolio includes solutions for power management, serial interfaces, packet-based and TDM wireline communications, enterprise storage optimization, and data security. Exar has locations worldwide providing real-time customer support to drive rapid product development. For more information about Exar, visit: www.exar.com.

# # # #

EXAR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share amounts)

(Unaudited)

	SEPTEMBER 26,			MARCH 28,
	2010			2010
ASSETS
Current assets:
Cash and cash equivalents	$	14,086		$	25,486
Short-term marketable securities		194,162			186,598
Accounts receivable (net of allowances of $793 and $831)		13,857			13,461
Accounts receivable, related party (net of allowances of $342 and $605)		3,963			4,323
Inventories		22,601			15,000
Other current assets		3,177			5,106
Total current assets		251,846			249,974
Property, plant and equipment, net		41,721			42,941
Goodwill		3,184			3,085
Intangible assets, net		26,009			31,957
Other non-current assets		5,048			5,357
Total assets	$	327,808		$	333,314
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	11,845		$	9,828
Accrued compensation and related benefits		7,161			6,619
Deferred income and allowances on sales to distributors		5,712			4,227
Deferred income and allowances on sales to distributors, related party		11,018			10,650
Other accrued expenses		8,699			10,598
Total current liabilities		44,435			41,922
Long-term lease financing obligations		12,888			13,454
Other non-current obligations		3,838			3,806
Total liabilities		61,161			59,182
Total stockholders’ equity
Preferred stock, $.0001 par value; 2,250,000 shares authorized; no shares outstanding		—			—
Common stock, $.0001 par value; 100,000,000 shares authorized; 44,251,257 and 43,839,514 shares issued and outstanding at September 26, 2010 and March 28, 2010, respectively (net of treasury shares)		4			4
Additional paid-in capital		724,899			720,455
Accumulated other comprehensive income		1,226			1,282
Treasury stock at cost, 19,924,369 shares at September 26, 2010 and March 28, 2010		(248,983	)		(248,983	)
Accumulated deficit		(210,499	)		(198,626	)
Total stockholders’ equity		266,647			274,132
Total liabilities and stockholders’ equity	$	327,808		$	333,314

Note: Certain amounts previously reported above have been reclassified to conform to the current period presentation.

EXAR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

	THREE MONTHS ENDED									SIX MONTHS ENDED
	SEPTEMBER 26,			JUNE 27,			SEPTEMBER 27,			SEPTEMBER 26,			SEPTEMBER 27,
	2010			2010			2009			2010			2009
Net sales	$	25,885		$	28,365		$	23,118		$	54,250		$	46,228
Net sales, related party		11,348			11,271			8,470			22,619			16,222
Total net sales		37,233			39,636			31,588			76,869			62,450
Cost of sales:
Cost of sales		13,205			14,079			11,843			27,284			24,732
Cost of sales, related party		5,222			5,188			4,088			10,410			7,876
Amortization of purchased intangible assets		1,515			1,553			1,567			3,068			2,907
Total cost of sales		19,942			20,820			17,498			40,762			35,515
Gross profit		17,291			18,816			14,090			36,107			26,935
Operating expenses:
Research and development		11,840			14,443			12,288			26,283			24,582
Selling, general and administrative		11,083			12,957			11,375			24,040			26,487
Total operating expenses		22,923			27,400			23,663			50,323			51,069
Loss from operations		(5,632	)		(8,584	)		(9,573	)		(14,216	)		(24,134	)
Other income and expense, net:
Interest income and other, net		1,578			1,613			1,700			3,191			3,454
Interest expense		(316	)		(318	)		(326	)		(634	)		(650	)
Impairment charges on investments		(62	)		—			(245	)		(62	)		(317	)
Total other income and expense, net		1,200			1,295			1,129			2,495			2,487
Loss before income taxes		(4,432	)		(7,289	)		(8,444	)		(11,721	)		(21,647	)
Provision for (benefit from) income taxes		27			125			(281	)		152			(609	)
Net loss	$	(4,459	)	$	(7,414	)	$	(8,163	)	$	(11,873	)	$	(21,038	)
Loss per share:
Basic loss per share	$	(0.10	)	$	(0.17	)	$	(0.19	)	$	(0.27	)	$	(0.48	)
Diluted loss per share	$	(0.10	)	$	(0.17	)	$	(0.19	)	$	(0.27	)	$	(0.48	)
Shares used in the computation of loss per share:
Basic		44,173			43,897			43,550			44,035			43,432
Diluted		44,173			43,897			43,550			44,035			43,432

Note: Certain amounts previously reported above have been reclassified to conform to the current period presentation.

