10-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(MARK ONE)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2012

OR

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ___________ TO _____________

Commission file number 0-25699

PLX Technology, Inc.

(Exact name of Registrant as Specified in its Charter)

Delaware	94-3008334
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)

870 W. Maude Avenue

Sunnyvale, California  94085

(408) 774-9060

(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class:	Name of Each Exchange on which Registered
Common Stock, par value $0.001 per share	The NASDAQ Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No [X].

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [X]

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]

        Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files). Yes [X]  No [  ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K, or any amendment to this Form 10-K.  [X]

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of "large accelerated filer", "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act (Check One):

Large accelerated filer [ ]Accelerated filer [X]Non-accelerated filer [ ] Smaller Reporting Company [ ]

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes [ ] No [X]

      The aggregate market value of the voting stock held by non-affiliates of the registrant, based upon the closing sale price of the registrant's common stock on June 30, 2012, as reported on The NASDAQ Global Market, was $265,952,815.

The number of shares of common stock outstanding at February 28, 2013was 45,410,784.

DOCUMENTS INCORPORATED BY REFERENCE

PART III OF THIS REPORT ON FORM 10-K INCORPORATES INFORMATION BY REFERENCE FROM THE REGISTRANT'S PROXY STATEMENT FOR ITS 2013 ANNUAL MEETING OF STOCKHOLDERS - ITEMS 10, 11, 12, 13 AND 14.

PLX Technology, Inc.

INDEX TO

ANNUAL REPORT ON FORM 10-K

FOR YEAR ENDED DECEMBER 31, 2012

Part I.		Page
Item 1.	Business	2
Item 1A.	Risk Factors	12
Item 1B.	Unresolved Staff Comments	20
Item 2.	Properties	21
Item 3.	Legal Proceedings	21
Item 4.	Mine Safety Disclosures	22
Part II.
Item 5.	Market for Registrant's Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities	23
Item 6.	Selected Financial Data	25
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	25
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	36
Item 8.	Financial Statements and Supplementary Data	36
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosures	36
Item 9A.	Controls and Procedures	37
Item 9B.	Other Information	37
Part III.
Item 10.	Directors, Executive Officers and Corporate Governance	38
Item 11.	Executive Compensation	38
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	38
Item 13.	Certain Relationships and Related Transactions, and Director Independence	38
Item 14.	Principal Accountant Fees and Services	38
Part IV.
Item 15.	Exhibits and Financial Statement Schedules	39
Signatures		75

PART I

ITEM 1: BUSINESS

Overview

PLX Technology, Inc. (“We”, "PLX" or the "Company"), designs, develops, manufactures, and sells integrated circuits that perform critical system connectivity functions.  These interconnect products are fundamental building blocks for standards-based electronic equipment.  The Company markets its products to major customers that sell electronic systems in the enterprise, consumer, server, storage, communications, PC peripheral and embedded markets.

The explosive growth of cloud-based computing has provided a significant opportunity for PLX, since the data centers that house these systems are limited by their ability to offer high performance, low cost, low power, scalable interconnections.  The level of integration is increasing, and the need for rapid expansion forces these customers to build their systems using standard-based, off-the-shelf devices.

The Company is a market share leader in stand-alone PCI Express switches and bridges.  We recognized the trend towards this serial, switched interconnect technology early, launched products for this market long before our competitors, and have deployed multiple generations of products to serve a general-purpose market.  In addition to enabling customer differentiation through our product features, the breadth of our product offering is in itself a significant benefit to our customers, since we can serve the complete needs of our customers with cost-effective solutions tailored to specific system requirements.  The Company supplies an extensive portfolio of PCI Express switches; PCI Express bridges that allow backward compatibility to the previous PCI standard; and our newest bridge enables seamless interoperability between two of the most popular mainstream interconnects: PCI Express and USB. Our long experience with PCI Express connectivity products enables PLX to deliver reliable devices that operate in non-ideal, real-world system environments.

Several trends within the data center are putting more emphasis on the performance and features of standard interconnection products.  These include:

·   High density data centers, which make the traditional solutions inadequate in terms of power dissipation and cost.

·   I/O Virtualization, which allows multiple host processors to share communication and storage devices.

·   Convergence, which enables different protocols to be delivered on standard, high volume interconnection technologies.

·   Solid State Disk (SSD) growth, which demands high bandwidth interconnection in order to scale effectively, and benefits from interconnection features that reduce overhead and increase performance.  The SSD market is growing at 2-3x annually.

In order to offer a complete solution portfolio to our customers, PLX also provides a wide range of connectivity bridges that allow systems that conform to different standards communicate with each other, and to enable low cost customer field-programmable gate arrays (FPGAs) and application-specific integrated circuits (ASICs) with non-standard interfaces to connect up to the mainstream interconnects.  Some of the more popular products in this family bridge PCI and USB to other types of interfaces.

PLX offers a complete solution consisting of semiconductor devices, software development kits, hardware design kits, software drivers, and firmware solutions that enable added-value features in our products.  We differentiate our products by offering higher performance at lower power, by enabling a richer customer experience based on proprietary features that enable system-level customer advantages, and by providing capabilities that enable a customer to get to market more quickly.

The Company has enhanced its systems and software capability in particular over the past several years.  This has become important, since the high level of integration of the silicon devices has driven more of the intelligence of the system into fewer devices.  This has made the architecture of the building blocks critical to overall system performance, and necessitates a closer relationship between the vendor and customer to achieve aggressive system operating goals.  In addition, the highly integrated solutions have become more complex, and both time-to-market goals and performance targets can only be reasonably attained if the device vendor supplies the appropriate software as part of the overall solution.  PLX’s customers view the Company as a resource from the start of their system development, choosing their architecture and making their trade-offs based on the features available in PLX products.

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The PLX growth strategy has several key components:

·   Identify the technology trends and discontinuities that drive high-volume markets and deliver highly differentiated products to that market before the competition;

·   Offer added-value features that enable our customers to differentiate their products;

·   Focus on adding value at competitive prices that enable high volume adoption of our customers’ solutions;

·   Deliver comprehensive solutions, including semiconductor devices, the necessary software and development kits to allow rapid time-to-market, and worldwide local technical support;

·   Identify where PLX can enable the market and expand the total addressable market (TAM) built from our leadership silicon and complimentary software;

PLX is a Delaware corporation established in 1986 with headquarters at 870 W. Maude Avenue, Sunnyvale, California 94085. The telephone number is (408) 774-9060. Additional information about PLX is available on our Website at http://www.plxtech.com. Information contained in the Website is not part of this report.

Our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports and the Proxy Statement for our Annual Meeting of Stockholders are made available, free of charge, on our Website, http://www.plxtech.com, as soon as reasonably practicable after the reports have been filed with or furnished to the Securities and Exchange Commission.

Discontinued Operations

PLX extended its penetration into the overall enterprise market through the October 2010 acquisition of Teranetics, Inc., a privately held fabless provider of high-performance mixed-signal semiconductors.  Teranetics, the broadly recognized leader in 10 Gigabit Ethernet over copper physical layer (10GBase-T PHY) technology, delivered the industry’s first fully integrated single-chip implementation of single-port and dual-port 10GBase-T PHY silicon.

The 10G Ethernet market developed more slowly than had previously been anticipated and as a result the Company divested the associated products. The Company completed the sale of a portion of its physical layer 10GBase-T integrated circuit (“PHY”) family of products pursuant to an Asset Purchase Agreement between the Company and Aquantia Corporation dated September 14, 2012.  The Company had also entered into an Asset Purchase Agreement with Entropic Communications, Inc. on July 6, 2012, as amended on November 21, 2012, pursuant to which the Company completed the sale of its digital channel stacking switch product line within the PHY product family, including certain assets exclusively related to the product line.  Together, these divestitures completed the sale of the PHY business. These divestitures were intended to reduce future spending and operating losses associated with this business.

The operations of the PHY related business have been segregated from continuing operations and are presented as discontinued operations in the Company’s consolidated statement of operations.  Unless otherwise indicated, the following discussions pertain only to our continuing operations.

Acquisition Activity

On April 30, 2012, the Company entered into an Agreement and Plan of Merger ("Merger Agreement") with Integrated Device Technology, Inc. ("IDT") in which IDT would purchase all of the Company's outstanding shares of common stock in exchange for consideration, per share, comprised of (i) $3.50 in cash plus (ii) 0.525 of a share of IDT common stock.

The Merger Agreement was subject to various conditions, including, but not limited to (i) at least a majority of shares of PLX common stock then outstanding (calculated on a fully diluted basis) being tendered into the Offer, (ii) the expiration or termination of the applicable Hart-Scott-Rodino Act ("HSR Act") waiting period, (iii) the registration statement for IDT's common stock issuable in connection with the Offer and Merger being declared effective by the SEC and the listing of such shares on Nasdaq and (iv) the absence of any Company Material Adverse Effect (as defined in the Merger Agreement) with respect to PLX's business.

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On December 18, 2012, the United States Federal Trade Commission ("FTC") filed an administrative complaint challenging IDT's proposed acquisition of PLX. On December 19, 2012, as a result of the FTC's determination to challenge the proposed acquisition, IDT and PLX mutually agreed to terminate the Merger Agreement.

Industry Background

High speed interconnect technology has largely consolidated over the past decade, converging on several mainstream standards that serve different roles within the system.  PCI Express has become the dominant interconnect within enterprise class individual electronic systems (sometimes referred to as “within the box”), and Ethernet and USB are the primary general purpose interconnect technologies between individual electronic systems (sometimes referred to as “box-to-box”).  PCI Express is now being considered for the box-to-box market due to its high performance, low power, low cost, and ease of connectivity to PCI Express devices within the box.

Although there are other interconnect standards and proprietary technologies that exist for specific purposes, they are limited to narrow functions, and the industry continues to converge on just a few general purpose interconnects.

This is happening due to the inherent cost and power advantages that accrue when many companies compete based on standards-based interconnect, and has been enabled by the mainstream standards being expanded to allow them to be used in a wider variety of usage models.

Customers today build up their systems based on off-the-shelf, standards-based products, supported by the appropriate software, all delivered by the vendors that compete for their business.  This building block approach allows them to get to market quickly, with a vastly lower cost of development.  Specifically, the software base that has been built up around the standards enables designers to focus on their own added value, rather than recreating the basic plumbing necessary to move data around.

Cloud-based computing, where basic storage and computational functions have been consolidated into a smaller number of extremely large compute and storage farms, has invigorated the enterprise market in particular, and has put renewed focus on the ability to move data around quickly and efficiently, and within very aggressive cost and power envelopes.  This industry shift has made the choice of interconnect technology into a key differentiator, and has made a standards-based approach crucial to success.

The need to achieve ambitious price points is important, since the vendors who supply the cloud services are all competing with each other, and this can only be accomplished by spreading the development cost of the subsystems over a broad customer base.  This is only possible within the framework of a standards-based approach that allows the industry at large to use the same basic building blocks.

Power dissipation has become critical, since the density of computing and storage has reached the point where there are tangible, significant costs associated with supplying power to the computer room, and in cooling the equipment to some reasonable temperature.  It is challenging just to dissipate the power that is generated within the powerful computing subsystem.  This need for lower power pushes the industry toward even deeper submicron fabrication technologies, and the costs of this move also favor those who can amortize their development costs over a wide customer base.  This is possible only through a framework based on standards.

PLX delivers high speed interconnection products based on high volume, standard connection points.  The connections are based on industry standards that allow interoperability between vendors, but PLX differentiates its products by offering lower overall system cost, lower power, higher performance, and a rich feature set, all while conforming to the connection points that have become mainstream.  The company is focused solely on the PCI Express standard.  In order to supplement the usage of PCI Express, the company also offers a variety of other bridging connections, the most significant of which is USB.

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PCI Express, also known as PCIe, is the primary interconnection mechanism inside computing systems today.  By remaining software compatible with the previous, ubiquitous parallel PCI technology, the switched serial PCI Express technology quickly became the connection of choice for the majority of computing and enterprise devices in the industry.  Since there is at least one, and sometimes many, PCI Express ports on almost every system building block, the least costly and highest performance approach for connecting the devices together is through this interconnection pathway.  To provide appropriate connection between subsystems in complex multi-chip systems, a switch is the most cost-effective approach.  The switch is thus a fundamental building block for the system, carrying data to and from the subsystems without impeding the native performance of the underlying devices.  For those few end points which do not have native PCI Express connections, PLX also provides bridges to translate the protocol.

The Universal Serial Bus (USB) standard was designed to replace the expensive, slow, unreliable, and un-scalable parallel interconnects of the time. USB was originally used to connect PCs with peripherals such as printers and external storage.  Its speed has been upgraded continuously since its initial rollout, and USB has become the most popular interconnect between electronic systems in the consumer market.  USB has become the natural way that users upgrade their system with peripherals, eliminating the need to open the case and add plug-in cards.

There are several trends which have accelerated the penetration of PLX products in the enterprise market.  The first is the rapid growth of SSD memory to either replace or augment the more traditional hard-disk based storage.  The SSD market is growing rapidly.  PCI Express has become the interface of choice for enterprise level SSD controllers, and PCI Express switches are used to create the large banks of storage that make up the dense subsystems in the data center.

The second industry trend that favors the PLX product focus is the continued increase in CPU and I/O speeds, especially in the communication and storage subsystems.  As speeds of these subsystems increase, the demand for greater bandwidth in the component-level interconnect follows.  Since PLX is a leader in mainstream PCI Express interconnection technology, it is in a unique position to satisfy this demand.

PCIe has become so common that it is either the main connectivity port on CPU, storage, and communication devices, or one of just a few.  This has created an opportunity for the technology to expand beyond its board-level dominance to being a single, converged fabric inside cloud and data center racks.   And since PLX is already supplying the majority of the stand-alone switching and bridging devices, it enables the company to identify and deploy products that take advantage of the synergies between inside-the-box and outside-the-box solutions.

The trend toward greater processing and I/O performance has been paralleled by several other trends: I/O virtualization and fabric convergence.  Computing systems have long used the concept of virtualization to enable individual users on a single system to appear to have all of the processor, I/O, and storage.  This was managed by the hardware and operating system.  As the processing power increased, and as standard operating systems such as Windows and Linux became dominant, virtualization was expanded to include even the operating system, and in current systems, not only do users believe that they have all of the resources, they also write their code based on one of the supported operating systems, and users all co-exist without knowledge that other users are “running” on something entirely different.  These improvements have led to special-purpose virtualization hardware features supported by software, and they have become common.

The initial I/O virtualization systems generally used a software approach.  However, this approach yielded poor performance and took up more of the processing subsystem than was acceptable.  It did not scale as easily because of the inherent limitations of a software-only implementation.  As with the other virtualization initiatives, hardware has become available to offload some of the tasks, and today there are systems deployed that allow a single host processor to share a limited number of I/O and storage subsystems with efficient hardware assistance.

The next phase of this evolution is to enable multiple host processors to share all of the I/O subsystems in the same way.  Today, there is no standard, widely deployed method to do this with hardware assistance.  The existing solutions are either proprietary or niche.  The most effective place for this multi-host I/O virtualization to exist is in the fabric that connects together the host processors and I/O.  This fabric can be created by PCIe, and the company is currently designing solutions that include hardware and software that enable this next phase of the virtualization capability.  To be successful, the solution needs to allow a step-by-step migration from the current system to the new, more powerful systems, and that is the approach the Company is taking.

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The final pertinent migration trend in the data center is fabric convergence.  The benefits of consolidation and standardization have been discussed several times, and they especially apply to the pathways over which information travels to and from the processing systems.  The economies of scale, rapid deployment, redundancy, and development cost advantages are significant when a wide range of different communication and storage protocols – each one well suited to a specific purpose – can share a mainstream, high performance connectivity technology.

The clear advantages that are made possible by separating the CPU, communication, and storage subsystems, and by allowing them to interact through a high speed, mainstream converged interconnect mechanism are driving significant industry trends.  One of the more high-profile industry initiatives to address this need is the Open Compute Platform, which has brought together industry leaders with the goal of a broadly supported standard approach.

PLX identified these trends several years ago, and began an initiative to create a high speed, virtualized, converged fabric based on PCI Express.  This solution has been given the name ExpressFabric®, and it combines the features discussed in this section.  ExpressFabric is meant to satisfy the demands of a single data center rack, or several racks, and will co-exist with other mainstream interconnect technologies such as Ethernet and Infiniband; each technology dominating the subsystems where its technical capability and historical advantages are best suited.

Strategy

PLX provides standards-based, off-the-shelf interconnect solutions to enable high performance, low cost, added-value features and rapid customer time-to-market.  Although the external connections are standard in order to enable high volume markets, the products themselves offer proprietary advantages through innovative technology.

PLX seeks to identify technology trends and to provide products that cater to these trends during the early, high growth phase of technology market discontinuities.  This allows the Company to establish itself as a product leader and has provided a powerful incumbency benefit as the target technology becomes mainstream.

·   We recognized the promise of PCI Express in the early days of the standard, and brought to market leadership switches and bridges in 2004, gaining market share at the key customers necessary for success.  We continue to enjoy market share leadership in the PCI Express interconnect market and continue to invest to maintain or grow this share. This included a broad PCIe Gen2 product line roll-out in 2007, and our newest products based on the Gen3 specification. The Company now offers an industry-leading 18 PCI Express Gen3 switches, most of which are in production, with the remaining sampling to key customers.

·   Given the company’s focus on interconnect, and our high penetration into our target markets, PLX has identified which standards are most important to bridge, and we introduced devices that allows PCI Express devices to bridge to USB 3.0.  This unique part allows customer products that have PCI Express as a connection point inside the box – which is the most common capability on both standard products and ASICs – to interconnect with devices outside the box based on the most popular consumer-level, general purpose USB standard.

·   The company recognized several years ago that the increasing use of PCIe as the dominant connection on CPU, storage, and communication devices targeted for the enterprise and computing markets, and the need for a lower cost, lower power solution in high density enterprise and cloud data centers, created an opportunity to extend the use of PCIe outside the box.  The company then identified the additional features that were necessary to make this a successful solution, and created switching solutions to complete the migration from the existing solutions to PCIe.  This was all done within a standards-based approach, and these products are expected to be deployed in enterprise systems over the next several years.

PLX focuses on offering leadership features to our customers at price points that are made possible through high volume delivery of standards-based solutions.

·   We focus on system level performance in all of our products.  Since interconnect choice has such a large impact on system performance, we identify those areas that might limit overall latency or throughput and enhance them.  This is done through advanced silicon design techniques, and also through innovative software and firmware that identify where the overhead is in the system.

·   We provide low power solutions to our customers since this has become a major differentiator for total system cost and environmental reasons.  PLX offers reduced power through technology choices, and through design techniques that modulate power for sections of the device that are not in use.

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·   We offer added-value features that enable customer product differentiation.  For PCI Express this includes features such as multiprocessor capability, multiple virtual channels for communications backplanes, integrated DMA for higher performance in control planes, the ability to share I/O virtually, and many other unique functions.

·   We focus on providing these capabilities at competitive prices.  We have a full COT (Customer Owned Tooling) capability – where PLX handles all of the design, placement, and layout of the circuits, and we manage the packaging and test pipeline.  We deploy our products on mainstream, high volume semiconductor technology process nodes, and use advanced synthesis and layout techniques to provide the best trade-off between features and cost.

PLX provides more than just the semiconductor device.  We focus on providing the whole product, and offer technical expertise that enables our customers to get to market quickly with a robust high-end product.

·   We supply a hardware-based Rapid Development Kit (RDK) as part of our standard offering.  This allows customers to evaluate our products easily, and enables software development and interoperability testing to begin prior to the customer developing their own hardware.

·   We provide simulation models to customers that allow them to develop their own devices and verify that they interoperate with our products prior to getting silicon.

·   We provide a complete Software Development Kit (SDK) that includes kernel-level drivers, a user-level application programming interface (API), customized binary software for each customer, sample code for some of the advanced features, and a state-of-the-art graphical user interface (GUI) that allows customers to easily bring up their system. Our solutions comply with industry-leading operating systems.

·   In addition to these visible features, our products also include in-chip capabilities that allow rapid debug of complex system problems in order to improve time-to-market.  This allows high speed signals to be effectively measured and debugged during development, in manufacturing, and even in the field without adding expensive special instrumentation.

·   We offer worldwide technical experts, with local, direct Field Applications Engineers (FAEs) in North America, Europe, and throughout Asia.

Technology

PLX focuses on providing differentiated products to customers that are leaders in their market.  In order to achieve this, we have developed unique core competencies in the underlying technologies necessary for success.

Semiconductor Design. Our engineers have substantial expertise in designing complex, reliable, high performance products.  We utilize state-of-the-art EDA tools and techniques for the entire design pipeline, and have developed proprietary verification mechanisms to ensure robust operation prior to committing to silicon.  It is relatively straightforward to get a device to operate in normal, error free environments.  It is much more challenging to have that device operate predictably and reliably in environments where errors occur in the system, and where unexpected or complex combinations of transactions occur.  PLX has built up an industry-leading suite of tests that ensure such reliable operation in real-world customer systems.

In addition to software-based simulation techniques, we have also invested in a flexible hardware-based emulation platform that enables our designers to run real software on a version of our design prior to committing to silicon.  This allows our products to operate in more complex system-level environments, where subtle and undocumented behaviors often exist.

PLX has a dedicated team and the appropriate EDA tools to translate the design into the database that is used to fabricate the device.  This physical design capability allows the Company to provide a smaller, lower power product, since the engineers who are doing this placement and layout work are part of our staff and work with the design engineers from the start of the project.  This capability also allows us to produce a product with higher signal integrity, which enables the device to work in a wider range of noisy environments more predictably.

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When we receive our initial sample silicon back from the third-party wafer fabrication facility (fab), we validate the product prior to sending it to our demanding customer base.  As with the pre-silicon verification, this post-silicon phase makes use of our years of product releases to ensure reliable product operation.  We have invested in the talent and equipment, and use our extensive proprietary test suites, to fully validate the device.  In addition, we have built up a broad interoperability lab, where we exercise the product with a growing number of other components and subsystems to ensure reliable operation in a range of real-world environments.

Software Technology. We have invested in a complete software development capability.  In order to enable our customers to get to market quickly, PLX provides device drivers that support our products for the most popular operating system platforms, as well as API libraries that allow programmers to quickly make use of our products.   In order to ensure that our products provide the highest performance possible, we have developed the tools and expertise to understand where the software bottlenecks occur in real-world systems, and our device drivers make use of this knowledge to increase the performance of targeted applications.  In addition to the software that resides on the host device, we offer embedded software, also known as firmware that runs on both general purpose and special purpose processors in some of our products.

Real-World Debug Capability. Our products have proprietary hardware features that allow complex problems to be solved in the field without special instrumentation, and performance monitoring hardware that makes visible important system performance metrics.  We include software as part of our normal release that takes these hardware features and allows them to be easily deployed through a modern GUI interface.  We also enable the programmer to view and change the registers in our device quickly and easily, and provide access to an on-line databook explanation of the registers.

One important skill that the company has developed is the ability to validate and characterize high speed SerDes and PHY signals, especially in regards to how they perform in dense configurations, and in often-unfriendly operating environments.  PLX has done this through many generations of products that have been deployed in highly diverse customer systems.  The company has added special-purpose hardware capabilities within the newer generations of devices, enabled them through the appropriate software, and has created validation and characterization platforms that rely on a combination of state-of-the-art test equipment and a deep level of knowledge shaped by years of experience.

Products

Our products consist of interconnect semiconductor products, fully supported by the software and hardware kits that enable our customers to get to market quickly with robust, differentiated solutions.

PCI Express Switches.  Since PCI Express is a point-to-point serial interconnect standard, it requires a switch to connect a single PCI Express port from a processor or chipset to multiple end-points.  Examples of applications include fan-out in servers and storage systems, multi-graphics engines in gaming and workstation systems, control planes in networking and communications systems and backplanes in embedded and industrial equipment.  PLX switches allow aggregation of multi-channel Ethernet, Fibre Channel, graphics and SAS cards to the host.  PLX switch products are offered in various configurations as requirements vary from one application to the next.  PCI Express switches have become a basic building block in systems being designed today using this standard.  PLX started with the Gen 1 family of PCI Express at 2.5 Gigabits per second in 2004, followed by Gen2 products in late 2007, where the data rate has doubled to 5.0 Gigabits per second. The company now offers an industry-leading 18 PCI Express Gen3 switches (8 Gigabit per second), including the world’s largest Gen3 PCIe switch at 96 lanes.  Eleven of these Gen3 switches are in production, with the remaining readily sampling to key customers.

PCI Express Bridges.  PCI Express Bridges allow devices with other standards to be used in systems that need to interoperate with PCI Express.  These bridges facilitate connection back to conventional PCI for purposes of upgrading, and our newest product in this family includes USB controllers that connect PCI Express to another popular I/O: USB 3.0.  Bridges of this kind allow users to quickly bring a new product to market.  Applications using these bridge devices include servers, storage host bus adapters, graphics, TV tuners and security systems.  We also offer bridges that translate PCI Express to general purpose serial and parallel ports.

USB Interface Chips.  USB interface chips are used by computer peripherals and consumer products to interoperate through an external cabled connection.  These devices have been used on products such as multi-function printers, portable media players, portable navigation systems and hard disks.  Our USB interface chips offer connection to either PCI or a general purpose interface, providing a simple connection that provides high performance. Current PLX products support the SuperSpeed USB 3.0 standard.

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Direct Attached Storage (DAS).  DAS devices are SOC products that allow external consumer storage peripherals to be easily connected to a PC through either a USB, 1394, or external Serial ATA (SATA) connection.    Our current products support the USB 3.0 standard.  No new products are in development.

Network Attached Storage (NAS).  NAS products provide customer-level data storage that attaches to a Local Area Network (LAN) in the home.  PLX NAS products are aimed at the consumer market, and are SOC devices that combine Ethernet, USB, PCI Express and SATA ports with other standard interfaces necessary to complete a state-of-the-art network appliance.  PLX products include a PCI interface to easily create complete subsystems, a DDR DRAM interface, and on-chip capabilities such as TCP off-load, RAID, and encryption.  These basic building blocks are enabled with high performance firmware that runs on a powerful, low power ARM processor.  No new products are in development.

PCI Bridges.  PLX offers a range of general purpose bridges that translate and extend the PCI bus.  These products offer a bridge between PCI and a variety of other serial and parallel general purpose interfaces.  Our PCI-to-PCI bridges are chips that increase the number of peripheral devices that can be included in a microprocessor-based system.  PLX’s bridge product line spans the entire PCI range, from 32-bit 33MHz through 64-bit 66MHz, and includes 133MHz PCI-X devices.  No new products are in development.

Customers, Sales and Marketing

We offer approximately 120 products to more than 1,000 active customers worldwide through both direct and indirect sales channels.  Our major customers are among the world’s leading electronics manufacturers.  Our target customers have high data communication processing and high performance requirements.

We supplement our direct sales force with manufacturers’ representatives for our products in North America, South America, Canada, and Europe. In addition, we have distributors who support our sales and marketing activities in North America, South America, Canada, Europe and Asia.

We maintain sales offices in the United States, China, Korea, Japan, Taiwan, and the United Kingdom.

Sales in North America represented 16%, 20% and 18%, of net revenues for 2012, 2011 and 2010, respectively. All worldwide sales to date have been denominated in U.S. dollars. We have one operating segment, the sale of semiconductor devices. Additional segment reporting information is included in Note 16 to the consolidated financial statements in this form 10-K.

Net revenues through distributors accounted for approximately 89%, 89% and 93% of our net revenues for 2012, 2011 and 2010, respectively. Revenues related to sales through distributors are expected to continue to account for a large portion of our total revenues. See "Item 1A, Risk Factors - Certain Factors That May Affect Future Operating Results - A Large Portion of Our Revenues Is Derived from Sales to Third-Party Distributors Who May Terminate Their Relationships with Us at Any Time" in this Form 10-K.

There were no direct end customers that accounted for more than 10% of net revenues. Sales to the following distributors accounted for 10% or more of net revenues:

	Years Ended December 31,
	2012			2011			2010
Excelpoint Systems Pte Ltd.		27	%		24	%		27	%
Avnet, Inc.		24	%		24	%		23	%
Answer Technology, Inc.		19	%		18	%		18	%

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We provide technical support and assistance to existing and potential customers in designing, testing, and qualifying systems designs that incorporate our products.  Technical support to customers is provided through field and factory applications engineers, technical marketing personnel, web-based support and, if necessary, product design engineers.  We believe that superior technical support plays a pivotal role in building long-term relationships with customers by providing our customers time-to-market, a high level of customer satisfaction and encouraging customers to use our next-generation products.

Since the components we produce are largely proprietary and generally not available from pin compatible second sources, we consider our end customer to be the entity specifying the use of our component in their design.  These end customers may then purchase our products directly from us, from an external sales representative or distributor, or through a third party manufacturer contracted to produce their designs.

Competition

The markets for our products are highly competitive and we expect competition to intensify as current competitors expand their product offerings and new competitors enter our markets.  Our ability to compete effectively and to expand our business will depend on our ability to continue to recruit key engineering talent, to execute on new product developments, and to pursue customers to design-in these new products into their applications.  We compete with other semiconductor suppliers that offer standard semiconductors, application-specific standard products and fully customized ICs, including embedded software, chip and board-level products.

The principal competitive factors in our markets include: time to market, quality of hardware/software designs and end-market system expertise; price; product benefits that are characterized by performance, features, quality and compatibility with standards; access to advanced process and packaging technologies at competitive prices; and sales and technical support, which includes assisting our customers with integration of our products and software into their systems and providing support from the concept stage through design, launch and production.

Research and Development

Our future success will depend to a large extent on our ability to rapidly develop and introduce new products and enhancements to our existing products that meet emerging industry standards and satisfy changing customer requirements.  We have made and expect to continue to make substantial investments in research and development and to participate in the development of new and existing industry standards.

The majority of our engineers are involved in semiconductor device development, with the remaining engineers working on software and reference design hardware.  Before development of a new product commences, our marketing managers work closely with research and development engineers and customers to develop a comprehensive requirements specification.  In addition, our marketing managers and engineers review the applicable industry standards and incorporate desired changes into the new product specification.  After the product is designed and commercially available, our engineers continue to work with various customers on specific design issues to understand emerging requirements that may be incorporated into future product generations or product upgrades.

Our research and development expenditures totaled $27.5 million, $28.2 million and $30.8 million in 2012, 2011 and 2010, respectively. Research and development expenses consist primarily of tape-out related costs at the independent foundries, salaries and related costs, including share-based compensation and expenses for outside engineering consultants. We perform our research and development activities at our headquarters in Sunnyvale, California and also in Bangalore, India. We periodically seek to hire additional skilled development engineers who are currently in short supply. Our business could be adversely affected if we encounter delays in hiring additional engineers.  See "Item 1A, Risk Factors - Certain Factors That May Affect Future Operating Results - We Could Lose Key Personnel Due to Competitive Market Conditions and Attrition" in this Form 10-K.

Our future performance depends on a number of factors, including our ability to identify emerging technology trends in our target markets, define and develop competitive new products in a timely manner, enhance existing products to differentiate them from those of competitors and bring products to market at competitive prices.  The technical innovations and product development required for us to remain competitive are inherently complex and require long development cycles.  We typically must incur substantial research and development costs before the technical feasibility and commercial viability of a product can be ascertained.  We must also continue to make significant investments in research and development in order to continually enhance the performance and functionality of our products to keep pace with competitive products and customer demands for improved performance.  Revenues from future products or product enhancements may not be sufficient to recover the development costs associated with these products or enhancements. The failure to successfully develop new products on a timely basis could have a material adverse effect on our business.

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Manufacturing

We have adopted a "fabless" semiconductor manufacturing model and outsource all of our semiconductor manufacturing, assembly, and testing. This approach allows us to focus our resources on the design, development and marketing of products and significantly reduces our capital requirements. Currently, our products are primarily being fabricated, assembled or tested by Advanced Semiconductor Engineering, Ardentec, Atmel, Epson, Faraday, Fujitsu, First Semiconductor Technology, MagnaChip, Open-Silicon, Renesas, STATS ChipPAC Ltd., Taiwan Semiconductor Manufacturing Corporation, UMC and Unimicron. These manufacturers fabricate, assemble, and test our products based on the design and test specifications we have provided. A small number of our products are currently manufactured by more than one supplier, and we expect a substantial amount of our products to be single-source manufactured for the foreseeable future. We must place orders two to four months in advance of expected delivery of finished goods. We maintain inventory levels based on current lead times from foundries plus safety stock to account for unanticipated interruption in supply and fluctuations in demand. Our inventory comprises a large portion of our working capital. As a result, we have limited ability to react to fluctuations in demand for our products which could cause us to have an excess or a shortage of inventory of a particular product and reduced product revenues.

In the event of a loss of, or a decision by us to change, a key supplier or foundry, qualifying a new supplier or foundry and commencing volume production would likely involve delay and expenses, resulting in lost revenues, reduced operating margins and possible detriment to customer relationships. Since we place our orders on a purchase order basis and do not have a long-term volume purchase agreement with any of our existing suppliers, any of these suppliers may allocate capacity to the production of other products while reducing deliveries to us on short notice. While we believe we currently have good relationships with our foundries and adequate capacity to support our current sales levels, there can be no assurance that adequate foundry capacity will be available in the future on acceptable terms, if at all. See "Item 1A, Risk Factors - Certain Factors That May Affect Future Operating Results - Our Independent Manufacturers May Not Be Able To Meet Our Manufacturing Requirements" in this Form 10-K.

Our semiconductor devices are currently fabricated using a range of semiconductor manufacturing processes. We must continuously develop our devices using more advanced processes to remain competitive on a cost and performance basis. Migrating to new technologies is a challenging task requiring new design skills, methods and software tools. We believe that the transition of our products to smaller geometries will be important for us to remain competitive. Our business could be materially adversely affected if any transition to new processes is delayed or inefficiently implemented. See " Item 1A, Risk Factors - Certain Factors That May Affect Future Operating Results - Defects in Our Products Could Increase Our Costs and Delay Our Product Shipments" in this Form 10-K.

Intellectual Property

 Our future success and competitive position depend upon our ability to obtain and maintain the proprietary technology used in our principal products. Most of our current products include implementations of the PCI, PCI Express and USB industry standards, which are available to other companies. We hold 43 patents on switching, interconnect and storage technologies that will expire at various dates beginning in 2014 through 2033. In the future, we plan to seek patent protection when we believe it is necessary.

 Our existing or future patents may be invalidated, circumvented, challenged or licensed to others. The rights granted may not provide competitive advantages to us. In addition, our future patent applications may not be issued with the scope of the claims sought by us, if at all. Furthermore, others may develop technologies that are similar or superior to our technology, duplicate our technology or design around the patents owned or licensed by us. In addition, effective patent, trademark, copyright and trade secret protection may be unavailable or limited in foreign countries where we may need this protection. We cannot be sure that steps taken by us to protect our technology will prevent misappropriation of our technology.

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The semiconductor industry is characterized by vigorous protection and pursuit of intellectual property rights or positions. This often results in significant, often protracted and expensive litigation. We may from time to time receive notifications of claims that we may be infringing patents or other intellectual property rights owned by other third parties. If it is necessary or desirable, we may seek licenses under these third party patents or intellectual property rights. However, we cannot be sure that licenses will be offered or that the terms of any offered licenses will be acceptable to us.

See “Item 3, Legal Proceedings” in this Form 10-K for a description of the four lawsuits filed against us by a company alleging patent infringement.

The failure to obtain a license from a third party for technology used by us could cause us to incur substantial liabilities and to suspend the manufacture or shipment of products or our use of processes requiring the technology. Litigation could result in significant expenses to us, adversely affect sales of the challenged product or technology and divert the efforts of our technical and management personnel, whether or not the litigation is determined in our favor. In the event of an adverse result in any litigation, we could be required to pay substantial damages, cease the manufacture, use, sale or importation of infringing products, expend significant resources to develop or acquire non-infringing technology, and discontinue the use of processes requiring the infringing technology or obtain licenses to the infringing technology. In addition, we may not be successful in developing or acquiring the necessary licenses under reasonable terms. This could require expenditures by us of substantial time and other resources. Any of these developments would have a material adverse effect on our business. See "Item 1A, Risk Factors - Certain Factors That May Affect Future Operating Results - Our Limited Ability to Protect Our Intellectual Property and Proprietary Rights Could Adversely Affect Our Competitive Position" in this Form 10-K.

Employees

As of December 31, 2012, we employed a total of 156 employees, including 79 engaged in research and development, 51 engaged in sales and marketing, 7 engaged in manufacturing operations and 19 engaged in general administration activities. We also from time to time employ part-time employees and hire contractors. Our employees are not represented by any collective bargaining agreement, and we have never experienced a work stoppage. We believe that our employee relations are good.

Backlog

PLX's backlog at any particular date is not necessarily indicative of actual sales for any succeeding period. This results from expected changes in product delivery schedules and cancellation of product orders. In addition, PLX's sales will often reflect orders shipped in the same quarter that they are received.

ITEM 1A: RISK FACTORS

FACTORS THAT MAY AFFECT FUTURE OPERATING RESULTS

If a company’s operating results are below the expectation of public market analysts or investors, then the market price of its common stock could decline.  Many factors that can affect a company’s quarterly and annual results are difficult to control or predict.  Factors which can affect the operating results of a semiconductor company such as PLX are described below.

Risks and uncertainties that could cause actual results to differ materially from those described herein include the following:

Our Operating Results May Fluctuate Significantly Due To Factors Which Are Not Within Our Control

Our quarterly operating results have fluctuated significantly in the past and are expected to fluctuate significantly in the future based on a number of factors, many of which are not under our control.  Our operating expenses, which include product development costs and selling, general and administrative expenses, are relatively fixed in the short-term.  If our revenues are lower than we expect because we sell fewer semiconductor devices, delay the release of new products or the announcement of new features, or for other reasons, we may not be able to quickly reduce our spending in response.

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Other circumstances that can affect our operating results include:

·   the timing of significant orders, order cancellations and reschedulings;

·   the loss of one or more significant customers;

·   introduction of products and technologies by our competitors;

·   the availability of production capacity at the fabrication facilities that manufacture our products;

·   our significant customers could lose market share that may affect our business;

·   integration of our product functionality into our customers’ products;

·   our ability to develop, introduce and market new products and technologies on a timely basis;

·   unexpected issues that may arise with devices in production;

·   shifts in our product mix toward lower margin products;

·   changes in our pricing policies or those of our competitors or suppliers, including decreases in unit average selling prices of our products;

·   the availability and cost of materials to our suppliers;

·   general macroeconomic conditions; and

·   political climate.

These factors are difficult to forecast, and these or other factors could adversely affect our business.  Any shortfall in our revenues would have a direct impact on our business.  In addition, fluctuations in our quarterly results could adversely affect the market price of our common stock in a manner unrelated to our long-term operating performance.

The Cyclical Nature Of The Semiconductor Industry May Lead To Significant Variances In The Demand For Our Products

In the past, the semiconductor industry has been characterized by significant downturns and wide fluctuations in supply and demand.  Also, the industry has experienced significant fluctuations in anticipation of changes in general economic conditions.  This cyclicality has led to significant variances in product demand and production capacity.  It has also accelerated erosion of average selling prices per unit.  We may experience periodic fluctuations in our future financial results because of industry-wide conditions.

Global Economic Conditions May Continue to Have an Adverse Effect on Our Businesses and Results of Operations

In late 2008 and 2009, the severe tightening of the credit markets, turmoil in the financial markets, and weakening global economy contributed to slowdowns in the industries in which we operate.  Economic uncertainty exacerbated negative trends in spending and caused certain customers to push out, cancel, or refrain from placing orders, which reduced revenue. We have seen market conditions improve since the second half of 2009 and throughout most of 2010; however, we are seeing that the rate of growth has slowed as inventory levels have balanced themselves out in 2011 and into 2012. Difficulties in obtaining capital and uncertain market conditions may lead to the inability of some customers to obtain affordable financing, resulting in lower sales. Customers with liquidity issues may lead to additional bad debt expense. These conditions may also similarly affect key suppliers, which could affect their ability to deliver parts and result in delays in the availability of product.  Further, these conditions and uncertainty about future economic conditions make it challenging for us to forecast our operating results, make business decisions, and identify the risks that may affect our business, financial condition and results of operations. In addition, we maintain an investment portfolio that is subject to general credit, liquidity, market and interest rate risks that may be exacerbated by deteriorating financial market conditions and, as a result, the value and liquidity of the investment portfolio could be negatively impacted and lead to impairment.  If the current improving economic conditions are not sustained or begin to deteriorate again, or if we are not able to timely and appropriately adapt to changes resulting from the difficult macroeconomic environment, our business, financial condition or results of operations may be materially and adversely affected.

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Because A Substantial Portion Of Our Net Revenues Are Generated By A Small Number Of Large Customers, If Any Of These Customers Delays Or Reduces Its Orders, Our Net Revenues And Earnings Will Be Harmed

Historically, a relatively small number of customers have accounted for a significant portion of our net revenues in any particular period. See Note 5 of the consolidated financial statements for customer concentrations.

We have no long-term volume purchase commitments from any of our significant customers. We cannot be certain that our current customers will continue to place orders with us, that orders by existing customers will continue at the levels of previous periods or that we will be able to obtain orders from new customers. In addition, some of our customers supply products to end-market purchasers and any of these end-market purchasers could choose to reduce or eliminate orders for our customers' products. This would in turn lower our customers' orders for our products.

We anticipate that sales of our products to a relatively small number of customers will continue to account for a significant portion of our net revenues.  Due to these factors, the following have in the past and may in the future reduce our net revenues or earnings:

·   the reduction, delay or cancellation of orders from one or more of our significant customers;

·   the selection of competing products or in-house design by one or more of our current customers;

·   the loss of one or more of our current customers; or

·   a failure of one or more of our current customers to pay our invoices.

Intense Competition In The Markets In Which We Operate May Reduce The Demand For Or Prices Of Our Products

Competition in the semiconductor industry is intense.  If our main target market, the microprocessor-based systems market, continues to grow, the number of competitors may increase significantly. In addition, new semiconductor technology may lead to new products that can perform similar functions as our products.  Some of our competitors and other semiconductor companies may develop and introduce products that integrate into a single semiconductor device the functions performed by our semiconductor devices.  This would eliminate the need for our products in some applications.

In addition, competition in our markets comes from companies of various sizes, many of which are significantly larger and have greater financial and other resources than we do and thus can better withstand adverse economic or market conditions.  Therefore, we cannot assure you that we will be able to compete successfully in the future against existing or new competitors, and increased competition may adversely affect our business.  See “Item 1, Business - Competition” and “-Products” in this Form 10-K.

Our Independent Manufacturers May Not Be Able To Meet Our Manufacturing Requirements

We do not manufacture any of our semiconductor devices.  Therefore, we are referred to in the semiconductor industry as a “fabless” producer of semiconductors. Consequently, we depend upon third party manufacturers to produce semiconductors that meet our specifications.  We currently have third party manufacturers located in China, Japan, Korea, Malaysia, Singapore and Taiwan that can produce semiconductors which meet our needs.  However, as the semiconductor industry continues to progress towards smaller manufacturing and design geometries, the complexities of producing semiconductors will increase.  Decreasing geometries may introduce new problems and delays that may affect product development and deliveries.  Due to the nature of the semiconductor industry and our status as a fabless semiconductor company, we could encounter fabrication-related problems that may affect the availability of our semiconductor devices, delay our shipments or increase our costs.

