Marvell Technology Group (MRVL)

Amortization of Stock-Based Compensation

Deferred stock-based compensation is being amortized using an accelerated method over the remaining option vesting period. The decrease in amortization expense in both absolute dollars and percentage of net revenue in fiscal 2005 compared to fiscal 2004 primarily resulted from a lower balance of deferred stock-based compensation being amortized in fiscal 2005 compared to fiscal 2004 as well as a result of the graded-vesting method which results in declining amortization expense in later periods. For a discussion of the effects of future expensing of stock options, see “Recent Accounting Pronouncements” below.

Amortization of Stock-Based Compensation

We have recorded deferred stock-based compensation in connection with the grant of stock options to our employees and directors prior to our initial public offering of common stock and in connection with the assumption and grant of stock options as a result of our acquisitions. Deferred stock-based compensation is being amortized using an accelerated method over the remaining option vesting period. The decrease in amortization expense in both absolute dollars and percentage of net revenue in the third quarter of fiscal 2006 and first nine months of fiscal 2006 compared to the third quarter of fiscal 2005 and first nine months of fiscal 2005 primarily resulted from a lower balance of deferred stock-based compensation being amortized in the third quarter and first nine months of fiscal 2006 compared to the third quarter and first nine months of fiscal 2005.  For a discussion of the effects of future expensing of stock options, see “Recent Accounting Pronouncements” below.

Amortization of Stock-Based Compensation

We have recorded deferred stock-based compensation in connection with the grant of stock options to our employees and directors prior to our initial public offering of common stock and in connection with the assumption and grant of stock options as a result of our acquisitions. Deferred stock-based compensation is being amortized using an accelerated method over the remaining option vesting period. The decrease in amortization expense in both absolute dollars and percentage of net revenue in the second quarter of fiscal 2006 and first six months of fiscal 2006 compared to the second quarter of fiscal 2005 and first six months of fiscal 2005 primarily resulted from a lower balance of deferred stock-based compensation being amortized in the second quarter and first six months of fiscal 2006 compared to the second quarter and first six months of fiscal 2005.  For a discussion of the effects of future expensing of stock options, see “Recent Accounting Pronouncements” below.

Amortization of Stock-Based Compensation

We have recorded deferred stock-based compensation in connection with the grant of stock options to our employees and directors prior to our initial public offering of common stock and in connection with the assumption and grant of stock options as a result of our acquisitions. Deferred stock-based compensation is being amortized using an accelerated method over the remaining option vesting period. The decrease in amortization expense in both absolute dollars and percentage of net revenue in the first quarter of fiscal 2006 compared to the first quarter of fiscal 2005 primarily resulted from less amortization expense as a result of the graded-vesting method which results in lower amortization expense over the vesting period. For a discussion of the effects of future expensing of stock options, see “Recent Accounting Pronouncements” below.

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Amortization of Stock-Based Compensation

        We have recorded deferred stock-based compensation in connection with the grant of stock options to our employees and directors prior to our initial public offering of common stock and in connection with the grant and assumption of stock options as a result of our acquisitions. Deferred stock-based compensation is being amortized using an accelerated method over the remaining option vesting period. The decrease in amortization expense in both absolute dollars and percentage of net revenue of fiscal 2004 compared to fiscal 2003 primarily resulted from a lower balance of deferred stock-based compensation being amortized in fiscal 2004 compared to fiscal 2003, partially offset by increased amortization expense from deferred stock-based compensation of $7.6 million recorded in fiscal 2004 as a result of acquisitions completed in fiscal 2004.

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