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: May 4, 2006

(Date of earliest event reported)

California Micro Devices Corporation

(Exact name of registrant as specified in its charter)

California	0-15449	94-2672609
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

430 N. McCarthy Blvd., No. 100, Milpitas, CA 95035-5112

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (408) 263-3214

N/A

(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 obligations 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))

TABLE OF CONTENTS

Item 2.02 Results of Operations and Financial Condition

Item 9.01 Financial Statements and Exhibits

Item 2.02. Results of Operations and Financial Condition.

On May 4, 2006, Registrant announced via news release its results for its fiscal 2006 fourth quarter and for the full 2006 fiscal year ended March 31, 2006. The full text of the news release issued in connection with that announcement is attached as Exhibit 99.1 to this Current Report on Form 8-K.

Use of Non-GAAP Financial Information

Certain disclosures prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP) included in the press release are accompanied by disclosures that are not prepared in conformity with GAAP. Management has determined that inclusion of these disclosures provides investors a meaningful presentation of the company’s operating results in addition to the GAAP disclosure. These non-GAAP condensed consolidated statements of operations are provided to enhance overall understanding of our current financial performance and how management views our operating results. The presentation of this non-GAAP information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP and is not necessarily comparable to non-GAAP results published by other companies. These non-GAAP disclosures and management’s rationale for providing them are as follows:

Partial Release of Valuation Allowance Against Deferred Tax Asset. The Company has recorded an accrual for its deferred tax asset which represents potential reduced taxes in the future should the Company realize taxable income. Because of the uncertainty of being able to use that deferred tax asset, the Company had established a valuation allowance against that deferred tax asset. Until March 31, 2006, that valuation allowance had been equal to the full amount of the deferred tax asset. In balancing the positive and negative evidence, the Company now believes that is more likely than not that $2.7 million dollars of the deferred tax asset will be utilized in the foreseeable future and accordingly has released $2.7 million of the valuation allowance. The release of this valuation allowance creates a negative tax rate and as a result increases our after tax income. However, it does not affect the taxes we pay currently. In the future, depending upon our results and perception of our future results, there may be future releases against our valuation allowance or we may accrete the valuation allowance. Given the significance and non-cash nature of the valuation allowance release, the income resulting from the corresponding change in our tax rate has been excluded from the non-GAAP presentation of our operating results.

The information contained in this Current Report on Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit 99.1, Registrant’s News Release dated May 4, 2006, is furnished pursuant to Item 2.02 of Form 8-K.

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this Report on Form 8-K to be signed on its behalf by the undersigned, thereunto duly authorized on the 4^th day of May, 2006.

CALIFORNIA MICRO DEVICES CORPORATION
(Registrant)
By:	/s/ ROBERT V. DICKINSON
	Robert V. Dickinson
	President and Chief Executive Officer

Exhibit Index

Exhibit	Description
99.1	Registrant’s news release dated May 4, 2006, is furnished pursuant to Item 2.02 of Form 8-K.

EX-99.1

Exhibit 99.1

NEWS RELEASE

For More Information Contact:

Kevin Berry, Chief Financial Officer

(408) 934-3144

kevinb@cmd.com

California Micro Devices Reports March Quarter and Fiscal 2006 Financial Results

Fiscal 2006 revenue and net income increase year on year, achieving all time highs

MILPITAS, Calif. — May 4, 2006 — California Micro Devices (Nasdaq: CAMD) today announced financial results for the fourth quarter of fiscal 2006, which ended March 31, 2006. Revenue was $17.4 million compared to $14.5 million a year ago. On a GAAP basis, diluted earnings per share were $0.22 compared to a loss of $0.05 a year ago. Non-GAAP diluted earnings were $0.10 per share, excluding the effect of a partial release of the valuation allowance associated with the net deferred tax asset in the amount of $2.7 million. The loss in the year ago quarter included restructuring charges of $270,000.

Fiscal 2006 revenue reached an all time high of $70.2 million compared to the record $65.9 million posted a year ago. On a GAAP basis, diluted earnings per share were $0.44 compared to $0.18 a year ago. Non-GAAP diluted earnings were a record $0.32 per share, excluding the effect of the partial release of the valuation allowance mentioned above. Fiscal 2005 results included restructuring charges of approximately $1.3 million.

“I am pleased to report that in Q4 we achieved revenue just below the high end of our guidance and that our gross margin percentage and pro forma EPS exceeded the high end of our guidance;” said Robert V. Dickinson, president and chief executive officer. “Revenue from both mobile handsets and from personal computers and digital consumer electronics showed strong growth year on year and we set a new record for low capacitance ESD revenue as the result of strong growth of both PicoGuard™ and MediaGuard™ shipments. Bookings rebounded to $18.5 million in Q4 and design wins reached record levels.