Only a small number of our semiconductor devices are currently manufactured by more than one supplier.  We place our orders on a purchase order basis and do not have a long term purchase agreement with any of our existing suppliers.  In the event that the supplier of a semiconductor device was unable or unwilling to continue to manufacture our products in the required volume, we would have to identify and qualify a substitute supplier.  Introducing new products or transferring existing products to a new third party manufacturer or process may result in unforeseen device specification and operating problems.  These problems may affect product shipments and may be costly to correct.  Silicon fabrication capacity may also change, or the costs per silicon wafer may increase.  Manufacturing-related problems may have a material adverse effect on our business.

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Lower Demand For Our Customers’ Products Will Result In Lower Demand For Our Products

Demand for our products depends largely on the development and expansion of the high-performance microprocessor-based systems markets including networking and telecommunications, enterprise and consumer storage, imaging and industrial applications.  The size and rate of growth of these microprocessor-based systems markets may in the future fluctuate significantly based on numerous factors. These factors include the adoption of alternative technologies, capital spending levels and general economic conditions.  Demand for products that incorporate high-performance microprocessor-based systems may not grow.

Our Lengthy Sales Cycle Can Result In Uncertainty And Delays With Regard To Our Expected Revenues

Our customers typically perform numerous tests and extensively evaluate our products before incorporating them into their systems.  The time required for test, evaluation and design of our products into a customer’s equipment can range from six to twelve months or more.  It can take an additional six to twelve months or more before a customer commences volume shipments of equipment that incorporates our products.  Because of this lengthy sales cycle, we may experience a delay between the time when we increase expenses for research and development and sales and marketing efforts and the time when we generate higher revenues, if any, from these expenditures.

In addition, the delays inherent in our lengthy sales cycle raise additional risks of customer decisions to cancel or change product plans.  When we achieve a design win, there can be no assurance that the customer will ultimately ship products incorporating our products.  Our business could be materially adversely affected if a significant customer curtails, reduces or delays orders during our sales cycle or chooses not to release products incorporating our products.

Failure To Have Our Products Designed Into The Products Of Electronic Equipment Manufacturers Will Result In Reduced Sales

Our future success depends on electronic equipment manufacturers that design our semiconductor devices into their systems.  We must anticipate market trends and the price, performance and functionality requirements of current and potential future electronic equipment manufacturers and must successfully develop and manufacture products that meet these requirements.  In addition, we must meet the timing requirements of these electronic equipment manufacturers and must make products available to them in sufficient quantities.  These electronic equipment manufacturers could develop products that provide the same or similar functionality as one or more of our products and render these products obsolete in their applications.

We do not have purchase agreements with our customers that contain minimum purchase requirements.  Instead, electronic equipment manufacturers purchase our products pursuant to short-term purchase orders that may be canceled without charge. We believe that in order to obtain broad penetration in the markets for our products, we must maintain and cultivate relationships, directly or through our distributors, with electronic equipment manufacturers that are leaders in the embedded systems markets.  Accordingly, we will incur significant expenditures in order to build relationships with electronic equipment manufacturers prior to volume sales of new products. If we fail to develop relationships with additional electronic equipment manufacturers to have our products designed into new microprocessor-based systems or to develop sufficient new products to replace products that have become obsolete, our business would be materially adversely affected.

Defects In Our Products Could Increase Our Costs And Delay Our Product Shipments

Our products are complex and we use third party developed intellectual property and serdes in the design of our products. While we test our products, these products may still have errors, defects or bugs that we find only after commercial production has begun. We have experienced errors, defects and bugs in the past in connection with new products.

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Our customers may not purchase our products if the products have reliability, quality or compatibility problems. This delay in acceptance could make it more difficult to retain our existing customers and to attract new customers.  Moreover, product errors, defects or bugs could result in additional development costs, diversion of technical and other resources from our other development efforts, claims by our customers or others against us, or the loss of credibility with our current and prospective customers. In the past, the additional time required to correct defects has caused delays in product shipments and resulted in lower revenues. We may have to spend significant amounts of capital and resources to address and fix problems in new products.

We must continuously develop our products using new process technology with smaller geometries to remain competitive on a cost and performance basis.  Migrating to new technologies is a challenging task requiring new design skills, methods and tools and is difficult to achieve.

Failure Of Our Products To Gain Market Acceptance Would Adversely Affect Our Financial Condition

We believe that our growth prospects depend upon our ability to gain customer acceptance of our products and technology.  Market acceptance of products depends upon numerous factors, including compatibility with other products, adoption of relevant interconnect standards, perceived advantages over competing products and the level of customer service available to support such products.  There can be no assurance that growth in sales of new products will continue or that we will be successful in obtaining broad market acceptance of our products and technology.

We expect to spend a significant amount of time and resources to develop new products and refine existing products. In light of the long product development cycles inherent in our industry, these expenditures will be made well in advance of the prospect of deriving revenues from the sale of any new products. Our ability to commercially introduce and successfully market any new products is subject to a wide variety of challenges during this development cycle, including start-up bugs, design defects and other matters that could delay introduction of these products to the marketplace. In addition, since our customers are not obligated by long-term contracts to purchase our products, our anticipated product orders may not materialize, or orders that do materialize may be cancelled. As a result, if we do not achieve market acceptance of new products, we may not be able to realize sufficient sales of our products in order to recoup research and development expenditures. The failure of any of our new products to achieve market acceptance would harm our business, financial condition, results of operation and cash flows.

A Large Portion Of Our Revenues Is Derived From Sales To Third-Party Distributors Who May Terminate Their Relationships With Us At Any Time

We depend on distributors to sell a significant portion of our products. Sales through distributors accounted for approximately 89%, 89% and 93% of our net revenues in 2012, 2011 and 2010, respectively. Some of our distributors also market and sell competing products.  Distributors may terminate their relationships with us at any time.  Our future performance will depend in part on our ability to attract additional distributors that will be able to market and support our products effectively, especially in markets in which we have not previously distributed our products. We may lose one or more of our current distributors or may not be able to recruit additional or replacement distributors. The loss of one or more of our major distributors could have a material adverse effect on our business, as we may not be successful in servicing our customers directly or through manufacturers’ representatives.

The Demand For Our Products Depends Upon Our Ability To Support Evolving Industry Standards

A majority of our revenues are derived from sales of products, which rely on the PCI Express, PCI and USB standards.  If markets move away from these standards and begin using new standards, we may not be able to successfully design and manufacture new products that use these new standards.  There is also the risk that new products we develop in response to new standards may not be accepted in the market.  In addition, these standards are continuously evolving, and we may not be able to modify our products to address new specifications.  Any of these events would have a material adverse effect on our business.

We Must Make Significant Research And Development Expenditures Prior To Generating Revenues From Products

To establish market acceptance of a new semiconductor device, we must dedicate significant resources to research and development, production and sales and marketing.  We incur substantial costs in developing, manufacturing and selling a new product, which often significantly precede meaningful revenues from the sale of this product.  Consequently, new products can require significant time and investment to achieve profitability.  Investors should understand that our efforts to introduce new semiconductor devices or other products or services may not be successful or profitable.  In addition, products or technologies developed by others may render our products or technologies obsolete or noncompetitive.

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We record as expenses the costs related to the development of new semiconductor devices and other products as these expenses are incurred.  As a result, our profitability from quarter to quarter and from year to year may be adversely affected by the number and timing of our new product launches in any period and the level of acceptance gained by these products.

We Could Lose Key Personnel Due To Competitive Market Conditions And Attrition

Our success depends to a significant extent upon our senior management and key technical and sales personnel.  The loss of one or more of these employees could have a material adverse effect on our business.  We do not have employment contracts with any of our executive officers.

Our success also depends on our ability to attract and retain qualified technical, sales and marketing, customer support, financial and accounting, and managerial personnel.  Competition for such personnel in the semiconductor industry is intense, and we may not be able to retain our key personnel or to attract, assimilate or retain other highly qualified personnel in the future.  In addition, we may lose key personnel due to attrition, including health, family and other reasons.  We have experienced, and may continue to experience, difficulty in hiring and retaining candidates with appropriate qualifications.  If we do not succeed in hiring and retaining candidates with appropriate qualifications, our business could be materially adversely affected.

The Successful Marketing And Sales Of Our Products Depend Upon Our Third Party Relationships, Which Are Not Supported By Written Agreements

When marketing and selling our semiconductor devices, we believe we enjoy a competitive advantage based on the availability of development tools offered by third parties.  These development tools are used principally for the design of other parts of the microprocessor-based system but also work with our products.  We will lose this advantage if these third party tool vendors cease to provide these tools for existing products or do not offer them for our future products.  This event could have a material adverse effect on our business.  We have no written agreements with these third parties, and these parties could choose to stop providing these tools at any time.

Our Limited Ability To Protect Our Intellectual Property And Proprietary Rights Could Adversely Affect Our Competitive Position

Our future success and competitive position depend upon our ability to obtain and maintain proprietary technology used in our principal products.  Currently, we have limited protection of our intellectual property in the form of patents and rely instead on trade secret protection.  Our existing or future patents may be invalidated, circumvented, challenged or licensed to others.  The rights granted there under may not provide competitive advantages to us.  In addition, our future patent applications may not be issued with the scope of the claims sought by us, if at all.  Furthermore, others may develop technologies that are similar or superior to our technology, duplicate our technology or design around the patents owned or licensed by us.  In addition, effective patent, trademark, copyright and trade secret protection may be unavailable or limited in foreign countries where we may need protection.  We cannot be sure that steps taken by us to protect our technology will prevent misappropriation of the technology.

We may from time to time receive notifications of claims that we may be infringing patents or other intellectual property rights owned by third parties.

See “Item 3, Legal Proceedings” in this Form 10-K for a description of the four lawsuits filed against us by a company alleging patent infringement.

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During the course of the litigations as well as any other future intellectual property litigations, we will incur costs associated with defending or prosecuting these matters. These litigations could also divert the efforts of our technical and management personnel, whether or not they are determined in our favor.  In addition, if it is determined in such a litigation that we have infringed the intellectual property rights of others, we may not be able to develop or acquire non-infringing technology or procure licenses to the infringing technology under reasonable terms.  This could require expenditures by us of substantial time and other resources.  Any of these developments would have a material adverse effect on our business.

Acquisitions Could Adversely Affect Our Financial Condition And Could Expose Us To Unanticipated Liabilities

As part of our business strategy, we expect to continue to review acquisition prospects that would complement our existing product offerings, improve market coverage or enhance our technological capabilities.  Potential future acquisitions could result in any or all of the following:

·   potentially dilutive issuances of equity securities;

·   large acquisition-related write-offs;

·   potential patent and trademark infringement claims against the acquired company;

·   the incurrence of debt and contingent liabilities or amortization expenses related to other intangible assets;

·   difficulties in the assimilation of operations, personnel, technologies, products and the information systems of the acquired companies;

·   the incurrence of additional operating losses and expenses of companies we may acquire;

·   possible delay or failure to achieve expected synergies;

·   diversion of management’s attention from other business concerns;

·   risks of entering geographic and business markets in which we have no or limited prior experience;

·   potential loss of key employees; and

·   potential lawsuits from shareholders.

Because We Sell Our Products To Customers Outside Of The United States And Because Our Products Are Incorporated With Products Of Others That Are Sold Outside Of The United States We Face Foreign Business, Political And Economic Risks

Sales outside of the United States accounted for 84%, 80% and 82% of our net revenues in 2012, 2011 and 2010, respectively.  Sales outside of the United States may fluctuate in future periods and may continue to account for a large portion of our revenues. In addition, equipment manufacturers who incorporate our products into their products sell their products outside of the Unites States, thereby exposing us indirectly to foreign risks. Further, most of our semiconductor products are manufactured outside of the United States. Accordingly, we are subject to international risks, including:

·   difficulties in managing distributors;

·   difficulties in staffing and managing foreign subsidiary and branch operations;

·   political and economic instability;

·   foreign currency exchange fluctuations;

·   difficulties in accounts receivable collections;

·   potentially adverse tax consequences;

·   timing and availability of export licenses;

·   changes in regulatory requirements, tariffs and other barriers;

·   difficulties in obtaining governmental approvals for telecommunications and other products; and

·   the burden of complying with complex foreign laws and treaties.

Because sales of our products have been denominated to date exclusively in United States dollars, increases in the value of the United States dollar will increase the price of our products so that they become relatively more expensive to customers in the local currency of a particular country, which could lead to a reduction in sales and profitability in that country.

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We May Be Required To Record A Significant Charge To Earnings If Our Goodwill Or Other Long Lived Asset Become Impaired

Under generally accepted accounting principles, we review our amortizable intangible and long lived assets for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. Goodwill is tested for impairment annually during the fourth quarter and between annual tests in certain circumstances. Factors that may be considered a change in circumstances, indicating that the carrying value of our goodwill or other long lived assets may not be recoverable, include a persistent decline in stock price and market capitalization, reduced future cash flow estimates, and slower growth rates in our industry. We have recorded goodwill related to prior acquisitions, and may do so in connection with any potential future acquisitions. In the fourth quarter of 2012, we tested the goodwill acquired and determined there was no impairment. We may be required to record a significant charge in our financial statements during the period in which any additional impairment of our goodwill  or other long lived assets is determined, which would adversely impact our results of operations.

Customer Demands And New Regulations Related To Conflict-Free Minerals May Force Us To Incur Additional Expenses

In August 2012, under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the SEC adopted new requirements for companies that use certain minerals and derivative metals (referred to as “conflict minerals,” regardless of their actual country of origin) in their products. These new requirements will require companies to investigate, disclose and report whether or not such metals originated from the Democratic Republic of Congo or adjoining countries. In October 2012, the National Association of Manufacturers and the U.S. Chamber of commerce filed a petition for review in the U.S. Court of Appeals for the District of Columbia in response to a piece of Dodd-Frank regulation that requires public companies to disclose whether their products have been manufactured with these conflict minerals in countries where the sale of these minerals fuel humanitarian violence. The outcome of this suit is uncertain and may impact the adoption of these new requirements.

In the semiconductor industry, these minerals are most commonly found in metals. As there may be only a limited number of suppliers offering “conflict free” metals, we cannot be sure that we will be able to obtain necessary metals in sufficient quantities or at competitive prices. Also, since our supply chain is complex and some suppliers will not share their confidential supplier information, we may face challenges with our customers and suppliers if we are unable to sufficiently verify that the metals used in our products are “conflict free.” Some customers may choose to disqualify us as a supplier and we may have to write off inventory in the event that it becomes unsalable as a result of these regulations.

Our Principal Stockholders Have Significant Voting Power And May Take Actions That May Not Be In The Best Interests Of Our Other Stockholders

Our executive officers, directors and other principal stockholders, in the aggregate, beneficially own a substantial amount of our outstanding common stock.  Although these stockholders do not have majority control, they currently have, and likely will continue to have, significant influence with respect to the election of our directors and approval or disapproval of our significant corporate actions.  This influence over our affairs might be adverse to the interests of other stockholders.  In addition, the voting power of these stockholders could have the effect of delaying or preventing a change in control of PLX.

The Anti-Takeover Provisions In Our Certificate of Incorporation Could Adversely Affect The Rights Of The Holders Of Our Common Stock

Anti-takeover provisions of Delaware law and our Certificate of Incorporation may make a change in control of PLX more difficult, even if a change in control would be beneficial to the stockholders.  These provisions may allow the Board of Directors to prevent changes in the management and control of PLX.

As part of our anti-takeover devices, our Board of Directors has the ability to determine the terms of preferred stock and issue preferred stock without the approval of the holders of the common stock.  Our Certificate of Incorporation allows the issuance of up to 5,000,000 shares of preferred stock.  There are no shares of preferred stock outstanding.  However, because the rights and preferences of any series of preferred stock may be set by the Board of Directors in its sole discretion without approval of the holders of the common stock, the rights and preferences of this preferred stock may be superior to those of the common stock.  Accordingly, the rights of the holders of common stock may be adversely affected.  Consistent with Delaware law, our Board of Directors may adopt additional anti-takeover measures in the future.

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The Company’s Business Could Be Negatively Affected If We Receive An Unsolicited Takeover Proposal Or Become Subject To A Proxy Contest Or Other Action Contesting The Strategic Direction Of Our Company

On January 25, 2013, Potomac Capital Partners II, L.Pand associated reporting persons (collectively, “Potomac”) filed a Schedule 13D with the SEC, reporting beneficial ownership of 5.1% of our outstanding common shares.  This filing included a copy of a letter Potomac had delivered to our board of directors, and stated in part that “The letter concluded that as a result of the recent divestiture of unprofitable non-core businesses and $20 million annual operating expense reduction, the Issuer [PLX] represents an even more attractive acquisition target today and, therefore, shareholder value can be maximized only through a robust exploration and evaluation of all available strategic options and value-maximizing opportunities.”

On February 13, 2013, Potomac filed an amendment to its Schedule 13D that includes a copy of a second letter delivered to our board of directors.  On that date, Potomac also issued a press release discussing and including a copy of the second letter.  That press release concluded in part that:  “Potomac reiterated its strong belief that value can best be created by capitalizing on the historic interest in PLX and exploring all strategic alternatives, including the sale of the Company. However, Potomac stressed that they had no faith that the current Board will translate strategic interest in PLX into a value-maximizing transaction and concluded that change is urgently needed in the composition of the Board.”

On March 6, 2013, Potomac filed a further amendment to its Schedule 13D that includes the following statements: "On March 6, 2013, PCP II delivered a letter to the Issuer nominating Messrs. Colombatto, Domenik, Schwartz, Singer, and Swift (together, the “Nominees”), as set forth therein, for election to the Board at the Issuer’s 2013 annual meeting of stockholders (including any other meeting of stockholders held in lieu thereof, and any adjournments, postponements, reschedulings or continuations thereof, the “Annual Meeting”).  The Reporting Persons intend to engage in discussions with management, the Board and stockholders of the Issuer regarding the nomination of directors at the Annual Meeting and the composition of the Issuer’s Board generally."

The brief summary set forth above is not intended as a complete description of all of the views and statements of Potomac, and interested persons should read the full text of Potomac’s filings, letters and press release referred to above and any future communications to the public Potomac may make about PLX.

If we should receive unsolicited proposals to acquire our company, if Potomac or other persons initiate or pursue efforts to replace or otherwise change our board of directors, or if Potomac or other persons should initiate a proxy contest to elect one or more directors other than those expected to be nominated by our board of directors at the 2013 annual meeting of stockholders or other actions that contest or conflict with our company’s strategic direction, any such actions could have an adverse effect on our company because:

·   responding to unsolicited takeover proposals or other actions by stockholders that contest the company’s director nominees can be costly and time-consuming, disrupt our operations, and divert the attention of our management and employees away from their regular duties;

·   these types of actions can create uncertainties that may adversely affect our business and market opportunities, and may make it more difficult to attract and retain qualified personnel and business partners; and

·   these types of actions could cause significant fluctuations in our company’s stock based on temporary or speculative market perceptions or other factors that do not necessarily reflect the underlying fundamentals and prospects of our business.

ITEM 1B: UNRESOLVED STAFF COMMENTS

None.

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ITEM 2: PROPERTIES

We own one facility in Sunnyvale, California, which has approximately 55,000 square feet. This facility comprises our headquarters and includes our research and development, sales and marketing and administration departments. Internationally, we lease offices in China, India, Japan, Korea and Taiwan. These leases comprise approximately 15,476 square feet and have terms expiring in or prior to April 2016. We believe that our current facilities will be adequate through 2013.

ITEM 3: LEGAL PROCEEDINGS

To date, Internet Machines LLC ("Internet Machines") has filed three separate lawsuits against PLX.  The first suit was filed on February 2, 2010, which has been served on PLX, entitled Internet Machines LLC v. Alienware Corporation, et al., in the United States District Court for the Eastern District of Texas, Tyler Division (the “First Suit”).  This First Suit alleges infringement by PLX and the other defendants in the lawsuit of two patents held by Internet Machines.  The complaint in the lawsuit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines' patents.  On May 14, 2010, we filed our answer to the live complaint and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.  On December 6, 2010, the Court held a case-management conference and subsequently entered a scheduling order in this matter, and set the trial for February 2012.

On February 21, 2012, through February 29, 2012, the claims and defenses asserted in the First Suit were tried to a seven-member jury in the United States District Court for the Eastern District of Texas, Tyler Division.  On February 29, 2012, the jury returned its verdict, finding the patents-in-suit valid and infringed and awarded money damages against PLX in the amount of $1.0 million.  The Court has not entered a final judgment on the jury’s verdict, and we intend to vigorously seek reversal of the jury’s verdict through post-trial motions and, if necessary, on appeal.

Internet Machines' second lawsuit, which has also been served on PLX, was filed on October 17, 2010, again in the United States District Court for the Eastern District of Texas, Tyler Division (the “Second Suit”).  This Second Suit, entitled Internet Machines LLC v. ASUS Computer International, et al., alleges infringement by PLX of another patent held by Internet Machines.  The complaint also asserts infringement claims against a separate group of defendants not named in the first Internet Machines lawsuit, and accuses those defendants of infringing the two patents asserted against PLX in the First Suit, as well as the additional patent listed in this Second Suit.  The complaint in the lawsuit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines' patents.  On December 28, 2010, we filed our answer to the live complaint in the second lawsuit and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.

On May 17, 2011, Internet Machines filed a third lawsuit entitled Internet Machines LLC v. Avnet, Inc., et al., again in the United States District Court for the Eastern District of Texas, Tyler Division (the “Third Suit”).  The third lawsuit has been served on PLX and alleges that PLX infringes a fourth patent held by Internet Machines.  This lawsuit also accuses a new group of defendants of infringing each of Internet Machines' patents at issue in the First and Second Suits, as well as the fourth patent asserted against PLX in this Third Suit.  The complaint in the Third Suit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines' patents.  On September 27, 2011, we filed our answer to the live complaint and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.

On January 20, 2012, the Court entered an order consolidating the Second and Third Suits into one action.  The Court further ordered that the schedule entered in the Third Suit would govern the consolidated action.  As a result, the consolidated action was originally set for trial in February 2013.

On March 25, 2011, a related entity, Internet Machines MC LLC, filed a lawsuit against PLX, entitled Internet Machines MC LLC v. PLX Technology, Inc., et al., in the United States District Court for the Eastern District of Texas, Marshall Division.  Internet Machines MC LLC, however, did not serve the initial complaint on PLX.  Instead, on August 26, 2011, Internet Machines MC LLC filed a first amended complaint, which has now been served on PLX, alleging infringement by PLX and the other defendants in the lawsuit of one patent held by Internet Machines MC LLC.  The complaint in this lawsuit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines MC LLC's patents.  On November 11, 2011, we filed our answer to the live complaint and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.  On March 5, 2012, the Court held an initial case-management conference in this matter. The Court entered a scheduling order in this matter, and trial was set for July 2013.

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On September 4, 2012, the Court entered an order staying the Second and Third Suits and the lawsuit brought by Internet Machines MC LLC discussed in the preceding paragraph.  Pursuant to the Court’s order, those lawsuits are stayed until a final non-appealable judgment is entered in the First Suit, again styled Internet Machines LLC v. Alienware Corp., et al., Cause No. 6:10-CV-023, in the United States District Court for the Eastern District of Texas.

As a result of the jury’s February 29, 2012 verdict on the First Suit, we accrued $1.0 million as of December 31, 2011.  As noted above, the Court has not filed its final judgment on the jury’s verdict. It is reasonably possible that any change in the ruling as a result of post-trial motions or possible appeals could change the estimated liability.  While it is not possible to determine the ultimate outcome of the remaining suits, we believe that we have meritorious defenses with respect to the claims asserted against us and intend to vigorously defend our position, but we are unable to estimate a range of possible loss.

ITEM 4: MINE SAFETY DISCLOSURES

Not applicable.

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PART II

ITEM 5: MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our common stock is traded on The NASDAQ Global Market and has been quoted on The NASDAQ Global Market under the symbol "PLXT" since its initial public offering on April 5, 1999. The following table sets forth, for the periods indicated, the range of quarterly high and low sales price for our common stock as reported on The NASDAQ Global Market:

2012	High			Low
First Quarter		$	4.16		$	2.73
Second Quarter		$	6.71		$	3.70
Third Quarter		$	6.38		$	5.07
Fourth Quarter		$	5.79		$	3.41

2011	High			Low
First Quarter		$	4.22		$	3.12
Second Quarter		$	3.72		$	3.20
Third Quarter		$	3.94		$	2.71
Fourth Quarter		$	3.39		$	2.52

As of February 28, 2013, there were approximately 107 holders of record of our common stock and as of that date, the last reported sales price of our common stock was $4.75.

We have never paid cash dividends on our common stock. We currently intend to retain earnings, if any, for use in our business and do not anticipate paying any cash dividends in the foreseeable future. Any future declaration and payment of dividends will be subject to the discretion of our Board of Directors, will be subject to applicable law and will depend upon our results of operations, earnings, financial condition, contractual limitations, cash requirements, future prospects and other factors deemed relevant by our Board of Directors.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

In September 2002, our Board of Directors authorized the repurchase of up to 2,000,000 shares of common stock. In July 2008, our Board of Directors authorized an additional 2,000,000 shares under the repurchase program.  At the discretion of the management, we can repurchase the shares from time to time in the open market or in privately negotiated transactions.   We purchased approximately 1,730,000 shares for $8.4 million between 2002 and 2008. We did not purchase any additional shares in between 2009 and 2012. As of December 31, 2012, under the Board’s repurchase authorization, we had the capacity to repurchase an additional 2,269,000 shares.

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Performance Graph

	Cumulative Total Return
	12/07		12/08		12/09		12/10		12/11		12/12
PLX Technology, Inc.		100.00		18.49		34.73		38.82		30.86		39.03
Russell 2000		100.00		66.21		84.20		106.82		102.36		119.09
Philadelphia Semiconductor		100.00		64.12		101.17		115.04		116.92		139.17

The graph and other information furnished under the above caption "Performance Graph" in this Part II, Item 5 of this Form 10-K shall not be deemed to be "soliciting material" or to be "filed" with the SEC or subject to Regulation 14A or 14C, or to the liabilities of the Exchange Act, as amended.

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ITEM 6: SELECTED FINANCIAL DATA

The following selected consolidated financial data should be read in conjunction with the consolidated financial statements and related notes thereto and "Management's Discussion and Analysis of Financial Condition and Results of Operations" appearing elsewhere in this Annual Report on Form 10-K.

	Years Ended December 31,
	2012			2011		2010		2009 (2)			2008 (3)
	in thousands, except per share data
Consolidated Statement of Operations Data:
Net Revenues (1)	$	100,248		$	111,152	$	115,540	$	82,832		$	81,068
Gross Profit (1)		58,786			64,552		67,787		46,932			48,282
Operating Income (Loss) From Continuing Operations (1)		(4,816	)		6,003		6,820		(15,490	)		(57,947	)
Income (Loss) From Continuing Operations (1)		(5,201	)		3,104		4,642		(18,802	)		(56,530	)
Basic Income (Loss) Per Share From Continuing Operations (1)	$	(0.12	)	$	0.07	$	0.12	$	(0.53	)	$	(2.00	)
Shares Used to Compute Basic Per Share Amounts		44,882			44,559		38,942		35,653			28,203
Diluted Income (Loss) Per Share From Continuing Operations (1)	$	(0.12	)	$	0.07	$	0.12	$	(0.53	)	$	(2.00	)
Shares Used to Compute Diluted Per Share Amounts		44,882			45,016		39,625		35,653			28,203

	Years Ended December 31,
	2012		2011		2010		2009		2008
	in thousands
Consolidated Balance Sheet Data:
Cash and Cash Equivalents	$	14,673	$	12,097	$	5,835	$	11,299	$	6,865
Working Capital		14,243		21,340		24,833		49,945		49,153
Total Assets		72,979		96,818		121,971		84,020		77,260
Total Long Term Borrowings		-		2,000		-		-		-
Total Long Term Note Payable and Capital Lease Obligations		-		-		1,731		1,098		-
Total Stockholders' Equity	$	46,672	$	75,219	$	97,808	$	71,999	$	69,203

(1)   In 2012 we completed the sale of certain assets of our PHY product family.  The results of operations for this business has been segregated and excluded from the continuing operations presented.  Periods prior to October 1, 2010, the date the disposed business was acquired, are not impacted.

(2)   Results of operations for 2009 include acquisition and related restructuring expenses of $2.9 million and a loss of $3.8 million on the fair value remeasurement of the contingently convertible note payable associated with the acquisition of Oxford in January 2009.

(3)   Results of operations for 2008 include impairment charges of $54.3 million and acquisition related fees of $0.8 million associated with the acquisition of Oxford in January 2009.

ITEM 7: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

This Annual Report on Form 10-K and certain information incorporated herein by reference contain forward-looking statements within the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. All statements contained in this Report on Form 10-K that are not purely historical are forward-looking statements, including, without limitation, statements regarding our expectations, objectives, anticipations, plans, hopes, beliefs, intentions or strategies regarding the future. Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from the results contemplated by the forward-looking statements.

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Forward-looking statements include, without limitation, the statements regarding the following:

·   the growing demand for standards-based components such as our semiconductor devices that connect systems together;

·   our objective to expand our advantages in data transfer technology;

·   our expectation that we will support new I/O standards where appropriate;

·   the statements regarding our objective to continue to expand our market position as a developer and supplier of I/O connectivity solutions for high performance systems;

·   our plan to target those applications where we believe we can attain a leadership position;

·   our plan to seek to integrate additional I/O-related functions into our semiconductor devices;

·   our belief that our understanding of I/O technology trends and market requirements allows us to bring to market more quickly new products that support the latest I/O technology;

·   that we continue to integrate more functionality in our semiconductor devices and continue to enhance and expand our software development kits;

·   our belief with respect to the principal factors of competition in the business;

·   our belief that we compete favorably with respect to each of those factors;

·   our expectation that revenues related to sales through distributors will continue to account for a large portion of total revenues;

·   our belief that providing customers with comprehensive product support is critical to remaining competitive in the markets we serve;

·   our belief that our close contact with customer design engineers provides valuable input into existing product enhancements and next generation product specifications;

·   our expectation that we will continue to make significant investments in research and development in order to continually enhance the performance and functionality of our products to keep pace with competitive products and customer demands for improved performance;

·   our belief that we must continuously develop our devices using more advanced processes to remain competitive on a cost and performance basis;

·   our belief that the transition of our products to smaller geometries will be important for us to remain competitive;

·    our intention to retain earnings for use in our business and not to pay any cash dividend in the foreseeable future;

·   our belief that our long-term success will depend on our ability to introduce new products;

·   our belief that we may be required to carry higher levels of inventory because of the difficulty in predicting future levels of sales and profitability;

·   our expectation that selling, general and administrative and research and development expenses in absolute dollars will increase in future periods; and

·   our belief that our existing resources, together with cash expected to be generated from our operations, will be sufficient to meet our capital requirements for at least the next twelve months.

All forward-looking statements included in this document are subject to additional risks and uncertainties further discussed under "Item 1A: Risk Factors - Factors That May Affect Future Operating Results" and are based on information available to us on the date hereof. We assume no obligation to update any such forward-looking statements. It is important to note that our actual results could differ materially from those included in such forward-looking statements. The factors that could cause our actual results to differ from those included in such forward-looking statements are set forth under the heading "Item 1A: Risk Factors - Factors That May Affect Future Operating Results," as well as those disclosed from time to time in our reports on Forms 10-Q and 8-K and our Annual Reports to Stockholders.

The following discussion should be read in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this report.

Overview

PLX Technology, Inc. ("PLX" or the "Company"), a Delaware corporation established in 1986, designs, develops, manufactures, and sells integrated circuits that perform critical system connectivity functions.  These interconnect products are fundamental building blocks for standards-based electronic equipment.  We market our products to major customers that sell electronic systems in the enterprise, consumer, server, storage, communications, PC peripheral and embedded markets.

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The explosive growth of cloud-based computing has provided a significant opportunity for PLX, since the data centers that house these systems are limited by their ability to offer high performance, low cost, low power, scalable interconnections.  The level of integration is increasing, and the need for rapid expansion forces these customers to build their systems using standard-based, off-the-shelf devices.

PLX is a market share leader in stand-alone PCI Express switches and bridges.  We recognized the trend towards this serial, switched interconnect technology early, launched products for this market long before our competitors, and have deployed multiple generations of products to serve a general-purpose market.  In addition to enabling customer differentiation through our product features, the breadth of our product offering is in itself a significant benefit to our customers, since we can serve the complete needs of our customers with cost-effective solutions tailored to specific system requirements.  PLX supplies an extensive portfolio of PCI Express switches; PCI Express bridges that allow backward compatibility to the previous PCI standard; and our newest bridges enable seamless interoperability between two of the most popular mainstream interconnects: PCI Express and USB. Our long experience with PCI Express connectivity products enables PLX to deliver reliable devices that operate in non-ideal, real-world system environments.

PLX offers a complete solution consisting of semiconductor devices, software development kits, hardware design kits, software drivers, and firmware solutions that enable added-value features in our products.  We differentiate our products by offering higher performance at lower power, by enabling a richer customer experience based on proprietary features that enable system-level customer advantages, and by providing capabilities that enable a customer to get to market more quickly.

We utilize a “fabless” semiconductor business model whereby we purchase wafers and packaged and tested semiconductor devices from independent manufacturing foundries. This approach allows us to focus on defining, developing, and marketing our products and eliminates the need for us to invest large amounts of capital in manufacturing facilities and work-in-process inventory.

We rely on a combination of direct sales personnel, distributors and manufacturers’ representatives throughout the world to sell a significant portion of our products.  We pay manufacturers’ representatives a commission on sales while we sell products to distributors at a discount from the selling price.

The time period between initial customer evaluation and design completion is generally between six and twelve months, though it can be longer in some circumstances. Furthermore, there is typically an additional six to twelve month or greater period after design completion before a customer requests volume production of our products.  Due to the variability and length of these design cycles and variable demand from customers, we may experience significant fluctuations in new orders from month to month. In addition, we typically make inventory purchases prior to receiving customer orders.  Consequently, if anticipated sales and shipments in any quarter do not occur when expected, expenses and inventory levels could be disproportionately high, and our results for that quarter and potentially future quarters would be materially and adversely affected.

Our long-term success will depend on our ability to introduce new products.  While new products typically generate little or no revenues during the first twelve months following their introduction, our revenues in subsequent periods depend upon these new products. Due to the lengthy sales cycle and additional time before our customers request volume production, significant revenues from our new products typically occur twelve to twenty-four months after product introduction.  As a result, revenues from newly introduced products have, in the past, produced a small percentage of our total revenues in the year the product was introduced.  See “Item 1A, Risk Factors - Certain Factors That May Affect Future Operating Results -- Our Lengthy Sales Cycle Can Result in Uncertainty and Delays with Regard to Our Expected Revenues” in this Form 10-K.

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Discontinued operations

On September 20, 2012, the Company completed the sale of a portion of its physical layer 10GBase-T integrated circuit (“PHY”) family of products pursuant to an Asset Purchase Agreement between the Company and Aquantia Corporation dated September 14, 2012.  The Company had also entered into an Asset Purchase Agreement (the “Entropic APA”) with Entropic Communications, Inc., on July 6, 2012, as amended on November 21, 2012, pursuant to which the Company completed the sale of its digital channel stacking switch product line within the PHY product family, including certain assets exclusively related to the product line.  Together, these divestitures completed the sale of the PHY business. The 10G Ethernet market developed more slowly than had previously been anticipated and the divestitures were intended to reduce future spending and operating losses associated with this business.  The operations of the PHY related business have been segregated from continuing operations and are presented as discontinued operations in the Company’s consolidated statement of operations.  Unless otherwise indicated, the following discussions in Results of Operations pertain only to our continuing operations.

Results of Operations

Comparison of Years Ended December 31, 2012, 2011 and 2010

Net Revenues. Net revenues consist of revenues generated principally by sales of our semiconductor devices as well as occasional IP and service development revenue.

The following table shows the revenue by type (in thousands) and as a percentage of net revenues:

	Years Ended December 31,
	2012				2011				2010
PCI Express revenue	$	66,780	66.6	%	$	61,557	55.4	%	$	54,361	47.0	%
Connectivity revenue		33,468	33.4	%		49,595	44.6	%		61,179	53.0	%
	$	100,248			$	111,152			$	115,540

Net revenues for the year ended December 31, 2012 were $100.2 million, a decrease of $10.9 million or 9.8% from $111.2 million in 2011. In 2011, we recorded licensed IP and development service revenue of $1.9 million primarily associated with our consumer storage technology. Excluding IP and development service revenue, revenues decreased $9.0 million or 8.3% compared to 2011.  The decrease in 2012 was due to lower sales of our Connectivity products as a result of the decline in demand for products used in systems nearing end of life and the customer transition from our legacy products to our PCI Express products, partially offset by higher sales of our PCI Express products due to the ramp of our Gen2 and Gen3 products.

Net revenues for the year ended December 31, 2011 were $111.2 million, a decrease of $4.4 million or 3.8% from $115.5 million in 2010. Excluding IP and development service revenue recorded in 2011, revenues decreased $6.3 million or 5.4% compared to 2010.  The decrease in 2011 was due to lower sales of our Connectivity and Consumer Storage products as well as lower average selling prices (ASPs) of our Consumer Storage products as a result of the transition to the low ASP markets, partially offset by higher sales of our PCI Express.

We currently expect to see revenue growth through 2013 for our PCI Express products and continued declines of our Connectivity products.

There were no direct end customers that accounted for more than 10% of net revenues. Sales to the following distributors accounted for 10% or more of net revenues:

	Years Ended December 31,
	2012			2011			2010
Excelpoint Systems Pte Ltd.		27	%		24	%		27	%
Avnet, Inc.		24	%		24	%		23	%
Answer Technology, Inc.		19	%		18	%		18	%

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We continue to generate significant revenues from Asia. For the year ended December 31, 2012, 2011 and 2010, approximately 71%, 68% and 71%, respectively, of net revenues were generated from Asia.
 

Future demand for our products is uncertain and is highly dependent on general economic conditions and the demand for products that contain our chips. Customer demand for semiconductors can change quickly and unexpectedly.  Our revenue levels have been highly dependent on the amount of new orders that are received for products to be delivered to the customer within the same quarter, also called “turns fill” orders.  Because of the long cycle time to build our products and our lack of visibility into demand when turns fill orders are high, it is difficult to predict which products to build to match future demand.  We believe the current high turns fill requirements will continue indefinitely.  The high turns fill orders pattern, together with the uncertainty of product mix and pricing, makes it difficult to predict future levels of sales and profitability and may require us to carry higher levels of inventory.

Gross Margin. Gross margin represents net revenues less the cost of revenues. Cost of revenues primarily includes the cost of (1) purchasing semiconductor devices from our independent foundries, (2) packaging, assembly and test services from our independent foundries, assembly contractors and test contractors and (3) our operating costs associated with the procurement, storage and shipment of products as allocated to production.

	Years Ended December 31,
	2012			2011			2010
	in thousands
Gross profit	$	58,786		$	64,552		$	67,787
Gross margin		58.6	%		58.1	%		58.7	%

Gross profit for the year ended December 31, 2012 decreased by 8.9%, or $5.8 million compared to 2011.  Excluding the IP and development service revenue of $1.9 million which were recorded at a 100% margin in 2011, 2011 gross margin was 57.4% and gross profit was $62.7 million, a decrease of 6.2% or $3.9 million.  The decrease in absolute dollars was due to the decrease in overall product sales, while the increase in gross margin percentage was due primarily to decreased sales of the low margin Consumer Storage devices within the Connectivity product grouping.

Gross profit for the year ended December 31, 2011 decreased by 4.8%, or $3.2 million compared to 2010.  Excluding the IP and development service revenue recorded in 2011, gross margin was 57.4% and gross profit was $62.7 million, a decrease of 7.5% or $5.1 million compared to 2010.  The decrease in absolute dollars and as a percentage was primarily due to decreased Consumer Storage product margins as a result of the transition to the low ASP markets and the decrease in Connectivity product shipments which generally have higher margins.
 

We expect gross margin to remain relatively flat in 2013. Future gross profit and gross margin are highly dependent on the product and customer mix, provisions and sales of previously written down inventory, the position of our products in their respective life cycles and specific manufacturing costs.  Accordingly, we are not able to predict future gross profit levels or gross margins with certainty.

Research and Development Expenses. Research and development (R&D) expenses consist primarily of tape-out costs at the independent foundries, salaries and related costs, including share-based compensation, software licenses, and expenses for outside engineering consultants included in R&D expenses.

	Years Ended December 31,
	2012			2011			2010
	in thousands
R&D expenses	$	27,532		$	28,218		$	30,799
As a percentage of revenues		27.5	%		25.4	%		26.7	%

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R&D expenses decreased by $0.7 million, or 2.4% in the year ended December 31, 2012 compared to 2011. Expenses relating to the 2011 divested UK design team were $0.2 million and $6.0 million in 2012 and 2011, respectively. Excluding the impact of the divestiture, R&D expenses increased by $5.1 million or 23.0%. The increase was primarily due to increases in tape-out-related activities of $3.1 million due to timing of projects taped-out, compensation and benefit expenses of $0.9 million due to an increase in headcount and variable compensation of $0.5 million as a result of the changes in the plan to tie variable compensation to personal and group performance objectives as well as financial metrics. In addition, due to the IDT acquisition activities, which were subsequently terminated, retention measures were put in place, particularly RSU grants resulting in an increase in share-based compensation expense of $0.4 million.

R&D expenses decreased by $2.6 million, or 8.4% in the year ended December 31, 2011 compared to 2010. The decrease was primarily due to decreases in engineering tools of $1.9 million due to license term expirations and decreased renewal rates of licenses, compensation and benefit expenses of $1.4 million as a result of downsizing of the operations in the UK in the first quarter of 2011 and the subsequent divestiture of the remaining UK team in October 2011, and consulting services of $0.5 million, partially offset by an increase in tape-out related activities of $1.4 million due to timing of projects taped-out.

We believe continued spending on research and development to develop new products is critical to our success.  In addition, we expect research and development expenses to modestly increase in future periods with the introduction of new products.

Selling, General and Administrative Expenses. Selling, general and administrative (SG&A) expenses consist primarily of salaries and related costs, including share-based compensation, sales commissions to manufacturers’ representatives and professional fees, as well as trade show and other promotional expenses.

	Years Ended December 31,
	2012			2011			2010
	in thousands
SG&A expenses	$	28,927		$	28,037		$	26,720
As a percentage of revenues		28.9	%		25.2	%		23.1	%

SG&A expenses increased by $0.9 million or 3.2% in the year ended December 31, 2012 compared to 2011. The increase was primarily due to an increase in variable compensation of $0.9 million as a result of the changes in the plan to tie variable compensation to personal and group performance objectives as well as financial metrics. In addition, due to the IDT acquisition activities, which were subsequently terminated, retention measures were put in place, particularly RSU grants and a one-time increase in employee related commissions, resulting in increases in share-based compensation expense of $0.6 million and employee commissions of $0.5 million. These increases were partially offset by a decrease in compensation and benefit expenses of $1.2 million due to a decrease in headcount.

SG&A expenses increased by $1.3 million or 4.9% in the year ended December 31, 2011 compared to 2010. The increase in SG&A in absolute dollars was primarily due to an accrual of $1.0 million as a result of the jury’s February 29, 2012 verdict on the first Internet Machines patent infringement lawsuit and increases in legal fees of $1.8 million relating to the Internet Machines lawsuits, consulting services of $0.3 million and share-based compensation expenses of $0.3 million, partially offset by decreases in compensation and benefit expenses of $1.4 million, primarily variable compensation, as a result of decreased profitability and commission expenses to manufacturer’s representatives of $0.3 million due to lower commission rates. See Note 15 of the consolidated financial statements and Item 3 of this report for additional information around the patent infringement complaints.

