ALPHA INDUSTRIES INC, 424B1, 1999-05-27

ALPHA INDUSTRIES INC
424B1, 1999-05-27
SEMICONDUCTORS & RELATED DEVICES

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Filed Pursuant to Rule 424(b)(1)
File No.: 333-77743

3,000,000 SHARES

[ALPHA LOGO]

COMMON STOCK

$35.00 PER SHARE

- --------------------------------------------------------------------------------

Alpha Industries, Inc. is offering 3,000,000 shares of common stock with this
prospectus. This is a firm commitment underwriting.

The common stock is listed on the Nasdaq National Market under the symbol
"AHAA." On May 26, 1999, the last reported sale price of the common stock on the
Nasdaq National Market was $36.75 per share.

INVESTING IN THE COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS"
BEGINNING ON PAGE 6.

<TABLE>
<CAPTION>
PER SHARE TOTAL
--------- ------------
<S> <C> <C>
Price to the public......................................... $35.0000 $105,000,000
Underwriting discount....................................... $ 1.8375 $ 5,512,500
Proceeds to Alpha........................................... $33.1625 $ 99,487,500
</TABLE>

Alpha has granted an over-allotment option to the underwriters. Under this
option, the underwriters may elect to purchase a maximum of 450,000 additional
shares from Alpha within 30 days following the date of this prospectus to cover
over-allotments.

- --------------------------------------------------------------------------------

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

CIBC WORLD MARKETS
PRUDENTIAL SECURITIES
U.S. BANCORP PIPER JAFFRAY

The date of this Prospectus is May 26, 1999

<PAGE> 2
Following the prospectus cover page on the top left is the title, "Serving
Global Wireless Communications Markets," directly underneath which is the
following description:

Alpha designs and manufactures a broad range of products for the wireless
voice and data communications markets. These products include: radio
frequency, microwave frequency and millimeter wave frequency integrated
circuits, discrete components and ceramic resonators and ferrites.

On the top right are, from top going down, color photos of two wireless
telephones and a hand-held wireless data device which is under development. To
the left is a photo of two individuals operating a wireless networked portable
personal computer.

In the center of page, below the photographs, is an illustration of the inside
of a cordless telephone handset, with arrows indicating the location inside the
cellular telephone handset of the following components sold by the Company:

Couplers and Detectors
Power Amplifiers
Switches
Diodes

Beneath the opened telephone handset is the Alpha logo,
<PAGE> 3

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary.......................................... 4
Risk Factors................................................ 6
Forward-Looking Statements.................................. 12
Use of Proceeds............................................. 13
Dividend Policy............................................. 13
Price Range of Common Stock................................. 14
Capitalization.............................................. 15
Selected Consolidated Financial Data........................ 16
Management's Discussion and Analysis of Financial Condition
and Results of Operations................................. 17
Business.................................................... 24
Management.................................................. 33
Principal Shareholders...................................... 35
Certain Transactions........................................ 37
Underwriting................................................ 38
Legal Matters............................................... 40
Experts..................................................... 40
Where You Can Find More Information......................... 40
Index to Consolidated Financial Statements.................. F-1
</TABLE>

------------------------------------

As used in this prospectus, the terms "we," "us," "our" and "Alpha" mean Alpha
Industries, Inc. and its subsidiaries (unless the context indicates a different
meaning), and the term "common stock" means our common stock, $0.25 par value
per share. Unless otherwise stated, all information contained in this prospectus
assumes no exercise of the over-allotment option granted to the underwriters.
All share and per share data, including market prices, in this prospectus have
been adjusted for the three-for-two common stock split effected on February 19,
1999.

The underwriters are offering the shares subject to various conditions and may
reject all or part of any order. The shares should be ready for delivery on or
about June 2, 1999, against payment in immediately available funds.

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<PAGE> 4

PROSPECTUS SUMMARY

You should read the following summary together with the more detailed
information regarding our company and the common stock being sold in this
offering and our financial statements and accompanying notes that appear
elsewhere in this prospectus.

ABOUT ALPHA

We design, develop, manufacture and market proprietary radio frequency,
microwave frequency and millimeter wave frequency integrated circuits and
discrete semiconductors for wireless voice and data communications. The primary
applications for our products include wireless handsets for cellular and
personal communication services, or PCS. We also produce integrated circuits,
discrete components and ceramic resonators and ferrites used in wireless base
station equipment, cable television, wireless local loop, wireless personal
digital assistants and wireless local area networks.