“Our Q4 represented a solid finish for fiscal 2006 in which we achieved new records for revenue, net income, cash, bookings and design wins and the highest gross margin percentage in more than ten years. This is especially notable in light of our exit from non-core businesses at the end of fiscal 2005.” Dickinson summarized fiscal 2006 achievements as follows:

• Core revenue growth of 30 percent

• Third consecutive year of profitability with pro forma diluted EPS reaching a record $0.32

• Gross margin of 37.3 percent, highest in 10 years

• Mobile handset product revenue growth of 35 percent

• Personal computer and digital consumer electronics product revenue growth of 13 percent

• Low capacitance ASIP unit shipments, revenue and design wins all more than tripled

• Ending cash balance of $49.7 million, up 38 percent from last year

• 1,436 design wins, up 18 percent from last year

• Sale of Tempe AZ facility, completing the transition to a fully fabless business model

• Initiated the Arques Technology acquisition to strengthen analog design team, LED driver portfolio and Asia presence

California Micro Devices Corporation • 490 N. McCarthy Blvd. #100, Milpitas, CA 95035-5112

www.calmicro.com • Tel: 408.263-3214 • Fax: 408.263-7846

Conference Call and Webcast Today

California Micro Devices will hold a conference call today at 2:00 p.m. Pacific Time to discuss its March quarter and fiscal 2006 results. Within the USA, interested parties can access the conference call by dialing 866-250-3615. International parties may gain access by dialing 303-262-2194. No password is necessary.

A replay of the conference call will be available on the company’s web site at www.calmicro.com (Investor Relations Link) beginning at approximately 4:00 p.m. Pacific Time today and continuing about a year.

About California Micro Devices Corporation

California Micro Devices Corporation is a leading supplier of application specific analog semiconductor products for the mobile handset, personal computer and digital consumer electronics markets. Key products include Application Specific Integrated Passive™ (ASIP™) devices and selected high value mixed signal ICs. Detailed corporate and product information may be accessed at www.calmicro.com.

All statements contained in this press release that are not historical facts are forward-looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. They are not guarantees of future performance or events. Rather, they are based on current expectations, estimates, beliefs, assumptions, and goals and objectives and are subject to uncertainties that are difficult to predict. As a result, our actual results may differ materially from the statements made. Often such statements can be identified by their use of words such as will, intends, expects, plans, believes, anticipates, and estimates. These forward-looking statements are based upon our assumptions about and assessment of the future, which may or may not prove true, and involve a number of risks and uncertainties including the risk factors detailed in the company’s Form 8K, 10K, and 10Q filings with the Securities and Exchange Commission. Due to these and other risks, the company’s future actual results could differ materially from those discussed above. These forward-looking statements speak only as to the date of this release, and, except as required by law, we undertake no obligation to publicly release updates or revisions to these statements whether as a result of new information, future events, or otherwise.

# # #

ASIP^TM, Application Specific Integrated Passive^TM, PicoGuard^TM and MediaGuard^TM are trademarks of California Micro Devices.

All other trademarks are property of their respective owners

California Micro Devices Corporation Ÿ 490 N. McCarthy Blvd. #100, Milpitas, CA 95035-5112

www.calmicro.com Ÿ Tel: 408.263-3214 • Fax: 408.263-7846

California Micro Devices Corporation

CONDENSED BALANCE SHEETS

(amounts in thousands, except share data)

(Unaudited)

	March 31,			March 31,
	2006			2005
ASSETS
Current assets:
Cash and cash equivalents	$	9,788		$	13,830
Short-term investments		39,958			22,245
Accounts receivable, less allowance for doubtful accounts of $146 and $74, respectively		10,667			7,574
Inventories		5,508			6,532
Deferred tax assets		2,711			—
Prepaid expenses and other current assets		1,078			1,286
Total current assets		69,710			51,467
Property, plant and equipment, net		3,961			6,038
Other long-term assets		61			172
TOTAL ASSETS	$	73,732		$	57,677
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	5,901		$	4,523
Accrued liabilities		3,185			3,762
Deferred margin on shipments to distributors		2,684			2,520
Current maturities of long-term debt and capital lease obligations		82			100
Total current liabilities		11,852			10,905
Long-term debt and capital leases, less current maturities		—			90
Other long-term liabilities		8			21
Total liabilities		11,860			11,016
Commitments and contingencies
Shareholders’ equity:
Common stock - no par value; 50,000,000 shares authorized; shares issued and outstanding: 22,855,223 and 21,605,315 as of March 31, 2006 and 2005, respectively		110,673			105,494
Accumulated other comprehensive loss		(5	)		(2	)
Accumulated deficit		(48,796	)		(58,831	)
Total shareholders’ equity		61,872			46,661
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	73,732		$	57,677