We expect SG&A expenses to decrease in 2013, primarily in legal expenses, as the result of the stayed Internet Machines lawsuits.

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Acquisition and Restructuring Related Costs.

	Years Ended December 31,
	2012		2011			2010
	in thousands
Deal costs	$	6,898	$	88		$	855
Escrow claim settlement		-		(1,397	)		-
Severance costs		-		501			-
Lease commitment accrual		-		301			-
	$	6,898	$	(507	)	$	855

In 2012 we recorded acquisition related costs of $6.9 million, primarily for outside legal and banking expenses associated with the IDT acquisition activities, which were subsequently terminated. In 2011 and 2010 we recorded $0.1 million and $0.9 million, respectively, in acquisition related costs associated with the October 1, 2010 acquisition of Teranetics. As a result of the indemnity claims we communicated to the Teranetics stockholders’ representative, we negotiated a $1.9 million reduction against the two promissory notes. The settlement included the cancelation of the $1.5 million note due in October 2013 and was recorded in 2011 as a reduction to acquisition and restructuring related costs in the Consolidated Statement of Operations for the assessed fair value of $1.4 million for the portion of the claims not directly related to the operations of the PHY activity. See Note 8 of the consolidated financial statements for additional information.  Deal costs related primarily to outside legal and accounting costs.

In 2011, we recorded approximately $0.5 million of severance and benefit related costs, included in acquisition and restructuring related costs in the Consolidated Statement of Operations, related to the termination of 14 employees as a result of the downsizing and refocus of the operations in the UK early in the year and cost control efforts as a result of the Teranetics acquisition. See Note 9 of the consolidated financial statements for additional information.

In 2011, in connection with the downsizing of the UK operations, we recorded lease commitment accrual and leasehold impairment charges of $0.3 million.  See Note 9 of the consolidated financial statements for additional information.

Amortization of Purchased Intangible Assets. Amortization of acquired intangible assets consists of amortization expense related to developed core technology, tradename and customer base acquired in the Oxford acquisition in January 2009.

	Years Ended December 31,
	2012			2011			2010
	in thousands
Amortization of purchased intangible assets	$	245		$	2,801		$	2,593
As a percentage of revenues		0.2	%		2.5	%		2.2	%

Amortization of acquired intangible assets decreased by $2.6 million or 91.3% in the year ended December 31, 2012 compared to 2011. The decrease in amortization expense was due to the Oxford USB and Serial developed core technology becoming fully amortized in 2011 and the useful life change and acceleration of the Network Attached Storage (NAS) Connectivity developed core technology as a result of the divestiture of the UK design team in October 2011. As of December 31, 2012 all purchased intangibles are fully amortized.

Amortization of acquired intangible assets increased by $0.2 million or 8.0% in the year ended December 31, 2011 compared to 2010. The increase in amortization expense was due to the useful life change and acceleration of Oxford NAS developed core technology as a result of the divestiture of the UK design team in October 2011, partially offset by the accelerated amortization of the Oxford USB and Serial developed core technology and the Oxford trade name becoming fully amortized in December 2010.  See Note 11 to our consolidated financial statements for additional information.

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Interest Income, Interest Expense and Other, Net.

	Years Ended December 31,
	2012			2011			2010
	in thousands
Interest income	$	33		$	73		$	186
Interest expense		(203	)		(165	)		(117	)
Other income (expense)		21			(56	)		(12	)
	$	(149	)	$	(148	)	$	57

Interest income for the years ended December 31, 2012, 2011 and 2010 of $33,000, $73,000 and $186,000, respectively, reflects interest earned on average cash, cash equivalents and short-term and long-term investment balances. The decreases in 2012 and 2011 were due to lower investments balances largely due to operating losses and the 2012 payment of the note related to the Teranetics acquisition.

Interest expense for the years ended December 31, 2012, 2011 and 2010 of $0.2 million, $0.2 million and $0.1 million, respectively, primarily consisted of interest recorded on the line of credit borrowings, our capital lease obligations and the note associated with the acquisition of Teranetics.

Other income (expense) includes foreign currency transaction gains and losses and other miscellaneous transactions.  Other income may fluctuate significantly due to currency fluctuations.

Provision for Income Taxes. Provision for income taxes for the year ended December 31, 2012 was $0.2 million on a pretax loss of $5.0 million, compared to a provision of $2.8 million on pretax income of $5.9 million and a provision of $2.2 million on a pretax income of $6.9 million for the periods ended December 31, 2011 and 2010, respectively. Our 2012 provision differs from the benefit derived by applying the applicable U.S. federal statutory rate to the loss from continuing operations due primarily to the change in valuation allowance for the net deferred tax asset, partially offset by a benefit of research and development tax credits and nondeductible permanent items. Our 2011 provision differs from the provision derived by applying the applicable U.S. federal statutory rate to income from continuing operations due primarily to nondeductible permanent items, partially offset by a benefit of research and development tax credits. Our 2010 provision differs from the provision derived by applying the applicable U.S. federal statutory rate to income from continuing operations due primarily to nondeductible permanent items, the limitation in the usage of acquired NOLs (net operating losses) related to Oxford and the recording of a valuation allowance for the net deferred tax asset partially offset by a benefit of research and development tax credits. See Note 13 of the consolidated financial statements for reconciliation of statutory tax rates.

Liquidity and Capital Resources

Cash and Investments. We invest cash not needed for current operations predominantly in certificate of deposits and debt instruments that are highly liquid, of high-quality investment grade and predominantly have maturities of less than one year with the intent to make such funds readily available for operating purposes. As of December 31, 2012 cash, cash equivalents, short and long-term marketable securities were $16.7 million, a decrease of $3.1 million from $19.8 million at December 31, 2011, and a decrease of $6.9 million from $23.6 million at December 31, 2010.

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Operating Activities.

	Years Ended December 31,
	2012			2011			2010
	in thousands
Income (loss) from continuing operations, net of non-cash items	$	1,638		$	10,397		$	12,743
Loss from discontinued operations, net of non-cash items		(14,968	)		(18,690	)		(5,714	)
Changes in working capital		893			5,637			(7,528	)
Net cash used in operating activities	$	(12,437	)	$	(2,656	)	$	(499	)

Cash used in operating activities primarily consists of net loss adjusted for certain non-cash items including depreciation, amortization, share-based compensation expense, impairments, provisions for excess and obsolete inventories, other non-cash items, and the effect of changes in working capital and other activities. Cash used in operating activities in 2012 was $12.4 million and included loss from discontinued operations, adjusted for non-cash items, of $15.0 million. The cash used in discontinued operations was partially offset by cash provided by income from continuing operations, adjusted for non-cash items, of $1.6 million and changes in working capital which provided cash of $0.9 million. The decrease in cash flow provided by continuing operations in 2012 compared to 2011 was primarily due to an increased net loss, adjusted for non-cash and non-operating items and changes in our working capital. Our days sales outstanding was relatively flat. The increase in inventory reflects strong demand for our PCI Express products. Our days payable outstanding increased due to the increase of payable related to the IDT acquisition activities, which were subsequently terminated, and the timing of vendor payments.

Cash used in operating activities in 2011 was $2.7 million compared to cash used in operating activities of $0.5 million in 2010. The loss adjusted for non-cash items from discontinued operations used cash of $18.7 million in 2011.  The cash used in discontinued operations was largely offset by cash provided by net income from continuing operations, adjusted for non-cash items, of $10.4 million and changes in working capital which provided $5.6 million of cash.  The increase in cash used by discontinued operations was due to a full year of PHY related activity in 2011 versus only one quarter of the year in 2010 due to the timing of the Teranetics acquisition, where we acquired the PHY operations. Our days sales outstanding decreased due to strong shipments late in December 2010 as compared to the same period in 2011. The decrease in inventory reflects our efforts to control inventory levels as orders softened in the fourth quarter of 2011. Our days payable outstanding decreased due to the decrease in inventory purchases and timing of vendor payments.

Investing Activities. Our investing activities are primarily driven by investment of our excess cash, sales of investments, business acquisitions and divestitures and capital expenditures. Capital expenditures have generally been comprised of purchases of engineering equipment, computer hardware, software, server equipment and furniture and fixtures. Cash provided by investing activities in 2012 was due to the proceeds received from the sale of the PHY business of $10.4 million and the sales and maturities of investments (net of purchases) of $5.5 million, partially offset by capital expenditures of $2.6 million. Cash provided by investing activities in 2011 of $7.5 million was due to the sales and maturities of investments (net of purchases) of $10.0 million and $0.5 million cash received for the net assets transferred in the divestiture of the UK design team, partially offset by capital expenditures of $3.0 million.

Financing Activities. Cash provided by financing activities in 2012 of $1.7 million was due to the borrowings against the line of credit (net of principal payments) of $6.0 million and proceeds from the exercise of stock options of $1.2 million, partially offset by the payment of the note associated with the 2010 acquisition of Teranetics of $4.8 million and payments made on capital lease obligations of $0.6 million.  Cash provided by financing activities in 2011 of $1.5 million was due to the borrowings against the line of credit of $2.0 million and the proceeds from the exercise of stock options of $0.4 million, partially offset by payments made on capital lease obligations of $0.9 million.

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As of December 31, 2012, we had the following significant contractual obligations and commercial commitments (in thousands):

	Payments due in
			Less than		1-3		More than
	Total		1 Year		Years		3 Years
Operating leases - facilities and equipment	$	583	$	243	$	340	$	-
Software licenses		5,196		3,203		1,993		-
Inventory purchase commitments		7,444		7,444		-		-
Borrowings against line of credit		8,000		8,000		-		-
Total cash obligations	$	21,223	$	18,890	$	2,333	$	-

On September 30, 2011, we entered into an agreement with Silicon Valley Bank (SVB) to establish a two-year $10.0 million revolving loan facility. Borrowings under the credit facility bear interest at rates equal to the prime rate announced from time to time in The Wall Street Journal. As of December 31, 2012 the prime rate was 3.25%.  The facility also provides for commitment, unused facility and letter-of-credit fees. As of December 31, 2012, we have outstanding borrowings of $8.0 million.  The facility is subject to certain financial covenants for earnings before interest, taxes, depreciation and amortization (“EBITDA”), as defined in the agreement, and a monthly quick ratio computation (PLX’s cash, investments and accounts receivable divided by current liabilities). We were in compliance with all financial covenants associated with this facility as of December 31, 2012. See Note 14 of the consolidated financial statements for additional information.

We believe that our existing resources, together with cash generated from our operations will be sufficient to meet our capital requirements for at least the next twelve months. Our future capital requirements will depend on many factors, including the level of investment we make in new technologies and improvements to existing technologies and the levels of monthly expenses required to launch new products. To the extent that existing resources and future earnings are insufficient to fund our future activities, we may need to raise additional funds through public or private financings. Given the current economic and credit conditions, additional funds may not be available or, if available, we may not be able to obtain them on terms favorable to us and our stockholders.

See Note 15 to our consolidated financial statements for additional information on our contractual obligations and commercial commitments.

Critical Accounting Policies

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosures of contingent assets and liabilities in the consolidated financial statements and accompanying notes. The U.S. Securities and Exchange Commission (“SEC”) has defined a company's critical accounting policies as the ones that are most important to the portrayal of the company's financial condition and results of operations, and which require the company to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, we have identified the critical accounting policies and judgments addressed below. We also have other key accounting policies which involve the use of estimates, judgments and assumptions that are significant to understanding our results. For additional information see Note 1 to the consolidated financial statements. Although we believe that our estimates, assumptions and judgments are reasonable, they are based upon information presently available. Actual results may differ significantly from these estimates under different assumptions, judgments or conditions.

Revenue Recognition. Werecognize revenue when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable and collection is reasonably assured.

34

 Revenue from product sales to customers is recognized upon shipment and transfer of risk of loss if we believe collection is reasonably assured and all other revenue recognition criteria are met. We assess the probability of collection based on a number of factors, including past transaction history and the customer’s creditworthiness.  At the end of each reporting period, the sufficiency of allowances for doubtful accounts is assessed based on the age of the receivable and the individual customer’s creditworthiness.

We offer pricing protection to two distributors whereby we support the distributor’s resale product margin on certain products held in the distributor’s inventory. We analyze current requests for credit in process, also known as ship and debits, historical rates and amounts of credits issued, and inventory at the distributor to determine the ending sales reserve required for this program. We also offer stock rotation rights to three distributors such that they can return up to a total of 5% of products purchased every six months in exchange for other PLX products of equal value. We analyze current stock rotation requests and past experience, which has historically been insignificant, to determine the ending sales reserve required for this program. In addition, we had arrangements with a small number of customers offering a rebate program on various products, which were terminated in June 2010. We recorded rebates as a reduction of revenue when the rebate was in the form of cash consideration. Reserves are reduced directly from revenue and recorded as a reduction to accounts receivable.

Inventory Valuation. We evaluate the need for potential inventory provisions by considering a combination of factors, including the life of the product, sales history, obsolescence, and sales forecast. Any adverse changes to our future product demand may result in increased provisions, resulting in decreased gross margin. In addition, future sales on any of our previously written down inventory may result in increased gross margin in the period of sale.
 

Allowance for Doubtful Accounts. We evaluate the collectability of our accounts receivable based on length of time the receivables are past due. Generally, our customers have between thirty days to forty five days to remit payment of invoices. We record reserves for bad debts against amounts due to reduce the net recognized receivable to the amount we reasonably believe will be collected.  Once we have exhausted collection efforts, we will reduce the related accounts receivable against the allowance established for that receivable.  We have certain customers with individually large amounts due at any given balance sheet date. Any unanticipated change in one of those customers’ creditworthiness or other matters affecting the collectability of amounts due from such customers could have a material effect on our results of operations in the period in which such changes or events occur.  Historically, our write-offs have been insignificant.

 Goodwill. Our methodology for allocating the purchase price related to business acquisitions is determined through established valuation techniques.  Goodwill is measured as the excess of the cost of the acquisition over the amounts assigned to identifiable tangible and intangible assets acquired less assumed liabilities. We have one operating segment and business reporting unit, the sales of semiconductor devices, and we perform goodwill impairment tests annually during the fourth quarter and between annual tests if indicators of potential impairment exist.

Long-lived Assets. We review long-lived assets, principally property and equipment and identifiable intangibles, for impairment whenever events or circumstances indicate that the carrying amount of assets may not be recoverable. We evaluate recoverability of assets to be held and used by comparing the carrying amount of an asset to estimated future net undiscounted cash flows generated by the asset.  If such assets are considered to be impaired, the impairment recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets.  In addition, if we determine the useful life of an asset is shorter than we had originally estimated, we accelerate the rate of depreciation over the assets’ new, shorter useful life.

Taxes. We account for income taxes using the asset and liability method.  Deferred taxes are determined based on the differences between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse.  Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized. As of December 31, 2012, we carried a valuation allowance for the net deferred tax asset as a result of uncertainties regarding the realization of the asset balance (see Note 13 to the consolidated financial statements). The net deferred tax assets are reduced by a valuation allowance if, based upon weighted available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.  We must make significant judgments to determine our provision for income taxes, our deferred tax assets and liabilities and any valuation allowance to be recorded against our net deferred tax asset.  As of December 31, 2012, a valuation allowance continues to be recorded for the deferred tax assets based on management’s assessment that realization of deferred tax assets is uncertain due to the history of losses, the variability of operating results and the inability to conclude that it is more likely than not that sufficient taxable income would be generated in future periods to realize those deferred tax assets. Future taxable income and/or tax planning strategies may eliminate all or a portion of the need for the valuation allowance. In the event we determine we are able to realize our deferred tax asset, an adjustment to the valuation allowance may significantly increase income in the period such determination is made.

35

Recent Accounting Pronouncements

In June 2011, the Financial Accounting Standards Board (“FASB”) issued a standard which revised the presentation of other comprehensive income (“OCI”). The new guidance requires entities to present net income and OCI in either a single continuous statement or in separate consecutive statements. The guidance does not change the components of net income or OCI, when OCI should be reclassified to net income, or the earnings per share calculation. This accounting guidance was effective for annual reporting periods beginning after December 15, 2011. We adopted this guidance as of January 1, 2012 using two consecutive statements.

In July 2012, the FASB issued amended standards to simplify how entities test indefinite-lived intangible assets for impairment which improve consistency in impairment testing requirements among long-lived asset categories. These amended standards permit an assessment of qualitative factors to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying value. For assets in which this assessment concludes it is more likely than not that the fair value is more than its carrying value, these amended standards eliminate the requirement to perform quantitative impairment testing as outlined in the previously issued standards. These amended standards are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.

In February 2013, the FASB issued amended standards to improve the reporting of reclassifications out of accumulated other comprehensive income by requiring an entity to report their corresponding effect(s) on net income. These amended standards are effective for annual reporting periods beginning after December 15, 2012. We do not expect the adoption of this guidance to have a material impact on our consolidated financial statements.

ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

We have an investment portfolio of fixed income securities, including amounts classified as cash equivalents short-term investments and long-term investments of approximately $4.0 million at December 31, 2012. These securities are subject to interest rate fluctuations and will decrease in market value if interest rates increase.

The primary objective of our investment activities is to preserve principal while at the same time maximizing yields without significantly increasing risk. We invest primarily in high quality, short-term and long-term debt instruments. A hypothetical 100 basis point increase in interest rates would result in less than a $10,000 decrease (less than 1%) in the fair value of the Company's available-for-sale securities.  At December 31, 2012, we had an unrealized gain on our investments of less than $1,000 and an unrealized gain of approximately $9,000 at December 31, 2011.

ITEM 8: FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information required by this Item is contained in the financial statements and schedule set forth in Item 15 (a) of this Form 10-K.

ITEM 9: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

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ITEM 9A:  CONTROLS AND PROCEDURES

Controls and Procedures

(a)   Evaluation of disclosure controls and procedures.

Based on their evaluation as of December 31, 2012, our Chief Executive Officer and Chief Financial Officer, have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) were effective to ensure that the information required to be disclosed by us in this Annual Report on Form 10-K was recorded, processed, summarized and reported within the time periods specified in the SEC's rules and instructions for Form 10-K and that such disclosure controls and procedures were also effective to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

(b)   Changes in internal controls.

There has been no change in our internal control over financial reporting that occurred during our most recent fiscal year that has materially affected or is reasonably likely to materially affect our internal control over financial reporting.

Management's Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2012. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") in Internal Control-Integrated Framework. Our management has concluded that, as of December 31, 2012, our internal control over financial reporting is effective based on these criteria.

Our independent registered public accounting firm, BDO USA, LLP, which audited the financial statements in this Annual Report on Form 10-K, independently assessed the effectiveness of the company’s internal control over financial reporting. BDO USA, LLP has issued an attestation report, included in Part IV, Item 15(a) of this report.

ITEM 9B:  OTHER INFORMATION

None.

37

PART III

ITEM 10: DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this Item is incorporated herein by reference to the Company's Proxy Statement for the 2013 Annual Meeting of Stockholders.

ITEM 11: EXECUTIVE COMPENSATION

The information required by this Item is incorporated herein by reference to the Company's Proxy Statement for the 2013 Annual Meeting of Stockholders.

ITEM 12: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by this Item is incorporated herein by reference to the Company's Proxy Statement for the 2013 Annual Meeting of Stockholders.

ITEM 13: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by this Item is incorporated herein by reference to the Company's Proxy Statement for the 2013 Annual Meeting of Stockholders.

ITEM 14: PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this Item is incorporated herein by reference to the Company's Proxy Statement for the 2013 Annual Meeting of Stockholders.

38

PART IV

ITEM 15: EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)	1.	Consolidated Financial Statements
		For the following financial information included herein, see Index on page 40:
		Report of Independent Registered Public Accounting Firm
		Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting
			Consolidated Balance Sheets as of December 31, 2012 and 2011.
			Consolidated Statements of Operations for each of the three years in the period ended December 31, 2012.
			Consolidated Statements of Comprehensive Loss for each of the three years in the period ended December 31, 2012.
			Consolidated Statements of Stockholders' Equity for each of the three years in the period ended December 31, 2012.
			Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2012.
			Notes to Consolidated Financial Statements.
	2.	Financial Statement Schedule
		The financial statement schedules of the Company are included in Part IV of this report: As of and for each of the three years in the period ended December 31, 2012-II Valuation and Qualifying Accounts. All other schedules have been omitted because they are not applicable.
	3.	Exhibit Index
		See Exhibit Index immediately following the signature page for a list of exhibits filed or incorporated by reference as a part of this report.
(b)	Exhibits
		The Company hereby files, as exhibits to this Form 10-K, those exhibits listed on the Exhibit Index referenced in Item 15 (a) (3) above.

39

	Page
Report of Independent Registered Public Accounting Firm	41
Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting	42
Consolidated Balance Sheets as of December 31, 2012 and 2011	43
Consolidated Statements of Operations for each of the three years in the period ended December 31, 2012	44
Consolidated Statements of Comprehensive Loss for each of the three years in the period ended December 31, 2012	45
Consolidated Statements of Stockholders' Equity for each of the three years in the period ended December 31, 2012	46
Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2012	47
Notes to the Consolidated Financial Statements	48

40

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders

PLX Technology, Inc.

Sunnyvale, California

We have audited the accompanying consolidated balance sheets of PLX Technology, Inc. as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive loss, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2012.  In connection with our audits of the financial statements, we have also audited Schedule II – Valuation and Qualifying Accounts as of and for each of the years ended December 31, 2012, 2011 and 2010.  These financial statements and schedule are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and schedule are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and schedule, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and schedule.  We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of PLX Technology, Inc. at December 31, 2012 and 2011, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2012, in conformity with accounting principles generally accepted in the United States of America.

Also, in our opinion, Schedule II – Valuation and Qualifying Accounts, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), PLX Technology, Inc.’s internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and our report dated March 15, 2013, expressed an unqualified opinion thereon.

/s/ BDO USA, LLP

San Jose, California

March 15, 2013

41

 Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting

The Board of Directors and Stockholders

PLX Technology, Inc.

Sunnyvale, California

We have audited PLX Technology, Inc.’s internal control over financial reporting as of December 31, 2012, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria).  PLX Technology, Inc.’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Item 9A, Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the company's internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances.  We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial  reporting  includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable  assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting  principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, PLX Technology, Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2012, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of PLX Technology, Inc. as of December 31, 2012 and 2011, and the related consolidated statements of operations, comprehensive loss, stockholders' equity, and cash flows for each of the three years in the period ended December 31, 2012, and our report dated March 15, 2013, expressed an unqualified opinion thereon.

/s/ BDO USA, LLP

San Jose, California

March 15, 2013

42

 PLX TECHNOLOGY, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

	December 31,
	2012			2011
ASSETS
Current Assets:
Cash and cash equivalents	$	14,673		$	12,097
Short-term investments		1,787			7,549
Accounts receivable, less allowances of $2,100 and $2,391		10,635			11,074
Inventories		10,560			8,896
Other current assets		2,894			1,323
Total current assets		40,549			40,939
Goodwill		20,461			21,338
Other purchased intangible assets, net		-			20,845
Property and equipment, net		11,267			12,291
Long-term investments		251			106
Other assets		451			1,299
Total assets	$	72,979		$	96,818
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	10,738		$	7,134
Accrued compensation and benefits		4,493			3,586
Accrued commissions		817			632
Other accrued expenses		2,259			3,132
Short term note payable and capital lease obligation		-			5,115
Short term borrowings against line of credit		8,000			-
Total current liabilities		26,307			19,599
Long term borrowings against line of credit		-			2,000
Total liabilities		26,307			21,599
Commitments and contingencies (Notes 12 and 15)
Stockholders' equity:
Preferred stock, $0.001 par value per share:
Authorized -- 5,000,000  shares: none issued and outstanding		-			-
Common stock, $0.001 par value per share:
Authorized -- 200,000,000 shares: issued and outstanding - 45,094,668 and 44,701,118		45			45
Additional paid-in capital		189,444			185,323
Accumulated other comprehensive loss		(226	)		(147	)
Accumulated deficit		(142,591	)		(110,002	)
Total stockholders' equity		46,672			75,219
Total liabilities and stockholders' equity	$	72,979		$	96,818

 See accompanying notes to consolidated financial statements.

43

PLX TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

	Years Ended December 31,
	2012			2011			2010
Net revenues	$	100,248		$	111,152		$	115,540
Cost of revenues		41,462			46,600			47,753
Gross profit		58,786			64,552			67,787
Operating expenses
Research and development		27,532			28,218			30,799
Selling, general and administrative		28,927			28,037			26,720
Net acquisition and restructuring related costs		6,898			(507	)		855
Amortization of purchased intangible assets		245			2,801			2,593
Total operating expenses		63,602			58,549			60,967
Income (loss) from operations		(4,816	)		6,003			6,820
Interest income		33			73			186
Interest expense		(203	)		(165	)		(117	)
Other income (expense), net		21			(56	)		(12	)
Income (loss) from continuing operations before provision for income taxes		(4,965	)		5,855			6,877
Provision for income taxes		236			2,751			2,235
Income (loss) from continuing operations, net of tax		(5,201	)		3,104			4,642
Loss from discontinued operations (including gain on disposal of $3,450 in 2012), net of tax		(27,388	)		(27,927	)		(7,931	)
Net loss	$	(32,589	)	$	(24,823	)	$	(3,289	)
Basic net income (loss) per share:
Income (loss) from continuing operations	$	(0.12	)	$	0.07		$	0.12
Loss from discontinued operations	$	(0.61	)	$	(0.63	)	$	(0.20	)
Net loss	$	(0.73	)	$	(0.56	)	$	(0.08	)
Diluted net income (loss) per share:
Income (loss) from continuing operations	$	(0.12	)	$	0.07		$	0.12
Loss from discontinued operations	$	(0.61	)	$	(0.62	)	$	(0.20	)
Net loss	$	(0.73	)	$	(0.55	)	$	(0.08	)
Shares used to compute per share amounts
Basic		44,882			44,559			38,942
Diluted		44,882			45,016			39,625

See accompanying notes to consolidated financial statements.

44

PLX TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands)

	Years Ended December 31,
	2012			2011			2010
Net loss	$	(32,589	)	$	(24,823	)	$	(3,289	)
Unrealized gain (loss) on marketable securities, net		(8	)		15			(34	)
Foreign currency translation adjustments		(71	)		(14	)		(27	)
Comprehensive net loss	$	(32,668	)	$	(24,822	)	$	(3,350	)

See accompanying notes to consolidated financial statements.

45

PLX TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(in thousands, except share amounts)
 

								Accumulated
								Other
						Additional		Comprehensive						Total
	Common Stock					Paid-in		Income			Accumulated			Stockholders'
	Shares			Amount		Capital		(Loss)			Deficit			Equity
Balance at December 31, 2009		37,012,223		$	37	$	153,939	$	(87	)	$	(81,890	)	$	71,999
Share-based compensation expense		-			-		1,264		-			-			1,264
Issuance of stock:
under employee equity plans		92,188			1		222		-			-			223
in connection with the acquisition of Teranetics		7,399,980			7		27,447		-			-			27,454
true up in connection with the acquisition of Oxford		(20	)		-		-		-			-			-
Tax benefit related to exercise of stock options		-			-		218		-			-			218
Change in unrealized loss on investments		-			-		-		(34	)		-			(34	)
Translation adjustments		-			-		-		(27	)		-			(27	)
Net loss		-			-		-		-			(3,289	)		(3,289	)
Balance at December 31, 2010		44,504,371			45		183,090		(148	)		(85,179	)		97,808
Share-based compensation expense		-			-		1,872		-			-			1,872
Issuance of stock:
under employee equity plans		196,747			-		361		-			-			361
Change in unrealized loss on investments		-			-		-		15			-			15
Translation adjustments		-			-		-		(14	)		-			(14	)
Net loss		-			-		-		-			(24,823	)		(24,823	)
Balance at December 31, 2011		44,701,118			45		185,323		(147	)		(110,002	)		75,219
Share-based compensation expense		-			-		2,963		-			-			2,963
Issuance of stock:
under employee equity plans, net of settlement for taxes		393,550			-		1,158		-			-			1,158
Change in unrealized loss on investments		-			-		-		(8	)		-			(8	)
Translation adjustments		-			-		-		(71	)		-			(71	)
Net loss		-			-		-		-			(32,589	)		(32,589	)
Balance at December 31, 2012		45,094,668		$	45	$	189,444	$	(226	)	$	(142,591	)	$	46,672

See accompanying notes to consolidated financial statements.

46

PLX TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Years Ended December 31,
	2012			2011			2010
Cash flows used in operating activities:
Net loss	$	(32,589	)	$	(24,823	)	$	(3,289	)
Adjustments to reconcile net loss to net cash flows used in operating activities,
net of assets acquired and liabilities assumed:
Depreciation and amortization		2,993			3,510			3,458
Share-based compensation expense		2,963			1,872			1,264
Amortization of purchased intangible assets		5,284			10,639			4,656
Impairment of assets		10,343			-			-
Gain on sale of business		(3,450	)		-			-
Write-downs of inventories		1,035			1,649			669
Escrow claim settlement		-			(1,397	)		-
Other non-cash items		91			257			271
Changes in operating assets and liabilities:
Accounts receivable		434			2,481			(3,945	)
Inventories		(3,952	)		2,773			(3,767	)
Other current assets		29			2,816			(1,112	)
Other assets		244			(300	)		623
Accounts payable		3,604			(1,649	)		(625	)
Accrued compensation and benefits		907			(1,612	)		3,376
Accrued commissions		185			118			(231	)
Other accrued expenses		(558	)		1,010			(1,847	)
Net cash used in operating activities		(12,437	)		(2,656	)		(499	)
Cash flows provided by investing activities:
Cash received in divestiture		10,400			500			-
Cash used in acquisition		-			-			(810	)
Purchase of marketable securities		(5,589	)		(6,257	)		(34,829	)
Sales and maturities of marketable securities		11,110			16,239			45,531
Purchase of property and equipment		(2,561	)		(2,956	)		(3,390	)
Proceeds from sales of property and equipment		-			-			22
Net cash provided by investing activities		13,360			7,526			6,524
Cash flows provided by (used in) used in financing activities:
Borrowing against line of credit		12,500			2,000			-
Principal payments on line of credit		(6,500	)		-			-
Proceeds from exercise of common stock options		1,224			361			223
Taxes paid related to net share settlement of equity awards		(66	)		-			-
Excess tax benefit from share-based compensation		-			-			242
Principal payment on acquisition note		(4,848	)		-			-
Principal payments on capital lease obligations		(583	)		(906	)		(727	)
Payments of assumed debt		-			-			(11,195	)
Net cash provided by (used in) financing activities		1,727			1,455			(11,457	)
Effect of exchange rate fluctuations on cash and cash equivalents		(74	)		(63	)		(32	)
Increase (decrease) in cash and cash equivalents		2,576			6,262			(5,464	)
Cash and cash equivalents at beginning of year		12,097			5,835			11,299
Cash and cash equivalents at end of year	$	14,673		$	12,097		$	5,835
Supplemental disclosure of cash flow information:
Cash from income tax refunds	$	15		$	990		$	2
Cash paid for income taxes	$	17		$	9		$	1,017
Cash paid for interest	$	334		$	56		$	1,268
Common stock issued in connection with acquisition	$	-		$	-		$	27,454
Notes issued in connection with acquisition	$	-		$	-		$	6,650

See accompanying notes to consolidated financial statements.

47

PLX TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  Organization and Summary of Significant Accounting Policies

Description of Business

PLX Technology, Inc. ("PLX" or the "Company"), a Delaware corporation established in May 1986, designs, develops manufactures and sells semiconductor devices that accelerate and manage the transfer of data in microprocessor-based systems including networking and telecommunications, enterprise storage, servers, personal computers (PCs), PC peripherals, consumer electronics, imaging and industrial products. The Company offers a complete solution consisting of two related types of products: semiconductor devices and development kits. The Company’s semiconductor devices simplify the development of data transfer circuits in micro-processor based systems. The Company’s development kits promote sales of its semiconductor devices by lowering customers' development costs and by accelerating their ability to bring new products to market. The Company utilizes a “fabless” semiconductor business model whereby it purchases wafers and packaged and tested semiconductor devices from independent manufacturing foundries.  Semiconductor devices as well as occasional IP and development service revenues account for substantially all of the Company's net revenues.

On September 20, 2012, the Company completed the sale of a portion of its physical layer 10GBase-T integrated circuit (“PHY”) family of products pursuant to an Asset Purchase Agreement between the Company and Aquantia Corporation dated September 14, 2012.  The Company had also entered into an Asset Purchase Agreement with Entropic Communications, Inc. on July 6, 2012, as amended on November 21, 2012, pursuant to which the Company completed the sale of its digital channel stacking switch product line within the PHY product family, including certain assets exclusively related to the product line.  Together, these divestitures completed the sale of the PHY business. The operations of the PHY related business have been segregated from continuing operations and are presented as discontinued operations in the Company’s consolidated statement of operations for the periods from October 1, 2010, the date the Company acquired the PHY business, through December 31, 2012 in these financial statements.

On April 30, 2012, the Company entered into an Agreement and Plan of Merger ("Merger Agreement") with Integrated Device Technology, Inc. ("IDT") in which IDT would purchase all of the Company's outstanding shares of common stock in exchange for consideration, per share, comprised of (i) $3.50 in cash plus (ii) 0.525 of a share of IDT common stock.

The Merger Agreement was subject to various conditions, including, but not limited to (i) at least a majority of shares of PLX common stock then outstanding (calculated on a fully diluted basis) being tendered into the Offer, (ii) the expiration or termination of the applicable Hart-Scott-Rodino Act ("HSR Act") waiting period, (iii) the registration statement for IDT's common stock issuable in connection with the Offer and Merger being declared effective by the SEC and the listing of such shares on Nasdaq and (iv) the absence of any Company Material Adverse Effect (as defined in the Merger Agreement) with respect to PLX's business.

On December 18, 2012, the United States Federal Trade Commission ("FTC") filed an administrative complaint challenging IDT's proposed acquisition of PLX. On December 19, 2012, as a result of the FTC's determination to challenge the proposed acquisition, IDT and PLX mutually agreed to terminate the Merger Agreement.

Basis of Presentation

The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States and include the accounts of the Company and its wholly-owned subsidiaries in China, India, Japan, Korea, Singapore, Taiwan and the United Kingdom. All intercompany transactions and balances have been eliminated.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

48

Investments   

At December 31, 2012, the Company’s securities consisted of certificates of deposits and debt securities.  Management determines the appropriate classification of debt securities at the time of purchase and reevaluates such designation as of each balance sheet date. At December 31, 2012 and 2011, all debt securities were designated as available-for-sale. Available-for-sale securities are carried at fair value, based on quoted market prices or prices quoted in markets that are not active, with unrealized gains and losses reported in a separate component of stockholders' equity. The amortized cost of debt securities is adjusted for the amortization of premiums and the accretion of discounts to maturity both of which are included in interest income. Realized gains and losses are recorded on the specific identification method.

The accounting guidance for fair value measurements provided a framework for measuring fair value and expands related disclosures. Fair value is defined as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The guidance also established a hierarchy which requires an entity to maximize the use of observable inputs, when available.  The guidance requires fair value measurement be classified and disclosed in one of the following three categories:

Level 1: Valuations based on quoted prices in active markets for identical assets and liabilities.  The fair value of available-for-sale securities included in the level 1 category is based on quoted prices that are readily and regularly available in an active market.

Level 2: Valuations based on observable inputs (other than Level 1 prices), such as quoted prices for similar assets at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly. The fair value of available-for-sale securities included in the Level 2 category is based upon quoted prices in markets that are not active and incorporate available trade, bid and other market information.

Level 3: Valuations based on inputs that are unobservable and involve management judgment and the reporting entity’s own assumptions about market participants and pricing.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are recorded at the invoiced amount and do not bear interest.  The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable.  The Company determines the allowance based on historical write-off experience and customer economic data.  The Company reviews its allowance for doubtful accounts monthly.  Past due balances over 90 days are reviewed individually for collectability.  Account balances are charged off against the allowance when the Company believes that it is probable the receivable will not be recovered.

Inventories

Inventories are valued at the lower of cost (first-in, first-out method) or market (net realizable value).  Inventories were as follows (in thousands):

	December 31,
	2012		2011
Work-in-process	$	4,986	$	4,216
Finished goods		5,574		4,680
Total	$	10,560	$	8,896

The Company evaluates the need for potential inventory write downs by considering a combination of factors, including the life of the product, sales history, obsolescence, sales forecasts and expected sales prices.

49

Goodwill and Other Intangible Assets

Goodwill represents the excess of cost over the value of net assets of businesses acquired and is carried at cost unless write-downs for impairment are required. The Company’s goodwill as of December 31, 2012, is a result of the Oxford and Teranetics acquisition on January 2, 2009 and October 1, 2010, respectively, as adjusted for the 2012 divestiture of the PHY business and the 2011 divestiture of the UK design team.  The Company evaluates the carrying value of goodwill on an annual basis during the fourth quarter and whenever events and changes in circumstances indicate that the carrying amount may not be recoverable. Such indicators would include a significant reduction in the Company's market capitalization, a decrease in operating results or a deterioration in the Company's financial position. The Company operates under a single reporting unit, and accordingly, all of its goodwill is associated with the entire company. In the fourth quarter of 2012 and 2011, the Company tested the goodwill acquired and determined there was no impairment.

Changes in the carrying amount of goodwill for the years ended December 31, 2012 and 2011 are as follows (in thousands):

Net goodwill as of December 31, 2010	$	21,412
Adjustment for divestiture of UK design team		(74	)
Net goodwill as of December 31, 2011		21,338
Adjustment for divestiture of PHY business		(877	)
Net goodwill as of December 31, 2012	$	20,461

The purchased intangible assets including customer base and developed/core technology were being amortized over the assets’ useful lives, which ranged from one to six years, utilizing the straight-line or accelerated methods which approximates the estimated future cash flows from the intangible. The Company evaluates other intangible assets for impairment whenever events and circumstances indicate that such assets might be impaired. Also, see Note 11 to the consolidated financial statements.

Long-lived Asset Impairment

Long-lived assets, principally property and equipment and identifiable intangibles, held and used by the Company are reviewed for impairment whenever events or circumstances indicate that the carrying amount of assets may not be recoverable.  The Company evaluates recoverability of assets to be held and used by comparing the carrying amount of an asset to estimated future net undiscounted cash flows generated by the asset.  If such assets are considered to be impaired, the impairment recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of thirty nine years for buildings, three to eight years for building improvements and three to seven years for equipment, furniture and purchased software.

50

Property and equipment are as follows (in thousands):

	December 31,
	2012			2011
Land	$	3,150		$	3,150
Building and improvements		4,327			4,327
Equipment and furniture		14,955			14,681
Purchased software		2,371			2,513
		24,803			24,671
Accumulated depreciation		(13,536	)		(12,380	)
Net property and equipment	$	11,267		$	12,291

Depreciation and amortization expense from continuing operations pertaining to property and equipment was approximately $2.2 million, $2.4 million and $2.2 million for the years ended December 31, 2012, 2011 and 2010, respectively.

Foreign Currency Translation

The functional currency of the Company’s international subsidiaries in China, India, Japan, Korea Singapore, Taiwan and UK, is the local currency of the resident countries.  Assets and liabilities of the Company’s foreign subsidiaries are translated into the Company’s reporting currency at month-end exchange rates.  Revenues and expenses of the Company’s foreign subsidiaries are translated into the Company’s reporting currency at weighted-average exchange rates. The effects of the translation are included in a separate component of the Consolidated Statements of Stockholder’s Equity and Comprehensive Loss.

Income Taxes

Income taxes are accounted for using the asset and liability method.  Under this method, deferred tax liabilities and assets are recognized for the expected future tax consequences of differences between the carrying amounts and the tax bases of assets and liabilities.  A valuation allowance is provided when it is more likely than not that all or some portion of deferred tax assets will not be realized.

The Company recognizes the tax liability for uncertain income tax positions on the income tax return based on the two-step process. The first step is to determine whether it is more likely than not that each income tax position would be sustained upon audit. The second step is to estimate and measure the tax benefit as the amount that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority. Estimating these amounts requires the Company to determine the probability of various possible outcomes. The Company evaluates these uncertain tax positions on a quarterly basis. This evaluation is based on the consideration of several factors including changes in facts or circumstances, changes in applicable tax law, settlement of issues under audit, and new exposures. If the Company later determines that the exposure is lower or that the liability is not sufficient to cover its revised expectations, the Company adjusts the liability and effect a related change in its tax provision during the period in which the Company makes such determination.

Revenue Recognition

The Companyrecognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collection is reasonably assured.

Revenue from product sales to direct customers and distributors is recognized upon shipment and transfer of risk of loss, if the Company believes collection is reasonably assured and all other revenue recognition criteria are met. The Company assesses the probability of collection based on a number of factors, including past transaction history and the customer’s creditworthiness.  At the end of each reporting period, the sufficiency of allowances is assessed based on the age of the receivable and the individual customer’s creditworthiness.

51

The Company offers pricing protection to two distributors whereby the Company supports the distributor’s resale product margin on certain products held in the distributor’s inventory. The Company analyzes current requests for credit in process, also known as ship and debits, historical rates and amounts of credits issued, and inventory at the distributor to determine the ending sales reserve required for this program. The Company also offers stock rotation rights to three distributors such that they can return up to a total of 5% of products purchased every six months in exchange for other PLX products of equal value. The Company analyzes current stock rotation requests and past experience to determine the ending sales reserve required for this program. In addition, the Company had arrangements with a small number of customers offering a rebate program on various products, which were terminated in June 2010. The Company recorded rebates as a reduction of revenue when the rebate is in the form of cash consideration. Reserves are reduced directly from revenue and recorded as a reduction to accounts receivable.

Product Warranty

The Company sells products with a limited warranty of product quality for a period of one year, and up to three years for a small number of customers, and a limited indemnification of customers against intellectual property infringement claims related to the Company’s products. The Company accrues for known warranty and indemnification issues if a loss is probable and can be reasonably estimated, and accrues for estimated incurred but unidentified issues based on historical activity.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods.  Actual results could differ from those estimates and such differences may be material to the consolidated financial statements.

Comprehensive Loss

The components of accumulated other comprehensive loss, reflected in the Consolidated Statements of Stockholders' Equity and Comprehensive Loss, consisted of the following (in thousands):

	Years Ended December 31,
	2012			2011			2010
Unrealized gain (loss) on investments, net	$	1		$	9		$	(6	)
Cumulative translation adjustments		(227	)		(156	)		(142	)
Accumulated other comprehensive loss	$	(226	)	$	(147	)	$	(148	)

Recent Accounting Pronouncements

In June 2011, the Financial Accounting Standards Board (“FASB”) issued a standard which revised the presentation of other comprehensive income (“OCI”). The new guidance requires entities to present net income and OCI in either a single continuous statement or in separate consecutive statements. The guidance does not change the components of net income or OCI, when OCI should be reclassified to net income, or the earnings per share calculation. This accounting guidance was effective for annual reporting periods beginning after December 15, 2011. The Company adopted this guidance as of January 1, 2012 using two consecutive statements.

