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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

For the fiscal year ended September 30, 2003

OR

For the transition period                      to                     .

Commission file number 0-17111

PHOENIX TECHNOLOGIES LTD.

(Exact name of registrant as specified in its charter)

915 Murphy Ranch Road, Milpitas, CA 95035

(Address of principal executive offices, including zip code)

(408) 570-1000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, par value $.001

Preferred Stock Purchase Rights

(Title of each Class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES  x    NO  ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.    x

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).    YES  x    No  ¨

The aggregate market value of the voting stock as of November 30, 2003, was $161,807,378 for non-affiliates of the registrant and $212,944,231, for all registrants. The calculation is based upon the last reported sales price of the Common Stock in the Nasdaq National Market, as reported by the Nasdaq Stock Market.

The number of shares of the registrant’s Common Stock outstanding as of November 30, 2003 was 24,420,210.

Documents Incorporated by Reference

Portions of the registrant’s definitive proxy statement to be filed pursuant to Regulation 14A in connection with the 2003 annual meeting of its stockholders, to be held on February 3, 2004, are incorporated by reference into Part III of this Form 10-K.

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PHOENIX TECHNOLOGIES LTD.

FORM 10-K

INDEX

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PART I

ITEM 1.    BUSINESS

FORWARD-LOOKING STATEMENTS

This report on Form 10-K, including without limitation the Business section and Management’s Discussion and Analysis of Financial Condition and Results of Operations, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, statements concerning future liquidity and financing requirements, potential price erosion, plans to make acquisitions, dispositions or strategic investments, expectation of sales volume to original equipment manufacturers (or “OEM”) and original design manufacturers (or “ODM”), and plans to improve and enhance existing products and develop new products.

Certain information and statements contained in this Management’s Discussion and Analysis of Financial Condition and Results of Operations and other sections of this report, including statements containing words such as “could”, “expects”, “may”, “anticipates”, “believes”, “estimates”, “plans”, and similar expressions, are forward-looking statements. The forward-looking statements of the Company are subject to risks and uncertainties. Some of the factors that could cause future results to materially differ from the recent results or those projected in the forward-looking statements include, but are not limited to, significant increases or decreases in demand for Phoenix’s products, increased competition, lower prices and margins, changes in customer buying patterns, failure to successfully develop and market new products and technologies, competitor introductions of superior products, continued industry consolidation, instability and currency fluctuations in international markets, product defects, failure to secure intellectual property rights, results of litigation, failure to retain and recruit key employees, adverse economic conditions, acts of war or global terrorism, and unexpected natural disasters. For a more detailed discussion of certain risks associated with the Company’s business, see the “Business Risks” section of this Form 10-K. The Company undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this Form 10-K.

GENERAL DEVELOPMENT OF THE BUSINESS

Phoenix Technologies Ltd. (“Phoenix” or the “Company”) is a global leader in core system software (“CSS”), otherwise known as Basic Input Output System or (“BIOS”), to activate, secure, connect, and recover personal computers (“PCs”), information appliances, and other digital devices connected to the Internet. Phoenix provides its products primarily to platform and peripheral manufacturers that range from large PC and information appliance manufacturers to small system integrators and value-added resellers (collectively, “Customers”). In addition to key products, Phoenix also provides support services, such as training, maintenance, and engineering services, to its customers as required. The Company markets and licenses its products and services through a global direct sales force as well as through a network of regional distributors and sales representatives, resellers, value-added OEMs, ODMs, system integrators, system builders, integrated service vendors (“ISVs”), and generic PC (or “White Box”) manufacturers.

The global computer industry, driven by the expansion of the Internet, has evolved into a rich “connected device ecosystem” embracing entirely new categories of form and functionality, driven by rapid technology changes that include increased processor speeds, hardware miniaturization, portability, and new and improved ways to connect devices and access information and services. Traditional PC platforms have evolved into “endpoints” of the Internet and have been joined by a wide array of new innovative devices. These emerging connected digital devices include Internet access terminals, interactive TVs and related set top box solutions, Internet-enabled DVD players and other traditional consumer electronics devices, wireless handheld appliances, interactive game stations, Web tablets, and rack-mounted single board server systems (known as “server blades”). Together, today’s PC and non-PC digital devices play an integral and growing role within almost everybody’s life.

