Mentor Graphics Reports Fiscal First Quarter Results

WILSONVILLE, Ore., May 22, 2008 - Mentor Graphics Corporation (NASDAQ: MENT) today announced first quarter fiscal 2009 revenue of $179.2 million. Non-GAAP earnings per share were a loss of $.10. On a GAAP basis, earnings per share were a loss of $.30, including significant special charges driven by cost control activities in the quarter.

“In a difficult environment, the company performed as we forecast,” said Walden C. Rhines, chairman and CEO of Mentor Graphics. “Our investments in new technologies and markets continue to pay dividends, with growth in analog/mixed-signal design, electronic system level (ESL) design, automotive and design-for-test, among others.” During the quarter, the company launched the Questa® InFact intelligent testbench which offers customers improved design verification, as well as the Questa Multi-view product which allows designers to span different levels of abstraction in their verification flows. The company also simplified the complex task of debugging multicore designs with the Questa Codelink product. Agilent and Mentor Graphics launched a tight integration of their respective tools to simplify and accelerate RF board design.

“During the quarter, we extended our cost management efforts, resulting in virtually flat headcount year over year, despite several acquisitions over the last year and our investment in field benchmarking staff for our Olympus place and route campaigns,” said Gregory K. Hinckley, president of Mentor Graphics. “Looking forward, we continue to see a strong second half driven by renewals.”

Financial tables

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Guidance

For fiscal year 2009, the company expects revenue of approximately $915 million, with non-GAAP earnings per share in the range of $1.05 to $1.10 and GAAP earnings per share in the range of $.45 to $.50. For fiscal second quarter, consistent with the previously forecast weaker first half, the company expects revenue of about $173 million, non-GAAP loss per share of $.10 to $.15 and GAAP loss per share of $.18 to $.23.

About Mentor Graphics

Mentor Graphics Corporation (Nasdaq: MENT) is a world leader in electronic hardware and software design solutions, providing products, consulting services and award-winning support for the world’s most successful electronics and semiconductor companies. Established in 1981, the company reported revenues over the last 12 months of over $850 million and employs approximately 4,200 people worldwide. Corporate headquarters are located at 8005 S.W. Boeckman Road, Wilsonville, Oregon 97070-7777. World Wide Web site: http://www.mentor.com/.