In July 2012, the FASB issued amended standards to simplify how entities test indefinite-lived intangible assets for impairment which improve consistency in impairment testing requirements among long-lived asset categories. These amended standards permit an assessment of qualitative factors to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying value. For assets in which this assessment concludes it is more likely than not that the fair value is more than its carrying value, these amended standards eliminate the requirement to perform quantitative impairment testing as outlined in the previously issued standards. These amended standards are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

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In February 2013, the FASB issued amended standards to improve the reporting of reclassifications out of accumulated other comprehensive income by requiring an entity to report their corresponding effect(s) on net income. These amended standards are effective for annual reporting periods beginning after December 15, 2012. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

2.  Share-Based Compensation

Equity Incentive Plans

In May 2008, the Company’s stockholders approved the 2008 Equity Incentive Plan (“2008 Plan”).  The 2008 Plan was amended by the Company’s stockholders in May 2010 to increase the number of shares reserved for issuance under the Plan by 1,500,000 shares. In May 2011, the 2008 Plan was amended again by the Company’s stockholders to increase the number of shares reserved for issuance under the Plan by 2,300,000 shares. Under the 2008 Plan, there is currently authorized for issuance and available for awards an aggregate of 5,000,000 shares of the Company’s common stock, plus up to an additional 2,407,369 shares that otherwise would have reverted to the share reserve of the Company’s prior incentive plan, the Company’s 1999 Stock Incentive Plan, subject to an overall, aggregate share reserve limit of 7,407,369 shares. Awards under the 2008 Plan may include stock options, restricted stock, stock appreciation rights, performance awards, restricted stock units and other awards, provided that with respect to full value awards, such as restricted stock or restricted stock units, no more than 300,000 shares may be issued in the form of full value awards during the term of the 2008 Plan.  Awards under the 2008 Plan may be made to the Company’s officers and other employees, its board members and consultants that it hires.  Generally, options vest over a four-year period and expire no more than seven years after the date of grant.  The 2008 Plan has a term of ten years.

Employee Stock Ownership Plan

In January 2009, the Company established the PLX Technology, Inc. Employee Stock Ownership Plan (the “ESOP”). The ESOP is a tax-qualified defined contribution retirement plan that is non-contributory.  PLX regular employees (other than nonresident aliens with no U.S.-source income, employees covered by a collective bargaining agreement, leased employees and employees of a non-participating subsidiary of PLX) who are at least 18 years old and have worked for PLX for at least 12 consecutive months are eligible to participate in the ESOP.  The Company made cash contributions equal to a percentage of eligible compensation that is determined annually by the Board of Directors. Eligible compensation was limited to $150,000.  The contributions were used to purchase common stock of the Company. Since the adoption of the ESOP, the Company has made annual contributions of 2% of each employee's eligible compensation up to a maximum of $3,000 for any single employee (2% of $150,000 of eligible compensation).  In accordance with the IDT merger agreement, the Company ceased contributing to the plan after the April 2012 contribution. The Company’s possible reinstatement of contributions for 2013 is under review.  Eligible participants received a share allocation at the end of the plan year based on the contributions plus an additional allocation for forfeitures that occurred during the plan year.  The shares and forfeitures are allocated to each ESOP participant who is employed on the last day of the ESOP Plan Year (December 31) in the same proportion that the compensation (up to the $150,000 limit) of each ESOP participant bears to the eligible compensation of all ESOP participants. 

Share-Based Compensation Expense

The fair value of share-based awards to employees is calculated using the Black-Scholes option pricing model, which requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values.

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The weighted-average fair value of share-based compensation to employees is based on the multiple option valuation approach. Forfeitures are estimated and it is assumed no dividends will be declared. The estimated fair value of share-based compensation awards to employees is amortized using the straight-line method over the vesting period of the options. The weighted-average fair value calculations are based on the following average assumptions:

	Years Ended December 31,
	2012			2011			2010
Expected volatility		62.90	%		61.34	%		61.54	%
Expected life (in years)		4.35			4.32			4.19
Risk-free interest rate		0.68	%		1.21	%		1.61	%

Risk-Free Interest Rate. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for the expected term of the option.

Expected Life. The Company’s expected life represents the weighted-average period that the Company’s stock options are expected to be outstanding. The expected life is based on the observed and expected time to post-vesting exercise of options by employees. The Company uses historical exercise patterns of previously granted options in relation to stock price movements to derive an employee behavioral pattern used to forecast expected exercise patterns.

Expected Volatility. The Company believes that historical volatility best represents expected volatility due to the lack of market data consistently available to calculate implied volatility. The historical volatility is based on the weekly closing prices of its common stock over a period equal to the expected term of the option and is a strong indicator of the expected future volatility.

These factors could change in the future, which would affect the share-based compensation expense in future periods.

As share-based compensation expense recognized in the Consolidated Statements of Operations for the fiscal years 2012, 2011 and 2010 is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. Forfeitures are estimated based on historical experience at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

The following table shows total share-based compensation and employee stock ownership plan expenses recorded for the years ended December 31, 2012, 2011 and 2010 (in thousands):

	Years Ended December 31,
	2012		2011		2010
Cost of revenues	$	147	$	47	$	33
Research and development		1,007		485		602
Selling, general and administrative		1,739		1,138		863
Discontinued operations (1)		251		660		113
Total share-based compensation expense	$	3,144	$	2,330	$	1,611

(1)   Recorded in loss from discontinued operations in the Consolidated Statement of Operations.

Share-based compensation expense from employee stock options and restricted stock units (“RSUs”) was $3.0 million, $1.9 million and $1.3 million for the years ended December 31, 2012, 2011 and 2010, respectively. For the same periods, ESOP expenses were $0.2 million, $0.5 million and $0.3 million, respectively.

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A summary of option activity under the Company’s stock equity plans during the years ended December 31, 2012, 2011 and 2010 are as follows:

				Weighted Average
				Remaining	Aggregate
	Number of	Weighted Average		Contractual Term	Intrinsic
Options	Shares	Exercise Price		(in years)	Value
Outstanding at December 31, 2009	2,825,796	$	4.36	5.14	$	1,794,310
Granted	1,581,000		4.27
Exercised	(92,188)		2.42
Cancelled	(111,955)		5.65
Outstanding at December 31, 2010	4,202,653		4.34	5.06	$	2,314,975
Granted	1,484,500		3.44
Exercised	(196,747)		1.84
Cancelled	(878,039)		4.35
Outstanding at December 31, 2011	4,612,367		4.15	4.61	$	872,567
Granted	1,066,000		4.38
Exercised	(372,444)		3.29
Cancelled	(1,083,371)		4.86
Outstanding at December 31, 2012	4,222,552		4.10	3.93	$	1,759,014
Exercisable at December 31, 2012	2,656,894	$	4.11	3.08	$	1,550,784

The Black-Scholes weighted average fair values of options granted during the years ended December 31, 2012, 2011 and 2010 were $2.17, $1.69, and $2.08, respectively.

The following table summarizes ranges of outstanding and exercisable options as of December 31, 2012:

	Options Outstanding				Options Exercisable
		Weighted Average
		Remaining	Weighted			Weighted
Range of		Contractual Term	Average			Average
Exercise Price	Number	(in years)	Exercise Price		Number	Exercise Price
$1.80-$2.69	1,075,761	3.46	$	2.13	925,824	$	2.06
$2.70-$3.73	1,041,656	3.89		3.54	592,303		3.50
$3.74-$4.10	855,577	5.26		4.03	213,402		3.85
$4.11-$6.66	913,666	4.22		5.13	589,473		4.91
$6.67-$15.58	335,892	1.36		9.57	335,892		9.57
Total	4,222,552	3.93	$	4.10	2,656,894	$	4.11

The total intrinsic value of options exercised during the years ended December 31, 2012, 2011 and 2010 was $0.8 million, $0.3 million, and $0.3 million, respectively.

The fair value of options vested during the year ended December 31, 2012 was approximately $2.5 million.

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As of December 31, 2012, total unrecognized compensation costs related to nonvested stock options net of estimated forfeitures was $1.2 million which is expected to be recognized as expense over a weighted average period of approximately 1.22 years.

The following table summarizes the activity for our RSUs during the year ended December 31, 2012:

	Nonvested Restricted Stock Units
	Number of		Weighted Average
	Shares		Grant-Date Fair Value
December 31, 2011	-		$	-
Granted	301,000			6.27
Vested	(33,500	)		6.46
Cancelled	(27,400	)		6.66
December 31, 2012	240,100		$	6.20

As of December 31, 2012, total unrecognized compensation cost related to nonvested RSUs was $0.2 million which is expected to be recognized in the first quarter of 2013. RSUs vest on January 1, 2013 and February 28, 2013 or accelerate upon an employee’s involuntary separation from the Company other than for cause.

3.  Net Income (Loss) Per Share

The Company uses the treasury stock method to calculate the weighted-average shares used in the diluted earnings per. The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands, except per share data):

	Years Ended December 31,
	2012			2011		2010
Income (loss) from continuing operations	$	(5,201	)	$	3,104	$	4,642
Weighted average shares outstanding - basic		44,882			44,559		38,942
Dilutive effect of stock options and RSUs		-			457		683
Weighted average shares outstanding - diluted		44,882			45,016		39,625
Basic income (loss) per share from continuing operations	$	(0.12	)	$	0.07	$	0.12
Diluted income (loss) per share from continuing operations	$	(0.12	)	$	0.07	$	0.12

As the Company incurred a loss from continuing operations for the year ended December 31, 2012, the effect of dilutive securities, totaling 4.5 million has been excluded from the computation of diluted loss per share, as their impact would be anti-dilutive.  Dilutive securities are comprised of options to purchase common stock and RSUs.

Weighted average employee stock options to purchase approximately 3.4 million and 2.0 million for the years ended December 31, 2011 and 2010, respectively, were outstanding, but were not included in the computation of diluted earnings per share as the exercise price of the options was greater than the average share price of the Company’s stock and, therefore, the effect would have been anti-dilutive.

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4.  Financial Instruments

Fair Value Measurements

The fair value of financial assets and liabilities measured on a recurring basis is as follows (in thousands):

			Fair Value Measurement as Reporting Date Using
			Quoted Prices in Active Markets		Significant Other		Significant
			for Identical Assets or Liabilities		Observable Inputs		Unobservable Inputs
	December 31, 2012		(Level 1)		(Level 2)		(Level 3)
Assets:
Money market funds	$	1,809	$	1,809	$	-	$	-
Certificate of deposit		2,707		-		2,707		-
Marketable securities		1,259		-		1,259		-
Escrow Receivable		1,600		-		-		1,600
Total	$	7,375	$	1,809	$	3,966	$	1,600

			Fair Value Measurement as Reporting Date Using
			Quoted Prices in Active Markets		Significant Other		Significant
			for Identical Assets or Liabilities		Observable Inputs		Unobservable Inputs
	December 31, 2011		(Level 1)		(Level 2)		(Level 3)
Assets:
Money market funds	$	89	$	89	$	-	$	-
Certificate of deposit		2,988		-		2,988		-
Marketable securities		6,161		-		6,161		-
Total	$	9,238	$	89	$	9,149	$	-

The fair value of the Company’s money-market funds classified as Level 1 is valued using prices in active markets. The fair values of the Company’s investments classified as Level 2 are valued using inputs that include actual trade data, benchmark yields, broker/dealer quotes and other similar data. These inputs are obtained from quoted market prices, independent pricing vendors or other sources.

The estimated fair value of the escrow payment is based on assumptions made regarding potential claims against the escrow using historical and market data and a 3.25% discount rate to consider present value. The Company estimated a claims rate of 17%. These assumptions and fair value estimate are subject to change. Changes in these inputs would change the assessed fair value of the escrow receivable. See Note 7 of the consolidated financial statements for more information on the escrow receivable. As of December 31, 2011, there were no Level 3 measurements.

Investments

As of December 31, 2012, the Company’s securities consisted of certificates of deposits and debt securities and were designated as available-for-sale. Available-for-sale securities are carried at fair value, based on quoted market prices or prices quoted in markets that are not active, with unrealized gains and losses reported in a separate component of stockholders’ equity.  The amortized cost of debt securities is adjusted for the amortization of premiums and the accretion of discounts to maturity, both of which are included in interest income.  Realized gains and losses are recorded on the specific identification method.

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The fair value of available-for-sale investments is as follows (in thousands):

	December 31, 2012
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gain		Loss		Fair Value
Certificate of deposit	$	2,707	$	-	$	-	$	2,707
Marketable securities:
Corporate bonds and notes		278		-		-		278
Municipal bonds		981		-		-		981
Total	$	3,966	$	-	$	-	$	3,966
Less amounts classified as cash equivalents								(1,928	)
Total short and long-term available-for-sale investments							$	2,038
Contractual maturity dates for investments:
Less than one year:								1,787
One to two years:								251
							$	2,038

	December 31, 2011
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gain		Loss		Fair Value
Certificate of deposit	$	2,988	$	-	$	-	$	2,988
Marketable securities:
Corporate bonds and notes		434		-		-		434
Municipal bonds		2,083		4		-		2,087
US treasury and government agencies securities		3,635		5		-		3,640
Total	$	9,140	$	9	$	-	$	9,149
Less amounts classified as cash equivalents								(1,494	)
Total short and long-term available-for-sale investments							$	7,655
Contractual maturity dates for investments:
Less than one year:								7,549
One to two years:								106
							$	7,655

As of December 31, 2012 and 2011, the Company had an aggregate unrealized loss of less than $1,000.

The Company reviews its available for sale investments for impairment at the end of each period.  Investments in debt securities, which make up the majority of the Company’s investments, are considered impaired when the fair value of the debt security is below its amortized cost. If an impairment exists and the Company determines it has intent to sell the debt security or if it is more likely than not that it will be required to sell the debt security before recovery of its amortized cost basis, an other-than-temporary impairment loss is recognized in earnings to write the debt security down to its fair value. However, even if the Company does not expect to sell the debt security, it must evaluate expected cash flows to be received and determine if a credit loss exists. In the event of a credit loss, only the amount of impairment associated with the credit loss is recognized in earnings. Amounts relating to factors other than credit losses are recognized in other comprehensive loss. The Company did not record any other-than-temporary write-downs in the accompanying financial statements.

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5.  Concentrations of Credit, Customer and Supplier Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash equivalents, short-term investments, long-term investments and trade receivables. The Company generally invests its excess cash in money market funds, certificates of deposits, corporate bonds with high credit ratings, municipal bonds and treasury bills. The Company’s cash, cash equivalents, short and long-term investments were approximately $16.7 million as of December 31, 2012 which exceeded the amount insured by the Federal Deposit Insurance Corporation (“FDIC”).  The Company has not experienced any significant losses on its cash equivalents or short and long-term investments.

The Company performs ongoing credit evaluations of its customers and generally requires no collateral. Customers who accounted for 10% or more of net accounts receivable are as follows:

	December 31,
	2012			2011			2010
Excelpoint Systems Pte Ltd.		30	%		27	%		24	%
Avnet, Inc.		21	%		28	%		24	%
Answer Technology, Inc.		19	%		12	%		17	%

The Company analyzes the need for reserves for potential credit losses and records reserves when necessary. Through fiscal 2012, there were no direct end customers that accounted for more than 10% of net revenues. Sales to the following distributors accounted for 10% or more of net revenues:

	Years Ended December 31,
	2012			2011			2010
Excelpoint Systems Pte Ltd.		27	%		24	%		27	%
Avnet, Inc.		24	%		24	%		23	%
Answer Technology, Inc.		19	%		18	%		18	%

Currently, the Company relies on single source suppliers for the significant majority of its product inventory. As a result, should the Company's current suppliers not produce and deliver inventory for the Company to sell on a timely basis, operating results may be adversely impacted.

6.  UK Design Team Divestiture

On October 5, 2011 the Company entered into an Asset Purchase agreement and IP license with OCZ Technology Group (OCZ) for $2.2 million in cash, whereby OCZ acquired the Company’s UK design team and related assets and liabilities, and obtained a nonexclusive perpetual license of its consumer storage technology. The deal closed on October 21, 2011. The Company continues to offer and support its current consumer storage products.

Ralph Schmitt, PLX’s CEO in 2011, was also a member of OCZ’s board of directors.  Throughout the term of negotiations and up to the date of acquisition of assets, he removed himself from all discussions to ensure execution of an arms-length transaction and had no authority to make decisions or influence the outcome of the arrangement.

The Company recorded $1.7 million as license revenue and $0.5 million was allocated to sale of assets and the transfer of the UK design team and related liabilities based on the relative fair values. The carrying value of net assets transferred and goodwill allocated was $0.4 million and $74,000, respectively. Based on the carrying values of assets transferred, the Company recognized a gain of $28,000 on the divestiture.

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As a result of this divestiture, the Company also reviewed the useful life and amortization method of its storage acquired finite lived core technology intangible and determined that a change in the assets useful life and amortization method was required. The Company reduced the total estimated useful life of the intangible from five years to four years and changed the amortization method from straight line to an accelerated method that more closely matches the remaining cash inflows from the consumer storage products. The change in estimated life and amortization acceleration was reflected in the fourth quarter of 2011, the period of change.

7.  Discontinued Operation

On September 20, 2012, the Company completed the sale of its physical layer 10GBase-T integrated circuit (“PHY”) family of products pursuant to an Asset Purchase Agreement (the “Aquantia APA”) between the Company and Aquantia Corporation for $2.0 million in cash.

On July 6, 2012, the Company had also entered into an Asset Purchase Agreement (the “Entropic APA”) with Entropic Communications, Inc., pursuant to which the Company completed the sale of its digital channel stacking switch product line within the PHY product family, including certain assets exclusively related to the product line. Under the terms of the Entropic APA, the Company continued to have an obligation to complete the development in process.  The agreement provided for $3.0 million upon closing and up to $5.0 million in future payments.  Future payments consisted of a milestone payment of $2.0 million in connection with product acceptance, a $2.0 million escrow payment relating to certain representations, warranties and indemnities made by PLX and is due to be released to PLX twelve months after product acceptance and a $1.0 million milestone payment in the event a third party royalty arrangement is secured.  In conjunction with the Entropic APA, the Company entered into an Intellectual Property License Agreement (the “License Agreement”) with Entropic which provided a fully paid, non-exclusive, royalty free license to certain of the physical layer 10GBase-T integrated circuit technology which provided for a $4.0 million payment from Entropic to the Company upon signing.  In connection with the transaction with Aquantia, on November 21, 2012, the Company negotiated a modification to the Agreement with Entropic that amended and restated the product acceptance milestone such that the milestone was deemed to have occurred upon execution of the amendment and changed the associated consideration from $2.0 million to $1.4 million.  In exchange, the obligation of PLX to complete the development of the product was assumed by Entropic.
 

The consideration received for the combined sale of the PHY business totaled $12.0 million and consisted of cash received at closing in connection with the Aquantia APA of $2.0 million, the Entropic APA of $3.0 million, the License Agreement of $4.0 million, the accelerated product acceptance milestone payment of $1.4 million and the rights to the estimated fair value of the escrow payment under the Entropic APA of $1.6 million.  The estimated fair value of the escrow payment is included in the Company’s balance sheet as other current assets and is based on assumptions made regarding potential claims against the escrow using historical and market data and is subject to change.  Future payments of up to $1.0 million which is contingent on future milestone achievements were not included in the initial consideration recorded and will be accounted for when they are probable of being received. The Company recorded a gain of $3.5 million related to this divestiture. The following table summarizes the components of the gain (in thousands):

Cash proceeds from sale (including fair value amount held in escrow)	$	12,000
Less carrying value of assets transferred and asset write-offs:
Inventory transferred		(1,254	)
Fixed assets transferred		(631	)
Intangible assets write-off		(5,783	)
Goodwill write-off		(877	)
Other adjustments		(5	)
Gain on disposal	$	3,450

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The following is selected financial information included in loss from discontinued operations:

		Years Ended December 31,
		2012			2011			2010
	in thousands
Revenues		$	2,947		$	4,637		$	1,020
Gain on disposal			3,450			-			-
Loss before income taxes			(27,476	)		(30,531	)		(9,732	)
Benefit from income taxes			(88	)		(2,604	)		(1,801	)
Loss from discontinued operations		$	(27,388	)	$	(27,927	)	$	(7,931	)

8.  Teranetics, Inc. Acquisition

On October 1, 2010, the Company acquired all of the outstanding shares of capital stock of Teranetics, Inc. (Teranetics), a privately held fabless provider of high performance mixed-signal semiconductors.

The following table summarizes the consideration paid for Teranetics:

	Common		Cash at		Notes		Bridge
	Shares of PLX		Closing		A and B		Note		Total
Purchase price	$	26,406	$	887	$	6,386	$	1,000	$	34,679
Teranetics CEO bonus		1,048		35		264		-		1,347
Total	$	27,454	$	922	$	6,650	$	1,000	$	36,026

As a part of the merger agreement, the Company acquired all of the outstanding shares of capital stock of Teranetics in exchange for 7.4 million shares of common stock of PLX, cash of approximately $1.0 million and two promissory notes in the aggregate principal amount of $6.9 million. One note was for the principal amount of approximately $1.5 million and was due 3 years after the closing of the Merger, and the other note was for the principal amount of $5.4 million and was due 12 months after the closing of the Merger (this $5.4 million note was delivered into an escrow fund that may be used to satisfy indemnity obligations owed to PLX).   The stated interest rate on the promissory notes was 0.46%.   The promissory notes were fair valued based on market interest rates and the assessed fair value of the promissory notes was approximately $6.7 million. The Company delayed payment of the $5.4 million note as a result of indemnity claims it communicated to the Teranetics stockholders’ representative.  As a result of the claims, the Company negotiated a $1.9 million reduction against the two promissory notes.  The settlement included a cancelation of the $1.5 million note due in October 2013 and was recorded in 2011 as a reduction to acquisition and restructuring related costs in the Consolidated Statement of Operations for the assessed fair value of $1.4 million. The reduction of the note due in October 2011 of $0.5 million was recorded against specific expenses and liabilities the Company incurred in 2011. The remaining $5.0 million was paid on January 3, 2012.

The Company extended a bridge loan to Teranetics in the amount of $1.0 million during negotiations to support the working capital needs of Teranetics and in contemplation of the Merger.  Upon closing of the Merger, the $1.0 million bridge note was also considered part of the merger consideration provided as a component of the purchase price.

In addition to consideration transferred to former stockholders of Teranetics, PLX made payments at closing in the amount of $13.2 million to repay debt and other assumed liabilities.  The payments consisted of $11.2 million for convertible promissory note and line of credit debt and $2.0 million of payables for legal and investment banking services performed for Teranetics prior to closing and in connection with the merger.

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The Company agreed to pay the former Teranetics employees a bonus pool under the Teranetics Employee Retention Plan which required continued employment in order to be earned by individual employees.  Under the final plan, a total of $5.3 million was carved out of the consideration as a bonus pool to be paid out over a period of time to participants who were employees of Teranetics at the time of a change in control, provided they fulfilled certain future service requirements for the combined entity.  If any individual left prior to the completion of the required service period, any amounts forfeited by the individual was added back to the bonus pool and re-allocated to the remaining participants.  As of December 31, 2011, the Company has paid all of the $5.3 million of the retention bonus.  Approximately $2.3 million of retention bonus expense was recorded in 2011 and included in acquisition and restructuring related costs in the Consolidated Statement of Operations.

Recognized amounts of identifiable assets acquired and liabilities assumed (in thousands):

Cash and cash equivalents	$	112
Trade receivables		443
Inventories		444
Other current assets		360
Property, plant and equipment		673
Identifiable intangible assets		30,500
Other assets		42
Trade and other payable		(2,919	)
Accruals and other liabilities		(15,021	)
Total indentifiable net assets	$	14,634
Goodwill		20,045
	$	34,679

The fair value of assets acquired includes trade receivables of $0.4 million.  The gross amount due under sales related contracts was $0.4 million, of which none was expected to be uncollectible.

The identified intangible assets consist of core technology, trade name and customer relationships.  The valuation of the acquired intangibles is classified as a level 3 measurement under the fair value measurement guidance, because the valuation was based on significant unobservable inputs and involved management judgment and assumptions about market participants and pricing.   In determining fair value of the acquired intangible assets, we determined the appropriate unit of measure, the exit market and the highest and best use for the assets. The fair value was estimated using an incremental income approach.

The goodwill arising from the acquisition was largely attributable to the synergies expected to be realized after the Company’s acquisition and integration of Teranetics.  The Company only has one operating segment, semiconductor products, so all of the goodwill was assigned to the one segment.  Goodwill is not expected to be deductible for tax purposes.

Teranetics operating results for all periods presented have been reclassified to discontinued operations as a result of the sale of the business in September 2012. Teranetics contributed revenues and gross profit of $2.9 million and $0.5 million, respectively, to the Company for the year ended December 31, 2012, $4.6 million and $1.6 million, respectively, to the Company for the year ended December 31, 2011 and $1.0 million and $0.3 million, respectively, to the Company for the year ended December 31, 2010.  The Company integrated Teranetics operations shortly after acquisition and was fully integrated as of December 31, 2010 and it is therefore not practicable to identify earnings associated with Teranetics’ contribution.

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9.  Acquisition and Restructuring Costs

	Years Ended December 31,
	2012		2011			2010
	in thousands
Deal costs	$	6,898	$	88		$	855
Escrow claim settlement		-		(1,397	)		-
Severance costs		-		501			-
Lease commitment accrual		-		301			-
	$	6,898	$	(507	)	$	855

Acquisition Costs

For the year ended December 31, 2012, the Company recorded acquisition related costs of $6.9 million, primarily for outside legal and banking expenses associated with the IDT acquisition activities, which were subsequently terminated. For the years ended December 31, 2011 and 2010 we recorded $0.1 million and $0.9 million, respectively, in acquisition related costs associated with the October 1, 2010 acquisition of Teranetics. Deal costs related primarily to outside legal and accounting costs.

In 2011, as a result of the indemnity claims we communicated to the Teranetics stockholders’ representative, we negotiated a $1.9 million reduction against the two promissory notes. The settlement included the cancelation of the $1.5 million note due in October 2013 and was recorded in 2011 as a reduction to acquisition and restructuring related costs in the Consolidated Statement of Operations for the assessed fair value of $1.4 million for the portion of the claims not directly related to the operations of the PHY activity.
 

Severance

In the year ended December 31, 2011, the Company recorded approximately $0.5 million of severance and benefit related costs, included in acquisition and restructuring related costs in the Consolidated Statement of Operations, related to the termination of 14 employees worldwide as a result of the downsizing and refocus of the operations in the UK early in the year and cost control efforts as a result of the Teranetics acquisition. As of December 31, 2011, all of the $0.5 million severance and benefit related costs were paid.

The following table summarizes the activity within the severance and benefit related liability (in thousands):

	December 31,
	2012			2011
Liability at beginning of period	$	-		$	-
Continuing operations expense		-			501
Discontinued operations expense (1)		592			-
Cash payments		(277	)		(501	)
Liability at end of period	$	315		$	-

(1)   Recorded in loss from discontinued operations in the Consolidated Statement of Operations. Severance related to the termination of 14 employees and 4 contractors in connection with the sale of the PHY business is expected to be paid by March 31, 2013.

Lease Termination

In connection with the downsizing of UK operations, the Company vacated the first floor of its building as of March 2011. In March 2011, the Company recorded a $0.2 million liability, included in other accrued expenses in the Consolidated Balance Sheet, for future lease costs and early termination fees. The lease accrual charge of $0.2 million was recorded in acquisition and restructuring related costs in the Consolidated Statement of Operations. As of December 31, 2011 the lease liability was paid.

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The following table summarizes the activity within the lease termination liability (in thousands):

	December 31,
	2012			2011
Liability at beginning of period	$	281		$	-
Continuing operations expense		-			301
Discontinued operations expense (1)		-			554
Cash payments		(281	)		(574	)
Liability at end of period	$	-		$	281

(1)   Recorded in loss from discontinued operations in the Consolidated Statement of Operations. In October 2010, associated with the acquisition of Teranetics, the Company assumed a building lease in San Jose, California which was vacated in March 2011. Given current lease rates and the available space in the area when the property was vacated, the Company recorded a $0.4 million liability, included in other accrued expenses in the Consolidated Balance Sheet, for the estimated fair value of the future lease costs through June 2012, reduced by estimated sublease rental and adjusted for deferred rent. As of September 30, 2011, the Company was not able to sublease the property and as a result accrued the remaining liability of $0.2 million. The total adjusted cash payment was not materially different from the fair value. As of June 30, 2012, the lease liability was paid.

10.  Asset Impairment

In June 2012 the Company recorded impairment charges of $10.3 million related to its 10 Gigabit Ethernet business, including core technology of $9.6 million, trade name and customer relationships of $0.2 million and certain tangible assets of $0.5 million.  The primary factors contributing to this impairment charge was the uncertainty of and reduction in forecasted cash flows, resulting in  an increase in the probability that the product line will be sold or disposed of based on the reduction and timing of future cash flows.  In determining the amount of impairment charges the Company calculated the fair value of the asset group as of the impairment date.  The valuation of the assets was classified as a level 3 measurement under the fair value measurement guidance. The fair value was determined using the weighted average of a discounted cash flow analysis and a market approach along with proceeds received from Entropic in July 2012 in connection with the IP license agreement.  The discounted cash flow approach calculates the value based on the risk-adjusted present value of the cash flows related to 10 Gigabit Ethernet while the market approach calculates the value based on  indications of what a market participant would pay for the asset group.  The key unobservable inputs utilized in the discounted cash flow model include a 40% discount rate, a tax rate of 40% and future cash flows based on current product and market data.  The impairment was recorded in discontinued operations in the Company’s Consolidated Statement of Operations.

11.  Other Intangible Assets

The acquisition of Teranetics and Oxford included the acquisition of $30.5 million and $9.1 million, respectively, of identifiable intangible assets.  All of these intangibles are subject to amortization.  There is no estimated residual value on any of the intangible assets.

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The following table summarizes the gross carrying amount and accumulated amortization for each major intangible class and the weighted average amortization period, in total and by major intangible asset class (in thousands).

	December 31, 2012
	Gross Carrying		Accumulated			Net
	Value		Amortization			Value
Existing and core technology
Oxford USB and Serial Connectivity	$	4,600	$	(4,600	)	$	-
Oxford Network Attached Storage Connectivity		3,800		(3,800	)		-
Trade Name
Oxford		600		(600	)		-
Customer Relationships
Oxford		56		(56	)		-
Totals	$	9,056	$	(9,056	)	$	-

	December 31, 2011
	Gross Carrying		Accumulated			Net
	Value		Amortization			Value
Existing and core technology
Oxford USB and Serial Connectivity	$	4,600	$	(4,600	)	$	-
Oxford Network Attached Storage Connectivity		3,800		(3,555	)		245
Teranetics Network PHY		20,100		(4,187	)		15,913
Trade Name
Oxford		600		(600	)		-
Teranetics		200		(125	)		75
Customer Relationships
Oxford		56		(56	)		-
Teranetics		10,200		(5,588	)		4,612
Totals	$	39,556	$	(18,711	)	$	20,845

As of the result of the divestiture of the UK design team on October 21, 2011, the Company reviewed the useful life of its storage acquired intangibles and determined a change in the assets useful life and method of amortization was required. The Company reduced the useful life of the intangible from five years to four years and changed the amortization method from straight-line to an accelerated method. The change and amortization acceleration was reflected in the fourth quarter of 2011, the period of change.

The amortization expense was $0.2 million, $2.8 million and $2.6 million for the years ended December 31, 2012, 2011 and 2010, respectively.

The amortization expense from discontinued operations was $5.1 million, $7.8 million and $2.1 million for the three years ended December 31, 2012, 2011 and 2010, respectively.  In the second quarter of 2012, the Company recorded impairment charges of $9.8 million related to its core technology, trade name and customer relationships acquired in the Teranetics acquisition. See Note 10 of the consolidated financial statements for more information on the impairment. As a result of the impairment and the Entropic and Aquantia transactions, the Company reduced the remaining useful lives and accelerated the amortization of the Teranetics acquired intangibles. The remaining value of the intangibles of $5.8 million was written off and included in the gain on disposal. See Note 7 of the consolidated financial statements for more information on the divestiture of the PHY business.

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12.  Retirement Savings Plan

The Company sponsors the PLX Technology, Inc. 401(k) Plan (the “Plan”).  The Plan allows all full-time employees to contribute up to 100% of their annual compensation.  However, employee contributions are limited to a maximum annual amount established by the Internal Revenue Service. Beginning in 1996, the Company made a matching contribution calculated at 50 cents on each dollar of the first 6% of the participant’s compensation. In January 2009, the Company announced that it suspended the matching contributions effective February 1, 2009 as a result of macroeconomic conditions. The Company reinstated its matching contributions in July 2010. The Company's expenses relating to the plan were approximately $0.4 million, $0.4 million and $0.2 million for 2012, 2011 and 2010, respectively.

The Company contributed to the U.K. national pension program and expensed approximately $0.1 million, $0.3 million and $0.3 million for 2012, 2011 and 2010, respectively, relating to this program.

In January 2009, the Company established the PLX Technology, Inc. Employee Stock Ownership Plan (the “ESOP”). The ESOP is non-contributory and provides cash contribution at a percent of eligible U.S. compensation that is determined annually by the Board of Directors. In 2009, the Company contributed 2% of eligible compensation up to $3,000 per employee.  In accordance with the IDT merger agreement, the Company ceased contributing to the plan after the April 2012 contribution. The Company’s possible reinstatement of contributions for 2013 is under review. The expense recorded for contributions to this plan was approximately $0.1 million, $0.3 million and $0.3 million for 2012, 2011 and 2010, respectively.

13. Income Taxes

The components of income before income tax provision for the years ended December 31, 2012, 2011 and 2010 are as follows (in thousands):

	Years Ended December 31,
	2012			2011			2010
United States	$	(8,510	)	$	8,718		$	13,188
Foreign		3,545			(2,863	)		(6,311	)
Income (loss) before income tax provision	$	(4,965	)	$	5,855		$	6,877

The provision (benefit) for income taxes consists of the following (in thousands):

	Years Ended December 31,
	2012		2011		2010
Federal:
Current	$	146	$	2,699	$	2,152
		146		2,699		2,152
State:
Current		20		5		36
		20		5		36
Foreign:
Current		70		47		47
		70		47		47
Total	$	236	$	2,751	$	2,235

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The provision (benefit) for income taxes differs from the amount of income taxes determined by applying the U.S. statutory federal income tax rate as follows (in thousands):

	Years Ended December 31,
	2012			2011			2010
Tax benefit at the U.S. statutory rate	$	(1,740	)	$	2,340		$	2,393
State taxes (net of federal benefit)		15			12			36
Change in net operating losses		-			-			1,663
Research and development credit		(2,982	)		(1,137	)		(3,298	)
Change in valuation allowance		6,147			274			(1,309	)
Foreign rate differential		(1,171	)		1,037			2,284
Other individually immaterial items		(33	)		225			466
	$	236		$	2,751		$	2,235

During the year ended December 31, 2012, the Company’s deferred tax asset valuation allowance decreased by $3.5 million. The Company’s deferred tax asset valuation allowance increased by $11.2 million and $26.1 million in 2011 and 2010, respectively.  The decrease from December 31, 2011 to December 31, 2012 relates to the sale of the PHY business and the unrealizability of the Teranetics tax attributes. The increase from December 31, 2010 to December 31, 2011 relates to deferred tax assets generated from domestic and foreign losses.

Significant components of the Company's deferred tax assets and liabilities are as follows (in thousands):

	December 31,
	2012			2011
Deferred tax assets:
Accrued expenses and reserves	$	3,566		$	3,015
Net operating loss carryforwards		25,399			34,657
Research and development credits		17,297			16,704
Depreciation		15,622			19,355
Share-based compensation		5,673			4,723
Other		114			179
Gross deferred tax assets:		67,671			78,633
Valuation Allowance		(67,021	)		(70,474	)
		650			8,159
Deferred tax liabilities:
Acquisition related intangibles		(650	)		(8,159	)
Total net deferred tax assets	$	-		$	-

At December 31, 2012, the Company had federal and state net operating loss carryforwards of $47.6 million and $56.6 million, respectively. During the fourth quarter of 2010, the Company concluded its analysis under Internal Revenue Code Section 382 for federal net operating losses and determined that utilization of the net operating loss and credit carryforwards are subject to various annual limitations.  The annual limitation results in certain expiration of net operating loss carryforwards before utilization. Net operating loss carryforwards will expire at various dates beginning in 2013 through 2031. In addition, as of December 31, 2012, the Company had federal and state tax credit carryforwards of approximately $10.3 million and $17.3 million, respectively.  The federal research and development credits will expire beginning in 2019 and the state credits will carryforward indefinitely. The Company also has approximately $26.1 million of net operating loss carryforwards from its UK operations.

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Approximately $2.8 million of the federal and $1.7 million of the state net operating loss carryforward relate to excess tax deductions from stock options which have not yet been realized.  The accounting guidance for share-based compensation prohibits recognition of a deferred income tax asset for excess tax benefits due to stock option exercises that have not yet been realized through a reduction in income tax payable. 

Due to operating losses incurred, the Company created a full valuation allowance as of December 2002 for deferred tax assets.  As of December 2012, a valuation allowance continues to be recorded for the net deferred tax asset based on management’s assessment that the realization of deferred tax assets is uncertain due to the history of losses, the variability of operating results and the inability to conclude that it is more likely than not that sufficient taxable income would be generated in future periods to realize those deferred tax assets. The Company will maintain a full valuation allowance until sufficient positive evidence exists to support a reversal of the valuation allowance.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is a follows (in thousands):

	Years Ended December 31,
	2012		2011		2010
Unrecognized tax benefits balance, beginning of period	$	4,401	$	4,038	$	3,662
Gross increase for tax positions for prior year		553		-		19
Gross increase for tax positions for current year		475		363		357
Unrecognized tax benefits balance, end of period	$	5,429	$	4,401	$	4,038

Future changes in the remaining balance of unrecognized tax benefits will have no impact on the effective tax rate as it is subject to a full valuation allowance.

The Company does not have any material accrued interest or penalties associated with any unrecognized tax benefits. The Company does not believe it is reasonably possible that its unrecognized tax benefits will significantly change within the next twelve months.

The Company is subject to taxation in the US and various state and foreign jurisdictions. The tax years 2008-2011 remain open to examination by the federal and state tax authorities. Net operating loss and tax credit carryforwards generated in prior periods remain open to examination.

The Company has made no provision for U.S. income taxes on approximately $0.4 million of cumulative undistributed earnings of certain foreign subsidiaries because it is the Company’s intention to indefinitely reinvest such earnings.  If such earnings were distributed, the Company would accrue additional taxes of approximately $0.2 million. Foreign operations generated pre-tax profit of $3.5 million in 2012 and a pre-tax loss of $2.8 million and $6.3 million in 2011 and 2010, respectively.

14.  Line of Credit

On September 30, 2011, the Company entered into an agreement with Silicon Valley Bank (SVB) to establish a two-year $10.0 million revolving loan facility. The facility provides for revolving advances based on a borrowing-base formula tied to the Company’s receivables and also provides for month-end and fiscal quarter-end advances beyond the borrowing-base formula subject to certain limitations and requirements. Borrowings under the credit facility bear interest at rates equal to the prime rate announced from time to time in The Wall Street Journal. As of December 31, 2012 the prime rate was 3.25%.  The facility also provides for commitment, unused facility and letter-of-credit fees. The facility is secured by liens on the Company’s personal property assets except for intellectual property, which is subject to a negative pledge against encumbrance. As of December 31, 2012 there is $8.0 million outstanding against the facility and borrowing availability is $2.0 million. Interest payments are made monthly with principal due on September 30, 2013.

The facility is subject to certain financial covenants for earnings before interest, taxes, depreciation and amortization (“EBITDA’), as defined in the agreement, and a monthly quick ratio computation (PLX’s cash, investments and accounts receivable divided by current liabilities). The Company was in compliance with all financial covenants associated with this facility as of December 31, 2012.

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15.  Commitments and Contingencies

The Company uses several contract manufacturers and suppliers to provide manufacturing services for its products. As of December 31, 2012, the Company has purchase commitments for inventory with these contract manufacturers and suppliers of approximately $7.4 million. These inventory purchase commitments are placed on a sales order basis with lead times ranging from 4 to 16 weeks to meet estimated customer demand requirements.

The Company leases facilities, equipment, and software tools under non-cancelable operating or capital leases and service agreements. Future minimum payments under facility, equipment, and software tool at December 31, 2012 are as follows (in thousands):

	Facility and
	Equipment		Software		Total
2013	$	243	$	3,203	$	3,446
2014		180		1,993		2,173
2015		123		-		123
2016		37		-		37
Total	$	583	$	5,196	$	5,779

Rental expense for all facility leases aggregated approximately $0.3 million, $0.7 million and $0.9 million for the years ended December 31, 2012, 2011 and 2010, respectively.

As of December 31, 2012, the Company’s capital leases consist of IP. Amortization expense relating to capital leases was approximately $0.6 million, $0.9 million and $1.1 million in 2012, 2011 and 2010, respectively. Included in other assets are capital lease assets of $0.1 million as of December 31, 2012 and is net of accumulated amortization of $3.6 million.

To date, Internet Machines LLC ("Internet Machines") has filed three separate lawsuits against PLX.  The first suit was filed on February 2, 2010, which has been served on PLX, entitled Internet Machines LLC v. Alienware Corporation, et al., in the United States District Court for the Eastern District of Texas, Tyler Division (the “First Suit”).  This First Suit alleges infringement by PLX and the other defendants in the lawsuit of two patents held by Internet Machines.  The complaint in the lawsuit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines' patents.  On May 14, 2010, the Company filed its answer to the live complaint and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.  On December 6, 2010, the Court held a case-management conference and subsequently entered a scheduling order in this matter, and set the trial for February 2012.

On February 21, 2012, through February 29, 2012, the claims and defenses asserted in the First Suit were tried to a seven-member jury in the United States District Court for the Eastern District of Texas, Tyler Division.  On February 29, 2012, the jury returned its verdict, finding the patents-in-suit valid and infringed and awarded money damages against PLX in the amount of $1.0 million.  The Court has not entered a final judgment on the jury’s verdict, and the Company intends to vigorously seek reversal of the jury’s verdict through post-trial motions and, if necessary, on appeal.
 

Internet Machines' second lawsuit, which has also been served on PLX, was filed on October 17, 2010, again in the United States District Court for the Eastern District of Texas, Tyler Division (the “Second Suit”).  This Second Suit, entitled Internet Machines LLC v. ASUS Computer International, et al., alleges infringement by PLX of another patent held by Internet Machines.  The complaint also asserts infringement claims against a separate group of defendants not named in the first Internet Machines lawsuit, and accuses those defendants of infringing the two patents asserted against PLX in the First Suit, as well as the additional patent listed in this Second Suit.  The complaint in the lawsuit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines' patents.  On December 28, 2010, the Company filed its answer to the live complaint in the second lawsuit and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.

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On May 17, 2011, Internet Machines filed a third lawsuit entitled Internet Machines LLC v. Avnet, Inc., et al., again in the United States District Court for the Eastern District of Texas, Tyler Division (the “Third Suit”).  The third lawsuit has been served on PLX and alleges that PLX infringes a fourth patent held by Internet Machines.  This lawsuit also accuses a new group of defendants of infringing each of Internet Machines' patents at issue in the First and Second Suits, as well as the fourth patent asserted against PLX in this Third Suit.  The complaint in the Third Suit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines' patents.  On September 27, 2011, the Company filed its answer to the live complaint and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.

On January 20, 2012, the Court entered an order consolidating the Second and Third Suits into one action.  The Court further ordered that the schedule entered in the Third Suit would govern the consolidated action.  As a result, the consolidated action was originally set for trial in February 2013.

On March 25, 2011, a related entity, Internet Machines MC LLC, filed a lawsuit against PLX, entitled Internet Machines MC LLC v. PLX Technology, Inc., et al., in the United States District Court for the Eastern District of Texas, Marshall Division.  Internet Machines MC LLC, however, did not serve the initial complaint on PLX.  Instead, on August 26, 2011, Internet Machines MC LLC filed a first amended complaint, which has now been served on PLX, alleging infringement by PLX and the other defendants in the lawsuit of one patent held by Internet Machines MC LLC.  The complaint in this lawsuit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines MC LLC's patents.  On November 11, 2011, the Company filed its answer to the live complaint and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.  On March 5, 2012, the Court held an initial case-management conference in this matter.  The Court entered a scheduling order in this matter, and trial was set for July 2013.