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Phoenix believes that its products and services enable Customers to bring robust, leading-edge products to market more quickly, while reducing their manufacturing and support costs and providing essential product differentiation. In particular, the growth of the Internet has spurred additional connectivity to a broad range of digital devices beyond the PC. Those include personal digital assistants (“PDAs”), cell phones, set top boxes, and other internet appliances that broaden the range of real time, interactive experiences available to the end user. The diversity of hardware architectures, operating systems, and microprocessors and peripherals used by these devices has created a demand for new network assurance and device management capabilities that are built into the device and enabled by Phoenix core system software.

The CSS/BIOS created a critical need for new network security and software applications capabilities that are built into the device and broadened the range of real-time, interactive experiences available to end-users. To meet the demand of this changing market, the Company has, through a combination of internal development and acquisitions, launched a series of product families to offer a range of complete solutions to its customers. In each case, Phoenix products at the core offer an intelligent, secure, and reliable platform for delivering high value-added features and functions to a wide range of PC and connected digital device customers, increasing their competitiveness in the marketplace.

In fiscal 2003, Phoenix implemented restructuring programs which reflects its continued efforts to re-align its corporate actions with corporate strategy to improve customer focus, harmonize product marketing, streamline engineering, consolidate facilities, and in general create a market-driven company. As part of that restructuring, the Company established Centers of Excellence throughout the world, all focused on leveraging technical expertise and industry leadership experience to provide fast, accurate, and high-quality development and innovation. The operational efficiencies gained by focusing resources in these Centers of Excellence enables Phoenix to provide its customers and partners many time-to-market advantages, high-quality product rollouts, faster development cycles, and superior innovation.

The Company was incorporated in the Commonwealth of Massachusetts in September 1979, and was reincorporated in the State of Delaware in December 1986. Phoenix headquarters is in Milpitas. The mailing address of our headquarters is 915 Murphy Ranch Road, Milpitas, CA 95035, and the telephone number at that location is (408) 570-1000.

Available Information

Our Website is www.phoenix.com. Through a link on the Investor Relations section of our Website, the Company makes available the following fillings as soon as reasonably practicable after they are electronically filed with or furnished to the SEC: the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934. All such filings are available free of charge. Information contained on the Company’s Website is not part of this report.

DESCRIPTION OF BUSINESS

The Company currently has one reportable segment, Phoenix, which includes the FirstBIOS, FirstWare, FirstAuthority, and FirstView product families. inSilicon Corporation (“inSilicon”), a formerly majority-owned subsidiary reported as a separate segment prior to fiscal 2001, was sold to Synopsys, Inc. (“Synopsys”) in fiscal 2002. See Note 10 of the Company’s Consolidated Financial Statements for further information regarding segment reporting and for customer revenues by geographic region. Technologies from the current product families are expanded to include additional platform tools and core-resistant applications, which are marketed and sold as Phoenix Core Managed Environment (“cME”).

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Business Operations

The Company utilizes a global sales force with sales offices in North America, Europe, Japan, and Asia Pacific regions.

Product Background

PC systems, as well as many information appliances and other electronic devices that connect to the Internet, consist of both hardware and system firmware, or CSS/BIOS, at the core platform level. These systems and devices may also use operating system (“OS”) software and applications software. The firmware or CSS/BIOS is typically stored in flash memory and/or a Read Only Memory (“ROM”) chip that resides on the device’s motherboard, built into the device, and is executed during power up in order to test, initialize, and manage the functionality of the hardware. Phoenix, with its CSS and other software products, has been instrumental in the advancement of PC architecture and the growth of the industry over the past 24 years. Phoenix core system software products provide the critical link between hardware platforms and operating systems, while offering improved reliability through Phoenix FirstWare products, increased security through Phoenix FirstAuthority solutions, and greater flexibility in device selection through its information appliance product, Phoenix FirstView. In each case, these product suites provide complete, inter-operable solutions for customers in the traditional PC marketplace, as well as those delivering a new class of non-PC connected digital devices to provide both enhanced traditional experiences and robust new ones in places where PCs do not reach.

In fiscal year 2003, the Company introduced the Phoenix cME. This is an expanded offering that includes additional platform tools and core-resident applications, which are marketed and sold as Phoenix cME, an open software platform, centered on CSS/BIOS, that enables the management and integration of functionality into the heart of digital devices. Phoenix cME provides intuitive system management, secure services, and system restoration capabilities that are both independent of and in support of the operating system.

