Altera Begins Shipping Industry's First High-Density 90-nm FPGAs to Customers

New Optimized Architecture and Strong Partnership With TSMC Lead to Successful Shipment of Stratix II Devices

San Jose, Calif., June 30, 2004 — Altera Corporation (NASDAQ: ALTR) today announced that it has begun shipping its new Stratix® II family, the industry’s highest density and fastest FPGAs, and the first FPGAs to use the 90-nm process with high-performance, low-k dielectric materials.  Stratix II devices are 50 percent faster and offer more than twice the logic capacity of competing FPGA products.  Bucking the trend of many companies struggling to build 90-nm products, Altera’s methodical design approach with foundry partner TSMC and its advanced design-for-manufacturing techniques have yielded fully functional Stratix II devices on the first pass.  Altera established a track record of on-schedule product rollouts with the first generation Stratix and Cyclone™ devices, both built on the 0.13-micron process, a technology node where Altera holds a commanding market share.  This track record continues with the delivery of the first Stratix II device, the EP2S60.

“We have received our first Stratix II devices, and look forward to incorporating them into our next-generation products,” said Roland Steffen, executive vice president, head of test and measurement division at Rohde and Schwarz.  “Altera has done an impressive job of shipping their products on schedule, which was a critical factor in our decision to use the Stratix II family.  The Stratix II architecture will enable us to achieve better performance, higher integration, and lower costs, while Altera’s clear commitment to on-time delivery will allow us to meet aggressive development and production schedules.”

Manufactured on 300-mm wafers using TSMC’s standard 90-nm process technology, which features Applied Materials’ Black Diamond® low-k dielectric, Stratix II devices were architected with an entirely new logic structure consisting of adaptive logic modules (ALMs).  Altera designed the new architecture specifically for the 90-nm process to offer the highest possible performance and increased logic efficiency while managing the power consumption.  Altera’s ability to ship parts to customers only four weeks after receiving first silicon from TSMC highlights the robustness of the process and is a good indication that the shipping schedule for the rest of the Stratix II family will be on target.

“The shipping of the EP2S60 is a major milestone in the programmable logic industry,” said Erik Cleage, Altera’s senior vice president of marketing.  “Altera’s ability to ship high-density products to customers using state-of-the-art, 90-nm, low-k technology underscores Altera’s leadership in bringing innovative products to the market.”

<>The Benefit of Redundancy in Manufacturing
Redundancy, a unique and patented Altera technology that dramatically increases yields and lowers device costs, is another major factor behind Altera’s consistent record of delivering new product families to customers on time.  Altera is the only programmable logic company that employs manufacturing redundancy on its devices.  With redundancy, large devices that would otherwise be highly susceptible to the early yield variability of a new process can be reliably manufactured.  In some cases, this technology can improve yields five-fold or more.  Advancements made to the Stratix II redundancy will allow Altera to reliably deliver the industry’s largest FPGA with nearly 180,000 equivalent logic elements.> <>

Device Availability
With the release of version 4.0 of the Quartus® II development software in February, the development of Stratix II designs at many customer sites is well underway.  Earlier this month the EP2S60 became the first member of the Stratix II family to start shipping. The remaining five members of the family will begin shipping in the fourth quarter of this year.  All members of the family will be in full production by early 2005.> <>

About the Stratix II Device Family
Featuring an innovative new logic structure, Stratix II devices offer over twice the logic density and 50 percent higher performance at 40 percent lower cost than first-generation Stratix devices.  Stratix II devices offer more than double the logic density and are 50 percent faster compared to the nearest competitive devices.  The new logic structure allows designers to conserve device resources by packing more functionality into a smaller area.  For more information about Stratix II devices, please visit www.altera.com/stratix2.> <>

About Altera
Altera Corporation (NASDAQ: ALTR) is the world’s pioneer in system-on-a-programmable-chip (SOPC) solutions.  Combining programmable logic technology with software tools, intellectual property, and technical services, Altera provides high-value programmable solutions to approximately 14,000 customers worldwide.  More information is available at www.altera.com.>

Safe Harbor

This press release contains “forward-looking statements” that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are generally preceded by words, such as “will” or “on target”, that imply a future state or that imply that a particular future event or events will occur.  Investors are cautioned that all forward-looking statements in this release involve risks and uncertainty, including without limitation the risk that future performance is dependent on our technology development capabilities, meeting our product development schedules, the design performance of software and other tools, and the performance and abilities of our subcontractors to provide wafers and assembly/test services in a timely manner.  Please refer to the company’s Securities and Exchange Commission filings, copies of which are available from the company without charge.

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