On September 4, 2012, the Court entered an order staying the Second and Third Suits and the lawsuit brought by Internet Machines MC LLC discussed in the preceding paragraph.  Pursuant to the Court’s order, those lawsuits are stayed until a final non-appealable judgment is entered in the First Suit, again styled Internet Machines LLC v. Alienware Corp., et al., Cause No. 6:10-CV-023, in the United States District Court for the Eastern District of Texas.

As a result of the jury’s February 29, 2012 verdict on the First Suit, the Company accrued $1.0 million as of December 31, 2011.  As noted above, the Court has not filed its final judgment on the jury’s verdict. It is reasonably possible that any change in the ruling as a result of post-trial motions or possible appeals could change the estimated liability.  While it is not possible to determine the ultimate outcome of the remaining suits, the Company believes that it has meritorious defenses with respect to the claims asserted against it and intends to vigorously defend its position, but it is unable to estimate a range of possible loss.

Warranty and Indemnification Provisions

Changes in sales warranty reserve are as follows (in thousands):

	Years Ended December 31,
	2012			2011			2010
Balance, beginning of period	$	96		$	120		$	80
Warranty costs incurred		(336	)		(252	)		(166	)
Additions related to current period sales		494			228			141
Additions related to acquisition		-			-			65
Balance, end of period	$	254		$	96		$	120

Warranty costs, which relate to product quality issues, remained consistent and insignificant during the periods presented.

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The Company enters into standard indemnification agreements with many of its customers and certain other business partners in the ordinary course of business. These agreements include provisions for indemnifying the customer against any claim brought by a third-party to the extent any such claim alleges that a PLX product infringes a patent, copyright or trademark, or violates any other proprietary rights of that third-party. It is not possible to estimate the maximum potential amount of future payments the Company could be required to make under these indemnification agreements. To date, the Company has not incurred any costs to defend lawsuits or settle claims related to these indemnification agreements. No liability for these indemnification agreements has been recorded at December 31, 2012, 2011 or 2010.

16.  Segments of an Enterprise and Related Information

The Company has one operating segment, the sale of semiconductor devices. The Chief Executive Officer has been identified as the Chief Operating Decision Maker (CODM) because he has final authority over resource allocation decisions and performance assessment. The CODM does not receive discrete financial information about individual components of the Company's business.  Substantially all of the Company’s assets are located in the United States.

Revenues by geographic region based on customer location were as follows (in thousands):

	Years Ended December 31,
	2012		2011		2010
Revenues:
China	$	27,026	$	26,740	$	33,006
Taiwan		22,682		25,379		21,665
United States		15,639		22,088		20,357
Singapore		13,432		13,312		15,692
Germany		11,575		11,765		10,649
Other Asia Pacific		7,959		9,762		11,367
Europe, Middle East and Africa		1,491		1,958		2,392
The Americas - excluding United States		444		148		412
Total	$	100,248	$	111,152	$	115,540

Revenues by type were as follows (in thousands):

	Years Ended December 31,
	2012		2011		2010
Revenues:
PCI Express	$	66,780	$	61,557	$	54,361
Connectivity		33,468		49,595		61,179
Total	$	100,248	$	111,152	$	115,540

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There were no direct end customers that accounted for more than 10% of net revenues.  Sales to the following distributors accounted for 10% or more of net revenues:

	Years Ended December 31,
	2012			2011			2010
Excelpoint Systems Pte Ltd.		27	%		24	%		27	%
Avnet, Inc.		24	%		24	%		23	%
Answer Technology, Inc.		19	%		18	%		18	%

17.  Quarterly Financial Data (unaudited)

 (In thousands, except per share amounts)

	Three Months Ended
	March 31,			June 30,			September 30,			December 31,
	2012			2012			2012			2012
Net revenues	$	24,532		$	25,437		$	26,866		$	23,413
Gross profit	$	13,977		$	15,067		$	16,058		$	13,684
Loss from continuing operations	$	(1,223	)	$	(484	)	$	(3,304	)	$	(190	)
Loss from discontinued operations	$	(6,218	)	$	(17,734	)	$	(3,013	)	$	(423	)
Net Loss	$	(7,441	)	$	(18,218	)	$	(6,317	)	$	(613	)
Basic loss per share - continuing operations (1)	$	(0.03	)	$	(0.01	)	$	(0.07	)	$	-
Basic loss per share - discontinued operations (1)	$	(0.14	)	$	(0.40	)	$	(0.07	)	$	(0.01	)
Basic net loss per share (1)	$	(0.17	)	$	(0.41	)	$	(0.14	)	$	(0.01	)
Diluted loss per share - continuing operations (1)	$	(0.03	)	$	(0.01	)	$	(0.07	)	$	-
Diluted loss per share - discontinued operations (1)	$	(0.14	)	$	(0.40	)	$	(0.07	)	$	(0.01	)
Diluted net loss per share (1)	$	(0.17	)	$	(0.41	)	$	(0.14	)	$	(0.01	)

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	Three Months Ended
	March 31,			June 30,			September 30,			December 31,
	2011			2011			2011			2011
Net revenues	$	26,328		$	30,165		$	29,763		$	24,896
Gross profit	$	14,667		$	17,368		$	17,183		$	15,334
Income (loss) from continuing operations	$	(1,567	)	$	1,561		$	1,882		$	1,228
Loss from discontinued operations	$	(7,565	)	$	(7,573	)	$	(6,108	)	$	(6,681	)
Net loss	$	(9,132	)	$	(6,012	)	$	(4,226	)	$	(5,453	)
Basic income (loss) per share - continuing operations (1)	$	(0.04	)	$	0.04		$	0.04		$	0.03
Basic loss per share - discontinued operations (1)	$	(0.17	)	$	(0.17	)	$	(0.14	)	$	(0.15	)
Basic net loss per share (1)	$	(0.21	)	$	(0.13	)	$	(0.10	)	$	(0.12	)
Diluted income (loss) per share - continuing operations (1)	$	(0.04	)	$	0.03		$	0.04		$	0.03
Diluted loss per share - discontinued operations (1)	$	(0.17	)	$	(0.17	)	$	(0.14	)	$	(0.15	)
Diluted net loss per share (1)	$	(0.21	)	$	(0.14	)	$	(0.10	)	$	(0.12	)

(1)   The sum of per share amounts for the quarters does not necessarily equal that for the year due to rounding as the computations were made independently.

73

SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS

(in thousands)

			Additions				Deductions
	Balance at		Charged to		Charged to		Amount			Balance at
	Beginning of		Costs and		Other		Recovered			End of
Description	Period		Expenses		Accounts (1)		(Written off)			Period
Year ended December 31, 2012:
Allowance for doubtful accounts	$	82	$	-	$	-	$	-		$	82
Allowance for returns	$	128	$	-	$	58	$	(89	)	$	97
Allowance for ship and debits	$	2,181	$	-	$	10,040	$	(10,300	)	$	1,921
Year ended December 31, 2011:
Allowance for doubtful accounts	$	82	$	-	$	-	$	-		$	82
Allowance for returns	$	193	$	-	$	255	$	(320	)	$	128
Allowance for ship and debits	$	1,357	$	-	$	9,650	$	(8,826	)	$	2,181
Year ended December 31, 2010:
Allowance for doubtful accounts	$	82	$	-	$	-	$	-		$	82
Allowance for returns and price concessions	$	1,330	$	-	$	788	$	(1,925	)	$	193
Allowance for ship and debits	$	735	$	-	$	7,327	$	(6,705	)	$	1,357

(1)   Amounts charged to other accounts are recorded as a reduction of revenue.

74

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

March 15, 2013 PLX Technology, Inc. by: /s/     David K. Raun                                                                     Name: David K. Raun Title: Chief Executive Officer

75

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints David K. Raun and Arthur O. Whipple, and each of them, his attorneys-in-fact, each with the power of substitution, for him in any and all capacities, to sign any amendments to this Report on Form 10-K and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in- fact, or his substitute or substitutes, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Name and Signature	Title(s)	Date
/s/ David K. Raun	Chief Executive Officer and Director	March 15, 2013
David K. Raun	(Principal Executive Officer)
	Chief Financial Officer, Vice President,
/s/ Arthur O. Whipple	Finance and Secretary	March 15, 2013
Arthur O. Whipple	(Principal Financial and Accounting Officer)
/s/ D. James Guzy	Director and Chairman of the Board of	March 15, 2013
D. James Guzy	Directors
/s/ Ralph H. Schmitt	Director	March 15, 2013
Ralph H. Schmitt
/s/ Michael J. Salameh	Director	March 15, 2013
Michael J. Salameh
/s/ Robert H. Smith	Director	March 15, 2013
Robert H. Smith
/s/ John H. Hart	Director	March 15, 2013
John H. Hart
/s/ Thomas J. Riordan	Director	March 15, 2013
Thomas Riordan
/s/ Patrick Verderico	Director	March 15, 2013
Patrick Verderico

76

EXHIBIT INDEX

Exhibit
Number	Description
2.1	Agreement and Plan of Merger (the “Agreement”), dated as of April 30, 2012, by and among Integrated Device Technology, Inc. (“IDT”), Pinewood Acquisition Corp., Pinewood Merger Sub, LLC and PLX Technology, Inc. (the “Company”) pursuant to which IDT would have acquired PLX Technology, filed as Exhibit 2.1 to the Company’s Form 8-K filed on April 30, 2012, and the Tender and Support Agreement, dated as of April 30, 2012, filed as Exhibit 99.2 to that Form 8-K, each of which is incorporated herein by reference, and the Company’s Form 8-K filed on December 20, 2012, describing the termination of the Agreement, incorporated herein by reference .
2.2	Asset Purchase Agreement, dated as of July 6, 2012, between Entropic Communications, Inc. as Purchaser and PLX Technology, Inc. as Seller, filed as Exhibit 2.1 to the Company’s Form 10-Q filed on November  9, 2012, and incorporated herein by reference.  Certain portions have been omitted pursuant to a confidential treatment request submitted to the Securities and Exchange Commission.  The omitted information is indicated by [*] and has been filed separately with the Securities and Exchange Commission.  In the event that the Securities and Exchange Commission should deny such request in whole or in part, such exhibit or relevant portions thereof shall be filed by further amendment to the appropriate report.  Pursuant to Regulation S-K, Item 601(b)(2), certain exhibits and schedules to this exhibit, as set forth in this exhibit, have not been filed therewith.  A list of schedules is included in the agreement.  The registrant agrees to furnish a supplemental copy of any such omitted exhibit or schedule to the Securities and Exchange Commission upon request; provided, however, that the registrant may request confidential treatment of omitted items.
2.3	Asset Purchase Agreement, dated as of September 14, 2012, by and between Aquantia Corp., as Purchaser and PLX Technology, Inc., as Seller, filed as Exhibit 10.1 to the Company’s Form 8-K filed on September 26, 2012, and incorporated herein by reference.  Pursuant to Regulation S-K, Item 601(b)(2), certain schedules (and similar attachments) to this exhibit have not been filed therewith.  A list of schedules is included in the agreement. The registrant agrees to furnish a supplemental copy of any such omitted exhibit or schedule to the Securities and Exchange Commission upon request; provided, however, that the registrant may request confidential treatment of omitted items.
3.1	Amended and Restated Certificate of Incorporation of the Company, filed as Exhibit 3.1 to the Company’s Registration Statement on Form S-1 (Registration No. 333-71795), as amended, filed on March 25, 1999, and incorporated herein by reference.
3.2	Amended and Restated Bylaws of the Company, filed as Exhibit 3.1 to the Company's Form 8-K, filed on January 29, 2013, and incorporated herein by reference.
3.3	Certificate of Amendment to Amended and Restated Certificate of Incorporation, dated May 24, 2004, filed as Exhibit 3.1 to the Company’s quarterly report on Form 10-Q for the quarter ended June 30, 2004, and incorporated herein by reference.
3.4	Certificate of Amendment to Amended and Restated Certificate of Incorporation, dated December 10, 2010, filed as Exhibit 3.1 to the Company's Form 8-K, filed on December 14, 2010, and incorporated herein by reference.
4.1	Reference is made to Exhibits 3.1, 3.3 and 3.4.
10.1*	1998 Stock Incentive Plan, filed as Exhibit 10.2 to the Company’s Registration Statement on Form S-1 (Registration No. 333-71795), as amended, filed on February 4, 1999, and incorporated herein by reference.
10.2*	Amended and Restated PLX Technology, Inc. 1999 Stock Incentive Plan, attached as Appendix A to the Company's Definitive Proxy Statement on Schedule 14A for the Annual Meeting of Stockholders held May 24, 2006, filed on April 18, 2006, and incorporated herein by reference.
10.3*	PLX Technology, Inc. Employee Stock Ownership Plan, filed as Exhibit 99.1 to the Company’s Registration Statement on Form S-8 (Registration No. 333-160026), filed on June 17, 2009, and incorporated herein by reference.

77

10.4*	PLX Technology, Inc. 2008 Equity Incentive Plan (Amended and Restated), attached as Appendix A to the Company’s Definitive Proxy Statement on Schedule 14A for the Annual Meeting of Stockholders held May 25, 2011, filed on April 25, 2011, and incorporated herein by reference.
10.5*	PLX Technology, Inc. 2012 Variable Compensation Plan.
10.6	Loan and Security Agreement, dated as of September 30, 2011, by and between Silicon Valley Bank and PLX Technology, Inc., filed as Exhibit 10.1 to the Company's quarterly report on Form 10-Q for the quarter ended September 30, 2011, and incorporated herin by reference.
10.7*	Form of Indemnification Agreement between the Company and each of its officers and directors, attached as Exhibit 10.9 to the Company’s Form 10-K, filed on March 13, 2012 and incorporated herein by reference.
10.8*	PLX Severance Plan for Executive Management, incorporated herein by this reference from Exhibit 10.1 to the Company’s Form 8-K filed on April 30, 2012, reporting the agreement under Item 5.02.
14.1	Code of Business Conduct and Ethics, filed as Exhibit 14.1 to the Company’s Form 10-K, filed on March 7, 2006, and incorporated herein by reference.
21.1	Subsidiaries of the Company.
23.1	Consent of Independent Registered Public Accounting Firm.
24.1	Power of Attorney (See Signature page).
31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer Pursuant to 18 U.S.C.Section 1350, Chapter 63 of Title 18, United States Code, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer Pursuant to 18 U.S.C.Section 1350, Chapter 63 of Title 18, United States Code, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS**	XBRL Instance Document
101.SCH**	XBRL Taxonomy Extension Schema Document
101.CAL**	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF**	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB**	XBRL Taxonomy Extension Label Linkbase Document
101.PRE**	XBRL Taxonomy Extension Presentation Linkbase Document
*	Management contract or compensatory plan or arrangement.
**	XBRL (Extensible Business Reporting Language) information is furnished and not filed herewith, is not a part of a registration statement or Prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

78

EX-10.5

EXHIBIT 10.5

PLX TECHNOLOGY, INC.

2012 VARIABLE COMPENSATION PLAN

 1.           Introduction - The Company hereby adopts this Plan, effective as of January 1, 2012. The purpose of the Plan is to reward performance and to retain all employees of PLX Technology, Inc. This document constitutes the written instrument under which the Plan is maintained.

2.           Definitions

a.   “Annual Operating Plan” or “AOP” is management’s projected operating plan for 2012 approved at the meeting of the Company’s Board of Directors on December 8, 2011.

b.   “Cause” means (i) conviction of a felony or a crime of moral turpitude; (ii) misconduct that results in harm to the Company; (iii) material failure to perform assigned duties; or (iv) willful disregard of lawful instructions from the chief executive officer of the Company or the Board of Directors relating to the business of the Company or any of its affiliates.

c.   “Code” means the Internal Revenue Code of 1986, as amended, and the regulations issued with respect thereof.

d.   “Committee” means the Compensation Committee of the Company’s Board of Directors.

e.   “Company” means PLX Technology, Inc., a Delaware corporation including its wholly-owned subsidiaries.

f.   “Disability” means that a Participant (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the Participant’s employer.

g.   “Eligible Employee” means each full-time employee who becomes an employee of the Company no later than September 30, 2012 who is not eligible under sales incentive plans.

h.   “Executive” means those individuals holding the titles listed as Executive Participants in Exhibit A.

a.   “Non-Executive” means Participant that does not mean the definition of Executive.

b.    “Normal Retirement Age” means age sixty (60).

c.   “Participant” means each Eligible Employee who is designated from time to time by the Committee in writing or, for Non-Executive Eligible Employees, by the Chief Executive Officer.

d.   “Plan” means the PLX Technology, Inc. 2012 Variable Compensation Plan, as set forth in this document and as hereafter amended.

e.   “Retirement” means the termination of employment after Normal Retirement Age.

3.           Variable Compensation Award

a.   Each Non-Executive Participant in the Plan has an adjusted target variable compensation expressed as a percentage of their base salary as shown in Exhibit A. The target variable compensation for Non-executive employees consists of five segments: Revenue (10%), Gross Margin (10%), Non-GAAP spending (10%), performance to group and or functional goals (40%) and performance to personal objectives (30%).  A Participant cannot receive more than 100% of that Participant’s adjusted target variable compensation for group or personal objectives and cannot receive more than 200% of that Participant’s position target variable compensation.  The scoring of the Participant’s performance against the group and individual goals will be measured in the Company’s Performance Management system.

b.   Each Executive Participant in the Plan has an adjusted target variable compensation expressed as a percentage of their base salary as shown in Exhibit A. The target variable compensation for Executive employees consists of five segments: Revenue (20%), Gross Margin (20%), Non-GAAP spending (20%), performance to group and or functional goals (20%) and performance to personal objectives (20%).  A Participant cannot receive more than 100% of that Participant’s adjusted target variable compensation for group or personal objectives and cannot receive more than 200% of that Participant’s position target variable compensation.  The scoring of the Participant’s performance against the group and individual goals will be measured in the Company’s Performance Management system.

c.   Performance to operating metrics

i.   The Company must have positive non-GAAP net income before any of the following operating metrics-based elements would apply.  The following operating metrics are based on the Company’s 2012 full year operating results.

ii.   Revenue – For each percent that revenues are above or below the AOP, the Participant’s revenue-related variable compensation target will be increased or reduced by ten (10) percent.  The amount cannot be less than zero and is subject to the aggregate limitation in Section 3.

iii.   Gross Margin – For each percentage point that gross margin is above or below the AOP, the Participant’s gross margin-related variable compensation target will be increased or reduced by forty (40) percent.   The amount cannot be less than zero and is subject to the aggregate limitation in Section 3.

iv.   Non-GAAP Spending – For each percent that non-GAAP spending is above or below the AOP, the Participant’s revenue-related variable compensation target will be reduced or increased by twenty (20) percent.  The amount cannot be less than zero and is subject to the aggregate limitation in Section 3.

d.   Adjustment of AOP – If a significant transaction that was not contemplated in the AOP occurs during 2012 and has the effect of modifying Revenue, Gross Margin or Non-GAAP Spending expectations, the Compensation Committee may make adjustments to the AOP to reflect those changes.

  4.           Payment of Variable Compensation Award

a.   Vesting, Timing and Form of Payment.

i.   Subject to Sections 4(b), 4(c), 4(d) and 7, each Non-executive Participant’s Award Payment Amount shall vest on January 1, 2013 and be paid on the last business day in January 2013.

ii.   Subject to Sections 4(b), 4(c), 4(d) and 7, for Executive Participants, one hundred percent (100%) of the first $1,200,000 of the Pool assigned to Executives shall vest on January 1, 2013 and be paid to the Participants on the last business day in January 2013.

a.   Aggregate amounts for the Executive Participant group that exceed $1,200,000 shall be paid as follows:

b.   Sixty percent (60%) of the amount in excess of $1,200,000 will be allocated to the Executive Participants and shall vest on January 1, 2013 and be paid to the Executive Participants on the last business day in January, 2013,

c.   Twenty percent (20%) of the amount in excess of $1,200,000 will be allocated to the Executive Participants and shall vest on January 1, 2014 and be paid to the Executive Participants on the last business day in January, 2014 and

d.   Twenty percent (20%) of the amount in excess of $1,200,000 will be allocated to the Executive Participants and shall vest on January 1, 2015 and be paid to the Executive Participants on the last business day in January, 2015.

e.   Interest on Award Payment Amount - Interest at the Fed Funds Rate as of the last business day in January 2013 shall accrue on the Participant’s unvested and unpaid Award Payment Amount. Subject to the forfeiture provisions in Section 4(c), interest shall be paid in accordance with the vesting schedule established by the Committee at the time the Award Payment is made.

b.   Distribution in the event of Retirement, termination as a result of Disability or termination without Cause - If a Participant terminates employment because of Retirement or Disability, or the Company terminates a Participant’s employment without Cause, the Participant shall be entitled to payment of all of his or her Award Payment Amount according to the schedule in Section 4(a), provided that if termination under these conditions occurs prior to January 1, 2013, the amount of the Variable Compensation Award payable will be the Award Payment Amount calculated pursuant to Section 3, multiplied by the number of days employee was employed in 2012 by the Company and then divided by 365 days, and all remaining amounts payable under Variable Compensation Award for 2012 shall be forfeited.

c.   Forfeiture - If the Company terminates a Participant’s employment for Cause or if the Participant’s employment is terminated for any reason not identified in 4(b), he or she shall forfeit all or any portion of his or her entire Award Payment Amount for 2012 (as set forth in Section 3) which is not yet vested and payable under the schedule set forth in Section 4(a) as of the date of termination.

d.   Timing of Distribution to a Beneficiary - If a Participant dies while still employed by the Company or after termination due to Retirement, Disability, or termination by the Company without Cause but before receiving a distribution of all of his or her Award Payment Amount according the schedule in Section 4(a), then the vesting of the Participant’s Award Payment Amount shall be fully accelerated such that one-hundred percent (100%) of the Award Payment Amount, as calculated pursuant to Section 4(b) hereof (with the amount prorated to the date of death in the event death occurs prior to January 1, 2013), will be distributed to his or her beneficiary as a lump sum distribution on the last business day in January, 2013 following the Participant’s death.

e.   Beneficiary Designation - Each Participant must designate a beneficiary to receive a distribution of his or her Variable Compensation Award if the Participant dies before such amount is fully distributed to him or her. To be effective, a beneficiary designation must be signed, dated and delivered to the Committee. In the absence of a valid or effective beneficiary designation, the Participant’s surviving spouse will be his or her beneficiary or, if there is no surviving spouse, the Participant’s estate will be his or her beneficiary. If a married Participant designates anyone other than his or her spouse as his or her beneficiary, such designation will be void unless it is signed and dated by the Participant’s spouse.

5.           Withholding - The Company will withhold from any Plan distribution all legally required taxes and deductions.

6.           Administration - The Committee has the full and exclusive discretion to interpret and administer the Plan. All actions, interpretations and decisions of the Committee are conclusive and binding on all persons, and will be given the maximum possible deference allowed by law. Subject to the provisions of the Plan, the Committee shall have full authority to select, in its sole discretion the Participants to whom Variable Compensation Awards will be granted.

7.           Amendment or Termination - Through December 31, 2012, the Committee, in its sole and unlimited discretion, may amend or terminate the Plan at any time, without prior notice to any Participant. After January 1, 2013, the Committee may amend or terminate the Plan provided that any such amendment does not reduce or increase any benefit which a Participant has earned and is otherwise entitled to under the terms of the Plan, nor accelerate the timing of any payment under the Plan. Notwithstanding the foregoing to the contrary, the Company reserves the right to the extent it deems necessary or advisable, in its sole discretion, to unilaterally alter or modify the Plan and any Variable Compensation Awards made thereunder to ensure that the Plan and Variable Compensation Awards provided to Participants who are U.S. taxpayers are made in such a manner that either qualify for exemption from or comply with Code Section 409A; provided, however, that the Company makes no representations that the Plan or any Variable Compensation Awards made thereunder will be exempt from or comply with Code Section 409A and makes no undertaking to preclude Code Section 409A from applying to the Plan or any Variable Compensation Awards made thereunder. The Plan shall automatically terminate on the date when no Participant (or beneficiary) has any right to or expectation of payment of further benefits under the Plan.

8.           Source of Payments - All payments under the Plan will be paid in cash from the general funds of the Company. No separate fund will be established under the Plan, and the Plan will have no assets. Any right of any person to receive any payment under the Plan is no greater than the right of any other general unsecured creditor of the Company. This Plan shall be binding upon the Company’s successors and assigns.

9.           Inalienability - A Participant’s rights to benefits under the Plan are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors of the Participant or the Participant’s beneficiary.

10.           Applicable Law - The provisions of the Plan will be construed, administered and enforced in accordance with the laws of the State of California without reference to its principles of conflicts-of-laws.

11.           Severability - If any provision of the Plan is held invalid or unenforceable, its invalidity or unenforceability will not affect any other provision of the Plan, and the Plan will be construed and enforced as if such provision had not been included.

12.           No Right of Continued Employment - THIS PLAN DOES NOT GIVE ANY ELIGIBLE EMPLOYEE OR PARTICIPANT THE RIGHT TO BE RETAINED AS AN EMPLOYEE. SUBJECT TO THE TERMS OF ANY WRITTEN EMPLOYMENT AGREEMENT TO THE CONTRARY, THE COMPANY SHALL HAVE THE RIGHT TO TERMINATE OR CHANGE THE TERMS OF EMPLOYMENT OF AN ELIGIBLE EMPLOYEE OR A PARTICIPANT AT ANY TIME AND FOR ANY REASON WHATSOEVER, WITH OR WITHOUT CAUSE.

13.           Bindings on Successor - The liabilities and obligations of the Company under this Plan will be binding upon any successor corporation or entity which succeeds to all or substantially all of the assets and business of the Company by merger or other transaction.

IN WITNESS WHEREOF, PLX Technology, Inc., by its duly authorized officer, has executed the Plan on the date indicated below.

PLX TECHNOLOGY, INC.

  /s/       Ralph Schmitt

Name: Ralph Schmitt

Title: Chief Executive Officer

Date: April 2, 2012

Exhibit A

Each Participant shall have a variable compensation target based upon their position and a percentage of their annual salary. The Participant’s target and adjusted target compensation from the Plan is as follows:

Executive Participants	Position Target			Adjusted Target
CEO:		100	%		80	%
COO:		90	%		72	%
CFO:		90	%		72	%
EVP and GM of Products		90	%		72	%
VP Sales:		75	%		60	%
VP Marketing & Bus. Dev.:		75	%		60	%
VP Operations:		75	%		60	%
VP Engineering - Switching:		75	%		60	%
VP Engineering PHY:		75	%		60	%
VP Engineering Architecture and Applications, PHY:		75	%		60	%

Non-Executive Participants	Position Target			Adjusted Target
Non-Executive VP		25	%		20	%
Senior Directors		20	%		16	%
Directors		15	%		12	%
Sr. Managers or Managers		10	%		8	%
Individual contributors:		8	%		6.40	%
Non-exempt employees:		5	%		4	%

EX-21.1

EXHIBIT 21.1

SUBSIDIARIES OF THE COMPANY

Name of Entity	Incorporation or Organization
PLX Technology Japan K.K.	Japan
PLX Technology Inc., China	China
PLX Technology Korea	Korea
Oxford Semiconductor, Inc.	United States
PLX Technology Ltd.	United Kingdom
Oxford Pte Ltd.	Singapore
PLX Technology Ltd.	Taiwan
Teranetics, Inc.	United States
Teranetics Semiconductor Pte Ltd.	India

EX-23.1

EXHIBIT 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

PLX Technology, Inc.

Sunnyvale, California

We hereby consent to the incorporation by reference in the Registration Statements on Form S-3 (Nos. 333-40722, 333-105745, 333-116702, 333-156760, 333-159668, 333-166014 and 333-170212) and Form S-8 (Nos. 333-88259, 333-38992, 333-38990, 333-67026, 333-97741, 333-105748, 333-116704, 333-135811, 333-153392, 333-160026 and 333-170213) of PLX Technology, Inc. of our reports dated March 15, 2013, relating to the consolidated financial statements and financial statement schedule, and the effectiveness of PLX Technology, Inc.’s internal control over financial reporting, which appear in this Form 10-K.

/s/ BDO USA, LLP

San Jose, California

March 15, 2013

EX-31.1

EXHIBIT 31.1

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, David K. Rauncertify that:

1. I have reviewed this annual report on Form 10-K of PLX Technology, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

/s/ David K. Raun                                                                                                           

Dated: March 15, 2013

David K. Raun

Chief Executive Officer

(Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Arthur O. Whipple certify that:

1. I have reviewed this annual report on Form 10-K of PLX Technology, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

/s/ Arthur O. Whipple

Dated: March 15, 2013

Arthur O. Whipple

Chief Financial Officer

(Principal Accounting Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of PLX Technology, Inc. (the "Company") on Form 10-K for the period ended December 31, 2012 as filed with the Securities and Exchange Commission (the "Report"), I, David K. Raun, Chief Executive Officer of the Company, hereby certify as of the date hereof, solely for purposes of Title 18, Chapter 63, Section 1350 of the United States Code, that to the best of my knowledge:

1.   the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and

2.   the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.

This Certification has not been, and shall not be deemed, "filed" with the Securities and Exchange Commission.

        Date: March 15, 2013

By: /s/ David K. Raun David K. Raun Chief Executive Officer

EX-32.2

EXHIBIT 32.2

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of PLX Technology, Inc. (the "Company") on Form 10-K for the period ended December 31, 2012 as filed with the Securities and Exchange Commission (the "Report"), I, Arthur O. Whipple,Chief Financial Officerof the Company, hereby certify as of the date hereof, solely for purposes of Title 18, Chapter 63, Section 1350 of the United States Code, that to the best of my knowledge:

1.   the Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and

2.   the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.

This Certification has not been, and shall not be deemed, "filed" with the Securities and Exchange Commission.

Date: March 15, 2013

By: /s/ Arthur O. Whipple  Arthur O. Whipple  Chief Financial Officer

XML

Segments Of An Enterprise And Related Information (Tables)

12 Months Ended

Dec. 31, 2012

Segments Of An Enterprise And Related Information [Abstract]

Schedule Of Revenues By Geographic Region Based On Customer Location

	Years Ended December 31,
	2012		2011		2010
Revenues:
China	$	27,026	$	26,740	$	33,006
Taiwan		22,682		25,379		21,665
United States		15,639		22,088		20,357
Singapore		13,432		13,312		15,692
Germany		11,575		11,765		10,649
Other Asia Pacific		7,959		9,762		11,367
Europe, Middle East and Africa		1,491		1,958		2,392
The Americas - excluding United States		444		148		412
Total	$	100,248	$	111,152	$	115,540

Schedule Of Revenues By Type

	Years Ended December 31,
	2012		2011		2010
Revenues:
PCI Express	$	66,780	$	61,557	$	54,361
Connectivity		33,468		49,595		61,179
Total	$	100,248	$	111,152	$	115,540

Schedule Of Percentage Of Net Revenues Accounted As Sales To Distributors

	Years Ended December 31,
	2012		2011		2010
Excelpoint Systems Pte Ltd.		27%		24%		27%
Avnet, Inc.		24%		24%		23%
Answer Technology, Inc.		19%		18%		18%

XML

Financial Instruments (Narrative) (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate	40.00%
Estimated claims rate	17.00%
Aggregate unrealized loss	$ 1,000	$ 1,000
Escrow Receivable [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Discount rate	3.25%

XML

Share-Based Compensation (Schedule Of Share-Based Compensation And Employee Stock Ownership Plan Expenses) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012		Dec. 31, 2011		Dec. 31, 2010
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total share-based compensation expense	$ 3,144		$ 2,330		$ 1,611
Cost Of Revenues [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total share-based compensation expense	147		47		33
Research And Development [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total share-based compensation expense	1,007		485		602
Selling, General And Administrative [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total share-based compensation expense	1,739		1,138		863
Discontinued Operations [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total share-based compensation expense	$ 251	[1]	$ 660	[1]	$ 113	[1]

[1] Recorded in loss from discontinued operations in the Consolidated Statement of Operations.

XML

Acquisition And Restructuring Costs (Summary Of Activity Within Lease Termination Liability) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended	3 Months Ended		1 Months Ended	12 Months Ended
	Dec. 31, 2011	Sep. 30, 2011 Discontinued Operations [Member]	Mar. 31, 2011 Discontinued Operations [Member]	Mar. 31, 2011 Lease Commitment [Member]	Dec. 31, 2012 Lease Commitment [Member]	Dec. 31, 2011 Lease Commitment [Member]	Dec. 31, 2011 Lease Commitment [Member] Discontinued Operations [Member]
Restructuring Cost and Reserve [Line Items]
Liability at beginning of period					$ 281
Operations expense	301	200	400	200			554	[1]
Cash payments					(281)	(574)
Liability at end of period				$ 200		$ 281

[1] Recorded in loss from discontinued operations in the Consolidated Statement of Operations. In October 2010, associated with the acquisition of Teranetics, the Company assumed a building lease in San Jose, California which was vacated in March 2011. Given current lease rates and the available space in the area when the property was vacated, the Company recorded a $0.4 million liability, included in other accrued expenses in the Consolidated Balance Sheet, for the estimated fair value of the future lease costs through June 2012, reduced by estimated sublease rental and adjusted for deferred rent. As of September 30, 2011, the Company was not able to sublease the property and as a result accrued the remaining liability of $0.2 million. The total adjusted cash payment was not materially different from the fair value. As of June 30, 2012, the lease liability was paid.

XML

Financial Instruments (Schedule Of Fair Value Of Assets And Liabilities On A Recurring Basis) (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	$ 7,375	$ 9,238
Quoted Prices In Active Markets For Identical Assets Or Liabilities (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	1,809	89
Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	3,966	9,149
Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	1,600
Money Market Funds [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	1,809	89
Money Market Funds [Member] | Quoted Prices In Active Markets For Identical Assets Or Liabilities (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	1,809	89
Certificate Of Deposit [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	2,707	2,988
Certificate Of Deposit [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	2,707	2,988
Marketable Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	1,259	6,161
Marketable Securities [Member] | Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	1,259	6,161
Escrow Receivable [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	1,600
Escrow Receivable [Member] | Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of financial assets	$ 1,600

XML

Income Taxes (Schedule Of Effective Income Amount Reconciliation) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Income Taxes [Abstract]
Tax benefit as the U.S. statutory rate	$ (1,740)	$ 2,340	$ 2,393
State taxes (net of federal benefit)	15	12	36
Change in net operating losses			1,663
Research and development credit	(2,982)	(1,137)	(3,298)
Change in valuation allowance	6,147	274	(1,309)
Foreign rate differnetial	(1,171)	1,037	2,284
Other individually immaterial items	(33)	225	466
Provision (benefit) for income taxes	$ 236	$ 2,751	$ 2,235

XML

Share-Based Compensation (Narrative) (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
ESOP annual salary contribution, percentage	2.00%
ESOP maximum annual contribution per employee	$ 3,000
Share-based compensation expense	3,144,000	2,330,000	1,611,000
Weighted average fair value of options granted	$ 2.17	$ 1.69	$ 2.08
Total intrinsic value of options exercised	800,000	300,000	300,000
Fair value of options vested	2,500,000
Total unrecognized compensation costs related to nonvested stock options	1,200,000
Weighted average period, years	1 year 2 months 19 days
2008 Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate shares of common stock authorized and available for awards, prior to 1999 Equity Plan eligible shares	5,000,000
Additional shares potentially available which would revert back to the 1999 Equity Plan	2,407,369
Aggregate share reserve limit under 2008 Equity Plan	7,407,369
Number of shares that may be issued in the form of full value	300,000
Award vesting period, years	4 years
Award expiration period, years	7 years
Term of plan, years	10 years
Nonvested Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total unrecognized compensation costs related to nonvested stock options	200,000
Stock Options And Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	3,000,000	1,900,000	1,300,000
May 2010 Amendment [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Increase in number of shares reserved for issuance	1,500,000
May 2011 Amendment [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Increase in number of shares reserved for issuance	2,300,000
ESOP [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
ESOP eligible annual compensation limit	150,000
ESOP annual salary contribution, percentage	2.00%
ESOP maximum annual contribution per employee	3,000
Share-based compensation expense	$ 200,000	$ 500,000	$ 300,000

XML

Discontinued Operation (Tables)

12 Months Ended

Dec. 31, 2012

Discontinued Operation [Abstract]

Components Of Gain On Sale Of A Business

Cash proceeds from sale (including fair value amount held in escrow)	$	12,000
Less carrying value of assets transferred and asset write-offs:
Inventory transferred		(1,254)
Fixed assets transferred		(631)
Intangible assets write-off		(5,783)
Goodwill write-off		(877)
Other adjustments		(5)
Gain on disposal	$	3,450

Summary Of Financial Information Included In Net Loss From Discontinued Operations

	Years Ended December 31,
	2012		2011		2010
	in thousands
Revenues	$	2,947	$	4,637	$	1,020
Gain on disposal		3,450		-		-
Loss before income taxes		(27,476)		(30,531)		(9,732)
Benefit from income taxes		(88)		(2,604)		(1,801)
Loss from discontinued operations	$	(27,388)	$	(27,927)	$	(7,931)

XML

Income Taxes (Schedule Of Deferred Tax Assets And Liabilities) (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Income Taxes [Abstract]
Accrued expenses and reserves	$ 3,566	$ 3,015
Net operating loss carryforwards	25,399	34,657
Research and development credits	17,297	16,704
Depreciation	15,622	19,355
Share-based compensation	5,673	4,723
Other	114	179
Gross deferred tax assets	67,671	78,633
Valuation Allowance	(67,021)	(70,474)
Deferred tax assets, net of valuation allowance	650	8,159
Acquisition related to intangibles	(650)	(8,159)
Total net deferred tax assets

XML

Other Intangible Assets (Schedule Of Gross Carrying Amount And Accumulated Amortization For Major Intangible Class And Weighted Average Amortization Period) (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	$ 9,056	$ 39,556
Accumulated Amortization	(9,056)	(18,711)
Net Value		20,845
Oxford USB And Serial Connectivity [Member] | Existing And Core Technology [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	4,600	4,600
Accumulated Amortization	(4,600)	(4,600)
Oxford Network Attached Storage Connectivity [Member] | Existing And Core Technology [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	3,800	3,800
Accumulated Amortization	(3,800)	(3,555)
Net Value		245
Teranetics Network PHY [Member] | Existing And Core Technology [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value		20,100
Accumulated Amortization		(4,187)
Net Value		15,913
Oxford [Member] | Trade Name [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	600	600
Accumulated Amortization	(600)	(600)
Oxford [Member] | Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	56	56
Accumulated Amortization	(56)	(56)
Teranetics [Member] | Trade Name [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value		200
Accumulated Amortization		(125)
Net Value		75
Teranetics [Member] | Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value		10,200
Accumulated Amortization		(5,588)
Net Value		$ 4,612

XML

Schedule II-Valuation And Qualifying Accounts (Details) (USD $) In Thousands, unless otherwise specified					12 Months Ended
	Dec. 31, 2012 Allowance For Doubtful Accounts [Member]	Dec. 31, 2011 Allowance For Doubtful Accounts [Member]	Dec. 31, 2010 Allowance For Doubtful Accounts [Member]	Dec. 31, 2009 Allowance For Doubtful Accounts [Member]	Dec. 31, 2012 Allowance For Returns [Member]		Dec. 31, 2011 Allowance For Returns [Member]		Dec. 31, 2010 Allowance For Returns [Member]		Dec. 31, 2012 Allowance For Ship And Debits [Member]		Dec. 31, 2011 Allowance For Ship And Debits [Member]		Dec. 31, 2010 Allowance For Ship And Debits [Member]
Valuation and Qualifying Accounts Disclosure [Line Items]
Balance at Beginning of Period	$ 82	$ 82	$ 82	$ 82	$ 128		$ 193		$ 1,330		$ 2,181		$ 1,357		$ 735
Charged to Other Accounts					58	[1]	255	[1]	788	[1]	10,040	[1]	9,650	[1]	7,327	[1]
Deductions Amount Recovered (Written Off)					(89)		(320)		(1,925)		(10,300)		(8,826)		(6,705)
Balance at End of Period	$ 82	$ 82	$ 82	$ 82	$ 97		$ 128		$ 193		$ 1,921		$ 2,181		$ 1,357

[1] Amounts charged to other accounts are recorded as a reduction of revenue.

XML

Concentrations Of Credit, Customer And Supplier Risk (Narrative) (Details) (USD $) In Millions, unless otherwise specified	Dec. 31, 2012
Concentrations Of Credit, Customer And Supplier Risk [Abstract]
Cash, cash equivalents, short and long-term investments	$ 16.7

XML

Income Taxes (Schedule Of Income Before Taxes By Jurisdiction) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Income Taxes [Abstract]
United States	$ (8,510)	$ 8,718	$ 13,188
Foreign	3,545	(2,863)	(6,311)
Income (loss) from continuing operations before provision for income taxes	$ (4,965)	$ 5,855	$ 6,877

XML

Segments Of An Enterprise And Related Information (Schedule of Revenues By Type) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Segment Reporting Information [Line Items]
Net revenues	$ 23,413	$ 26,866	$ 25,437	$ 24,532	$ 24,896	$ 29,763	$ 30,165	$ 26,328	$ 100,248	$ 111,152	$ 115,540
PCI Express [Member]
Segment Reporting Information [Line Items]
Net revenues									66,780	61,557	54,361
Connectivity [Member]
Segment Reporting Information [Line Items]
Net revenues									$ 33,468	$ 49,595	$ 61,179

XML

Line Of Credit (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Sep. 30, 2011
Line Of Credit [Abstract]
Line of credit facility term	2 years
Line of credit facility borrowing capacity		$ 10.0
Prime rate on line of credit facility	3.25%
Line of credit facility amount outstanding	8.0
Line of credit facility remaining availability	$ 2.0

XML

Segments Of An Enterprise And Related Information (Schedule Of Percentage Of Net Revenues Accounted As Sales To Distributors) (Details) (Revenue [Member])	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Excelpoint Systems Pte Ltd. [Member]
Revenue, Major Customer [Line Items]
Percentage of net revenues	27.00%	24.00%	27.00%
Avnet, Inc. [Member]
Revenue, Major Customer [Line Items]
Percentage of net revenues	24.00%	24.00%	23.00%
Answer Technology, Inc. [Member]
Revenue, Major Customer [Line Items]
Percentage of net revenues	19.00%	18.00%	18.00%

XML

Income Taxes (Schedule Of Provision (Benefit) For Income Taxes) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Income Taxes [Abstract]
Federal, Current	$ 146	$ 2,699	$ 2,152
Federal	146	2,699	2,152
State, Current	20	5	36
State	20	5	36
Foreign, Current	70	47	47
Foreign	70	47	47
Provision (benefit) for income taxes	$ 236	$ 2,751	$ 2,235

XML

Asset Impairment (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended
	Jun. 30, 2012	Dec. 31, 2012
Impairment of assets	$ 9,800	$ 10,343
Fair value inputs, discount rate		40.00%
Fair value inputs income tax rate		40.00%
Existing And Core Technology [Member]
Impairment of assets		9,600
Trade Names and Customer Relationships [Member]
Impairment of assets		200
Tangible Assets [Member]
Impairment of assets		$ 500

XML

Quarterly Financial Data

12 Months Ended

Dec. 31, 2012

Quarterly Financial Data [Abstract]

Quarterly Financial Data

17.  Quarterly Financial Data (unaudited)

(In thousands, except per share amounts)

	Three Months Ended
	March 31,		June 30,		September 30,		December 31,
	2012		2012		2012		2012
Net revenues	$	24,532	$	25,437	$	26,866	$	23,413
Gross profit	$	13,977	$	15,067	$	16,058	$	13,684
Loss from continuing operations	$	(1,223)	$	(484)	$	(3,304)	$	(190)
Loss from discontinued operations	$	(6,218)	$	(17,734)	$	(3,013)	$	(423)
Net Loss	$	(7,441)	$	(18,218)	$	(6,317)	$	(613)
Basic loss per share - continuing operations (1)	$	(0.03)	$	(0.01)	$	(0.07)	$	-
Basic loss per share - discontinued operations (1)	$	(0.14)	$	(0.40)	$	(0.07)	$	(0.01)
Basic net loss per share (1)	$	(0.17)	$	(0.41)	$	(0.14)	$	(0.01)
Diluted loss per share - continuing operations (1)	$	(0.03)	$	(0.01)	$	(0.07)	$	-
Diluted loss per share - discontinued operations (1)	$	(0.14)	$	(0.40)	$	(0.07)	$	(0.01)
Diluted net loss per share (1)	$	(0.17)	$	(0.41)	$	(0.14)	$	(0.01)

	Three Months Ended
	March 31,		June 30,		September 30,		December 31,
	2011		2011		2011		2011
Net revenues	$	26,328	$	30,165	$	29,763	$	24,896
Gross profit	$	14,667	$	17,368	$	17,183	$	15,334
Income (loss) from continuing operations	$	(1,567)	$	1,561	$	1,882	$	1,228
Loss from discontinued operations	$	(7,565)	$	(7,573)	$	(6,108)	$	(6,681)
Net loss	$	(9,132)	$	(6,012)	$	(4,226)	$	(5,453)
Basic income (loss) per share - continuing operations (1)	$	(0.04)	$	0.04	$	0.04	$	0.03
Basic loss per share - discontinued operations (1)	$	(0.17)	$	(0.17)	$	(0.14)	$	(0.15)
Basic net loss per share (1)	$	(0.21)	$	(0.13)	$	(0.10)	$	(0.12)
Diluted income (loss) per share - continuing operations (1)	$	(0.04)	$	0.03	$	0.04	$	0.03
Diluted loss per share - discontinued operations (1)	$	(0.17)	$	(0.17)	$	(0.14)	$	(0.15)
Diluted net loss per share (1)	$	(0.21)	$	(0.14)	$	(0.10)	$	(0.12)

(1) The sum of per share amounts for the quarters does not necessarily equal that for the year due to rounding as the computations were made independently.