Phoenix cME is targeted to address four market segments: Phoenix cME PC Edition for personal computers (desktops, notebooks, workstations and Tablet PCs); Phoenix cME Server Edition for server environments; Phoenix cME Information Appliance Edition for information appliances and consumer electronics; and Phoenix cME Embedded Edition for industrial products. Each of these suites includes a platform-specific portfolio of application software, security features, advanced Core System Software, developer tools, and application program interfaces (“APIs”). Customers can select those technologies in each platform that best enable them to differentiate their products and provide additional value to their customers. Phoenix also licenses software developer kits (“SDKs”) to qualified partners for the development of core-resident, integrated, value-add solutions built on the Phoenix cME platform. These partners, including ISVs, OEMs, ODMs, system integrators, and system builders, can build and deploy applications in categories such as utilities, productivity, security, and content delivery.

The Phoenix product families are:

FirstBIOS Product Family

The Company’s CSS/BIOS software products continue to play an essential role in the design of PCs and other devices, providing the critical link between hardware platforms and operating systems. The Company’s FirstBIOS and FirstBIOS Pro products continue to meet changing customer requirements for system functionality, as well as to serve as an enabling platform for improved reliability through the use of the FirstWare products described below and enhanced system manageability with the inclusion of FirstAuthority solutions mentioned subsequently.

During fiscal 2003, these CSS/BIOS products continued to be significantly enhanced to ease deployment, and to improve system manageability and serviceability.

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FirstBIOS (upgraded from AwardBIOS) and FirstBIOS Pro (based upon PhoenixBIOS 4.0) were further enhanced to meet the current and emerging requirements of different types of systems built by the Company’s manufacturing customers. Among the distinctions are:

Majority of the total revenues recognized in each fiscal year is related to FirstBIOS revenues. Revenues from FirstBIOS as a percentage of total revenues were 90%, 93%, and 86% for fiscal 2003, 2002, and 2001, respectively.

Customers:    The Company’s CSS/BIOS technology is targeted towards PC OEMs and ODMs, as well as certain embedded systems. The Company has licensed its CSS/BIOS technology to various global technology leaders, including:

Competitors:    The Company competes for CSS/BIOS sales primarily with in-house research and development (“R&D”) departments of PC manufacturers that may have significantly greater financial and technical resources, as well as closer engineering ties and experience with specific hardware platforms, than those of the Company. The Company believes that OEM/ODM customers often license the Company’s system software products rather than develop these products internally in order to: (1) differentiate their system offerings with advanced features, (2) easily leverage the additional value of other Phoenix solutions, such as Phoenix cME StrongROM, (3) improve time to market, (4) reduce product development risks, (5) minimize product development and support costs, and/or (6) enhance compatibility with the latest industry standards.

The Company also competes for system software business with other independent suppliers, including American Megatrends Inc., a privately held company, and other small BIOS companies such as General Software, Inc. and Insyde Software, Inc.

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FirstWare and Disk Tools Product Family

The Company’s FirstWare product suite is targeted at reducing OEM/ODM and system builders’ manufacturing and technical support costs. This suite includes a product to create a proprietary, protected FirstWare space on a computer’s hard disk which is visible to, and may only be invoked by, the FirstBIOS during start-up or the Master Boot Record (‘MBR”). Phoenix applications products can also be enabled on other companies’s BIOSes through an MBR enablement module, albeit with less application security. The highest levels of application integrity are offered when the products are deployed in a system with Phoenix cME FirstBIOS. Phoenix has also created other value add applications that run within this space. To date, these applications include:

Phoenix also offers ImageCast and other disk preparation and duplication software to assist manufacturers and others involved in deploying new computers in the product suites. These disk tools are designed to rapidly install software on a new system’s hard disk.

Customers:    The FirstWare product family is largely sold to the Company’s CSS/BIOS customers, as well as systems builders. The Company’s major customers for the FirstWare application and disk tools products include Fujitsu Ltd., International Business Machines, Samsung Electronics Co. Ltd., Founder Computer Systems Co., Ltd., and Legend Holdings Company, Ltd.

Competitors:    In the FirstWare applications software area, as with CSS/BIOS, the Company competes with in-house solutions to access the protected area of hard drives. The Company’s applications that reside in the protected area compete with individual component software and diagnostic and repair software from other companies, as well as PC manufacturer-developed solutions. Price and product performance are the principal method of competition in this market. The Company leverages its existing business relationships, years of experience, intellectual property, and ability to provide integrated solutions on existing CSS/BIOS deployments as a competitive advantage against the competition.

