FORTUNE Names SigmaTel as One of 25 Breakout Companies of 2005

    Business Editors/High-Tech Writers

    AUSTIN, Texas--(BUSINESS WIRE)--May 4, 2005--Bolstered by strong financial performance and a healthy and growing market for its portable digital audio technologies, SigmaTel (NASDAQ:SGTL) has been named among 25 Breakout Companies of the year by FORTUNE magazine.
    "What is a breakout company? These upstarts are changing the game; they're truly innovative companies from a frothy sea of poseurs," say FORTUNE's Julie Schlosser and Matt Boyle. "Today's esprit de cool flows from San Diego to Beijing, encompassing touch recognition, noninvasive biopsies, and -- at last! -- self-heating coffee."
    With first quarter revenues of $99.3 million, up 215 percent year-over-year, SigmaTel has experienced consistent growth and strong financials. The majority of the world's MP3 players use SigmaTel's single-chip solution for decoding digital audio tracks, managing battery power, controlling the display and communicating with a flash memory chip or a very small hard disk drive.
    "Being named to FORTUNE's 25 Breakout Companies list underscores the importance of SigmaTel's ongoing efforts to promote product excellence, provide strong customer service and sustain market leadership," said Ron Edgerton, president and CEO of SigmaTel. "We're honored to be recognized, but we also take this as a challenge to continue living up to the high expectations placed on us by the market and by our own desire for excellence."
    To compile its 13th annual list of 25 Breakout Companies, FORTUNE screened more than 100 candidates submitted by venture capitalists, entrepreneurs and other sources. FORTUNE will release the list of the 25 Breakout Companies of 2005 in its May 16, 2005 print edition. The list also is available online at http://www.fortune.com/fortune/breakout.

    About SigmaTel:

    SigmaTel, Inc. a fabless semiconductor company headquartered in Austin, Texas, designs, develops, and markets proprietary, analog intensive, mixed-signal ICs for a variety of products in the consumer electronics and computing markets, including portable compressed audio players, such as MP3 players, notebook and desktop PCs, DVD players, digital televisions, and set-top boxes. SigmaTel provides complete, system-level solutions that include highly-integrated ICs, customizable firmware and software, software development tools, reference designs, and applications support. The Company's focus is on providing system-level solutions that enable customers to rapidly introduce and offer electronic products that are small, light-weight, power-efficient, reliable, and cost-effective. SigmaTel is ISO 9001:2000 certified and is committed to providing customers with high performance, quality products along with superior customer service.

    Readers may obtain investment information from the company's investor relations department at 512-381-3931, by sending email to investor.relations@sigmatel.com, or on the Web at www.sigmatel.com/investor.relations. For product information, please visit www.sigmatel.com.

    Cautionary Language:

    This press release contains forward-looking statements based on current SigmaTel expectations. The words "expect," "will," "should," "would," "anticipate," "project," "outlook," "believe," "intend," and similar phrases as they relate to SigmaTel or future events are intended to identify such forward-looking statements. These forward-looking statements reflect the current views and assumptions of SigmaTel, but are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. A number of important factors could cause actual results to differ materially from those in the forward-looking statements, and there will be events in the future that SigmaTel is not able to accurately predict or control. For a discussion of factors that could impact SigmaTel's financial results and cause actual results to differ materially from those in the forward-looking statements, please refer to recent SigmaTel filings with the SEC, particularly the 424(b)(4) final prospectuses filed September 19, 2003 and February 19, 2004, the Form 10-Qs that were filed on October 29, 2003, April 20, 2004, July 20, 2004, October 19, 2004, and April 19, 2005, and the Form 10-Ks that were filed on February 17, 2004 and February 8, 2005.

    SigmaTel is a registered trademark of SigmaTel. All other products and brand names as they appear in this release are trademarks or registered trademarks of their respective holders. All specifications may be changed without notice.

--30--SW/sa*

CONTACT: for SigmaTel, Inc. Kendra Petrone Office: 214-443-7597 Mobile: 214-773-5615 kendra.petrone@edelman.com

KEYWORD: TEXAS INDUSTRY KEYWORD: HARDWARE SOFTWARE PUBLISHING MARKETING AGREEMENTS SOURCE: SigmaTel, Inc.

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