XML

Share-Based Compensation (Summary Of Ranges Of Outstanding And Exercisable Options) (Details) (USD $)	12 Months Ended
	Dec. 31, 2012
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Options Outstanding, Number	4,222,552
Options Outstanding, Weighted Average Remaining Contractual Term (in years)	3 years 11 months 5 days
Options Outstanding, Weighted Average Exercise Price	$ 4.10
Options Exercisable, Number	2,656,894
Options Exercisable, Weighted Average Exercise Price	$ 4.11
$1.80-$2.69 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, lower limit	$ 1.80
Range of Exercise Prices, upper limit	$ 2.69
Options Outstanding, Number	1,075,761
Options Outstanding, Weighted Average Remaining Contractual Term (in years)	3 years 5 months 16 days
Options Outstanding, Weighted Average Exercise Price	$ 2.13
Options Exercisable, Number	925,824
Options Exercisable, Weighted Average Exercise Price	$ 2.06
$2.70-$3.73 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, lower limit	$ 2.70
Range of Exercise Prices, upper limit	$ 3.73
Options Outstanding, Number	1,041,656
Options Outstanding, Weighted Average Remaining Contractual Term (in years)	3 years 10 months 21 days
Options Outstanding, Weighted Average Exercise Price	$ 3.54
Options Exercisable, Number	592,303
Options Exercisable, Weighted Average Exercise Price	$ 3.50
$3.74-$4.10 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, lower limit	$ 3.74
Range of Exercise Prices, upper limit	$ 4.10
Options Outstanding, Number	855,577
Options Outstanding, Weighted Average Remaining Contractual Term (in years)	5 years 3 months 4 days
Options Outstanding, Weighted Average Exercise Price	$ 4.03
Options Exercisable, Number	213,402
Options Exercisable, Weighted Average Exercise Price	$ 3.85
$4.11-$6.66 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, lower limit	$ 4.11
Range of Exercise Prices, upper limit	$ 6.66
Options Outstanding, Number	913,666
Options Outstanding, Weighted Average Remaining Contractual Term (in years)	4 years 2 months 19 days
Options Outstanding, Weighted Average Exercise Price	$ 5.13
Options Exercisable, Number	589,473
Options Exercisable, Weighted Average Exercise Price	$ 4.91
$6.67-$15.58 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, lower limit	$ 6.67
Range of Exercise Prices, upper limit	$ 15.58
Options Outstanding, Number	335,892
Options Outstanding, Weighted Average Remaining Contractual Term (in years)	1 year 4 months 10 days
Options Outstanding, Weighted Average Exercise Price	$ 9.57
Options Exercisable, Number	335,892
Options Exercisable, Weighted Average Exercise Price	$ 9.57

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Organization And Summary Of Significant Accounting Policies (Schedule Of Inventories) (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Organization And Summary Of Significant Accounting Policies [Abstract]
Work-in-process	$ 4,986	$ 4,216
Finished goods	5,574	4,680
Total	$ 10,560	$ 8,896

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Income Taxes (Narrative) (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Operating Loss Carryforwards [Line Items]
Change in deferred tax assets valuation allowance	$ (3,500,000)	$ 11,200,000	$ 26,100,000
Net operating loss carryforwards, expiration dates	2013 through 2031
Undistributed earnings of foreign subsidiaries	400,000
Potential earnings distribution, additional taxes	200,000
Foreign operations pre-ta profit (loss)	3,545,000	(2,863,000)	(6,311,000)
Internal Revenue Service (IRS) [Member]
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	47,600,000
Tax credit carryforwards	10,300,000
Tax credit carryforwards, expiration dates	2019
Deferred tax asset not recognized	2,800,000
State and Local Jurisdiction [Member]
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	56,600,000
Tax credit carryforwards	17,300,000
Deferred tax asset not recognized	1,700,000
Foreign Tax Authority [Member]
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	$ 26,100,000

XML

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2012

Income Taxes [Abstract]

Schedule Of Income Before Taxes By Jurisdiction

	Years Ended December 31,
	2012		2011		2010
United States	$	(8,510)	$	8,718	$	13,188
Foreign		3,545		(2,863)		(6,311)
Income (loss) before income tax provision	$	(4,965)	$	5,855	$	6,877

Schedule Of Provision (Benefit) For Income Taxes

	Years Ended December 31,
	2012		2011		2010
Federal:
Current	$	146	$	2,699	$	2,152
		146		2,699		2,152
State:
Current		20		5		36
		20		5		36
Foreign:
Current		70		47		47
		70		47		47
Total	$	236	$	2,751	$	2,235

Schedule Of Effective Income Amount Reconciliation

	Years Ended December 31,
	2012		2011		2010
Tax benefit at the U.S. statutory rate	$	(1,740)	$	2,340	$	2,393
State taxes (net of federal benefit)		15		12		36
Change in net operating losses		-		-		1,663
Research and development credit		(2,982)		(1,137)		(3,298)
Change in valuation allowance		6,147		274		(1,309)
Foreign rate differential		(1,171)		1,037		2,284
Other individually immaterial items		(33)		225		466
	$	236	$	2,751	$	2,235

Schedule Of Deferred Tax Assets And Liabilities

	December 31,
	2012		2011
Deferred tax assets:
Accrued expenses and reserves	$	3,566	$	3,015
Net operating loss carryforwards		25,399		34,657
Research and development credits		17,297		16,704
Depreciation		15,622		19,355
Share-based compensation		5,673		4,723
Other		114		179
Gross deferred tax assets:		67,671		78,633
Valuation Allowance		(67,021)		(70,474)
		650		8,159
Deferred tax liabilities:
Acquisition related intangibles		(650)		(8,159)
Total net deferred tax assets	$	-	$	-

Schedule Of Unrecognized Tax Benefits

	Years Ended December 31,
	2012		2011		2010
Unrecognized tax benefits balance, beginning of period	$	4,401	$	4,038	$	3,662
Gross increase for tax positions for prior year		553		-		19
Gross increase for tax positions for current year		475		363		357
Unrecognized tax benefits balance, end of period	$	5,429	$	4,401	$	4,038

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Net Income (Loss) Per Share (Narrative) (Details) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Net Income (Loss) Per Share [Abstract]
Shares excluded from computation of diluted loss per share	4.5	3.4	2.0

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Acquisition And Restructuring Costs (Narrative) (Details) (USD $)	12 Months Ended						1 Months Ended
	Dec. 31, 2012 employee	Dec. 31, 2011 employee	Dec. 31, 2010	Dec. 31, 2011 Teranetics [Member]	Dec. 31, 2010 Teranetics [Member]	Dec. 31, 2012 Integrated Device Technology, Inc [Member]	Mar. 31, 2011 Lease Commitment [Member]	Dec. 31, 2011 Lease Commitment [Member]
Acquisition And Restructuring Costs [Line Items]
Acquisition related costs	$ 6,898,000	$ 88,000	$ 855,000	$ 100,000	$ 900,000	$ 6,900,000
Reduction against the two promissory notes		1,900,000
Amount of notes cancelled		1,500,000
Escrow claim settlement		1,397,000
Severance and benefit related costs		501,000
Number of employees terminated	14	14
Liability amount included in other accrued expense							200,000	281,000
Lease commitment accrual		$ 301,000					$ 200,000

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Discontinued Operation (Narrative) (Details) (USD $)	12 Months Ended		0 Months Ended		12 Months Ended	0 Months Ended	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Sep. 20, 2012 Aquantia APA [Member]	Jul. 06, 2012 Entropic APA [Member]	Dec. 31, 2012 Entropic APA [Member]	Nov. 21, 2012 Entropic APA [Member] Product Acceptance [Member]	Dec. 31, 2012 Entropic APA [Member] Product Acceptance [Member]	Dec. 31, 2012 Entropic APA [Member] Potential Third Party Royalty Arrangement [Member]
Proceeds from sale of product line			$ 2,000,000	$ 3,000,000
Possible future proceeds for post closing milestones and amount held in escrow					5,000,000
Possible future proceeds for post-closing milestones						1,400,000	2,000,000	1,000,000
Possible escrow agreement proceeds from Entropic for post-closing indemnification					2,000,000
Proceeds from Entropic for nonexclusive licensing fee for intellectual property	4,000,000	1,700,000
Cash proceeds from sale (including fair value amount held in escrow)	12,000,000
Fair value of escrow payment					1,600,000
Gain on disposal	$ 3,450,000

XML

Share-Based Compensation (Schedule Of Weighted-Average Fair Value Calculations Based On Weighted Average Assumptions) (Details)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Share-Based Compensation [Abstract]
Expected volatility	62.90%	61.34%	61.54%
Expected life (years)	4 years 4 months 6 days	4 years 3 months 26 days	4 years 2 months 9 days
Risk-free interest rate	0.68%	1.21%	1.61%

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Organization And Summary Of Significant Accounting Policies

12 Months Ended

Dec. 31, 2012

Organization And Summary Of Significant Accounting Policies [Abstract]

Organization And Summary Of Significant Accounting Policies

1.  Organization and Summary of Significant Accounting Policies

Description of Business

PLX Technology, Inc. ("PLX" or the "Company"), a Delaware corporation established in May 1986, designs, develops manufactures and sells semiconductor devices that accelerate and manage the transfer of data in microprocessor-based systems including networking and telecommunications, enterprise storage, servers, personal computers (PCs), PC peripherals, consumer electronics, imaging and industrial products. The Company offers a complete solution consisting of two related types of products: semiconductor devices and development kits. The Company’s semiconductor devices simplify the development of data transfer circuits in micro-processor based systems. The Company’s development kits promote sales of its semiconductor devices by lowering customers' development costs and by accelerating their ability to bring new products to market. The Company utilizes a “fabless” semiconductor business model whereby it purchases wafers and packaged and tested semiconductor devices from independent manufacturing foundries.  Semiconductor devices as well as occasional IP and development service revenues account for substantially all of the Company's net revenues.

On September 20, 2012, the Company completed the sale of a portion of its physical layer 10GBase-T integrated circuit (“PHY”) family of products pursuant to an Asset Purchase Agreement between the Company and Aquantia Corporation dated September 14, 2012.  The Company had also entered into an Asset Purchase Agreement with Entropic Communications, Inc. on July 6, 2012, as amended on November 21, 2012, pursuant to which the Company completed the sale of its digital channel stacking switch product line within the PHY product family, including certain assets exclusively related to the product line.  Together, these divestitures completed the sale of the PHY business. The operations of the PHY related business have been segregated from continuing operations and are presented as discontinued operations in the Company’s consolidated statement of operations for the periods from October 1, 2010, the date the Company acquired the PHY business, through December 31, 2012 in these financial statements.

On April 30, 2012, the Company entered into an Agreement and Plan of Merger ("Merger Agreement") with Integrated Device Technology, Inc. ("IDT") in which IDT would purchase all of the Company's outstanding shares of common stock in exchange for consideration, per share, comprised of (i) $3.50 in cash plus (ii) 0.525 of a share of IDT common stock.

The agreement was subject to various conditions, including, but not limited to (i) at least a majority of shares of PLX common stock then outstanding (calculated on a fully diluted basis) being tendered into the Offer, (ii) the expiration or termination of the applicable Hart-Scott-Rodino Act ("HSR Act") waiting period, (iii) the registration statement for IDT's common stock issuable in connection with the Offer and Merger being declared effective by the SEC and the listing of such shares on Nasdaq and (iv) the absence of any Company Material Adverse Effect (as defined in the Merger Agreement) with respect to PLX's business.

On December 18, 2012, the United States Federal Trade Commission ("FTC") filed an administrative complaint challenging IDT's proposed acquisition of PLX. On December 19, 2012, as a result of the FTC's determination to challenge the proposed acquisition, IDT and PLX mutually agreed to terminate the Merger Agreement.

Basis of Presentation

The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States and include the accounts of the Company and its wholly-owned subsidiaries in China, India, Japan, Korea, Singapore, Taiwan and the United Kingdom. All intercompany transactions and balances have been eliminated.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Investments

At December 31, 2012, the Company’s securities consisted of certificates of deposits and debt securities.  Management determines the appropriate classification of debt securities at the time of purchase and reevaluates such designation as of each balance sheet date. At December 31, 2012 and 2011, all debt securities were designated as available-for-sale. Available-for-sale securities are carried at fair value, based on quoted market prices or prices quoted in markets that are not active, with unrealized gains and losses reported in a separate component of stockholders' equity. The amortized cost of debt securities is adjusted for the amortization of premiums and the accretion of discounts to maturity both of which are included in interest income. Realized gains and losses are recorded on the specific identification method.

The accounting guidance for fair value measurements provided a framework for measuring fair value and expands related disclosures. Fair value is defined as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The guidance also established a hierarchy which requires an entity to maximize the use of observable inputs, when available.  The guidance requires fair value measurement be classified and disclosed in one of the following three categories:

Level 1: Valuations based on quoted prices in active markets for identical assets and liabilities.  The fair value of available-for-sale securities included in the level 1 category is based on quoted prices that are readily and regularly available in an active market. 

Level 2: Valuations based on observable inputs (other than Level 1 prices), such as quoted prices for similar assets at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly. The fair value of available-for-sale securities included in the Level 2 category is based upon quoted prices in markets that are not active and incorporate available trade, bid and other market information.

Level 3: Valuations based on inputs that are unobservable and involve management judgment and the reporting entity’s own assumptions about market participants and pricing.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are recorded at the invoiced amount and do not bear interest.  The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable.  The Company determines the allowance based on historical write-off experience and customer economic data.  The Company reviews its allowance for doubtful accounts monthly.  Past due balances over 90 days are reviewed individually for collectability.  Account balances are charged off against the allowance when the Company believes that it is probable the receivable will not be recovered.

Inventories

Inventories are valued at the lower of cost (first-in, first-out method) or market (net realizable value).  Inventories were as follows (in thousands):

	December 31,
	2012		2011
Work-in-process	$	4,986	$	4,216
Finished goods		5,574		4,680
Total	$	10,560	$	8,896

The Company evaluates the need for potential inventory write downs by considering a combination of factors, including the life of the product, sales history, obsolescence, sales forecasts and expected sales prices.

Goodwill and Other Intangible Assets

Goodwill represents the excess of cost over the value of net assets of businesses acquired and is carried at cost unless write-downs for impairment are required. The Company’s goodwill as of December 31, 2012, is a result of the Oxford and Teranetics acquisition on January 2, 2009 and October 1, 2010, respectively, as adjusted for the 2012 divestiture of the PHY business and the 2011 divestiture of the UK design team.  The Company evaluates the carrying value of goodwill on an annual basis during the fourth quarter and whenever events and changes in circumstances indicate that the carrying amount may not be recoverable. Such indicators would include a significant reduction in the Company's market capitalization, a decrease in operating results or a deterioration in the Company's financial position. The Company operates under a single reporting unit, and accordingly, all of its goodwill is associated with the entire company. In the fourth quarter of 2012 and 2011, the Company tested the goodwill acquired and determined there was no impairment.

Changes in the carrying amount of goodwill for the years ended December 31, 2012 and 2011 are as follows (in thousands):

Net goodwill as of December 31, 2010	$	21,412
Adjustment for divestiture of UK design team		(74)
Net goodwill as of December 31, 2011		21,338
Adjustment for divestiture of PHY business		(877)
Net goodwill as of December 31, 2012	$	20,461

The purchased intangible assets including customer base and developed/core technology were being amortized over the assets’ useful lives, which ranged from one to six years, utilizing the straight-line or accelerated methods which approximates the estimated future cash flows from the intangible. The Company evaluates other intangible assets for impairment whenever events and circumstances indicate that such assets might be impaired. Also, see Note 11 to the consolidated financial statements.

Long-lived Asset Impairment

Long-lived assets, principally property and equipment and identifiable intangibles, held and used by the Company are reviewed for impairment whenever events or circumstances indicate that the carrying amount of assets may not be recoverable.  The Company evaluates recoverability of assets to be held and used by comparing the carrying amount of an asset to estimated future net undiscounted cash flows generated by the asset.  If such assets are considered to be impaired, the impairment recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of thirty nine years for buildings, three to eight years for building improvements and three to seven years for equipment, furniture and purchased software.

Property and equipment are as follows (in thousands):

	December 31,
	2012		2011
Land	$	3,150	$	3,150
Building and improvements		4,327		4,327
Equipment and furniture		14,955		14,681
Purchased software		2,371		2,513
		24,803		24,671
Accumulated depreciation		(13,536)		(12,380)
Net property and equipment	$	11,267	$	12,291

Depreciation and amortization expense from continuing operations pertaining to property and equipment was approximately $2.2 million, $2.4 million and $2.2 million for the years ended December 31, 2012, 2011 and 2010, respectively.

Foreign Currency Translation

The functional currency of the Company’s international subsidiaries in China, India, Japan, Korea Singapore, Taiwan and UK, is the local currency of the resident countries.  Assets and liabilities of the Company’s foreign subsidiaries are translated into the Company’s reporting currency at month-end exchange rates.  Revenues and expenses of the Company’s foreign subsidiaries are translated into the Company’s reporting currency at weighted-average exchange rates. The effects of the translation are included in a separate component of the Consolidated Statements of Stockholder’s Equity and Comprehensive Loss.

Income Taxes

Income taxes are accounted for using the asset and liability method.  Under this method, deferred tax liabilities and assets are recognized for the expected future tax consequences of differences between the carrying amounts and the tax bases of assets and liabilities.  A valuation allowance is provided when it is more likely than not that all or some portion of deferred tax assets will not be realized.

The Company recognizes the tax liability for uncertain income tax positions on the income tax return based on the two-step process. The first step is to determine whether it is more likely than not that each income tax position would be sustained upon audit. The second step is to estimate and measure the tax benefit as the amount that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority. Estimating these amounts requires the Company to determine the probability of various possible outcomes. The Company evaluates these uncertain tax positions on a quarterly basis. This evaluation is based on the consideration of several factors including changes in facts or circumstances, changes in applicable tax law, settlement of issues under audit, and new exposures. If the Company later determines that the exposure is lower or that the liability is not sufficient to cover its revised expectations, the Company adjusts the liability and effect a related change in its tax provision during the period in which the Company makes such determination.

Revenue Recognition

The Companyrecognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collection is reasonably assured.

Revenue from product sales to direct customers and distributors is recognized upon shipment and transfer of risk of loss, if the Company believes collection is reasonably assured and all other revenue recognition criteria are met. The Company assesses the probability of collection based on a number of factors, including past transaction history and the customer’s creditworthiness.  At the end of each reporting period, the sufficiency of allowances is assessed based on the age of the receivable and the individual customer’s creditworthiness.

The Company offers pricing protection to two distributors whereby the Company supports the distributor’s resale product margin on certain products held in the distributor’s inventory. The Company analyzes current requests for credit in process, also known as ship and debits, historical rates and amounts of credits issued, and inventory at the distributor to determine the ending sales reserve required for this program. The Company also offers stock rotation rights to three distributors such that they can return up to a total of 5% of products purchased every six months in exchange for other PLX products of equal value. The Company analyzes current stock rotation requests and past experience to determine the ending sales reserve required for this program. In addition, the Company had arrangements with a small number of customers offering a rebate program on various products, which were terminated in June 2010. The Company recorded rebates as a reduction of revenue when the rebate is in the form of cash consideration. Reserves are reduced directly from revenue and recorded as a reduction to accounts receivable.

Product Warranty

The Company sells products with a limited warranty of product quality for a period of one year, and up to three years for a small number of customers, and a limited indemnification of customers against intellectual property infringement claims related to the Company’s products. The Company accrues for known warranty and indemnification issues if a loss is probable and can be reasonably estimated, and accrues for estimated incurred but unidentified issues based on historical activity. 

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods.  Actual results could differ from those estimates and such differences may be material to the consolidated financial statements.

Comprehensive Loss

The components of accumulated other comprehensive loss, reflected in the Consolidated Statements of Stockholders' Equity and Comprehensive Loss, consisted of the following (in thousands):

	Years Ended December 31,
	2012		2011		2010
Unrealized gain (loss) on investments, net	$	1	$	9	$	(6)
Cumulative translation adjustments		(227)		(156)		(142)
Accumulated other comprehensive loss	$	(226)	$	(147)	$	(148)

Recent Accounting Pronouncements

In June 2011, the Financial Accounting Standards Board (“FASB”) issued a standard which revised the presentation of other comprehensive income (“OCI”). The new guidance requires entities to present net income and OCI in either a single continuous statement or in separate consecutive statements. The guidance does not change the components of net income or OCI, when OCI should be reclassified to net income, or the earnings per share calculation. This accounting guidance was effective for annual reporting periods beginning after December 15, 2011. The Company adopted this guidance as of January 1, 2012 using two consecutive statements.

In July 2012, the FASB issued amended standards to simplify how entities test indefinite-lived intangible assets for impairment which improve consistency in impairment testing requirements among long-lived asset categories. These amended standards permit an assessment of qualitative factors to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying value. For assets in which this assessment concludes it is more likely than not that the fair value is more than its carrying value, these amended standards eliminate the requirement to perform quantitative impairment testing as outlined in the previously issued standards. These amended standards are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

In February 2013, the FASB issued amended standards to improve the reporting of reclassifications out of accumulated other comprehensive income by requiring an entity to report their corresponding effect(s) on net income. These amended standards are effective for annual reporting periods beginning after December 15, 2012. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

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Discontinued Operation (Components Of Gain On Sale Of A Business) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Discontinued Operation [Abstract]
Cash proceeds from sale (including fair value amount held in escrow)	$ 12,000
Inventory transferred	(1,254)
Fixed assets transferred	(631)
Intangible assets write-off	(5,783)
Goodwill write-off	(877)	(74)
Other adjustments	(5)
Gain on disposal	$ 3,450

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Organization And Summary Of Significant Accounting Policies (Schedule Of Changes In The Carrying Amount Of Goodwill) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011
Organization And Summary Of Significant Accounting Policies [Abstract]
Net goodwill	$ 21,338	$ 21,412
Adjustment for divestiture	(877)	(74)
Net goodwill	$ 20,461	$ 21,338

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Share-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2012

Share-Based Compensation [Abstract]

Schedule Of Weighted-Average Fair Value Calculations Based On Weighted Average Assumptions

	Years Ended December 31,
	2012		2011		2010
Expected volatility		62.90%		61.34%		61.54%
Expected life (in years)		4.35		4.32		4.19
Risk-free interest rate		0.68%		1.21%		1.61%

Schedule Of Share-Based Compensation And Employee Stock Ownership Plan Expenses

	Years Ended December 31,
	2012		2011		2010
Cost of revenues	$	147	$	47	$	33
Research and development		1,007		485		602
Selling, general and administrative		1,739		1,138		863
Discontinued operations (1)		251		660		113
Total share-based compensation expense	$	3,144	$	2,330	$	1,611

(1)  Recorded in loss from discontinued operations in the Consolidated Statement of Operations.

Summary Of Stock Option Activity

				Weighted Average
				Remaining	Aggregate
	Number of	Weighted Average		Contractual Term	Intrinsic
Options	Shares	Exercise Price		(in years)	Value
Outstanding at December 31, 2009	2,825,796	$	4.36	5.14	$	1,794,310
Granted	1,581,000		4.27
Exercised	(92,188)		2.42
Cancelled	(111,955)		5.65
Outstanding at December 31, 2010	4,202,653		4.34	5.06	$	2,314,975
Granted	1,484,500		3.44
Exercised	(196,747)		1.84
Cancelled	(878,039)		4.35
Outstanding at December 31, 2011	4,612,367		4.15	4.61	$	872,567
Granted	1,066,000		4.38
Exercised	(372,444)		3.29
Cancelled	(1,083,371)		4.86
Outstanding at December 31, 2012	4,222,552		4.10	3.93	$	1,759,014
Exercisable at December 31, 2012	2,656,894	$	4.11	3.08	$	1,550,784

Summary Of Ranges Of Outstanding And Exercisable Options

	Options Outstanding				Options Exercisable
		Weighted Average
		Remaining	Weighted			Weighted
Range of		Contractual Term	Average			Average
Exercise Price	Number	(in years)	Exercise Price		Number	Exercise Price
$1.80-$2.69	1,075,761	3.46	$	2.13	925,824	$	2.06
$2.70-$3.73	1,041,656	3.89		3.54	592,303		3.50
$3.74-$4.10	855,577	5.26		4.03	213,402		3.85
$4.11-$6.66	913,666	4.22		5.13	589,473		4.91
$6.67-$15.58	335,892	1.36		9.57	335,892		9.57
Total	4,222,552	3.93	$	4.10	2,656,894	$	4.11

Summary Of Activity For Nonvested Restricted Stock Units

	Nonvested Restricted Stock Units
	Number of	Weighted Average
	Shares	Grant-Date Fair Value
December 31, 2011	-	$	-
Granted	301,000		6.27
Vested	(33,500)		6.46
Cancelled	(27,400)		6.66
December 31, 2012	240,100	$	6.20

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Organization And Summary Of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2012

Organization And Summary Of Significant Accounting Policies [Abstract]

Schedule Of Inventories

	December 31,
	2012		2011
Work-in-process	$	4,986	$	4,216
Finished goods		5,574		4,680
Total	$	10,560	$	8,896

Schedule Of Changes In The Carrying Amount Of Goodwill

Net goodwill as of December 31, 2010	$	21,412
Adjustment for divestiture of UK design team		(74)
Net goodwill as of December 31, 2011		21,338
Adjustment for divestiture of PHY business		(877)
Net goodwill as of December 31, 2012	$	20,461

Schedule Of Property And Equipment

	December 31,
	2012		2011
Land	$	3,150	$	3,150
Building and improvements		4,327		4,327
Equipment and furniture		14,955		14,681
Purchased software		2,371		2,513
		24,803		24,671
Accumulated depreciation		(13,536)		(12,380)
Net property and equipment	$	11,267	$	12,291

Schedule Of Accumulated Comprehensive Loss

	Years Ended December 31,
	2012		2011		2010
Unrealized gain (loss) on investments, net	$	1	$	9	$	(6)
Cumulative translation adjustments		(227)		(156)		(142)
Accumulated other comprehensive loss	$	(226)	$	(147)	$	(148)

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Financial Instruments (Schedule Of Fair Value Of Available-For-Sale Investments) (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Schedule of Available-for-sale Securities [Line Items]
Less amounts classified as cash equivalents	$ (1,928)	$ (1,494)
Total short and long-term available-for-sale investments	2,038	7,655
Contractual maturity dates for investments, Less than one year, Estimated Fair Value	1,787	7,549
Contractual maturity dates for investments, One to two years, Estimated Fair Value	251	106
Available-for-sale Securities, Total	2,038	7,655
Certificate Of Deposit [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	2,707	2,988
Estimated Fair Value	2,707	2,988
Corporate Bonds And Notes [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	278	434
Estimated Fair Value	278	434
Municipal Bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	981	2,083
Unrealized Gain		4
Estimated Fair Value	981	2,087
US Treasury And Government Agencies Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost		3,635
Unrealized Gain		5
Estimated Fair Value		3,640
Total Bonds, Notes And Equity Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	3,966	9,140
Unrealized Gain		9
Estimated Fair Value	$ 3,966	$ 9,149

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Organization And Summary Of Significant Accounting Policies (Schedule Of Property And Equipment) (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Property, Plant and Equipment [Line Items]
Property and equipment	$ 24,803	$ 24,671
Accumulated depreciation	(13,536)	(12,380)
Net property and equipment	11,267	12,291
Land [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	3,150	3,150
Building And Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	4,327	4,327
Equipment And Furniture [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	14,955	14,681
Software [Member]
Property, Plant and Equipment [Line Items]
Property and equipment	$ 2,371	$ 2,513

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Net Income (Loss) Per Share (Tables)

12 Months Ended

Dec. 31, 2012

Net Income (Loss) Per Share [Abstract]

Computation Of Basic And Diluted Net Income (Loss) Per Share

	Years Ended December 31,
	2012		2011		2010
Income (loss) from continuing operations	$	(5,201)	$	3,104	$	4,642
Weighted average shares outstanding - basic		44,882		44,559		38,942
Dilutive effect of stock options and RSUs		-		457		683
Weighted average shares outstanding - diluted		44,882		45,016		39,625
Basic income (loss) per share from continuing operations	$	(0.12)	$	0.07	$	0.12
Diluted income (loss) per share from continuing operations	$	(0.12)	$	0.07	$	0.12

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Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2012

Financial Instruments [Abstract]

Schedule Of Fair Value Of Financial Assets And Liabilities Measured On Recurring Basis

			Fair Value Measurement as Reporting Date Using
			Quoted Prices in Active Markets		Significant Other		Significant
			for Identical Assets or Liabilities		Observable Inputs		Unobservable Inputs
	December 31, 2012		(Level 1)		(Level 2)		(Level 3)
Assets:
Money market funds	$	1,809	$	1,809	$	-	$	-
Certificate of deposit		2,707		-		2,707		-
Marketable securities		1,259		-		1,259		-
Escrow Receivable		1,600		-		-		1,600
Total	$	7,375	$	1,809	$	3,966	$	1,600

			Fair Value Measurement as Reporting Date Using
			Quoted Prices in Active Markets		Significant Other		Significant
			for Identical Assets or Liabilities		Observable Inputs		Unobservable Inputs
	December 31, 2011		(Level 1)		(Level 2)		(Level 3)
Assets:
Money market funds	$	89	$	89	$	-	$	-
Certificate of deposit		2,988		-		2,988		-
Marketable securities		6,161		-		6,161		-
Total	$	9,238	$	89	$	9,149	$	-

Schedule Of Fair Value Of Available-For-Sale Investments

	December 31, 2012
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gain		Loss		Fair Value
Certificate of deposit	$	2,707	$	-	$	-	$	2,707
Marketable securities:
Corporate bonds and notes		278		-		-		278
Municipal bonds		981		-		-		981
Total	$	3,966	$	-	$	-	$	3,966
Less amounts classified as cash equivalents								(1,928)
Total short and long-term available-for-sale investments							$	2,038
Contractual maturity dates for investments:
Less than one year:								1,787
One to two years:								251
							$	2,038

	December 31, 2011
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gain		Loss		Fair Value
Certificate of deposit	$	2,988	$	-	$	-	$	2,988
Marketable securities:
Corporate bonds and notes		434		-		-		434
Municipal bonds		2,083		4		-		2,087
US treasury and government agencies securities		3,635		5		-		3,640
Total	$	9,140	$	9	$	-	$	9,149
Less amounts classified as cash equivalents								(1,494)
Total short and long-term available-for-sale investments							$	7,655
Contractual maturity dates for investments:
Less than one year:								7,549
One to two years:								106
							$	7,655

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Consolidated Statements Of Cash Flows (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Cash flows used in operating activities:
Net loss	$ (32,589)	$ (24,823)	$ (3,289)
Adjustments to reconcile net loss to net cash flows used in operating activities, net of assets acquired and liabilities assumed:
Depreciation and amortization	2,993	3,510	3,458
Share-based compensation expense	2,963	1,872	1,264
Amortization of purchased intangible assets	5,284	10,639	4,656
Impairment of assets	10,343
Gain on sale of business	(3,450)
Write-downs of inventories	1,035	1,649	669
Escrow claim settlement		(1,397)
Other non-cash items	91	257	271
Changes in operating assets and liabilities:
Accounts receivable	434	2,481	(3,945)
Inventories	(3,952)	2,773	(3,767)
Other current assets	29	2,816	(1,112)
Other assets	244	(300)	623
Accounts payable	3,604	(1,649)	(625)
Accrued compensation and benefits	907	(1,612)	3,376
Accrued commissions	185	118	(231)
Other accrued expenses	(558)	1,010	(1,847)
Net cash used in operating activities	(12,437)	(2,656)	(499)
Cash flows provided by investing activities:
Cash received in divestiture	10,400	500
Cash used in acquisition			(810)
Purchases of marketable securities	(5,589)	(6,257)	(34,829)
Sales and maturities of marketable securities	11,110	16,239	45,531
Purchase of property and equipment	(2,561)	(2,956)	(3,390)
Proceeds from sales of property and equipment			22
Net cash provided by investing activities	13,360	7,526	6,524
Cash flows provided by (used in) financing activities:
Borrowing against line of credit	12,500	2,000
Principal payments on line of credit	(6,500)
Proceeds from exercise of common stock options	1,224	361	223
Taxes paid related to net share settlement of equity awards	(66)
Excess tax benefit from share-based compensation			242
Principal payment on acquisition note	(4,848)
Principal payments on capital lease obligations	(583)	(906)	(727)
Payments of assumed debt			(11,195)
Net cash provided by (used in) financing activities	1,727	1,455	(11,457)
Effect of exchange rate fluctuations on cash and cash equivalents	(74)	(63)	(32)
Increase (decrease) in cash and cash equivalents	2,576	6,262	(5,464)
Cash and cash equivalents at beginning of year	12,097	5,835	11,299
Cash and cash equivalents at end of year	14,673	12,097	5,835
Supplemental disclosure of cash flow information:
Cash from income tax refunds	15	990	2
Cash paid for income taxes	17	9	1,017
Cash paid for interest	334	56	1,268
Common stock issued in connection with acquisition			27,454
Notes issued in connection with acquisition			$ 6,650

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Concentrations Of Credit, Customer And Supplier Risk (Tables)

12 Months Ended

Dec. 31, 2012

Concentrations Of Credit, Customer And Supplier Risk [Abstract]

Schedule Of Percentage Of Total Accounts Receivable Balance Accounted To Customers

	December 31,
	2012		2011		2010
Excelpoint Systems Pte Ltd.		30%		27%		24%
Avnet, Inc.		21%		28%		24%
Answer Technology, Inc.		19%		12%		17%

Schedule Of Percentage Of Net Revenues Accounted As Sales To Distributors

	Years Ended December 31,
	2012		2011		2010
Excelpoint Systems Pte Ltd.		27%		24%		27%
Avnet, Inc.		24%		24%		23%
Answer Technology, Inc.		19%		18%		18%

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Commitments And Contingencies (Schedule Of Future Minimum Lease Payments) (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012
Property, Plant and Equipment [Line Items]
2013	$ 3,446
2014	2,173
2015	123
2016	37
Total	5,779
Facility And Equipment [Member]
Property, Plant and Equipment [Line Items]
2013	243
2014	180
2015	123
2016	37
Total	583
Software [Member]
Property, Plant and Equipment [Line Items]
2013	3,203
2014	1,993
Total	$ 5,196

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Quarterly Financial Data (Tables)

12 Months Ended

Dec. 31, 2012

Quarterly Financial Data [Abstract]

Schedule Of Quarterly Financial Data

	Three Months Ended
	March 31,		June 30,		September 30,		December 31,
	2012		2012		2012		2012
Net revenues	$	24,532	$	25,437	$	26,866	$	23,413
Gross profit	$	13,977	$	15,067	$	16,058	$	13,684
Loss from continuing operations	$	(1,223)	$	(484)	$	(3,304)	$	(190)
Loss from discontinued operations	$	(6,218)	$	(17,734)	$	(3,013)	$	(423)
Net Loss	$	(7,441)	$	(18,218)	$	(6,317)	$	(613)
Basic loss per share - continuing operations (1)	$	(0.03)	$	(0.01)	$	(0.07)	$	-
Basic loss per share - discontinued operations (1)	$	(0.14)	$	(0.40)	$	(0.07)	$	(0.01)
Basic net loss per share (1)	$	(0.17)	$	(0.41)	$	(0.14)	$	(0.01)
Diluted loss per share - continuing operations (1)	$	(0.03)	$	(0.01)	$	(0.07)	$	-
Diluted loss per share - discontinued operations (1)	$	(0.14)	$	(0.40)	$	(0.07)	$	(0.01)
Diluted net loss per share (1)	$	(0.17)	$	(0.41)	$	(0.14)	$	(0.01)

	Three Months Ended
	March 31,		June 30,		September 30,		December 31,
	2011		2011		2011		2011
Net revenues	$	26,328	$	30,165	$	29,763	$	24,896
Gross profit	$	14,667	$	17,368	$	17,183	$	15,334
Income (loss) from continuing operations	$	(1,567)	$	1,561	$	1,882	$	1,228
Loss from discontinued operations	$	(7,565)	$	(7,573)	$	(6,108)	$	(6,681)
Net loss	$	(9,132)	$	(6,012)	$	(4,226)	$	(5,453)
Basic income (loss) per share - continuing operations (1)	$	(0.04)	$	0.04	$	0.04	$	0.03
Basic loss per share - discontinued operations (1)	$	(0.17)	$	(0.17)	$	(0.14)	$	(0.15)
Basic net loss per share (1)	$	(0.21)	$	(0.13)	$	(0.10)	$	(0.12)
Diluted income (loss) per share - continuing operations (1)	$	(0.04)	$	0.03	$	0.04	$	0.03
Diluted loss per share - discontinued operations (1)	$	(0.17)	$	(0.17)	$	(0.14)	$	(0.15)
Diluted net loss per share (1)	$	(0.21)	$	(0.14)	$	(0.10)	$	(0.12)

(1) The sum of per share amounts for the quarters does not necessarily equal that for the year due to rounding as the computations were made independently.

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Net Income (Loss) Per Share (Computation Of Basic And Diluted Net Income (Loss) Per Share) (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended															12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012		Jun. 30, 2012		Mar. 31, 2012		Dec. 31, 2011		Sep. 30, 2011		Jun. 30, 2011		Mar. 31, 2011		Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Net Income (Loss) Per Share [Abstract]
Income (loss) from continuing operations	$ (190)	$ (3,304)		$ (484)		$ (1,223)		$ 1,228		$ 1,882		$ 1,561		$ (1,567)		$ (5,201)	$ 3,104	$ 4,642
Weighted average shares outstanding - basic																44,882	44,559	38,942
Dillutive effect of stock options and RSU's																	457	683
Weighted average shares outstanding - diluted																44,882	45,016	39,625
Basic net income (loss) per share from continuing operations		$ (0.07)	[1]	$ (0.01)	[1]	$ (0.03)	[1]	$ 0.03	[1]	$ 0.04	[1]	$ 0.04	[1]	$ (0.04)	[1]	$ (0.12)	$ 0.07	$ 0.12
Diluted net income (loss) per share from continuing operations		$ (0.07)	[1]	$ (0.01)	[1]	$ (0.03)	[1]	$ 0.03	[1]	$ 0.04	[1]	$ 0.03	[1]	$ (0.04)	[1]	$ (0.12)	$ 0.07	$ 0.12

[1] The sum of per share amounts for the quarters does not necessarily equal that for the year due to rounding as the computations were made independently.

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Other Intangible Assets (Narrative) (Details) (USD $)	3 Months Ended		9 Months Ended	12 Months Ended
	Jun. 30, 2012	Dec. 31, 2011	Sep. 30, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Acquired Finite-Lived Intangible Assets [Line Items]
Useful life of intangibles		4 years	5 years
Amortization expense				$ 5,284,000	$ 10,639,000	$ 4,656,000
Impairment charges	9,800,000			10,343,000
Intangible assets write-off				(5,783,000)
Continuing Operations [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization expense				245,000	2,801,000	2,593,000
Discontinued Operations [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization expense				5,100,000	7,800,000	2,100,000
Teranetics [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Identifiable intangibles acquired				30,500,000
Oxford [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Identifiable intangibles acquired				$ 9,100,000

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
ASSETS
Cash and cash equivalents	$ 14,673	$ 12,097
Short-term investments	1,787	7,549
Accounts receivable, less allowances of $2,100 and $2,391	10,635	11,074
Inventories	10,560	8,896
Other current assets	2,894	1,323
Total current assets	40,549	40,939
Goodwill	20,461	21,338
Other purchased intangible assets, net		20,845
Property and equipment, net	11,267	12,291
Long-term investments	251	106
Other assets	451	1,299
Total assets	72,979	96,818
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	10,738	7,134
Accrued compensation and benefits	4,493	3,586
Accrued commissions	817	632
Other accrued expenses	2,259	3,132
Short term note payable and capital lease obligation		5,115
Short term borrowings against line of credit	8,000
Total current liabilities	26,307	19,599
Long term borrowings against line of credit		2,000
Total liabilities	26,307	21,599
Commitments and contingencies (Notes 12 and 15)
Stockholders' equity:
Preferred stock, $0.001 par value per share: Authorized -- 5,000,000 shares: none issued and outstanding
Common stock, $0.001 par value per share: Authorized -- 200,000,000 shares: issued and outstanding - 45,094,668 and 44,701,118	45	45
Additional paid-in capital	189,444	185,323
Accumulated other comprehensive loss	(226)	(147)
Accumulated deficit	(142,591)	(110,002)
Total stockholders' equity	46,672	75,219
Total liabilities and stockholders' equity	$ 72,979	$ 96,818

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Organization And Summary Of Significant Accounting Policies (Schedule Of Accumulated Comprehensive Loss) (Details) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Organization And Summary Of Significant Accounting Policies [Abstract]
Unrealized gain (loss) on investments, net	$ 1	$ 9	$ (6)
Cumulative translation adjustments	(227)	(156)	(142)
Accumulated other comprehensive loss	$ (226)	$ (147)	$ (148)

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Consolidated Statements Of Comprehensive Loss (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Consolidated Statements Of Comprehensive Loss [Abstract]
Net loss	$ (32,589)	$ (24,823)	$ (3,289)
Unrealized gain (loss) on marketable securities, net	(8)	15	(34)
Foreign currency translation adjustments	(71)	(14)	(27)
Comprehensive net loss	$ (32,668)	$ (24,822)	$ (3,350)

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Concentrations Of Credit, Customer And Supplier Risk (Schedule Of Percentage Of Net Revenues Accounted As Sales To Distributors) (Details) (Revenue [Member])	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Excelpoint Systems Pte Ltd. [Member]
Concentration Risk [Line Items]
Percentage of net revenues	27.00%	24.00%	27.00%
Avnet, Inc. [Member]
Concentration Risk [Line Items]
Percentage of net revenues	24.00%	24.00%	23.00%
Answer Technology, Inc. [Member]
Concentration Risk [Line Items]
Percentage of net revenues	19.00%	18.00%	18.00%

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Acquisition And Restructuring Costs (Tables)

12 Months Ended

Dec. 31, 2012

Restructuring Cost and Reserve [Line Items]

Schedule Of Acquisition and Restructuring Costs

	Years Ended December 31,
	2012		2011		2010
	in thousands
Deal costs	$	6,898	$	88	$	855
Escrow claim settlement		-		(1,397)		-
Severance costs		-		501		-
Lease commitment accrual		-		301		-
	$	6,898	$	(507)	$	855

Severance [Member]

Restructuring Cost and Reserve [Line Items]

Summary Of Restructuring

	December 31,
	2012		2011
Liability at beginning of period	$	-	$	-
Continuing operations expense		-		501
Discontinued operations expense (1)		592		-
Cash payments		(277)		(501)
Liability at end of period	$	315	$	-

(1) Recorded in loss from discontinued operations in the Consolidated Statement of Operations. Severance related to the termination of 14 employees and 4 contractors in connection with the sale of the PHY business is expected to be paid by March 31, 2013.