FirstAuthority Product Family

Security made a significant market impact in fiscal 2003, and Phoenix responded to capitalize on the trend. In fiscal 2003, Phoenix realized increasing industry endorsement and adoption of its cME security strategy

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through some major design wins with key industry partners in strategic industry markets. As a result, the Company began to increase its investment in marketing to security-aware customer segments such as the U.S. federal government.

As part of the cME value proposition, Phoenix repositioned FirstAuthority products and security technologies as a core ingredient in all Phoenix products and continued to expand market awareness. FirstAuthority product messaging is now communicated within the cME value proposition to better leverage global marketing efforts. Moving forward, security products will carry the cME brand.

Phoenix significantly enhanced intrinsic security functions of CSS in fiscal 2003. For example, Phoenix worked closely with National Semiconductor Corporation, Infineon Technologies AG, and Atmel Corporation to support Trusted Platform Modules (“TPM”) for incarnation into the designs of several major OEMs to support Trusted Computing Platform Association (“TCPA”) specifications. This initiative extended Phoenix’s leadership as a key ecosystem provider in the marketplace. Enhancements such as this, targeted at the higher-value OEM market to create customer value-add opportunities and preserve or increase average selling price (ASP), will begin entering the market in the first quarter of fiscal 2004.

Customers:    In addition to its traditional ODM and OEM customer base, Phoenix began to broaden its base with significant relationships with some key industry market leaders. New customers such as, SafeNet Inc., a major vendor in the government and financial market industries, deployed cME device authentication technology (formerly DeviceConnect) in 1) its managed Virtual Private Network (VPN) service and 2) Research in Motion (“RIM”) used the Simple Protocol for Exponential Key Exchange (“SPEKE”) technology from the Phoenix cME Security SDK (formerly FirstAuthority SDK) in its mobile networking products. Our major customer Nippon Telegraph and Telecommunications (“NTT”) Data Systems engaged with Phoenix to begin development of a suite of services to help their customers better manage security and the protection of intellectual property for enterprise networks.

Competitors:    The Company’s security products provide strong two-factor authentication built into the system through tamperproof firmware when used in conjunction with FirstBIOS products. The Company has architected its security solutions based upon security best practices which recommend a layered solution. Therefore, the Company views its FirstAuthority products as complementary to other security technologies including tokens, smart cards, and biometrics for the utilization of multi-factor security solutions by customers. Accordingly, customers using the Phoenix FirstAuthority product family can maintain traditional security solutions that the customers have found to be effective, supplementing them with FirstAuthority products, while also replacing those the customers have found to be ineffective, difficult to maintain or costly to implement.

FirstView Product Family

The Company also provides software for next generation consumer electronics, information appliances, and other non-PC devices. Such devices include: Internet access terminals, interactive TVs and related set top box solutions, Internet-enabled DVD players, wireless handheld appliances, interactive game stations, digital media centers, web tablets, and other consumer-centric electronic devices. Solutions based upon these products leverage many of the same technology underpinnings and capabilities found in the Company’s FirstBIOS, FirstAuthority, and FirstWare products.

Phoenix believes that non-PC interconnected devices constitute an entirely new class of business for the company as home networking. Moreover, the availability of digital media and services increases and offers a growing market and revenue opportunity for platform software solutions that can provide digital device OEMs with reduced product development costs and risks, and improved time-to-market. The FirstView product family offers a complete platform, based upon modular components (from Firmware through select applications) as desired by the customer to deliver a compelling digital experience on their target platform.

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The Company offers the following product:

With industry-leading, standards-based support and a small code size, FirstView Connect is designed specifically for the emerging connected consumer device markets. FirstView Connect delivers the easy-to-use, appliance-like experiences that are expected from consumer electronics today. Phoenix continues to participate in leading industry forums, including the digital home working group and DVD forum among others, to drive standards and remain first to market with effective solutions.

Customers:    FirstView Connect products are targeted to next-generation information appliance manufacturers, as well as traditional consumer electronics companies. The Company’s major customers for the FirstView product family include Pioneer Electronics Inc., Hitachi Ltd., Hewlett-Packard Company, and Tottori Sanyo Electric Co., Ltd.