EXAR CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL RECONCILIATION OF GAAP TO NON-GAAP RESULTS

(In thousands, except per share amounts)

(Unaudited)

	THREE MONTHS ENDED									SIX MONTHS ENDED
	SEPTEMBER 26,			JUNE 27,			SEPTEMBER 27,			SEPTEMBER 26,			SEPTEMBER 27,
	2010			2010			2009			2010			2009
Net Sales	$	37,233		$	39,636		$	31,588		$	76,869		$	62,450
GAAP gross profit	$	17,291		$	18,816		$	14,090		$	36,107		$	26,935
GAAP gross margin		46.4	%		47.5	%		44.6	%		47.0	%		43.1	%
Stock-based compensation		98			220			151			318			267
Amortization of acquired intangible assets		1,515			1,553			1,567			3,068			2,907
Fair value adjustment of acquired inventories		—			42			447			42			2,234
Acquisition-related costs		—			—			18			—			24
Non-GAAP gross profit		18,904			20,631			16,273			39,535			32,367
Non-GAAP gross margin		50.8	%		52.1	%		51.5	%		51.4	%		51.7	%
GAAP research and development expenses	$	11,840		$	14,443		$	12,288		$	26,283		$	24,582
Stock-based compensation		665			1,556			748			2,221			1,234
Amortization of acquired intangible assets		1,074			1,074			635			2,148			1,223
Acquisition-related costs		—			—			192			—			749
Non-GAAP research and development expenses	$	10,101		$	11,813		$	10,713		$	21,914		$	21,376
GAAP selling, general and administrative expenses	$	11,083		$	12,957		$	11,375		$	24,040		$	26,487
Stock-based compensation		751			1,546			767			2,297			1,474
Amortization of acquired intangible assets		297			298			179			595			321
Acquisition-related costs		—			328			620			328			4,546
Separation costs of executive officers		—			—			—			—			162
Non-GAAP selling, general and administrative expenses	$	10,035		$	10,785		$	9,809		$	20,820		$	19,984
GAAP operating expenses	$	22,923		$	27,400		$	23,663		$	50,323		$	51,069
Stock-based compensation		1,416			3,102			1,515			4,518			2,708
Amortization of acquired intangible assets		1,371			1,372			814			2,743			1,544
Acquisition-related costs		—			328			812			328			5,295
Separation costs of executive officers		—			—			—			—			162
Non-GAAP operating expenses	$	20,136		$	22,598		$	20,522		$	42,734		$	41,360
GAAP operating loss	$	(5,632	)	$	(8,584	)	$	(9,573	)	$	(14,216	)	$	(24,134	)
Stock-based compensation		1,514			3,322			1,666			4,836			2,975
Amortization of acquired intangible assets		2,886			2,925			2,381			5,811			4,451
Fair value adjustment of acquired inventories		—			42			447			42			2,234
Acquisition-related costs		—			328			830			328			5,319
Separation costs of executive officers		—			—			—			—			162
Non-GAAP operating loss	$	(1,232	)	$	(1,967	)	$	(4,249	)	$	(3,199	)	$	(8,993	)
GAAP net loss	$	(4,459	)	$	(7,414	)	$	(8,163	)	$	(11,873	)	$	(21,038	)
Stock-based compensation		1,514			3,322			1,666			4,836			2,975
Amortization of acquired intangible assets		2,886			2,925			2,381			5,811			4,451
Fair value adjustment of acquired inventories		—			42			447			42			2,234
Acquisition-related costs		—			328			830			328			5,319
Separation costs of executive officers		—			—			—			—			162
Impairment charges on investments		62			—			245			62			317
Income tax effects		32			33			(136	)		65			(288	)
Non-GAAP net income (loss)	$	35		$	(764	)	$	(2,730	)	$	(729	)	$	(5,868	)
GAAP loss per share	$	(0.10	)	$	(0.17	)	$	(0.19	)	$	(0.27	)	$	(0.48	)
Stock-based compensation		0.03			0.08			0.04			0.11			0.07
Amortization of acquired intangible assets		0.07			0.07			0.05			0.13			0.10
Fair value adjustment of acquired inventories		—			0.00			0.01			0.00			0.05
Acquisition-related costs		—			0.01			0.02			0.01			0.12
Separation costs of executive officers		—			—			—			—			0.00
Impairment charges on investments		0.00			—			0.01			0.00			0.01
Income tax effects		0.00			0.00			(0.00	)		0.00			(0.01	)
Non-GAAP diluted earnings (loss) per share	$	0.00		$	(0.02	)	$	(0.06	)	$	(0.02	)	$	(0.14	)
Shares used in earnings (loss) per share — GAAP		44,173			43,897			43,550			44,035			43,432
The effect of dilutive potential common shares due to reporting Non-GAAP net income		261			—			—			—			—
The effect of removing stock-based compensation expense under SFAS 123R for Non-GAAP presentation purpose		(329	)		—			—			—			—
Shares used in diluted earnings per share — Non-GAAP		44,105			43,897			43,550			44,035			43,432

Notes: Certain amounts may not total due to rounding.

Certain amounts previously reported above have been reclassified to conform to the current period presentation.