MIPS Technologies Acquires Leading GNU Tool Chain Company, UK-Based Algorithmics

Acquisition Another Step Toward Enabling Complete MIPS-Based™ Solutions Needed for SOC Development

MOUNTAIN VIEW, Calif., July 18, 2002 - MIPS Technologies, Inc. (Nasdaq: MIPS, MIPSB), a leading provider of industry-standard processor architectures and cores for digital consumer and business applications, today announced that it has acquired the UK-based GNU tool chain company Algorithmics Limited. When combined with the hundreds of software development tools already offered by the partners in MIPS Technologies' Alliance Program (MAP), Algorithmics' technologies will further enable OEM and semiconductor customers to get to market more quickly with functional silicon based upon the industry-standard MIPS32™ and MIPS64™ architectures.

"The acquisition of Algorithmics underscores our commitment to lead the MIPS ecosystem," said John Bourgoin, chairman & CEO of MIPS Technologies. "This team brings to MIPS an important set of skills which enhance MIPS' ability to provide more complete and more highly tuned system solutions. This is an important step forward for our company as we grow our solutions capabilities and deliver on our promise to deliver value to the embedded industry."

MIPS Technologies and its subsidiaries will hire all Algorithmics employees, continue Algorithmics' existing business, and also acquire the affiliated company DFS3 Limited. Terms of the transaction were not disclosed.

"This transaction solidifies the long relationship between our companies and highlights our excellent track record of delivering and supporting GNU products for MIPS customers," said Dominic Sweetman of Algorithmics. "Now our teams will combine to work even closer with the top engineering talent at MIPS Technologies to enable powerful MIPS-based consumer and networking applications that drive the user experience."

"This acquisition not only brings assets and technology to MIPS, but a team with close to two decades of experience in developing compilers, tools, systems, and hardware solutions for the MIPS community," said Mike Uhler, vice president of architecture and software for MIPS Technologies. "Combined with MIPS' proven abilities in architecture and processor design we believe that this acquisition is truly synergistic."

About MIPS Technologies
MIPS Technologies, Inc. is a leading provider of industry-standard processor architectures and cores for digital consumer and business applications. The company drives the broadest architectural alliance that is delivering 32- and 64-bit embedded RISC solutions. The company licenses its intellectual property to semiconductor companies, ASIC developers and system OEMs. MIPS Technologies and its licensees offer the widest range of robust, scalable processors in standard, custom, semi-custom and application-specific products. The company is based in Mountain View, Calif., and can be reached at +1 (650) 567-5000 or www.mips.com .

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SEC Safe Harbor Statement
This press release contains forward-looking statements regarding future events or the future financial performance of MIPS Technologies, Inc. Actual events or results may differ materially. Many factors could cause the actual results to differ materially from those contained in such forward-looking statements, including but not limited to: that products will fail to achieve market acceptance, increases in our research and development expenses, the anticipated benefits of our partnering relationships may be more difficult to achieve than expected, the timing of or delays in customer orders, delays in the design process, the length of MIPS Technologies' sales cycle, MIPS Technologies' ability to develop, introduce and market new products and product enhancements, and the level of demand for semiconductors and end-user products that incorporate semiconductors. With respect to MIPS Technologies, we refer you to the documents that it files from time to time with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended June 30, 2001 and subsequent Forms 10-Q and 8-K.