Competitors:    FirstView Connect and the related information appliance products compete with products from other operating system and software developers, who may have greater resources than those of the Company. These companies include Wind River Systems, Inc. and Microsoft Corporation. The Company also competes with smaller embedded software providers such as OpenTV Corporation, Opera Software ASA, Planetweb, Inc., and ACCESS Co Ltd., who may have been focused on certain segments of the information appliance market.

As part of its enhancement strategy, FirstView Connect became part of the FirstWare Connect family near the close of fiscal 2003 (The FirstWare family and FirstWare Connect were described earlier.) Phoenix plans to offer products for both the traditional PC market and the emerging consumer market.

Significant Customers

Fujitsu Limited accounted for 12%, 14% and 11% of the Company’s total revenues in fiscal 2003, 2002, and 2001, respectively. Another customer, Sony Corporation, accounted for 14% of total revenues in fiscal 2001. No other customer accounted for more than 10% of total revenues in fiscal 2003, 2002, or 2001.

PRODUCT DEVELOPMENT

The Company constantly seeks to develop new products, maintain and enhance its current product lines, maintain technological competitiveness, and meet continually changing customer and market requirements. The company’s research and development expenditures in fiscal years 2003, 2002 and 2001 were $27.1 million, $30.2 million and $34.4 million, respectively. All of Phoenix’s expenditures for research and development have been expensed as incurred. At November 30, 2003, the Company’s research and development and customer engineering group included 227 full-time employees.

INTELLECTUAL PROPERTY AND OTHER PROPRIETARY RIGHTS

The Company relies primarily on U.S. and foreign patents, trade secrets, trademarks, copyrights, and contractual agreements to establish and maintain proprietary rights in its technology. The Company has an active program to file applications for and obtain patents in the U.S. and in selected foreign countries where a potential market for its products exists. As of September 30, 2003, the Company had been issued 58 patents in the U.S. and has 54 patent applications in process in the United States Patent and Trademark Office. On a worldwide basis, the Company has been issued 106 patents with respect to its current product offerings and has 168 patent applications pending with respect to certain of the products it markets. There can be no assurance that any of these patents would be upheld as valid if challenged.

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The Company’s general policy has been to seek patent protection for those inventions and improvements likely to be incorporated in its products or otherwise expected to be of long-term value. The Company protects the source code of its products as trade secrets and as unpublished copyrighted works. It also initiates litigation where appropriate to protect its rights in that intellectual property. The Company licenses the source code for its products to its customers for limited uses. Wide dissemination of its software products makes protection of its proprietary rights difficult, particularly outside the United States. Although it is possible for competitors or users to make illegal copies of its products, the Company believes the rate of technology change and the continual addition of new product features lessen the impact of illegal copying.

In recent years, there has been a marked increase in the number of patents applied for and issued with respect to software products. Although the Company believes that its products do not infringe on any copyright or other proprietary rights of third parties, the Company has no assurance that third parties will not obtain, or do not have, intellectual property rights covering features of its products, in which event the Company or its customers might be required to obtain licenses to use such features. If an intellectual property rights holder refuses to grant a license on reasonable terms or at all, the Company may be required to alter certain products or stop marketing them.

EMPLOYEES

As of November 30, 2003 Phoenix employed 429 full-time employees worldwide, of whom 227 were in research and development and customer engineering, 127 were in sales and marketing, and 75 were in general administration. Phoenix’s employees are not represented by a labor organization, and the Company has never experienced a work stoppage. The Company considers its employee relations to be satisfactory.

COMPLIANCE WITH ENVIRONMENTAL REGULATIONS

To the Company’s present knowledge, compliance with federal, state and local provisions enacted or adopted for protection of the environment has had no material effect upon its operations.

ITEM 2.    PROPERTIES

In fiscal 2003, the Company entered into a ten-year facility lease to relocate its headquarters, from San Jose to Milpitas, California in November 2003. In fiscal 1997, the Company entered into a five-year lease agreement for a facility in Irvine, California, with an additional seven year renewal starting fiscal 2002. During fiscal 2003, the Company signed a contract to sublease part of its Irvine location for the remainder of its lease term. The Company is seeking subtenants to lease the reminder of the Irvine facility. The Company also leases smaller office facilities in other locations including: Norwood, Massachusetts; Beaverton, Oregon; Brookfield, Houston and Austin, Texas; Taipei, Taiwan; Hong Kong; Shenzhen, Shanghai, Beijing, and Nanjing, China; Tokyo and Osaka, Japan; Seoul, Korea; Budapest, Hungary; Munich, Germany and Maarssen, The Netherlands. These offices generally provide engineering, sales, and technical support to customers.