Industry analysts expect sales of wireless handsets to grow from 163 million
units in 1998 to more than 250 million units in 2000. This represents a compound
annual growth rate of approximately 25% or more. Consumer wireless applications
are expanding from voice-only to many different forms of data transmission,
including applications enabling wireless access to the Internet and e-mail, as
well as wireless home automation. Many of these new wireless data applications
need more bandwidth than voice. Gallium arsenide, or GaAs, semiconductor
technology has emerged as an effective alternative or complement to silicon
technology in many high performance radio frequency, microwave frequency and
millimeter wave frequency voice and data applications. GaAs has inherent
physical properties that permit devices to operate at much higher speeds than
silicon devices or at the same speeds with lower power consumption.

We offer a broad range of products, including integrated circuit switches and
controls, power amplifiers, diodes and components that comprise a significant
portion of the radio frequency devices used in wireless telephone handsets. We
use a range of technologies, processes and materials to meet our customers'
performance requirements, including gallium arsenide metal semiconductor field
effect transistor, or GaAs MESFET, gallium arsenide pseudomorphic high electron
mobility transistor, or GaAs PHEMT, silicon and electrical ceramic. We currently
are developing power amplifiers and other devices made with the gallium arsenide
heterojunction bipolar transistor, or GaAs HBT.

We have divided our operations into three groups to address the distinct
dynamics of different markets: (1) The Wireless Semiconductor Products Group
supplies GaAs integrated circuits and discrete semiconductors in high volume for
wireless telephone handsets and wireless data applications. These products are
used in all major air interface standards, including the leading digital
standards, Global System for Mobile Communications, or GSM, Code Division
Multiple Access, or CDMA and Time Division Multiple Access, or TDMA. This Group
generated $65.8 million or 52.1% of our total sales in fiscal 1999. (2) The
Application Specific Products Group supplies radio frequency, microwave
frequency and millimeter wave frequency GaAs integrated circuits and discrete
semiconductors and components for customized products in the satellite
communications, broadband data and defense markets. This Group generated $35.0
million or 27.7% of our total sales in fiscal 1999. (3) The Ceramics Products
Group uses electrical ceramic and ferrite technologies to supply resonators and
filters, primarily for wireless base station equipment. This Group generated
$25.5 million or 20.2% of our total sales in fiscal 1999.

We focus our sales and marketing efforts on dominant original equipment
manufacturers in the wireless communications industry and their principal
suppliers. Since January 1998, we have increased our penetration in this
industry from 25 products for 13 handset platforms to 81 products for 40 handset
platforms. Our product portfolio has helped us become a strategic supplier to
Motorola and Ericsson, two of the three largest producers of handsets in the
world. Motorola and Ericsson were our largest customers in fiscal 1999,
representing 36.3% of our sales in this period.

Our principal executive offices are located at 20 Sylvan Road, Woburn,
Massachusetts 01801. Our telephone number is (781) 935-5150.

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THE OFFERING

Common stock offered by Alpha........... 3,000,000 shares

Common stock to be outstanding after the
offering................................ 19,023,503 shares

Use of proceeds......................... For working capital and general
corporate purposes, which may
include the purchase of equipment,
the expansion of facilities and
potential acquisitions.

Nasdaq National Market symbol........... AHAA

SUMMARY CONSOLIDATED FINANCIAL INFORMATION

The as adjusted balance sheet data in the table below give effect to the sale of
3,000,000 shares of common stock offered by us at an offering price of $35.00
per share, and the application of the net proceeds from the sale of the shares,
after deducting the underwriting discount and estimated offering expenses
payable by us. See "Use of Proceeds."

