Page No.
PART I.		FINANCIAL INFORMATION
Item 1.		Consolidated Financial Statements (Unaudited)
		Consolidated Balance Sheets—September 29, 2002 and December 30, 2001		3
		Consolidated Statements of Operations—Three and nine months ended September 29, 2002 and September 30, 2001		4
		Consolidated Statements of Cash Flows—Nine months ended September 29, 2002 and September 30, 2001		5
		Notes to Consolidated Financial Statements, September 29, 2002		6
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		15
Item 3.		Qualitative and Quantitative Disclosures About Market Risk		21
Item 4		Controls and Procedures		30
PART II.		OTHER INFORMATION
Item 1.		Legal Proceedings		30
Item 2.		Changes in Securities and Use of Proceeds		31
Item 3.		Defaults Upon Senior Securities		31
Item 4.		Submission of Matters to a Vote of Security Holders		31
Item 5.		Other Information		31
Item 6.		Exhibits and Reports on Form 8-K		31
SIGNATURES				32
CERTIFICATIONS				33

		September 29, 2002				December 30, 2001
		(unaudited)				(see note)
ASSETS
Current Assets
Cash and cash equivalents		$	149,248			$	78,664
Short-term investments			157,990				215,991
Trade accounts receivable, less allowances of $734 in 2002 and $1,848 in 2001			3,316				5,025
Inventories:
Raw materials			2,014				4,328
Work in progress			1,508				1,653
Finished goods			841				3,259
Total inventories			4,363				9,240
Prepaid expenses and other current assets			3,477				8,857
Total current assets			318,394				317,777
Property, plant and equipment:
Land and building			—				24,605
Assets held for sale			19,397				—
Manufacturing and development equipment			7,149				49,880
Computer software and equipment			4,189				7,810
Office equipment			935				4,279
Leasehold improvements			1,774				15,772
Construction in progress			428				3,053
			33,872				105,399
Less allowances for depreciation and amortization			(6,861	)			(17,333	)
Net property, plant and equipment			27,011				88,066
Intangible assets, net of accumulated amortization of $1,192 in 2002 and $13,700 in 2001			1,556				12,294
Other assets			5,327				11,587
Total assets		$	352,288			$	429,724
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	1,683			$	2,438
Accrued compensation and related benefits			3,922				5,710
Accrued expenses			2,620				5,111
Restructuring accrual, current portion			8,100				4,736
Deferred revenue and research and development funding			—				1,775
Current portion of long-term debt			—				109
Total current liabilities			16,325				19,879
Restructuring accrual, long-term			16,349				220
Long-term debt, less current portion			—				7
Deferred rent			460				1,508
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.001 par value:
Authorized shares—10,000,000
Issued and outstanding—none			—				—
Common stock, $0.001 par value:
Authorized shares—250,000,000
Issued and outstanding—76,411,719 in 2002 and 75,980,323 in 2001			76				76
Additional paid-in capital			977,094				977,541
Notes receivable from stockholders			(2,135	)			(5,815	)
Deferred compensation			(4,208	)			(18,220	)
Accumulated other comprehensive income (loss)			(3,083	)			1,436
Accumulated deficit			(648,590	)			(546,908	)
Total stockholders’ equity			319,154				408,110
Total liabilities and stockholders’ equity		$	352,288			$	429,724

		Three Months Ended								Nine Months Ended
		September 29, 2002				September 30, 2001				September 29, 2002				September 30, 2001
Net revenues		$	6,743			$	15,838			$	25,953			$	83,249
Cost of net revenues (1)			9,811				16,882				36,631				98,673
Gross loss			(3,068	)			(1,044	)			(10,678	)			(15,424	)
Operating Expenses:
Research and development (2)			4,321				14,646				19,702				41,908
Less funding received from research and development contracts			(72	)			(1,166	)			(1,574	)			(1,256	)
Net research and development			4,249				13,480				18,128				40,652
Sales and marketing (3)			1,837				2,592				6,727				7,981
General and administrative (4)			3,688				5,010				11,879				17,643
Amortization of goodwill and other intangibles			183				5,255				2,852				49,154
Impairment of goodwill and other intangibles			—				—				7,692				241,574
In-process research and development			—				—				—				13,400
Restructuring charges			36,597				2,162				72,215				5,785
Deferred compensation			3,377				11,766				13,392				53,147
Total operating expenses			49,931				40,265				132,885				429,336
Operating loss			(52,999	)			(41,309	)			(143,563	)			(444,760	)
Interest income			2,030				4,046				6,928				14,321
Interest expense			—				(9	)			(78	)			(33	)
Other income (expense), net			(6,531	)			304				35,031				(448	)
Loss before benefit for income taxes			(57,500	)			(36,968	)			(101,682	)			(430,920	)
Benefit for income taxes			—				(5,000	)			—				(15,000	)
Net loss		$	(57,500	)		$	(31,968	)	<