California Micro Devices Corporation

CONDENSED STATEMENTS OF OPERATIONS

(amounts in thousands, except per share data)

(Unaudited)

(On a GAAP basis)

	Three Months Ended March 31,						Twelve Months Ended March 31,
	2006			2005			2006			2005
Net sales	$	17,395		$	14,497		$	70,241		$	65,869
Cost and expenses:
Cost of sales		10,575			10,630			44,068			42,085
Research and development		1,496			1,533			6,817			5,181
Selling, general and administrative		3,546			3,275			13,348			13,240
Restructuring expense/(benefit)		(20	)		270			39			1,325
Total costs and expenses		15,597			15,708			64,272			61,831
Operating income (loss)		1,798			(1,211	)		5,969			4,038
Other income, net		503			190			1,491			129
Income (loss) before income taxes		2,301			(1,021	)		7,460			4,167
Income taxes/(benefit)		(2,704	)		(30	)		(2,575	)		125
Net income (loss)	$	5,005		$	(991	)	$	10,035		$	4,042
Net income (loss) per share–basic	$	0.22		$	(0.05	)	$	0.45		$	0.19
Weighted average common shares outstanding–basic		22,802			21,555			22,128			21,318
Net income (loss) per share–diluted	$	0.22		$	(0.05	)	$	0.44		$	0.18
Weighted average common shares and share equivalents outstanding–diluted		23,031			21,555			22,777			22,582
Reconciliation of net income (loss) to non-GAAP net income (loss):
Net income (loss)	$	5,005		$	(991	)	$	10,035		$	4,042
Reconciling items:
Partial release of valuation allowance against deferred tax assets		(2,711	)		—			(2,711	)		—
Non-GAAP net income (loss)	$	2,294		$	(991	)	$	7,324		$	4,042
Non-GAAP:
Net income (loss) per share–basic	$	0.10		$	(0.05	)	$	0.33		$	0.19
Net income (loss) per share–diluted	$	0.10		$	(0.05	)	$	0.32		$	0.18
Shares used in calculation of non-GAAP:
Weighted average common shares outstanding–basic		22,802			21,555			22,128			21,318
Weighted average common shares and share equivalents outstanding–diluted		23,172			21,555			22,812			22,582

California Micro Devices Corporation

CONDENSED STATEMENTS OF OPERATIONS

(amounts in thousands, except per share data)

(Unaudited)

(On a non-GAAP basis)

	Three Months Ended March 31,						Twelve Months Ended March 31,
	2006			2005			2006		2005
Net sales	$	17,395		$	14,497		$	70,241	$	65,869
Cost and expenses:
Cost of sales		10,575			10,630			44,068		42,085
Research and development		1,496			1,533			6,817		5,181
Selling, general and administrative		3,546			3,275			13,348		13,240
Restructuring expense/(benefit)		(20	)		270			39		1,325
Total costs and expenses		15,597			15,708			64,272		61,831
Operating income (loss)		1,798			(1,211	)		5,969		4,038
Other income, net		503			190			1,491		129
Income (loss) before income taxes		2,301			(1,021	)		7,460		4,167
Income taxes		7			(30	)		136		125
Net income (loss)	$	2,294		$	(991	)	$	7,324	$	4,042
Net income (loss) per share–basic	$	0.10		$	(0.05	)	$	0.33	$	0.19
Weighted average common shares outstanding–basic		22,802			21,555			22,128		21,318
Net income (loss) per share–diluted	$	0.10		$	(0.05	)	$	0.32	$	0.18
Weighted average common shares and share equivalents outstanding–diluted		23,172			21,555			22,812		22,582

See accompanying reconciliation of GAAP measures to non-GAAP measures.

California Micro Devices Corporation

RECONCILIATION OF GAAP MEASURES TO NON-GAAP MEASURES

(Unaudited)

	Three Months Ended March 31,						Twelve Months Ended March 31,
Net income (loss) per share:	2006			2005			2006			2005
Basic:
GAAP net income (loss) per share	$	0.22		$	(0.05	)	$	0.45		$	0.19
Reconciling items:
Partial release of valuation allowance against deferred tax assets	$	(0.12	)	$	—		$	(0.12	)	$	—
Non-GAAP net income (loss) per share	$	0.10		$	(0.05	)	$	0.33		$	0.19
Diluted:
GAAP net income (loss) per share	$	0.22		$	(0.05	)	$	0.44		$	0.18
Reconciling items:
Partial release of valuation allowance against deferred tax assets	$	(0.12	)	$	—		$	(0.12	)	$	—
Non-GAAP net income (loss) per share	$	0.10		$	(0.05	)	$	0.32		$	0.18