Lease Commitment [Member]

Restructuring Cost and Reserve [Line Items]

Summary Of Restructuring

	December 31,
	2012		2011
Liability at beginning of period	$	281	$	-
Continuing operations expense		-		301
Discontinued operations expense (1)		-		554
Cash payments		(281)		(574)
Liability at end of period	$	-	$	281

(1) Recorded in loss from discontinued operations in the Consolidated Statement of Operations. In October 2010, associated with the acquisition of Teranetics, the Company assumed a building lease in San Jose, California which was vacated in March 2011. Given current lease rates and the available space in the area when the property was vacated, the Company recorded a $0.4 million liability, included in other accrued expenses in the Consolidated Balance Sheet, for the estimated fair value of the future lease costs through June 2012, reduced by estimated sublease rental and adjusted for deferred rent. As of September 30, 2011, the Company was not able to sublease the property and as a result accrued the remaining liability of $0.2 million. The total adjusted cash payment was not materially different from the fair value. As of June 30, 2012, the lease liability was paid.

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Teranetics, Inc. Acquisition (Summary Of Consideration Paid For Teranetics) (Details) (USD $) In Thousands, unless otherwise specified	Oct. 01, 2010
Common Shares Of PLX	$ 27,454
Cash At Closing	922
Total	36,026
Purchase Price [Member]
Common Shares Of PLX	26,406
Cash At Closing	887
Total	34,679
Teranetics CEO Bonus [Member]
Common Shares Of PLX	1,048
Cash At Closing	35
Total	1,347
Notes A And B [Member]
Notes	6,650
Notes A And B [Member] | Purchase Price [Member]
Notes	6,386
Notes A And B [Member] | Teranetics CEO Bonus [Member]
Notes	264
Bridge Note [Member]
Notes	1,000
Bridge Note [Member] | Purchase Price [Member]
Notes	$ 1,000

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Line Of Credit

12 Months Ended

Dec. 31, 2012

Line Of Credit [Abstract]

Line Of Credit

14.  Line of Credit

On September 30, 2011, the Company entered into an agreement with Silicon Valley Bank (SVB) to establish a two-year $10.0 million revolving loan facility. The facility provides for revolving advances based on a borrowing-base formula tied to the Company’s receivables and also provides for month-end and fiscal quarter-end advances beyond the borrowing-base formula subject to certain limitations and requirements. Borrowings under the credit facility bear interest at rates equal to the prime rate announced from time to time in The Wall Street Journal. As of December 31, 2012 the prime rate was 3.25%.  The facility also provides for commitment, unused facility and letter-of-credit fees. The facility is secured by liens on the Company’s personal property assets except for intellectual property, which is subject to a negative pledge against encumbrance. As of December 31, 2012 there is $8.0 million outstanding against the facility and borrowing availability is $2.0 million. Interest payments are made monthly with principal due on September 30, 2013.

The facility is subject to certain financial covenants for earnings before interest, taxes, depreciation and amortization (“EBITDA’), as defined in the agreement, and a monthly quick ratio computation (PLX’s cash, investments and accounts receivable divided by current liabilities). The Company was in compliance with all financial covenants associated with this facility as of December 31, 2012.

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Other Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2012

Other Intangible Assets [Abstract]

Schedule Of Gross Carrying Amount And Accumulated Amortization For Major Intangible Class And Weighted Average Amortization Period

	December 31, 2012
	Gross Carrying		Accumulated		Net
	Value		Amortization		Value
Existing and core technology
Oxford USB and Serial Connectivity	$	4,600	$	(4,600)	$	-
Oxford Network Attached Storage Connectivity		3,800		(3,800)		-
Trade Name
Oxford		600		(600)		-
Customer Relationships
Oxford		56		(56)		-
Totals	$	9,056	$	(9,056)	$	-

	December 31, 2011
	Gross Carrying		Accumulated		Net
	Value		Amortization		Value
Existing and core technology
Oxford USB and Serial Connectivity	$	4,600	$	(4,600)	$	-
Oxford Network Attached Storage Connectivity		3,800		(3,555)		245
Teranetics Network PHY		20,100		(4,187)		15,913
Trade Name
Oxford		600		(600)		-
Teranetics		200		(125)		75
Customer Relationships
Oxford		56		(56)		-
Teranetics		10,200		(5,588)		4,612
Totals	$	39,556	$	(18,711)	$	20,845

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Segments Of An Enterprise And Related Information

12 Months Ended

Dec. 31, 2012

Segments Of An Enterprise And Related Information [Abstract]

Segments Of An Enterprise And Related Information

16.  Segments of an Enterprise and Related Information

The Company has one operating segment, the sale of semiconductor devices. The Chief Executive Officer has been identified as the Chief Operating Decision Maker (CODM) because he has final authority over resource allocation decisions and performance assessment. The CODM does not receive discrete financial information about individual components of the Company's business.  Substantially all of the Company’s assets are located in the United States.

Revenues by geographic region based on customer location were as follows (in thousands):

	Years Ended December 31,
	2012		2011		2010
Revenues:
China	$	27,026	$	26,740	$	33,006
Taiwan		22,682		25,379		21,665
United States		15,639		22,088		20,357
Singapore		13,432		13,312		15,692
Germany		11,575		11,765		10,649
Other Asia Pacific		7,959		9,762		11,367
Europe, Middle East and Africa		1,491		1,958		2,392
The Americas - excluding United States		444		148		412
Total	$	100,248	$	111,152	$	115,540

Revenues by type were as follows (in thousands):

	Years Ended December 31,
	2012		2011		2010
Revenues:
PCI Express	$	66,780	$	61,557	$	54,361
Connectivity		33,468		49,595		61,179
Total	$	100,248	$	111,152	$	115,540

There were no direct end customers that accounted for more than 10% of net revenues.  Sales to the following distributors accounted for 10% or more of net revenues:

	Years Ended December 31,
	2012		2011		2010
Excelpoint Systems Pte Ltd.		27%		24%		27%
Avnet, Inc.		24%		24%		23%
Answer Technology, Inc.		19%		18%		18%

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Acquisition And Restructuring Costs (Schedule Of Acquisition and Restructuring Costs) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Acquisition And Restructuring Costs [Abstract]
Deal costs	$ 6,898	$ 88	$ 855
Escrow claim settlement		(1,397)
Severance costs		501
Lease commitment accrual		301
Total acquisition and restructuring costs	$ 6,898	$ (507)	$ 855

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Consolidated Statements Of Stockholders' Equity (USD $) In Thousands, except Share data	Common Stock [Member]	Additional Paid-In Capital [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Accumulated Deficit [Member]	Total
Balance at Dec. 31, 2009	$ 37	$ 153,939	$ (87)	$ (81,890)	$ 71,999
Balance, shares at Dec. 31, 2009	37,012,223
Share-based compensation expense		1,264			1,264
Issuance of stock under employee equity plans, value	1	222			223
Issuance of stock under employee equity plans, shares	92,188
Issuance of stock in connection with the acquisition of Teranetics, value	7	27,447			27,454
Issuance of stock in connection with the acquisition of Teranetics, shares	7,399,980
Issuance of stock true up in connection with the acquisition of Oxford, shares	(20)
Tax benefit related to exercise of stock options		218			218
Change in unrealized loss on investments			(34)		(34)
Translation adjustments			(27)		(27)
Net loss				(3,289)	(3,289)
Balance at Dec. 31, 2010	45	183,090	(148)	(85,179)	97,808
Balance, shares at Dec. 31, 2010	44,504,371
Share-based compensation expense		1,872			1,872
Issuance of stock under employee equity plans, value		361			361
Issuance of stock under employee equity plans, shares	196,747
Change in unrealized loss on investments			15		15
Translation adjustments			(14)		(14)
Net loss				(24,823)	(24,823)
Balance at Dec. 31, 2011	45	185,323	(147)	(110,002)	75,219
Balance, shares at Dec. 31, 2011	44,701,118
Share-based compensation expense		2,963			2,963
Issuance of stock under employee equity plans, value		1,158			1,158
Issuance of stock under employee equity plans, shares	393,550
Change in unrealized loss on investments			(8)		(8)
Translation adjustments			(71)		(71)
Net loss				(32,589)	(32,589)
Balance at Dec. 31, 2012	$ 45	$ 189,444	$ (226)	$ (142,591)	$ 46,672
Balance, shares at Dec. 31, 2012	45,094,668

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Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Dec. 31, 2012	Dec. 31, 2011
Consolidated Balance Sheets [Abstract]
Accounts receivable allowances	$ 2,100	$ 2,391
Preferred stock, par value per share	$ 0.001	$ 0.001
Preferred stock, authorized shares	5,000,000	5,000,000
Preferred stock, issued	0	0
Preferred stock, outstanding	0	0
Commom stock, par value per share	$ 0.001	$ 0.001
Common stock, authorized shares	200,000,000	200,000,000
Common stock, issued	45,094,668	44,701,118
Common stock, outstanding	45,094,668	44,701,118

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Acquisition And Restructuring Costs

12 Months Ended

Dec. 31, 2012

Acquisition And Restructuring Costs [Abstract]

Acquisition And Restructuring Costs

9.  Acquisition and Restructuring Costs

	Years Ended December 31,
	2012		2011		2010
	in thousands
Deal costs	$	6,898	$	88	$	855
Escrow claim settlement		-		(1,397)		-
Severance costs		-		501		-
Lease commitment accrual		-		301		-
	$	6,898	$	(507)	$	855

Acquisition Costs

For the year ended December 31, 2012, the Company recorded acquisition related costs of $6.9 million, primarily for outside legal and banking expenses associated with the IDT acquisition activities, which were subsequently terminated. For the years ended December 31, 2011 and 2010 we recorded $0.1 million and $0.9 million, respectively, in acquisition related costs associated with the October 1, 2010 acquisition of Teranetics. Deal costs related primarily to outside legal and accounting costs.

In 2011, as a result of the indemnity claims we communicated to the Teranetics stockholders’ representative, we negotiated a $1.9 million reduction against the two promissory notes. The settlement included the cancelation of the $1.5 million note due in October 2013 and was recorded in 2011 as a reduction to acquisition and restructuring related costs in the Consolidated Statement of Operations for the assessed fair value of $1.4 million for the portion of the claims not directly related to the operations of the PHY activity.

Severance

In the year ended December 31, 2011, the Company recorded approximately $0.5 million of severance and benefit related costs, included in acquisition and restructuring related costs in the Consolidated Statement of Operations, related to the termination of 14 employees worldwide as a result of the downsizing and refocus of the operations in the UK early in the year and cost control efforts as a result of the Teranetics acquisition. As of December 31, 2011, all of the $0.5 million severance and benefit related costs were paid. 

The following table summarizes the activity within the severance and benefit related liability (in thousands):

	December 31,
	2012		2011
Liability at beginning of period	$	-	$	-
Continuing operations expense		-		501
Discontinued operations expense (1)		592		-
Cash payments		(277)		(501)
Liability at end of period	$	315	$	-

(1) Recorded in loss from discontinued operations in the Consolidated Statement of Operations. Severance related to the termination of 14 employees and 4 contractors in connection with the sale of the PHY business is expected to be paid by March 31, 2013.

Lease Termination

In connection with the downsizing of UK operations, the Company vacated the first floor of its building as of March 2011. In March 2011, the Company recorded a $0.2 million liability, included in other accrued expenses in the Consolidated Balance Sheet, for future lease costs and early termination fees. The lease accrual charge of $0.2 million was recorded in acquisition and restructuring related costs in the Consolidated Statement of Operations. As of December 31, 2011 the lease liability was paid.

The following table summarizes the activity within the lease termination liability (in thousands):

	December 31,
	2012		2011
Liability at beginning of period	$	281	$	-
Continuing operations expense		-		301
Discontinued operations expense (1)		-		554
Cash payments		(281)		(574)
Liability at end of period	$	-	$	281

Recorded in loss from discontinued operations in the Consolidated Statement of Operations. In October 2010, associated with the acquisition of Teranetics, the Company assumed a building lease in San Jose, California which was vacated in March 2011. Given current lease rates and the available space in the area when the property was vacated, the Company recorded a $0.4 million liability, included in other accrued expenses in the Consolidated Balance Sheet, for the estimated fair value of the future lease costs through June 2012, reduced by estimated sublease rental and adjusted for deferred rent. As of September 30, 2011, the Company was not able to sublease the property and as a result accrued the remaining liability of $0.2 million. The total adjusted cash payment was not materially different from the fair value. As of June 30, 2012, the lease liability was paid.

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Document And Entity Information (USD $)	12 Months Ended
	Dec. 31, 2012	Feb. 28, 2013	Jun. 30, 2012
Document And Entity Information [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2012
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2012
Entity Registrant Name	PLX TECHNOLOGY INC
Entity Central Index Key	0000850579
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Entity Public Float			$ 265,952,815
Entity Common Stock, Shares Outstanding		45,410,784

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Asset Impairment

12 Months Ended

Dec. 31, 2012

Asset Impairment [Abstract]

Asset Impairment

10.  Asset Impairment

In June 2012 the Company recorded impairment charges of $10.3 million related to its 10 Gigabit Ethernet business, including core technology of $9.6 million, trade name and customer relationships of $0.2 million and certain tangible assets of $0.5 million.  The primary factors contributing to this impairment charge was the uncertainty of and reduction in forecasted cash flows, resulting in  an increase in the probability that the product line will be sold or disposed of based on the reduction and timing of future cash flows.  In determining the amount of impairment charges the Company calculated the fair value of the asset group as of the impairment date.  The valuation of the assets was classified as a level 3 measurement under the fair value measurement guidance. The fair value was determined using the weighted average of a discounted cash flow analysis and a market approach along with proceeds received from Entropic in July 2012 in connection with the IP license agreement.  The discounted cash flow approach calculates the value based on the risk-adjusted present value of the cash flows related to 10 Gigabit Ethernet while the market approach calculates the value based on  indications of what a market participant would pay for the asset group.  The key unobservable inputs utilized in the discounted cash flow model include a 40% discount rate, a tax rate of 40% and future cash flows based on current product and market data.  The impairment was recorded in discontinued operations in the Company’s Consolidated Statement of Operations.

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Income Taxes (Schedule Of Unrecognized Tax Benefits) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Income Taxes [Abstract]
Unrecognized tax benefits balance, beginning of period	$ 4,401	$ 4,038	$ 3,662
Gross increase for tax positions for prior year	553		19
Gross increase for tax positions for current year	475	363	357
Unrecognized tax benefits balance, end of period	$ 5,429	$ 4,401	$ 4,038

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Consolidated Statements Of Operations (USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Net revenues	$ 100,248	$ 111,152	$ 115,540
Cost of revenues	41,462	46,600	47,753
Gross profit	58,786	64,552	67,787
Operating expenses
Research and development	27,532	28,218	30,799
Selling, general and administrative	28,927	28,037	26,720
Net acquisition and restructuring related costs	6,898	(507)	855
Amortization of purchased intangible assets	5,284	10,639	4,656
Total operating expenses	63,602	58,549	60,967
Income (loss) from operations	(4,816)	6,003	6,820
Interest income	33	73	186
Interest expense	(203)	(165)	(117)
Other income (expense), net	21	(56)	(12)
Income (loss) from continuing operations before provision for income taxes	(4,965)	5,855	6,877
Provision for income taxes	236	2,751	2,235
Income (loss) from continuing operations, net of tax	(5,201)	3,104	4,642
Loss from discontinued operations (including gain on disposal of $3,450 in 2012), net of tax	(27,388)	(27,927)	(7,931)
Net loss	(32,589)	(24,823)	(3,289)
Basic net income (loss) per share:
Income (loss) from continuing operations	$ (0.12)	$ 0.07	$ 0.12
Loss from discontinued operations	$ (0.61)	$ (0.63)	$ (0.20)
Net loss	$ (0.73)	$ (0.56)	$ (0.08)
Diluted net income (loss) per share:
Income (loss) from continuing operations	$ (0.12)	$ 0.07	$ 0.12
Loss from discontinued operations	$ (0.61)	$ (0.62)	$ (0.20)
Net loss	$ (0.73)	$ (0.55)	$ (0.08)
Shares used to compute basic per share amounts	44,882	44,559	38,942
Shares used to compute diluted per share amounts	44,882	45,016	39,625
Continuing Operations [Member]
Operating expenses
Amortization of purchased intangible assets	$ 245	$ 2,801	$ 2,593

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Financial Instruments

12 Months Ended

Dec. 31, 2012

Financial Instruments [Abstract]

Financial Instruments

4.  Financial Instruments

Fair Value Measurements

The fair value of financial assets and liabilities measured on a recurring basis is as follows (in thousands):

			Fair Value Measurement as Reporting Date Using
			Quoted Prices in Active Markets		Significant Other		Significant
			for Identical Assets or Liabilities		Observable Inputs		Unobservable Inputs
	December 31, 2012		(Level 1)		(Level 2)		(Level 3)
Assets:
Money market funds	$	1,809	$	1,809	$	-	$	-
Certificate of deposit		2,707		-		2,707		-
Marketable securities		1,259		-		1,259		-
Escrow Receivable		1,600		-		-		1,600
Total	$	7,375	$	1,809	$	3,966	$	1,600

			Fair Value Measurement as Reporting Date Using
			Quoted Prices in Active Markets		Significant Other		Significant
			for Identical Assets or Liabilities		Observable Inputs		Unobservable Inputs
	December 31, 2011		(Level 1)		(Level 2)		(Level 3)
Assets:
Money market funds	$	89	$	89	$	-	$	-
Certificate of deposit		2,988		-		2,988		-
Marketable securities		6,161		-		6,161		-
Total	$	9,238	$	89	$	9,149	$	-

The fair value of the Company’s money-market funds classified as Level 1 is valued using prices in active markets. The fair values of the Company’s investments classified as Level 2 are valued using inputs that include actual trade data, benchmark yields, broker/dealer quotes and other similar data. These inputs are obtained from quoted market prices, independent pricing vendors or other sources.

The estimated fair value of the escrow payment is based on assumptions made regarding potential claims against the escrow using historical and market data and a 3.25% discount rate to consider present value. The Company estimated a claims rate of 17%. These assumptions and fair value estimate are subject to change. Changes in these inputs would change the assessed fair value of the escrow receivable. See Note 7 of the consolidated financial statements for more information on the escrow receivable. As of December 31, 2011, there were no Level 3 measurements.

Investments

As of December 31, 2012, the Company’s securities consisted of certificates of deposits and debt securities and were designated as available-for-sale. Available-for-sale securities are carried at fair value, based on quoted market prices or prices quoted in markets that are not active, with unrealized gains and losses reported in a separate component of stockholders’ equity.  The amortized cost of debt securities is adjusted for the amortization of premiums and the accretion of discounts to maturity, both of which are included in interest income.  Realized gains and losses are recorded on the specific identification method.

The fair value of available-for-sale investments is as follows (in thousands):

	December 31, 2012
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gain		Loss		Fair Value
Certificate of deposit	$	2,707	$	-	$	-	$	2,707
Marketable securities:
Corporate bonds and notes		278		-		-		278
Municipal bonds		981		-		-		981
Total	$	3,966	$	-	$	-	$	3,966
Less amounts classified as cash equivalents								(1,928)
Total short and long-term available-for-sale investments							$	2,038
Contractual maturity dates for investments:
Less than one year:								1,787
One to two years:								251
							$	2,038

	December 31, 2011
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gain		Loss		Fair Value
Certificate of deposit	$	2,988	$	-	$	-	$	2,988
Marketable securities:
Corporate bonds and notes		434		-		-		434
Municipal bonds		2,083		4		-		2,087
US treasury and government agencies securities		3,635		5		-		3,640
Total	$	9,140	$	9	$	-	$	9,149
Less amounts classified as cash equivalents								(1,494)
Total short and long-term available-for-sale investments							$	7,655
Contractual maturity dates for investments:
Less than one year:								7,549
One to two years:								106
							$	7,655

As of December 31, 2012 and 2011, the Company had an aggregate unrealized loss of less than $1,000.

The Company reviews its available for sale investments for impairment at the end of each period.  Investments in debt securities, which make up the majority of the Company’s investments, are considered impaired when the fair value of the debt security is below its amortized cost. If an impairment exists and the Company determines it has intent to sell the debt security or if it is more likely than not that it will be required to sell the debt security before recovery of its amortized cost basis, an other-than-temporary impairment loss is recognized in earnings to write the debt security down to its fair value. However, even if the Company does not expect to sell the debt security, it must evaluate expected cash flows to be received and determine if a credit loss exists. In the event of a credit loss, only the amount of impairment associated with the credit loss is recognized in earnings. Amounts relating to factors other than credit losses are recognized in other comprehensive loss. The Company did not record any other-than-temporary write-downs in the accompanying financial statements.

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Net Income (Loss) Per Share

12 Months Ended

Dec. 31, 2012

Net Income (Loss) Per Share [Abstract]

Net Income (Loss) Per Share

3.Net Income (Loss) Per Share

The Company uses the treasury stock method to calculate the weighted-average shares used in the diluted earnings per. The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands, except per share data):

	Years Ended December 31,
	2012		2011		2010
Income (loss) from continuing operations	$	(5,201)	$	3,104	$	4,642
Weighted average shares outstanding - basic		44,882		44,559		38,942
Dilutive effect of stock options and RSUs		-		457		683
Weighted average shares outstanding - diluted		44,882		45,016		39,625
Basic income (loss) per share from continuing operations	$	(0.12)	$	0.07	$	0.12
Diluted income (loss) per share from continuing operations	$	(0.12)	$	0.07	$	0.12

As the Company incurred a loss from continuing operations for the year ended December 31, 2012, the effect of dilutive securities, totaling4.5 million has been excluded from the computation of diluted loss per share, as their impact would be anti-dilutive.  Dilutive securities are comprised of options to purchase common stock and RSUs.

Weighted average employee stock options to purchase approximately 3.4 million and 2.0 million for the years ended December 31, 2011 and 2010, respectively, were outstanding, but were not included in the computation of diluted earnings per share as the exercise price of the options was greater than the average share price of the Company’s stock and, therefore, the effect would have been anti-dilutive.

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Commitments And Contingencies

12 Months Ended

Dec. 31, 2012

Commitments And Contingencies [Abstract]

Commitments And Contingencies

15.  Commitments and Contingencies

The Company uses several contract manufacturers and suppliers to provide manufacturing services for its products. As of December 31, 2012, the Company has purchase commitments for inventory with these contract manufacturers and suppliers of approximately $7.4 million. These inventory purchase commitments are placed on a sales order basis with lead times ranging from 4 to 16 weeks to meet estimated customer demand requirements.

The Company leases facilities, equipment, and software tools under non-cancelable operating or capital leases and service agreements. Future minimum payments under facility, equipment, and software tool at December 31, 2012 are as follows (in thousands):

	Facility and
	Equipment		Software		Total
2013	$	243	$	3,203	$	3,446
2014		180		1,993		2,173
2015		123		-		123
2016		37		-		37
Total	$	583	$	5,196	$	5,779

Rental expense for all facility leases aggregated approximately $0.3 million, $0.7 million and $0.9 million for the years ended December 31, 2012, 2011 and 2010, respectively.

As of December 31, 2012, the Company’s capital leases consist of IP. Amortization expense relating to capital leases was approximately $0.6 million, $0.9 million and $1.1 million in 2012, 2011 and 2010, respectively. Included in other assets are capital lease assets of $0.1 million as of December 31, 2012 and is net of accumulated amortization of $3.6 million.

To date, Internet Machines LLC ("Internet Machines") has filed three separate lawsuits against PLX.  The first suit was filed on February 2, 2010, which has been served on PLX, entitled Internet Machines LLC v. Alienware Corporation, et al., in the United States District Court for the Eastern District of Texas, Tyler Division (the “First Suit”).  This First Suit alleges infringement by PLX and the other defendants in the lawsuit of two patents held by Internet Machines.  The complaint in the lawsuit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines' patents.  On May 14, 2010, the Company filed its answer to the live complaint and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.  On December 6, 2010, the Court held a case-management conference and subsequently entered a scheduling order in this matter, and set the trial for February 2012.

On February 21, 2012, through February 29, 2012, the claims and defenses asserted in the First Suit were tried to a seven-member jury in the United States District Court for the Eastern District of Texas, Tyler Division.  On February 29, 2012, the jury returned its verdict, finding the patents-in-suit valid and infringed and awarded money damages against PLX in the amount of $1.0 million.  The Court has not entered a final judgment on the jury’s verdict, and the Company intends to vigorously seek reversal of the jury’s verdict through post-trial motions and, if necessary, on appeal.    

Internet Machines' second lawsuit, which has also been served on PLX, was filed on October 17, 2010, again in the United States District Court for the Eastern District of Texas, Tyler Division (the “Second Suit”).  This Second Suit, entitled Internet Machines LLC v. ASUS Computer International, et al., alleges infringement by PLX of another patent held by Internet Machines.  The complaint also asserts infringement claims against a separate group of defendants not named in the first Internet Machines lawsuit, and accuses those defendants of infringing the two patents asserted against PLX in the First Suit, as well as the additional patent listed in this Second Suit.  The complaint in the lawsuit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines' patents.  On December 28, 2010, the Company filed its answer to the live complaint in the second lawsuit and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.

On May 17, 2011, Internet Machines filed a third lawsuit entitled Internet Machines LLC v. Avnet, Inc., et al., again in the United States District Court for the Eastern District of Texas, Tyler Division (the “Third Suit”).  The third lawsuit has been served on PLX and alleges that PLX infringes a fourth patent held by Internet Machines.  This lawsuit also accuses a new group of defendants of infringing each of Internet Machines' patents at issue in the First and Second Suits, as well as the fourth patent asserted against PLX in this Third Suit.  The complaint in the Third Suit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines' patents.  On September 27, 2011, the Company filed its answer to the live complaint and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit. 

On January 20, 2012, the Court entered an order consolidating the Second and Third Suits into one action.  The Court further ordered that the schedule entered in the Third Suit would govern the consolidated action.  As a result, the consolidated action was originally set for trial in February 2013.

On March 25, 2011, a related entity, Internet Machines MC LLC, filed a lawsuit against PLX, entitled Internet Machines MC LLC v. PLX Technology, Inc., et al., in the United States District Court for the Eastern District of Texas, Marshall Division.  Internet Machines MC LLC, however, did not serve the initial complaint on PLX.  Instead, on August 26, 2011, Internet Machines MC LLC filed a first amended complaint, which has now been served on PLX, alleging infringement by PLX and the other defendants in the lawsuit of one patent held by Internet Machines MC LLC.  The complaint in this lawsuit seeks unspecified compensatory damages, treble damages and attorneys' fees, as well as injunctive relief against further infringement of Internet Machines MC LLC's patents.  On November 11, 2011, the Company filed its answer to the live complaint and asserted counterclaims, seeking declaratory judgments of non-infringement and invalidity of the patents-in-suit.  On March 5, 2012, the Court held an initial case-management conference in this matter.  The Court entered a scheduling order in this matter, and trial was set for July 2013.

On September 4, 2012, the Court entered an order staying the Second and Third Suits and the lawsuit brought by Internet Machines MC LLC discussed in the preceding paragraph.  Pursuant to the Court’s order, those lawsuits are stayed until a final non-appealable judgment is entered in the First Suit, again styled Internet Machines LLC v. Alienware Corp., et al., Cause No. 6:10-CV-023, in the United States District Court for the Eastern District of Texas.

As a result of the jury’s February 29, 2012 verdict on the First Suit, the Company accrued $1.0 million as of December 31, 2011.  As noted above, the Court has not filed its final judgment on the jury’s verdict. It is reasonably possible that any change in the ruling as a result of post-trial motions or possible appeals could change the estimated liability.  While it is not possible to determine the ultimate outcome of the remaining suits, the Company believes that it has meritorious defenses with respect to the claims asserted against it and intends to vigorously defend its position, but it is unable to estimate a range of possible loss.

Warranty and Indemnification Provisions

Changes in sales warranty reserve are as follows (in thousands):

	Years Ended December 31,
	2012		2011		2010
Balance, beginning of period	$	96	$	120	$	80
Warranty costs incurred		(336)		(252)		(166)
Additions related to current period sales		494		228		141
Additions related to acquisition		-		-		65
Balance, end of period	$	254	$	96	$	120

Warranty costs, which relate to product quality issues, remained consistent and insignificant during the periods presented.

The Company enters into standard indemnification agreements with many of its customers and certain other business partners in the ordinary course of business. These agreements include provisions for indemnifying the customer against any claim brought by a third-party to the extent any such claim alleges that a PLX product infringes a patent, copyright or trademark, or violates any other proprietary rights of that third-party. It is not possible to estimate the maximum potential amount of future payments the Company could be required to make under these indemnification agreements. To date, the Company has not incurred any costs to defend lawsuits or settle claims related to these indemnification agreements. No liability for these indemnification agreements has been recorded at December 31, 2012, 2011 or 2010.

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Other Intangible Assets

12 Months Ended

Dec. 31, 2012

Other Intangible Assets [Abstract]

Other Intangible Assets

11.  Other Intangible Assets

The acquisition of Teranetics and Oxford included the acquisition of $30.5 million and $9.1 million, respectively, of identifiable intangible assets.  All of these intangibles are subject to amortization.  There is no estimated residual value on any of the intangible assets. 

The following table summarizes the gross carrying amount and accumulated amortization for each major intangible class and the weighted average amortization period, in total and by major intangible asset class (in thousands).

	December 31, 2012
	Gross Carrying		Accumulated		Net
	Value		Amortization		Value
Existing and core technology
Oxford USB and Serial Connectivity	$	4,600	$	(4,600)	$	-
Oxford Network Attached Storage Connectivity		3,800		(3,800)		-
Trade Name
Oxford		600		(600)		-
Customer Relationships
Oxford		56		(56)		-
Totals	$	9,056	$	(9,056)	$	-

	December 31, 2011
	Gross Carrying		Accumulated		Net
	Value		Amortization		Value
Existing and core technology
Oxford USB and Serial Connectivity	$	4,600	$	(4,600)	$	-
Oxford Network Attached Storage Connectivity		3,800		(3,555)		245
Teranetics Network PHY		20,100		(4,187)		15,913
Trade Name
Oxford		600		(600)		-
Teranetics		200		(125)		75
Customer Relationships
Oxford		56		(56)		-
Teranetics		10,200		(5,588)		4,612
Totals	$	39,556	$	(18,711)	$	20,845

As of the result of the divestiture of the UK design team on October 21, 2011, the Company reviewed the useful life of its storage acquired intangibles and determined a change in the assets useful life and method of amortization was required. The Company reduced the useful life of the intangible from five years to four years and changed the amortization method from straight-line to an accelerated method. The change and amortization acceleration was reflected in the fourth quarter of 2011, the period of change.   

The amortization expense was $0.2 million, $2.8 million and $2.6 million for the years ended December 31, 2012, 2011 and 2010, respectively.

The amortization expense from discontinued operations was $5.1 million, $7.8 million and $2.1 million for the three years ended December 31, 2012, 2011 and 2010, respectively.  In the second quarter of 2012, the Company recorded impairment charges of $9.8 million related to its core technology, trade name and customer relationships acquired in the Teranetics acquisition. See Note 10 of the consolidated financial statements for more information on the impairment. As a result of the impairment and the Entropic and Aquantia transactions, the Company reduced the remaining useful lives and accelerated the amortization of the Teranetics acquired intangibles. The remaining value of the intangibles of $5.8 million was written off and included in the gain on disposal. See Note 7 of the consolidated financial statements for more information on the divestiture of the PHY business.

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Commitments And Contingencies (Schedule Of Changes In Sales Warranty Reserve) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Commitments And Contingencies [Abstract]
Balance, beginning of period	$ 96	$ 120	$ 80
Warranty costs incurred	(336)	(252)	(166)
Additions related to current period sales	494	228	141
Additions related to acquisitions			65
Balance, end of period	$ 254	$ 96	$ 120

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Discontinued Operation

12 Months Ended

Dec. 31, 2012

Discontinued Operation [Abstract]

Discontinued Operation

7.  Discontinued Operation

On September 20, 2012, the Company completed the sale of its physical layer 10GBase-T integrated circuit (“PHY”) family of products pursuant to an Asset Purchase Agreement (the “Aquantia APA”) between the Company and Aquantia Corporation for $2.0 million in cash.

On July 6, 2012, the Company had also entered into an Asset Purchase Agreement (the “Entropic APA”) with Entropic Communications, Inc., pursuant to which the Company completed the sale of its digital channel stacking switch product line within the PHY product family, including certain assets exclusively related to the product line. Under the terms of the Entropic APA, the Company continued to have an obligation to complete the development in process.  The agreement provided for $3.0 million upon closing and up to $5.0 million in future payments.  Future payments consisted of a milestone payment of $2.0 million in connection with product acceptance, a $2.0 million escrow payment relating to certain representations, warranties and indemnities made by PLX and is due to be released to PLX twelve months after product acceptance and a $1.0 million milestone payment in the event a third party royalty arrangement is secured.  In conjunction with the Entropic APA, the Company entered into an Intellectual Property License Agreement (the “License Agreement”) with Entropic which provided a fully paid, non-exclusive, royalty free license to certain of the physical layer 10GBase-T integrated circuit technology which provided for a $4.0 million payment from Entropic to the Company upon signing.  In connection with the transaction with Aquantia, on November 21, 2012, the Company negotiated a modification to the Agreement with Entropic that amended and restated the product acceptance milestone such that the milestone was deemed to have occurred upon execution of the amendment and changed the associated consideration from $2.0 million to $1.4 million.  In exchange, the obligation of PLX to complete the development of the product was assumed by Entropic. 

The consideration received for the combined sale of the PHY business totaled $12.0 million and consisted of cash received at closing in connection with the Aquantia APA of $2.0 million, the Entropic APA of $3.0 million, the License Agreement of $4.0 million, the accelerated product acceptance milestone payment of $1.4 million and the rights to the estimated fair value of the escrow payment under the Entropic APA of $1.6 million.  The estimated fair value of the escrow payment is included in the Company’s balance sheet as other current assets and is based on assumptions made regarding potential claims against the escrow using historical and market data and is subject to change.  Future payments of up to $1.0 million which is contingent on future milestone achievements were not included in the initial consideration recorded and will be accounted for when they are probable of being received. The Company recorded a gain of $3.5 million related to this divestiture. The following table summarizes the components of the gain (in thousands):

Cash proceeds from sale (including fair value amount held in escrow)	$	12,000
Less carrying value of assets transferred and asset write-offs:
Inventory transferred		(1,254)
Fixed assets transferred		(631)
Intangible assets write-off		(5,783)
Goodwill write-off		(877)
Other adjustments		(5)
Gain on disposal	$	3,450

The following is selected financial information included in loss from discontinued operations:

	Years Ended December 31,
	2012		2011		2010
	in thousands
Revenues	$	2,947	$	4,637	$	1,020
Gain on disposal		3,450		-		-
Loss before income taxes		(27,476)		(30,531)		(9,732)
Benefit from income taxes		(88)		(2,604)		(1,801)
Loss from discontinued operations	$	(27,388)	$	(27,927)	$	(7,931)

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UK Design Team Divestiture (Details) (USD $)	3 Months Ended	9 Months Ended	12 Months Ended
	Dec. 31, 2011	Sep. 30, 2011	Dec. 31, 2012	Dec. 31, 2011
UK Design Team Divestiture [Abstract]
Cash from Asset Purchase agreement and IP license				$ 2,200,000
License revenue			4,000,000	1,700,000
Sale of assets			10,400,000	500,000
Carrying value of net assets transferred	400,000			400,000
Carrying value of goodwill allocated	74,000			74,000
Gain on divestitures				$ 28,000
Useful life of intangibles	4 years	5 years

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Concentrations Of Credit, Customer And Supplier Risk

12 Months Ended

Dec. 31, 2012

Concentrations Of Credit, Customer And Supplier Risk [Abstract]

Concentrations Of Credit, Customer And Supplier Risk

5.  Concentrations of Credit, Customer and Supplier Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash equivalents, short-term investments, long-term investments and trade receivables. The Company generally invests its excess cash in money market funds, certificates of deposits, corporate bonds with high credit ratings, municipal bonds and treasury bills. The Company’s cash, cash equivalents, short and long-term investments were approximately $16.7 million as of December 31, 2012 which exceeded the amount insured by the Federal Deposit Insurance Corporation (“FDIC”).  The Company has not experienced any significant losses on its cash equivalents or short and long-term investments.

The Company performs ongoing credit evaluations of its customers and generally requires no collateral. Customers who accounted for 10% or more of net accounts receivable are as follows:

	December 31,
	2012		2011		2010
Excelpoint Systems Pte Ltd.		30%		27%		24%
Avnet, Inc.		21%		28%		24%
Answer Technology, Inc.		19%		12%		17%

The Company analyzes the need for reserves for potential credit losses and records reserves when necessary. Through fiscal 2012, there were no direct end customers that accounted for more than 10% of net revenues. Sales to the following distributors accounted for 10% or more of net revenues:

	Years Ended December 31,
	2012		2011		2010
Excelpoint Systems Pte Ltd.		27%		24%		27%
Avnet, Inc.		24%		24%		23%
Answer Technology, Inc.		19%		18%		18%

Currently, the Company relies on single source suppliers for the significant majority of its product inventory. As a result, should the Company's current suppliers not produce and deliver inventory for the Company to sell on a timely basis, operating results may be adversely impacted.

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UK Design Team Divestiture

12 Months Ended

Dec. 31, 2012

UK Design Team Divestiture [Abstract]

UK Design Team Divestiture

6.  UK Design Team Divestiture

On October 5, 2011 the Company entered into an Asset Purchase agreement and IP license with OCZ Technology Group (OCZ) for $2.2 million in cash, whereby OCZ acquired the Company’s UK design team and related assets and liabilities, and obtained a nonexclusive perpetual license of its consumer storage technology. The deal closed on October 21, 2011. The Company continues to offer and support its current consumer storage products.

Ralph Schmitt, PLX’s CEO in 2011, was also a member of OCZ’s board of directors.  Throughout the term of negotiations and up to the date of acquisition of assets, he removed himself from all discussions to ensure execution of an arms-length transaction and had no authority to make decisions or influence the outcome of the arrangement.

The Company recorded $1.7 million as license revenue and $0.5 million was allocated to sale of assets and the transfer of the UK design team and related liabilities based on the relative fair values. The carrying value of net assets transferred and goodwill allocated was $0.4 million and $74,000, respectively.Based on the carrying values of assets transferred, the Company recognized a gain of $28,000 on the divestiture.

As a result of this divestiture, the Company also reviewed the useful life and amortization method of its storage acquired finite lived core technology intangible and determined that a change in the assets useful life and amortization method was required. The Company reduced the total estimated useful life of the intangible from five years to four years and changed the amortization method from straight line to an accelerated method that more closely matches the remaining cash inflows from the consumer storage products. The change in estimated life and amortization acceleration was reflected in the fourth quarter of 2011, the period of change.

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Teranetics, Inc. Acquisition

12 Months Ended

Dec. 31, 2012

Teranetics, Inc. Acquisition [Abstract]

Teranetics, Inc. Acquisition

8.  Teranetics, Inc. Acquisition

On October 1, 2010, the Company acquired all of the outstanding shares of capital stock of Teranetics, Inc. (Teranetics), a privately held fabless provider of high performance mixed-signal semiconductors.

The following table summarizes the consideration paid for Teranetics:

	Common		Cash at		Notes		Bridge
	Shares of PLX		Closing		A and B		Note		Total
Purchase price	$	26,406	$	887	$	6,386	$	1,000	$	34,679
Teranetics CEO bonus		1,048		35		264		-		1,347
Total	$	27,454	$	922	$	6,650	$	1,000	$	36,026

As a part of the merger agreement, the Company acquired all of the outstanding shares of capital stock of Teranetics in exchange for 7.4 million shares of common stock of PLX, cash of approximately $1.0 million and two promissory notes in the aggregate principal amount of $6.9 million. One note was for the principal amount of approximately $1.5 million and wasdue 3 years after the closing of the Merger, and the other note was for the principal amount of $5.4 million and wasdue 12 months after the closing of the Merger (this $5.4 million note was delivered into an escrow fund that may be used to satisfy indemnity obligations owed to PLX).   The stated interest rate on the promissory notes was0.46%.  The promissory notes were fair valued based on market interest rates and the assessed fair value of the promissory notes was approximately $6.7 million. The Company delayed payment of the $5.4 million note as a result of indemnity claims it communicated to the Teranetics stockholders’ representative.  As a result of the claims, the Company negotiated a $1.9 million reduction against the two promissory notes.  The settlement included a cancelation of the $1.5 million note due in October 2013 and was recorded in 2011 as a reduction to acquisition and restructuring related costs in the Consolidated Statement of Operations for the assessed fair value of $1.4 million. The reduction of the note due in October 2011 of $0.5 million was recorded against specific expenses and liabilities the Company incurred in 2011. The remaining $5.0 million was paid on January 3, 2012.

The Companyextended a bridge loan to Teranetics in the amount of $1.0 million during negotiations to support the working capital needs of Teranetics and in contemplation of the Merger.  Upon closing of the Merger, the $1.0 million bridge note was also considered part of the merger consideration provided as a component of the purchase price.

In addition to consideration transferred to former stockholders of Teranetics, PLX made payments at closing in the amount of $13.2 million to repay debt and other assumed liabilities.  The payments consisted of $11.2 million for convertible promissory note and line of credit debt and  $2.0 million of payables for legal and investment banking services performed for Teranetics prior to closing and in connection with the merger.