The Company considers its leased properties to be in good condition, well maintained, and generally suitable for their present and foreseeable future needs. The Company believes its facilities are adequate for its current needs and that suitable additional or substitute space will be available as needed to accommodate any expansion of its operations.

ITEM 3.    LEGAL PROCEEDINGS

On April 21, 2003, the Suwon District Court in Korea approved the motion of the Korea Electronic Certification Authority (“KECA” or “CrossCert”) for a preliminary attachment on Phoenix’s expected payments by another Phoenix customer, Samsung Electronics (“Samsung”). The amount of the preliminary attachment is KRW 496,608,750, approximately USD$412,000. Subsequently, on May 7, 2003, Phoenix and its subsidiary,

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Phoenix Technologies (Hungary) Software Licensing LLC (Phoenix’s assignee of the license between Phoenix and CrossCert) filed suit in Santa Clara County Superior Court in United States of America for breach of contract, interference with contract, interference with prospective economic advantage and unfair competition, against CrossCert. The Company also challenged the preliminary attachment that was given to CrossCert by the District Court in Korea. CrossCert (“complaint”) subsequently filed suit against Phoenix on June 14, 2003 in Korea. The basis of the alleged suit is breach of contract and/or fraud in connection with the parties’ license agreement. The complaint seeks $825,000 plus interest under both the license agreement and Korean law.

Subsequently in November 2003, the Seoul District Court had dismissed CrossCert’s suit against Phoenix stating the lack of jurisdiction. The Company plans to move quickly upon the dismissal to challenge CrossCert and remove the attachment on Samsung that the District Court had previously approved to CrossCert. The Company believes the CrossCert suit for succeeding is extremely doubtful and the prospects of success by CrossCert are slight. The Company also believes that there is a possibility of recovering legal expenses from CrossCert after the suits are completed.

Phoenix is subject to certain routine legal proceedings, as well as demands, claims and threatened litigation, that arise in the normal course of our business. We currently believe that the ultimate amount of liability, if any, for any pending claims of any type (either alone or combined) will not materially affect our financial position, results of operations or liquidity. However, the ultimate outcome of any litigation is uncertain, and either unfavorable or favorable outcomes could have a material negative impact. Regardless of outcome, litigation can have an adverse impact on the Company due to defense costs, diversion of management resources and other factors.

ITEM 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

EXECUTIVE OFFICERS OF PHOENIX TECHNOLOGIES LTD.

The executive officers of the Company serve at the discretion of the Board of Directors of Phoenix. As of the filing date of this Form 10-K, executive officers of the Company are as follows:

BIOGRAPHIES

Mr. Sisto joined the Company as President and Chief Executive Officer and was appointed to the Board in June 1999. He was elected Chairman of the Board in January 2000. Mr. Sisto was formerly Chief Operating Officer of RSA Security, Inc. from 1997 to 1999. He served as Chairman, President, and CEO of DocuMagix from 1994 to 1997. From 1989 to 1994, Mr. Sisto served as the President and CEO of PixelCraft, Inc. Mr. Sisto has also served in executive management roles at MIPS Technologies, Relational Technologies (INGRES), Intel, Honeywell, and General Electric. Mr. Sisto is on the Boards of Directors of Hi/fn Inc., a semiconductor components company. Mr. Sisto earned a Bachelor of Science in Engineering from Stevens Institute of Technology.

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Mr. Bolten joined Phoenix Technologies as Chief Financial Officer in June 2003. Prior to joining Phoenix, he served as a consultant providing interim CFO services to entrepreneurial companies from 2001 to 2002. Mr. Bolten was Chief Financial Officer and Vice President of Operations for BroadVision, Inc. from 1995 to 2001, during a time when the enterprise applications software company grew from a private company with no revenues to a highly visible public company with a revenue run rate of $550 million at its peak. From 1992 to 1994, he served as CFO of BioCAD Corporation, a supplier of drug discovery software products. Prior to BioCAD, Mr. Bolten held various financial and executive management positions at Teknekron, Oracle Corporation, and Tandem Computers Incorporated. Mr. Bolten earned an undergraduate degree in Economics from Princeton University and an MBA from Stanford University.

