TowerJazz, the global specialty foundry leader, today announced financial results for the third quarter ended September 30, 2011.

Third Quarter 2011 Highlights
• Record revenues of $176.1 million, up 31 percent year-over-year and sequential increase of 26 percent;
• GAAP net profit of $1.8 million compared to a profit of $1.2 million in the third quarter of last year;
• Non-GAAP gross profit at $57 million and net profit at $46 million, a 26 percent net margins;
• Cash balance at quarter-end of $178 million as compared to $139 million as of June 30, 2011 and $88 million as of September 30, 2010;
• The Company expects revenues of $170 to $180 million in the fourth quarter of 2011, with mid range increase of 30 percent year-over-year and implying full year growth of approximately 20 percent.

CEO Perspective
Russell Ellwanger, Chief Executive Officer, commented: "The third quarter revenue level puts us at a run rate of around $700 million plus per year, increasing our lead as the number 1 specialty foundry and bringing us a big step closer to our goal of becoming a billion dollar company by 2014. The third quarter was the first full quarter post-acquisition of the Nishiwaki factory. The integration has been seamless, with all committed and forecasted metrics having been met or surpassed. Specific to the Japanese market, we have already been selected by a top ten Japanese integrated device maker (IDM) who will transfer product and flow into the Nishiwaki facility and a 2nd large IDM who will transfer a major growth product and flow into one of our MH facilities with a 2nd product family targeted to transfer to Nishiwaki.

On November 2nd and 3rd we held our annual TowerJazz Global Symposium at our Newport Beach facility, with record turnout of about 200 customers. In spite of a currently weak market, we realized close to 100 design wins for Q3, which combined with present programs and long term customer engagements, promise a trajectory that should enable us to take full advantage of the added Nishiwaki capacity and continue our momentum to expand our lead as the #1 specialty foundry. We will discuss the various avenues of perspective growth and customer interactions during our conference call."

Third quarter 2011 results summary
Third quarter 2011 revenue reached $176.1 million, a 31 percent growth over third quarter 2010 revenue of $134.7 million and 26 percent growth over the prior quarter.

On a non-GAAP basis, as described and reconciled below, the third quarter 2011 gross profit was $57 million and operating profit was $39 million. This is compared with a gross profit of $51 million and operating profit of $35 million, as achieved in the prior quarter. Net profit on a non-GAAP basis, was $46 million.

On a GAAP basis, the net profit was $1.8 million, or tiny_mce_marker.01 earnings per share, compared with a net profit of $1.2 million, or tiny_mce_marker.01 earnings per share in the third quarter of 2010 and a net profit of $1.7 million, or tiny_mce_marker.01 earnings per share, in the prior quarter.

Net profit for the quarter includes $9 million of gain, net due to the sale of the Company's holdings of HHSL in China announced on August 18, 2011.

The Company's cash and short-term deposits balance as of September 30, 2011 was $178 million, $139 million as of June 30, 2011 and 88 million as of September 30, 2010;

TowerJazz Japan results are included as from the acquisition date, June 3, 2011.

Financial Guidance
TowerJazz expects revenues of $170 to $180 million in the fourth quarter of 2011, with mid range increase of 30 percent year-over-year and implying full year growth of approximately 20 percent.

About TowerJazz
Tower Semiconductor Ltd. (NASDAQ: TSEM, TASE: TSEM), the global specialty foundry leader, its fully owned U.S. subsidiary Jazz Semiconductor and its fully owned Japanese subsidiary TowerJazz Japan, LTD, operate collectively under the brand name TowerJazz, manufacturing integrated circuits with geometries ranging from 1.0 to 0.13-micron. TowerJazz provides industry leading design enablement tools to allow complex designs to be achieved quickly and more accurately and offers a broad range of customizable process technologies including SiGe, BiCMOS, Mixed-Signal and RFCMOS, CMOS Image Sensor, Power Management (BCD), and Non-Volatile Memory (NVM) as well as MEMS capabilities. To provide world-class customer service, TowerJazz maintains two manufacturing facilities in Israel, one in the U.S., and one in Japan with additional capacity available in China through manufacturing partnerships. For more information, please visit www.towerjazz.com.