The Company agreed to pay the former Teranetics employees a bonus pool under the Teranetics Employee Retention Plan which required continued employment in order to be earned by individual employees.  Under the final plan, a total of $5.3 million was carved out of the consideration as a bonus pool to be paid out over a period of time to participants who were employees of Teranetics at the time of a change in control, provided they fulfilled certain future service requirements for the combined entity.  If any individual left prior to the completion of the required service period, any amounts forfeited by the individual was added back to the bonus pool and re-allocated to the remaining participants.As of December 31, 2011, the Company has paid all of the $5.3 million of the retention bonus.   Approximately $2.3 million of retention bonus expense was recorded in 2011 and included in acquisition and restructuring related costs in the Consolidated Statement of Operations.

Recognized amounts of identifiable assets acquired and liabilities assumed (in thousands):

Cash and cash equivalents	$	112
Trade receivables		443
Inventories		444
Other current assets		360
Property, plant and equipment		673
Identifiable intangible assets		30,500
Other assets		42
Trade and other payable		(2,919)
Accruals and other liabilities		(15,021)
Total indentifiable net assets	$	14,634
Goodwill		20,045
	$	34,679

The fair value of assets acquired includes trade receivables of $0.4 million.  The gross amount due under sales related contracts was  $0.4 million, of which nonewas expected to be uncollectible.

The identified intangible assets consist of core technology, trade name and customer relationships.  The valuation of the acquired intangibles is classified as a level 3 measurement under the fair value measurement guidance, because the valuation was based on significant unobservable inputs and involved management judgment and assumptions about market participants and pricing.   In determining fair value of the acquired intangible assets, we determined the appropriate unit of measure, the exit market and the highest and best use for the assets. The fair value was estimated using an incremental income approach.

The goodwill arising from the acquisition was largely attributable to the synergies expected to be realized after the Company’s acquisition and integration of Teranetics.  The Company only has one operating segment, semiconductor products, so all of the goodwill was assigned to the one segment.  Goodwill is not expected to be deductible for tax purposes.

Teranetics operating results for all periods presented have been reclassified to discontinued operations as a result of the sale of the business in September 2012. Teranetics contributed revenues and gross profit of $2.9 million and $0.5 million, respectively, to the Company for the year ended December 31, 2012, $4.6 million and $1.6 million, respectively, to the Company for the year ended December 31, 2011 and $1.0 million and $0.3 million, respectively, to the Company for the year ended December 31, 2010.  The Company integrated Teranetics operations shortly after acquisition and was fully integrated as of December 31, 2010 and it is therefore not practicable to identify earnings associated with Teranetics’ contribution.

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Teranetics, Inc. Acquisition (Narrative) (Details) (USD $)	0 Months Ended	3 Months Ended								12 Months Ended
	Jan. 03, 2012	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Oct. 01, 2010
Cash paid													$ 922,000
Principal amount													6,900,000
Stated interest rate													0.46%
Reduction against the two promissory notes											1,900,000
Amount of notes cancelled											1,500,000
Escrow claim settlement											1,397,000
Repayment of notes payable	5,000,000
Assumed debt and other liabilities repayment													13,200,000
Repayments of Assumed Debt												11,195,000
Repayment of promissory note and line of credit debt												11,195,000
Repayment of legal and investment banking services												2,000,000
Amount of carve out retention bonus plan													5,300,000
Amount of carve out retention bonus expense						2,300,000					2,300,000
Trade receivables													443,000
Revenues		23,413,000	26,866,000	25,437,000	24,532,000	24,896,000	29,763,000	30,165,000	26,328,000	100,248,000	111,152,000	115,540,000
Gross profit		13,684,000	16,058,000	15,067,000	13,977,000	15,334,000	17,183,000	17,368,000	14,667,000	58,786,000	64,552,000	67,787,000
Note A [Member]
Principal amount													1,500,000
Maturity Date, Description												due 3 years after the closing of the Merger
Amount of notes cancelled											500,000
Note B [Member]
Principal amount													5,400,000
Maturity Date, Description												due 12 months after the closing of the Merger
Amount of notes cancelled											1,500,000
Notes A And B [Member]
Fair value of the promissory notes													6,650,000
Bridge Note [Member]
Fair value of the promissory notes													1,000,000
Common Stock [Member]
Issuance of stock in connection with the acquisition of Teranetics, shares												7,399,980
Teranetics [Member]
Revenues										2,900,000	4,600,000	1,000,000
Gross profit										$ 500,000	$ 1,600,000	$ 300,000

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Segments Of An Enterprise And Related Information (Schedule Of Revenues By Geographic Region Based On Customer Location) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended								12 Months Ended
	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2011	Sep. 30, 2011	Jun. 30, 2011	Mar. 31, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Revenues from External Customers and Long-Lived Assets [Line Items]
Net revenues	$ 23,413	$ 26,866	$ 25,437	$ 24,532	$ 24,896	$ 29,763	$ 30,165	$ 26,328	$ 100,248	$ 111,152	$ 115,540
China [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net revenues									27,026	26,740	33,006
Taiwan [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net revenues									22,682	25,379	21,665
United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net revenues									15,639	22,088	20,357
Singapore [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net revenues									13,432	13,312	15,692
Germany [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net revenues									11,575	11,765	10,649
Other Asia Pacific [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net revenues									7,959	9,762	11,367
Europe, Middle East And Africa [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net revenues									1,491	1,958	2,392
The Americas - Excluding United States [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net revenues									$ 444	$ 148	$ 412

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Teranetics, Inc. Acquisition (Schedule Of Recognized Amounts Of Identifiable Assets Acquired And Liabilities Assumed) (Details) (USD $) In Thousands, unless otherwise specified	Oct. 01, 2010
Teranetics, Inc. Acquisition [Abstract]
Cash and cash equivalents	$ 112
Trade receivables	443
Inventories	444
Other current assets	360
Property, plant and equipment	673
Identifiable intangible assets	30,500
Other assets	42
Trade and other payable	(2,919)
Accruals and other liabilities	(15,021)
Total indentifiable net assets	14,634
Goodwill	20,045
Total	$ 34,679

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Discontinued Operation (Summary Of Financial Information Included In Net Loss From Discontinued Operations) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Discontinued Operation [Abstract]
Revenues	$ 2,947	$ 4,637	$ 1,020
Gain on disposal	3,450
Loss before income taxes	(27,476)	(30,531)	(9,732)
Benefit from income taxes	(88)	(2,604)	(1,801)
Loss from discontinued operations	$ (27,388)	$ (27,927)	$ (7,931)

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Teranetics, Inc. Acquisition (Tables)

12 Months Ended

Dec. 31, 2012

Teranetics, Inc. Acquisition [Abstract]

Summary Of Consideration Paid For Teranetics

	Common		Cash at		Notes		Bridge
	Shares of PLX		Closing		A and B		Note		Total
Purchase price	$	26,406	$	887	$	6,386	$	1,000	$	34,679
Teranetics CEO bonus		1,048		35		264		-		1,347
Total	$	27,454	$	922	$	6,650	$	1,000	$	36,026

Schedule Of Recognized Amounts Of Identifiable Assets Acquired And Liabilities Assumed

Cash and cash equivalents	$	112
Trade receivables		443
Inventories		444
Other current assets		360
Property, plant and equipment		673
Identifiable intangible assets		30,500
Other assets		42
Trade and other payable		(2,919)
Accruals and other liabilities		(15,021)
Total indentifiable net assets	$	14,634
Goodwill		20,045
	$	34,679

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Share-Based Compensation (Summary Of Activity For Unvested Restricted Stock Units) (Details) (USD $)	12 Months Ended
	Dec. 31, 2012
Share-Based Compensation [Abstract]
Number of Shares, Granted	301,000
Number of Shares, Vested	(33,500)
Number of Shares. Cancelled	(27,400)
Number of Shares, Ending Balance	240,100
Weighted Average Grant-Date Fair Value, Granted	$ 6.27
Weighted Average Grant-Date Fair Value, Vested	$ 6.46
Weighted Average Grant-Date Fair Value, Cancelled	$ 6.66
Weighted Average Grant-Date Fair Value, Ending Balance	$ 6.20

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Income Taxes

12 Months Ended

Dec. 31, 2012

Income Taxes [Abstract]

Income Taxes

13. Income Taxes

The components of income before income tax provision for the years ended December 31, 2012, 2011 and 2010 are as follows (in thousands):

	Years Ended December 31,
	2012		2011		2010
United States	$	(8,510)	$	8,718	$	13,188
Foreign		3,545		(2,863)		(6,311)
Income (loss) before income tax provision	$	(4,965)	$	5,855	$	6,877

The provision (benefit) for income taxes consists of the following (in thousands):

	Years Ended December 31,
	2012		2011		2010
Federal:
Current	$	146	$	2,699	$	2,152
		146		2,699		2,152
State:
Current		20		5		36
		20		5		36
Foreign:
Current		70		47		47
		70		47		47
Total	$	236	$	2,751	$	2,235

The provision (benefit) for income taxes differs from the amount of income taxes determined by applying the U.S. statutory federal income tax rate as follows (in thousands):

	Years Ended December 31,
	2012		2011		2010
Tax benefit at the U.S. statutory rate	$	(1,740)	$	2,340	$	2,393
State taxes (net of federal benefit)		15		12		36
Change in net operating losses		-		-		1,663
Research and development credit		(2,982)		(1,137)		(3,298)
Change in valuation allowance		6,147		274		(1,309)
Foreign rate differential		(1,171)		1,037		2,284
Other individually immaterial items		(33)		225		466
	$	236	$	2,751	$	2,235

During the year ended December 31, 2012, the Company’s deferred tax asset valuation allowance decreased by $3.5 million. The Company’s deferred tax asset valuation allowance increased by $11.2 million and $26.1 million in 2011 and 2010, respectively.  The decrease from December 31, 2011 to December 31, 2012 relates to the sale of the PHY business and the unrealizability of the Teranetics tax attributes. The increase from December 31, 2010 to December 31, 2011 relates to deferred tax assets generated from domestic and foreign losses. 

Significant components of the Company's deferred tax assets and liabilities are as follows (in thousands):

	December 31,
	2012		2011
Deferred tax assets:
Accrued expenses and reserves	$	3,566	$	3,015
Net operating loss carryforwards		25,399		34,657
Research and development credits		17,297		16,704
Depreciation		15,622		19,355
Share-based compensation		5,673		4,723
Other		114		179
Gross deferred tax assets:		67,671		78,633
Valuation Allowance		(67,021)		(70,474)
		650		8,159
Deferred tax liabilities:
Acquisition related intangibles		(650)		(8,159)
Total net deferred tax assets	$	-	$	-

At December 31, 2012, the Company had federal and state net operating loss carryforwards of $47.6 million and $56.6 million, respectively. During the fourth quarter of 2010, the Company concluded its analysis under Internal Revenue Code Section 382 for federal net operating losses and determined that utilization of the net operating loss and credit carryforwards are subject to various annual limitations.  The annual limitation results in certain expiration of net operating loss carryforwards before utilization. Net operating loss carryforwards will expire at various dates beginning in  2013 through 2031. In addition, as of December 31, 2012, the Company had federal and state tax credit carryforwards of approximately $10.3 million and $17.3 million, respectively.  The federal research and development credits will expire beginning in 2019 and the state credits will carryforward indefinitely. The Company also has approximately $26.1 million of net operating loss carryforwards from its UK operations.

Approximately $2.8 million of the federal and $1.7 million of the state net operating loss carryforward relate to excess tax deductions from stock options which have not yet been realized.  The accounting guidance for share-based compensation prohibits recognition of a deferred income tax asset for excess tax benefits due to stock option exercises that have not yet been realized through a reduction in income tax payable. 

Due to operating losses incurred, the Company created a full valuation allowance as of December 2002 for deferred tax assets.  As of December 2012, a valuation allowance continues to be recorded for the net deferred tax asset based on management’s  assessment that the realization of deferred tax assets is uncertain due to the history of losses, the variability of operating results and the inability to conclude that it is more likely than not that sufficient taxable income would be generated in future periods to realize those deferred tax assets. The Company will maintain a full valuation allowance until sufficient positive evidence exists to support a reversal of the valuation allowance.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is a follows (in thousands):

	Years Ended December 31,
	2012		2011		2010
Unrecognized tax benefits balance, beginning of period	$	4,401	$	4,038	$	3,662
Gross increase for tax positions for prior year		553		-		19
Gross increase for tax positions for current year		475		363		357
Unrecognized tax benefits balance, end of period	$	5,429	$	4,401	$	4,038

Future changes in the remaining balance of unrecognized tax benefits will have no impact on the effective tax rate as it is subject to a full valuation allowance.

The Company does not have any material accrued interest or penalties associated with any unrecognized tax benefits. The Company does not believe it is reasonably possible that its unrecognized tax benefits will significantly change within the next twelve months.

The Company is subject to taxation in the US and various state and foreign jurisdictions. The tax years 2008-2011 remain open to examination by the federal and state tax authorities. Net operating loss and tax credit carryforwards generated in prior periods remain open to examination.

The Company has made no provision for U.S. income taxes on approximately $0.4 million of cumulative undistributed earnings of certain foreign subsidiaries because it is the Company’s intention to indefinitely reinvest such earnings.  If such earnings were distributed, the Company would accrue additional taxes of approximately $0.2 million. Foreign operations generated pre-tax profit of $3.5 million in 2012 and a pre-tax loss of $2.8 million and $6.3 million in 2011 and 2010, respectively.

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Schedule II-Valuation And Qualifying Accounts

12 Months Ended

Dec. 31, 2012

Schedule II-Valuation And Qualifying Accounts [Abstract]

Schedule II-Valuation And Qualifying Accounts

SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS

(in thousands)

			Additions				Deductions
	Balance at		Charged to		Charged to		Amount		Balance at
	Beginning of		Costs and		Other		Recovered		End of
Description	Period		Expenses		Accounts (1)		(Written off)		Period
Year ended December 31, 2012:
Allowance for doubtful accounts	$	82	$	-	$	-	$	-	$	82
Allowance for returns	$	128	$	-	$	58	$	(89)	$	97
Allowance for ship and debits	$	2,181	$	-	$	10,040	$	(10,300)	$	1,921
Year ended December 31, 2011:
Allowance for doubtful accounts	$	82	$	-	$	-	$	-	$	82
Allowance for returns	$	193	$	-	$	255	$	(320)	$	128
Allowance for ship and debits	$	1,357	$	-	$	9,650	$	(8,826)	$	2,181
Year ended December 31, 2010:
Allowance for doubtful accounts	$	82	$	-	$	-	$	-	$	82
Allowance for returns and price concessions	$	1,330	$	-	$	788	$	(1,925)	$	193
Allowance for ship and debits	$	735	$	-	$	7,327	$	(6,705)	$	1,357

(1) Amounts charged to other accounts are recorded as a reduction of revenue.  

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Share-Based Compensation (Summary Of Stock Option Activity) (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009
Share-Based Compensation [Abstract]
Number of Shares, Outstanding, Beginning Balance	4,612,367	4,202,653	2,825,796
Number of Shares, Granted	1,066,000	1,484,500	1,581,000
Number of Shares, Exercised	(372,444)	(196,747)	(92,188)
Number of Shares, Cancelled	(1,083,371)	(878,039)	(111,955)
Number of Shares, Outstanding, Ending Balance	4,222,552	4,612,367	4,202,653	2,825,796
Number of Shares, Exercisable December 31, 2012	2,656,894
Weighted Average Exercise Price, Outstanding, Beginning Balance	$ 4.15	$ 4.34	$ 4.36
Weighted Average Exercise Price, Granted	$ 4.38	$ 3.44	$ 4.27
Weighted Average Exercise Price, Exercised	$ 3.29	$ 1.84	$ 2.42
Weighted Average Exercise Price, Cancelled	$ 4.86	$ 4.35	$ 5.65
Weighted Average Exercise Price, Outstanding, Ending Balance	$ 4.10	$ 4.15	$ 4.34	$ 4.36
Weighted Average Exercise Price, Exercisable at December 31, 2012	$ 4.11
Weighted Average Remaining Contractual Term (in years), Outstanding	3 years 11 months 5 days	4 years 7 months 10 days	5 years 22 days	5 years 1 month 21 days
Weighted Average Remaining Contractual Term (in years), Exercisable at December 31, 2012	3 years 29 days
Aggregate Intrinsic Value, Outstanding	$ 1,759,014	$ 872,567	$ 2,314,975	$ 1,794,310
Aggregate Intrinsic Value, Exercisable at December 31, 2012	$ 1,550,784

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Organization And Summary Of Significant Accounting Policies (Narrative) (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended	9 Months Ended	12 Months Ended
	Dec. 31, 2011	Sep. 30, 2011	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Apr. 30, 2012
Property, Plant and Equipment [Line Items]
Proposed cash to be paid per share						$ 3.50
Proposed number of shares of IDT stock offered per common stock						0.525
Useful life of intangibles	4 years	5 years
Depreciation and amortization expense			$ 2,993	$ 3,510	$ 3,458
Distributor stock rotation rights percentage			5.00%
Buildings [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life			39 years
Maximum [Member]
Property, Plant and Equipment [Line Items]
Useful life of intangibles			6 years
Product warranty period			3 years
Maximum [Member] | Building Improvements [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life			8 years
Maximum [Member] | Equipment, Furniture And Purchased Software [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life			7 years
Minimum [Member]
Property, Plant and Equipment [Line Items]
Useful life of intangibles			1 year
Product warranty period			1 year
Minimum [Member] | Building Improvements [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life			3 years
Minimum [Member] | Equipment, Furniture And Purchased Software [Member]
Property, Plant and Equipment [Line Items]
Estimated useful life			3 years
Continuing Operations [Member]
Property, Plant and Equipment [Line Items]
Depreciation and amortization expense			$ 2,200	$ 2,400	$ 2,200

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Consolidated Statements Of Operations (Parenthetical) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012
Consolidated Statements Of Operations [Abstract]
Gain on disposal	$ 3,450

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Quarterly Financial Data (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended																12 Months Ended
	Dec. 31, 2012		Sep. 30, 2012		Jun. 30, 2012		Mar. 31, 2012		Dec. 31, 2011		Sep. 30, 2011		Jun. 30, 2011		Mar. 31, 2011		Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Quarterly Financial Data [Abstract]
Net revenues	$ 23,413		$ 26,866		$ 25,437		$ 24,532		$ 24,896		$ 29,763		$ 30,165		$ 26,328		$ 100,248	$ 111,152	$ 115,540
Gross profit	13,684		16,058		15,067		13,977		15,334		17,183		17,368		14,667		58,786	64,552	67,787
Income (loss) from continuing operations	(190)		(3,304)		(484)		(1,223)		1,228		1,882		1,561		(1,567)		(5,201)	3,104	4,642
Loss from discontinued operations	(423)		(3,013)		(17,734)		(6,218)		(6,681)		(6,108)		(7,573)		(7,565)		(27,388)	(27,927)	(7,931)
Net loss	$ (613)		$ (6,317)		$ (18,218)		$ (7,441)		$ (5,453)		$ (4,226)		$ (6,012)		$ (9,132)		$ (32,589)	$ (24,823)	$ (3,289)
Basic net income (loss) per share from continuing operations			$ (0.07)	[1]	$ (0.01)	[1]	$ (0.03)	[1]	$ 0.03	[1]	$ 0.04	[1]	$ 0.04	[1]	$ (0.04)	[1]	$ (0.12)	$ 0.07	$ 0.12
Basic loss per share - discontinued operations	$ (0.01)	[1]	$ (0.07)	[1]	$ (0.40)	[1]	$ (0.14)	[1]	$ (0.15)	[1]	$ (0.14)	[1]	$ (0.17)	[1]	$ (0.17)	[1]	$ (0.61)	$ (0.63)	$ (0.20)
Basic net loss per share	$ (0.01)	[1]	$ (0.14)	[1]	$ (0.41)	[1]	$ (0.17)	[1]	$ (0.12)	[1]	$ (0.10)	[1]	$ (0.13)	[1]	$ (0.21)	[1]	$ (0.73)	$ (0.56)	$ (0.08)
Diluted net income (loss) per share from continuing operations			$ (0.07)	[1]	$ (0.01)	[1]	$ (0.03)	[1]	$ 0.03	[1]	$ 0.04	[1]	$ 0.03	[1]	$ (0.04)	[1]	$ (0.12)	$ 0.07	$ 0.12
Diluted loss per share - discontinued operations	$ (0.01)	[1]	$ (0.07)	[1]	$ (0.40)	[1]	$ (0.14)	[1]	$ (0.15)	[1]	$ (0.14)	[1]	$ (0.17)	[1]	$ (0.17)	[1]	$ (0.61)	$ (0.62)	$ (0.20)
Diluted net loss per share	$ (0.01)	[1]	$ (0.14)	[1]	$ (0.41)	[1]	$ (0.17)	[1]	$ (0.12)	[1]	$ (0.10)	[1]	$ (0.14)	[1]	$ (0.21)	[1]	$ (0.73)	$ (0.55)	$ (0.08)

[1] The sum of per share amounts for the quarters does not necessarily equal that for the year due to rounding as the computations were made independently.

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Share-Based Compensation

12 Months Ended

Dec. 31, 2012

Share-Based Compensation [Abstract]

Share-Based Compensation

2.  Share-Based Compensation

Equity Incentive Plans

In May 2008, the Company’s stockholders approved the 2008 Equity Incentive Plan (“2008 Plan”).  The 2008 Plan was amended by the Company’s stockholders in May 2010 to increase the number of shares reserved for issuance under the Plan by 1,500,000 shares. In May 2011, the 2008 Plan was amended again by the Company’s stockholders to increase the number of shares reserved for issuance under the Plan by 2,300,000 shares. Under the 2008 Plan, there is currently authorized for issuance and available for awards an aggregate of 5,000,000 shares of the Company’s common stock, plus up to an additional 2,407,369 shares that otherwise would have reverted to the share reserve of the Company’s prior incentive plan, the Company’s 1999 Stock Incentive Plan, subject to an overall, aggregate share reserve limit of 7,407,369 shares. Awards under the 2008 Plan may include stock options, restricted stock, stock appreciation rights, performance awards, restricted stock units and other awards, provided that with respect to full value awards, such as restricted stock or restricted stock units, no more than 300,000 shares may be issued in the form of full value awards during the term of the 2008 Plan.  Awards under the 2008 Plan may be made to the Company’s officers and other employees, its board members and consultants that it hires.  Generally, options vest over a four-year period and expire no more than seven years after the date of grant.  The 2008 Plan has a term of ten years.

Employee Stock Ownership Plan

In January 2009, the Company established the PLX Technology, Inc. Employee Stock Ownership Plan (the “ESOP”). The ESOP is a tax-qualified defined contribution retirement plan that is non-contributory.  PLX regular employees (other than nonresident aliens with no U.S.-source income, employees covered by a collective bargaining agreement, leased employees and employees of a non-participating subsidiary of PLX) who are at least 18 years old and have worked for PLX for at least 12 consecutive months are eligible to participate in the ESOP.  The Company made cash contributions equal to a percentage of eligible compensation that is determined annually by the Board of Directors. Eligible compensation was limited to $150,000.  The contributions were used to purchase common stock of the Company. Since the adoption of the ESOP, the Company has made annual contributions of 2% of each employee's eligible compensation up to a maximum of $3,000 for any single employee (2% of $150,000 of eligible compensation).  In accordance with the IDT merger agreement, the Company ceased contributing to the plan after the April 2012 contribution. The Company’s possible reinstatement of contributions for 2013 is under review.  Eligible participants received a share allocation at the end of the plan year based on the contributions plus an additional allocation for forfeitures that occurred during the plan year.  The shares and forfeitures are allocated to each ESOP participant who is employed on the last day of the ESOP Plan Year (December 31) in the same proportion that the compensation (up to the $150,000 limit) of each ESOP participant bears to the eligible compensation of all ESOP participants. 

Share-Based Compensation Expense

The fair value of share-based awards to employees is calculated using the Black-Scholes option pricing model, which requires subjective assumptions, including future stock price volatility and expected time to exercise, which greatly affect the calculated values.

The weighted-average fair value of share-based compensation to employees is based on the multiple option valuation approach. Forfeitures are estimated and it is assumed no dividends will be declared. The estimated fair value of share-based compensation awards to employees is amortized using the straight-line method over the vesting period of the options. The weighted-average fair value calculations are based on the following average assumptions:

	Years Ended December 31,
	2012		2011		2010
Expected volatility		62.90%		61.34%		61.54%
Expected life (in years)		4.35		4.32		4.19
Risk-free interest rate		0.68%		1.21%		1.61%

Risk-Free Interest Rate. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for the expected term of the option.

Expected Life. The Company’s expected life represents the weighted-average period that the Company’s stock options are expected to be outstanding. The expected life is based on the observed and expected time to post-vesting exercise of options by employees. The Company uses historical exercise patterns of previously granted options in relation to stock price movements to derive an employee behavioral pattern used to forecast expected exercise patterns.

Expected Volatility. The Company believes that historical volatility best represents expected volatility due to the lack of market data consistently available to calculate implied volatility. The historical volatility is based on the weekly closing prices of its common stock over a period equal to the expected term of the option and is a strong indicator of the expected future volatility.

These factors could change in the future, which would affect the share-based compensation expense in future periods.

As share-based compensation expense recognized in the Consolidated Statements of Operations for the fiscal years 2012, 2011 and 2010 is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. Forfeitures are estimated based on historical experience at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

The following table shows total share-based compensation and employee stock ownership plan expenses recorded for the years ended December 31, 2012, 2011 and 2010 (in thousands):

	Years Ended December 31,
	2012		2011		2010
Cost of revenues	$	147	$	47	$	33
Research and development		1,007		485		602
Selling, general and administrative		1,739		1,138		863
Discontinued operations (1)		251		660		113
Total share-based compensation expense	$	3,144	$	2,330	$	1,611

(1)  Recorded in loss from discontinued operations in the Consolidated Statement of Operations.

Share-based compensation expense from employee stock options and restricted stock units (“RSUs”) was $3.0 million, $1.9 million and $1.3 million for the years ended December 31, 2012, 2011 and 2010, respectively. For the same periods, ESOP expenses were $0.2 million, $0.5 million and $0.3 million, respectively.

A summary of option activity under the Company’s stock equity plans during the years ended December 31, 2012, 2011 and 2010 are as follows:

				Weighted Average
				Remaining	Aggregate
	Number of	Weighted Average		Contractual Term	Intrinsic
Options	Shares	Exercise Price		(in years)	Value
Outstanding at December 31, 2009	2,825,796	$	4.36	5.14	$	1,794,310
Granted	1,581,000		4.27
Exercised	(92,188)		2.42
Cancelled	(111,955)		5.65
Outstanding at December 31, 2010	4,202,653		4.34	5.06	$	2,314,975
Granted	1,484,500		3.44
Exercised	(196,747)		1.84
Cancelled	(878,039)		4.35
Outstanding at December 31, 2011	4,612,367		4.15	4.61	$	872,567
Granted	1,066,000		4.38
Exercised	(372,444)		3.29
Cancelled	(1,083,371)		4.86
Outstanding at December 31, 2012	4,222,552		4.10	3.93	$	1,759,014
Exercisable at December 31, 2012	2,656,894	$	4.11	3.08	$	1,550,784

The Black-Scholes weighted average fair values of options granted during the years ended December 31, 2012, 2011 and 2010 were $2.17, $1.69, and $2.08, respectively.

The following table summarizes ranges of outstanding and exercisable options as of December 31, 2012:

	Options Outstanding				Options Exercisable
		Weighted Average
		Remaining	Weighted			Weighted
Range of		Contractual Term	Average			Average
Exercise Price	Number	(in years)	Exercise Price		Number	Exercise Price
$1.80-$2.69	1,075,761	3.46	$	2.13	925,824	$	2.06
$2.70-$3.73	1,041,656	3.89		3.54	592,303		3.50
$3.74-$4.10	855,577	5.26		4.03	213,402		3.85
$4.11-$6.66	913,666	4.22		5.13	589,473		4.91
$6.67-$15.58	335,892	1.36		9.57	335,892		9.57
Total	4,222,552	3.93	$	4.10	2,656,894	$	4.11

The total intrinsic value of options exercised during the years ended December 31, 2012, 2011 and 2010 was  $0.8 million, $0.3 million, and $0.3 million, respectively.

The fair value of options vested during the year ended December 31, 2012 was approximately $2.5 million.

As of December 31, 2012, total unrecognized compensation costs related to nonvested stock options net of estimated forfeitures was $1.2 million which is expected to be recognized as expense over a weighted average period of approximately 1.22 years.

The following table summarizes the activity for our RSUs during the year ended December 31, 2012:

	Nonvested Restricted Stock Units
	Number of	Weighted Average
	Shares	Grant-Date Fair Value
December 31, 2011	-	$	-
Granted	301,000		6.27
Vested	(33,500)		6.46
Cancelled	(27,400)		6.66
December 31, 2012	240,100	$	6.20

As of December 31, 2012, total unrecognized compensation cost related to nonvested RSUs was $0.2 million which is expected to be recognized in the first quarter of 2013. RSUs vest on January 1, 2013 and February 28, 2013 or accelerate upon an employee’s involuntary separation from the Company other than for cause.

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Concentrations Of Credit, Customer And Supplier Risk (Schedule Of Percentage Of Total Accounts Receivable Balance Accounted To Customers) (Details) (Accounts Receivable [Member])	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Excelpoint Systems Pte Ltd. [Member]
Concentration Risk [Line Items]
Percentage of total accounts receivable	30.00%	27.00%	24.00%
Avnet, Inc. [Member]
Concentration Risk [Line Items]
Percentage of total accounts receivable	21.00%	28.00%	24.00%
Answer Technology, Inc. [Member]
Concentration Risk [Line Items]
Percentage of total accounts receivable	19.00%	12.00%	17.00%

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Commitments And Contingencies (Narrative) (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Purchase commitments	$ 7.4
Rental expense	0.3	0.7	0.9
Capital leases, amortization expense	0.6	0.9	1.1
Capital leases, included in other assets	0.1
Capital lease assets, accumulated amortization	3.6
Money damages awarded		$ 1.0
Maximum [Member]
Sales order, lead time	112 days
Minimum [Member]
Sales order, lead time	28 days

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Acquisition And Restructuring Costs (Summary Of Activity Within The Severance And Benefit Related Liability) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012 employee		Dec. 31, 2011 employee
Restructuring Cost and Reserve [Line Items]
Operations expense			$ 501
Number of employees terminated	14		14
Number of contractors terminated	4
Severance [Member]
Restructuring Cost and Reserve [Line Items]
Cash payments	(277)		(501)
Liability at end of period	315
Severance [Member] | Discontinued Operations [Member]
Restructuring Cost and Reserve [Line Items]
Operations expense	592	[1]

[1] Recorded in loss from discontinued operations in the Consolidated Statement of Operations. Severance related to the termination of 14 employees and 4 contractors in connection with the sale of the PHY business is expected to be paid by March 31, 2013.

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Organization And Summary Of Significant Accounting Policies (Policy)

12 Months Ended

Dec. 31, 2012

Organization And Summary Of Significant Accounting Policies [Abstract]

Basis Of Presentation

Basis of Presentation

The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States and include the accounts of the Company and its wholly-owned subsidiaries in China, India, Japan, Korea, Singapore, Taiwan and the United Kingdom. All intercompany transactions and balances have been eliminated.

Cash And Cash Equivalents

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Investments

Investments

At December 31, 2012, the Company’s securities consisted of certificates of deposits and debt securities.  Management determines the appropriate classification of debt securities at the time of purchase and reevaluates such designation as of each balance sheet date. At December 31, 2012 and 2011, all debt securities were designated as available-for-sale. Available-for-sale securities are carried at fair value, based on quoted market prices or prices quoted in markets that are not active, with unrealized gains and losses reported in a separate component of stockholders' equity. The amortized cost of debt securities is adjusted for the amortization of premiums and the accretion of discounts to maturity both of which are included in interest income. Realized gains and losses are recorded on the specific identification method.

The accounting guidance for fair value measurements provided a framework for measuring fair value and expands related disclosures. Fair value is defined as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The guidance also established a hierarchy which requires an entity to maximize the use of observable inputs, when available.  The guidance requires fair value measurement be classified and disclosed in one of the following three categories:

Level 1: Valuations based on quoted prices in active markets for identical assets and liabilities.  The fair value of available-for-sale securities included in the level 1 category is based on quoted prices that are readily and regularly available in an active market. 

Level 2: Valuations based on observable inputs (other than Level 1 prices), such as quoted prices for similar assets at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly. The fair value of available-for-sale securities included in the Level 2 category is based upon quoted prices in markets that are not active and incorporate available trade, bid and other market information.

Level 3: Valuations based on inputs that are unobservable and involve management judgment and the reporting entity’s own assumptions about market participants and pricing.

Accounts Receivable And Allowance For Doubtful Accounts

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are recorded at the invoiced amount and do not bear interest.  The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable.  The Company determines the allowance based on historical write-off experience and customer economic data.  The Company reviews its allowance for doubtful accounts monthly.  Past due balances over 90 days are reviewed individually for collectability.  Account balances are charged off against the allowance when the Company believes that it is probable the receivable will not be recovered.

Inventories

Inventories

Inventories are valued at the lower of cost (first-in, first-out method) or market (net realizable value).  Inventories were as follows (in thousands):

	December 31,
	2012		2011
Work-in-process	$	4,986	$	4,216
Finished goods		5,574		4,680
Total	$	10,560	$	8,896

The Company evaluates the need for potential inventory write downs by considering a combination of factors, including the life of the product, sales history, obsolescence, sales forecasts and expected sales prices.

Goodwill And Other Intangible Assets

Goodwill and Other Intangible Assets

Goodwill represents the excess of cost over the value of net assets of businesses acquired and is carried at cost unless write-downs for impairment are required. The Company’s goodwill as of December 31, 2012, is a result of the Oxford and Teranetics acquisition on January 2, 2009 and October 1, 2010, respectively, as adjusted for the 2012 divestiture of the PHY business and the 2011 divestiture of the UK design team.  The Company evaluates the carrying value of goodwill on an annual basis during the fourth quarter and whenever events and changes in circumstances indicate that the carrying amount may not be recoverable. Such indicators would include a significant reduction in the Company's market capitalization, a decrease in operating results or a deterioration in the Company's financial position. The Company operates under a single reporting unit, and accordingly, all of its goodwill is associated with the entire company. In the fourth quarter of 2012 and 2011, the Company tested the goodwill acquired and determined there was no impairment.

Changes in the carrying amount of goodwill for the years ended December 31, 2012 and 2011 are as follows (in thousands):

Net goodwill as of December 31, 2010	$	21,412
Adjustment for divestiture of UK design team		(74)
Net goodwill as of December 31, 2011		21,338
Adjustment for divestiture of PHY business		(877)
Net goodwill as of December 31, 2012	$	20,461

The purchased intangible assets including customer base and developed/core technology were being amortized over the assets’ useful lives, which ranged from one to six years, utilizing the straight-line or accelerated methods which approximates the estimated future cash flows from the intangible. The Company evaluates other intangible assets for impairment whenever events and circumstances indicate that such assets might be impaired. Also, see Note 11 to the consolidated financial statements.

Long-lived Asset Impairment

Long-lived Asset Impairment

Long-lived assets, principally property and equipment and identifiable intangibles, held and used by the Company are reviewed for impairment whenever events or circumstances indicate that the carrying amount of assets may not be recoverable.  The Company evaluates recoverability of assets to be held and used by comparing the carrying amount of an asset to estimated future net undiscounted cash flows generated by the asset.  If such assets are considered to be impaired, the impairment recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Property And Equipment

Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of thirty nine years for buildings, three to eight years for building improvements and three to seven years for equipment, furniture and purchased software.

Property and equipment are as follows (in thousands):

	December 31,
	2012		2011
Land	$	3,150	$	3,150
Building and improvements		4,327		4,327
Equipment and furniture		14,955		14,681
Purchased software		2,371		2,513
		24,803		24,671
Accumulated depreciation		(13,536)		(12,380)
Net property and equipment	$	11,267	$	12,291

Depreciation and amortization expense from continuing operations pertaining to property and equipment was approximately $2.2 million, $2.4 million and $2.2 million for the years ended December 31, 2012, 2011 and 2010, respectively.

Foreign Currency Translation

Foreign Currency Translation

The functional currency of the Company’s international subsidiaries in China, India, Japan, Korea Singapore, Taiwan and UK, is the local currency of the resident countries.  Assets and liabilities of the Company’s foreign subsidiaries are translated into the Company’s reporting currency at month-end exchange rates.  Revenues and expenses of the Company’s foreign subsidiaries are translated into the Company’s reporting currency at weighted-average exchange rates. The effects of the translation are included in a separate component of the Consolidated Statements of Stockholder’s Equity and Comprehensive Loss.

Income Taxes

Income Taxes

Income taxes are accounted for using the asset and liability method.  Under this method, deferred tax liabilities and assets are recognized for the expected future tax consequences of differences between the carrying amounts and the tax bases of assets and liabilities.  A valuation allowance is provided when it is more likely than not that all or some portion of deferred tax assets will not be realized.

The Company recognizes the tax liability for uncertain income tax positions on the income tax return based on the two-step process. The first step is to determine whether it is more likely than not that each income tax position would be sustained upon audit. The second step is to estimate and measure the tax benefit as the amount that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority. Estimating these amounts requires the Company to determine the probability of various possible outcomes. The Company evaluates these uncertain tax positions on a quarterly basis. This evaluation is based on the consideration of several factors including changes in facts or circumstances, changes in applicable tax law, settlement of issues under audit, and new exposures. If the Company later determines that the exposure is lower or that the liability is not sufficient to cover its revised expectations, the Company adjusts the liability and effect a related change in its tax provision during the period in which the Company makes such determination.

Revenue Recognition

Revenue Recognition

The Companyrecognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collection is reasonably assured.

Revenue from product sales to direct customers and distributors is recognized upon shipment and transfer of risk of loss, if the Company believes collection is reasonably assured and all other revenue recognition criteria are met. The Company assesses the probability of collection based on a number of factors, including past transaction history and the customer’s creditworthiness.  At the end of each reporting period, the sufficiency of allowances is assessed based on the age of the receivable and the individual customer’s creditworthiness.

The Company offers pricing protection to two distributors whereby the Company supports the distributor’s resale product margin on certain products held in the distributor’s inventory. The Company analyzes current requests for credit in process, also known as ship and debits, historical rates and amounts of credits issued, and inventory at the distributor to determine the ending sales reserve required for this program. The Company also offers stock rotation rights to three distributors such that they can return up to a total of 5% of products purchased every six months in exchange for other PLX products of equal value. The Company analyzes current stock rotation requests and past experience to determine the ending sales reserve required for this program. In addition, the Company had arrangements with a small number of customers offering a rebate program on various products, which were terminated in June 2010. The Company recorded rebates as a reduction of revenue when the rebate is in the form of cash consideration. Reserves are reduced directly from revenue and recorded as a reduction to accounts receivable.

Product Warranty

Product Warranty

The Company sells products with a limited warranty of product quality for a period of one year, and up to three years for a small number of customers, and a limited indemnification of customers against intellectual property infringement claims related to the Company’s products. The Company accrues for known warranty and indemnification issues if a loss is probable and can be reasonably estimated, and accrues for estimated incurred but unidentified issues based on historical activity. 

Use Of Estimates

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods.  Actual results could differ from those estimates and such differences may be material to the consolidated financial statements.

Comprehensive Loss

Comprehensive Loss

The components of accumulated other comprehensive loss, reflected in the Consolidated Statements of Stockholders' Equity and Comprehensive Loss, consisted of the following (in thousands):

	Years Ended December 31,
	2012		2011		2010
Unrealized gain (loss) on investments, net	$	1	$	9	$	(6)
Cumulative translation adjustments		(227)		(156)		(142)
Accumulated other comprehensive loss	$	(226)	$	(147)	$	(148)

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In June 2011, the Financial Accounting Standards Board (“FASB”) issued a standard which revised the presentation of other comprehensive income (“OCI”). The new guidance requires entities to present net income and OCI in either a single continuous statement or in separate consecutive statements. The guidance does not change the components of net income or OCI, when OCI should be reclassified to net income, or the earnings per share calculation. This accounting guidance was effective for annual reporting periods beginning after December 15, 2011. The Company adopted this guidance as of January 1, 2012 using two consecutive statements.

In July 2012, the FASB issued amended standards to simplify how entities test indefinite-lived intangible assets for impairment which improve consistency in impairment testing requirements among long-lived asset categories. These amended standards permit an assessment of qualitative factors to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying value. For assets in which this assessment concludes it is more likely than not that the fair value is more than its carrying value, these amended standards eliminate the requirement to perform quantitative impairment testing as outlined in the previously issued standards. These amended standards are effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

In February 2013, the FASB issued amended standards to improve the reporting of reclassifications out of accumulated other comprehensive income by requiring an entity to report their corresponding effect(s) on net income. These amended standards are effective for annual reporting periods beginning after December 15, 2012. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements.

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Retirement Savings Plan (Details) (USD $)	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Retirement Savings Plan [Abstract]
Percentage of annual compensation eligible for contribution to plan	100.00%
Employer match per dollar	50.00%
Employer matching percentage of employee salary	6.00%
Plan expenses	$ 400,000	$ 400,000	$ 200,000
Foreign pension plan expense	100,000	300,000	300,000
ESOP annual salary contribution, percentage	2.00%
ESOP maximum annual contribution per employee	3,000
ESOP, plan expense	$ 100,000	$ 300,000	$ 300,000

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Commitments And Contingencies (Tables)

12 Months Ended

Dec. 31, 2012

Commitments And Contingencies [Abstract]

Schedule of Future Minimum Lease Payments

	Facility and
	Equipment		Software		Total
2013	$	243	$	3,203	$	3,446
2014		180		1,993		2,173
2015		123		-		123
2016		37		-		37
Total	$	583	$	5,196	$	5,779

Schedule Of Changes In Sales Warranty Reserve

	Years Ended December 31,
	2012		2011		2010
Balance, beginning of period	$	96	$	120	$	80
Warranty costs incurred		(336)		(252)		(166)
Additions related to current period sales		494		228		141
Additions related to acquisition		-		-		65
Balance, end of period	$	254	$	96	$	120

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Retirement Savings Plan

12 Months Ended

Dec. 31, 2012

Retirement Savings Plan [Abstract]

Retirement Savings Plan

12.  Retirement Savings Plan

The Company sponsors the PLX Technology, Inc. 401(k) Plan (the “Plan”).  The Plan allows all full-time employees to contribute up to 100% of their annual compensation.  However, employee contributions are limited to a maximum annual amount established by the Internal Revenue Service. Beginning in 1996, the Company made a matching contribution calculated at 50 cents on each dollar of the first 6% of the participant’s compensation. In January 2009, the Company announced that it suspended the matching contributions effective February 1, 2009 as a result of macroeconomic conditions. The Company reinstated its matching contributions in July 2010. The Company's expenses relating to the plan were approximately $0.4 million, $0.4 million and $0.2 million for 2012, 2011 and 2010, respectively.

The Company contributed to the U.K. national pension program and expensed approximately $0.1 million, $0.3 million and $0.3 million for 2012, 2011 and 2010, respectively, relating to this program.

In January 2009, the Company established the PLX Technology, Inc. Employee Stock Ownership Plan (the “ESOP”). The ESOP is non-contributory and provides cash contribution at a percent of eligible U.S. compensation that is determined annually by the Board of Directors. In 2009, the Company contributed 2% of eligible compensation up to $3,000 per employee.  In accordance with the IDT merger agreement, the Company ceased contributing to the plan after the April 2012 contribution. The Company’s possible reinstatement of contributions for 2013 is under review. The expense recorded for contributions to this plan was approximately $0.1 million, $0.3 million and $0.3 million for 2012, 2011 and 2010, respectively.