Mr. Eades joined the Company as Senior Vice President, Corporate Marketing and Products Division in August 2002, leading the marketing, positioning, and products development. From 2001 to 2002, Mr. Eades was program director at International Business Machines Corporation (“IBM”) for emerging technologies, including server, security and autonomic software. From 2000 to 2001, he served as vice president of market development for Mobilesys, where he redirected sales from a direct to a channel methodology. From 1996 to 2000, he was a worldwide program director for IBM’s Personal Systems Group, where he specialized in server, desktop, and laptop products. He also has served in management positions with ThinkPad, Lapland UK, First Stop Computer Group, and Dun & Bradstreet. Mr. Eades holds business, finance, and marketing degrees from Southampton University and Southampton Technical College in England.

Mr. Francis joined the Company as Senior Vice President and General Manager of the Corporate Engineering and Planning Division in October 2001. He joined Phoenix from Quantum Corporation, where he served as Vice President of Corporate Development from May 1998 to April 2001. Before joining Quantum, Mr. Francis was Vice President of Corporate Development and Strategic Planning at Advanced Micro Devices from April 1995 to May 1998 and also served as Vice President of Corporate Development at Sun Microsystems from August 1993 to April 1995. Prior to joining Sun Microsystems, he served in a number of executive capacities in the areas of corporate strategy, strategic planning, and finance at Advanced Micro Devices, and previously had worked as a consultant for the Boston Consulting Group. Mr. Francis holds a B.S. degree in Engineering and Applied Science from Yale University, a M.S. degree in Electrical Engineering from Massachusetts Institute of Technology, and an MBA Degree from Harvard Business School.

Mr. Gibbs became the Senior Vice President and General Manager of the Global Sales and Support Division in October 2001. He joined the Company as Vice President of Business Development in March 2001 and was promoted to Senior Vice President and General Manager of the Information Appliance Division in May 2001. Prior to joining Phoenix, he served in several senior management roles at FlashPoint Technologies, an embedded appliance OS company, from 1998 to 2001. Prior to that, Mr. Gibbs was Vice President of Sales at DocuMagix/JetFax from 1997 to 1998, and held a number of executive sales and business development roles between November 1993 to March 1997 while at Insignia Solutions. Mr. Gibbs earned a B.A. degree in Economics from UCLA.

Ms. Madriz joined Phoenix in October 2000 as Vice President, Human Resources. She joined Phoenix from Xicor, Inc. where she served as Director of Human Resources from 1984 and was promoted to and served as Vice President from 1990 to 2000. In addition to her responsibilities as the senior executive for Human Resources, she also assumed responsibility for Safety and Environmental Compliance. Prior to Xicor, Ms. Madriz served as Division Senior HR Manager for Atari, Inc. from 1980 to 1984. She has also worked for Dysan Corporation, and Federated Department Stores in various HR capacities. She has served as an appointed Commissioner for The City of San Jose since 1994 and is on the board of several non-profit organizations. Ms. Madriz earned a B.A. degree in Business Administration from the University of Pavia, Italy.

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PART II

ITEM 5.    MARKET FOR REGISTRANT’S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

The Company’s common stock is traded on the NASDAQ National Market under the symbol PTEC. The following table sets forth, for the periods indicated, the highest and lowest closing sale prices for the Company’s common stock, as reported by the Nasdaq National Market.

The Company had 215 shareholders of record as of November 30, 2003. To date, the Company has paid no cash dividends on its common stock. The Company currently intends to retain all earnings for use in its business and does not anticipate paying any dividends in the foreseeable future.

ITEM 6.    SELECTED CONSOLIDATED FINANCIAL DATA

The selected financial data below includes business combinations described in Note 3 and reflects the disposition of the Company’s ownership interest in inSilicon in September 2002, as described in Note 4 as discontinued operations to the Consolidated Financial Statements. The tables in Part II include selected unaudited quarterly consolidated data for fiscal 2003 and 2002. This information was derived from the Company’s unaudited consolidated financial statements that, in the opinion of management, reflect all recurring adjustments necessary to fairly present this information when read in conjunction with the Company’s annual Consolidated Financial Statements. The results of operations for any period are not necessarily indicative of the results to be expected for any future period.

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Selected Annual Consolidated Data

(In thousands, except per share data)