SUNNYVALE, Calif., July 9, 2001 - UMC (NSYE: UMC), a world-leading semiconductor foundry, and Applied Micro Circuits Corp. (AMCC) [NASDAQ: AMCC], today announced that AMCC has selected UMC for the 0.13-micron production of next-generation optical networking silicon. UMC's 0.13-micron technology enables complete OC-192 SONET/SDH and 10 Gigabit Ethernet solutions from the physical layer to the switch fabric, offering a platform with "no compromises" to realize multiple specialized functions such as high-speed, mixed-signal interfaces and the world's most advanced network processors.

"With this announcement, AMCC is further demonstrating its leadership role in bringing the most advanced semiconductor technologies to market in the high-bandwidth communications arena," said Brent Little, senior vice president of marketing for AMCC. "To address our customers' demands for higher levels of integration, lower cost and lower-power solutions without performance degradation or time-to-market penalties, we chose to partner with UMC. This foundry provides world-class semiconductor technology at 0.13-micron, with full-featured mixed-signal capabilities, copper and low-K dielectric enabling us to reduce wire delays and power consumption. UMC's continued customer support and short cycle times are key reasons why we have recently awarded UMC our 'Engineering Ownership' award."

AMCC is utilizing UMC's 0.13-micron CMOS technology with full mixed-signal options, including MiM capacitors, triple well isolation, and low Vt transistors. Jim Ballingall, vice president of worldwide marketing at UMC noted, "AMCC is a leader in optical network solutions and a highly strategic customer for us, and therefore demands leading-edge technology and excellent customer support and cycle times. UMC is committed to continuing to deliver products based on the 0.13-micron process technology to market as soon as possible, thereby meeting the requirements of today's leading communications developers. For example, we provide mixed-signal technology that is built upon the foundry industy's fastest logic transistor, such that it can replace the 10Gb/s mixed-signal interfaces that are usually dominated by SiGe BiCMOS. Similarly, our embedded SRAM and DRAM technologies are built upon this same high-speed transistor, enabling a true SOC platform."

AMCC will be sampling its first 0.13-micron CMOS silicon solutions this quarter.

AMCC designs, develops, manufactures, and markets high-performance, high-bandwidth silicon solutions for the world's optical networks. AMCC utilizes a combination of high-frequency analog, mixed-signal and digital design expertise coupled with system-level knowledge and multiple silicon process technologies to offer integrated circuit products that enable the transport of voice and data over fiber optic networks. The company's system solution portfolio includes PMD, PHY, framer/mapper, network processor, traffic management and switch fabric devices that address the high-performance needs of the evolving intelligent optical network. AMCC's corporate headquarters and wafer fabrication facilities are located in San Diego, California. Sales and engineering offices are located throughout the world.

The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements, including statements relating to AMCC's products or UMC's process technologies, the relationship with UMC, and anticipated sales resulting from the relationship, are subject to a number of risks and uncertainties, including the risk that the relationship would not result in expected sales, that the products or process technologies would not be successfully or timely developed or achieve market acceptance, as well as the risks associated with general economic conditions and other risks and uncertainties set forth in the Company's Annual Report on Form 10-K for the year ended March 31, 2001, the Company's recent 10-Q filing, and in other filings of the Company with the Securities and Exchange Commission. As a result of these risks and uncertainties, actual results may differ materially from these forward-looking statements. The forward-looking statements contained in this news release are made as of the date hereof and AMCC does not assume any obligation to update any forward-looking statement.

Some of the statements in the foregoing announcement are forward looking within the meaning of the U.S. Federal Securities laws, including statements about future outsourcing, wafer capacity, technologies, business relationships and market conditions. Investors are cautioned that actual events and results could differ materially from these statements as a result of a variety of factors, including conditions in the overall semiconductor market and economy; acceptance and demand for products from UMC; and technological and development risks.