<TABLE>
<CAPTION>
YEARS ENDED
--------------------------------------
MARCH 30, MARCH 29, MARCH 28,
1997 1998 1999
---------- ---------- ----------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Sales.................................................. $ 85,253 $116,881 $126,339
Gross profit........................................... 16,734 44,082 55,208
Operating income (loss)................................ (15,326) 11,688 19,555
Income (loss) before income taxes...................... (15,572) 11,447 20,225
Net income (loss)...................................... $(15,572) $ 10,302 $ 21,490
======== ======== ========
Net income (loss) per share:
Basic................................................ $ (1.05) $ 0.67 $ 1.36
======== ======== ========
Diluted.............................................. $ (1.05) $ 0.66 $ 1.31
======== ======== ========
Shares used in per share calculation:
Basic................................................ 14,772 15,302 15,824
======== ======== ========
Diluted.............................................. 14,772 15,711 16,351
======== ======== ========
</TABLE>

<TABLE>
<CAPTION>
MARCH 28, 1999
-----------------------
ACTUAL AS ADJUSTED
-------- -----------
(IN THOUSANDS)
<S> <C> <C>
BALANCE SHEET DATA:
Cash, cash equivalents and short-term investments........... $ 23,760 $122,748
Working capital............................................. 42,687 141,675
Total assets................................................ 106,681 205,669
Long-term debt, including current portion................... 1,625 1,625
Stockholders' equity........................................ 81,014 180,002
</TABLE>

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RISK FACTORS

You should carefully consider the following factors before deciding to invest in
the shares. The risks and uncertainties described below are not the only ones we
face. Additional risks and uncertainties not presently known to us, which we
currently deem immaterial or which are similar to those faced by other companies
in our industry or business in general, may also impair our business operations.
If any of the following risks actually occurs, our business, financial condition
or results of future operations could be materially and adversely affected. In
such case, the trading price of our common stock could decline, and you may lose
all or part of your investment. This prospectus also contains forward-looking
statements that involve risks and uncertainties. Our actual results could differ
materially from those anticipated in these forward-looking statements as a
result of certain factors, including the risks faced by us described below and
elsewhere in this prospectus. Please refer to "Forward-Looking Statements" on
page 12.

OUR RELIANCE ON A SMALL NUMBER OF CUSTOMERS FOR A LARGE PORTION OF OUR SALES
COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR RESULTS OF OPERATIONS.

A significant portion of our sales in each fiscal period has been concentrated
among a limited number of customers. If we lost one or more of these major
customers, or if one or more major customers decreases its orders, our business
would be materially and adversely affected. In recent periods, sales to our
major customers as a percentage of total sales have increased. In fiscal 1999,
sales to our five largest customers accounted for 50.2% of our sales, with
Motorola accounting for 28.1% of sales. Our future operating results depend on
the success of these customers and our success in selling products to them.

OUR SALES VOLUME IS AFFECTED BY OUR OEM CUSTOMERS' SALES VOLUME.

A substantial portion of our sales is derived from sales of products to OEMs.
These OEMs demand highly reliable products and often require up to several
months to evaluate and test our integrated circuits and devices before deciding
to design them into their products. If our products are designed into an OEM's
product, our sales volume will depend upon the commercial success of the OEM's
product.

SALES TO OUR OEM CUSTOMERS FLUCTUATE WITH THEIR PRODUCT CYCLES.

Because the markets our OEM customers serve are characterized by numerous new
product introductions and rapid product enhancements, our operating results may
vary significantly in some fiscal quarters. OEMs generally are in various stages
of designing replacement products for their mature products. During the final
production of a mature product, OEMs typically consume their existing inventory
of our products. Consequently, orders for our products can be reduced. Even if
our products are designed into both the mature product and the replacement
product, our sales may suffer. Typically, production of the mature product will
cease as the replacement product is introduced. A delay in the transition to
commercial production of the replacement product would delay our ability to
recover the lost sales from the discontinuation of the mature product. The
decrease in our sales in the first two fiscal quarters of fiscal 1999 compared
with the fourth quarter of fiscal 1998 was primarily attributable to this
dynamic as our largest customer was introducing a new series of handsets. We may
continue to experience these fluctuations in our operating results in the
future.

DIFFICULTIES IN PRODUCTION WOULD ADVERSELY AFFECT OUR OPERATING RESULTS.

Our products are very complex, have sophisticated designs and are manufactured
using highly complex process technologies. In most cases, our products are
customized for our customers who insist that our products meet their exact
specifications for quality, performance and reliability. If we are unable to
manufacture to our customers' specifications, our operating results will suffer.

IF ONE OF OUR LIMITED NUMBER OF ASSEMBLY SUBCONTRACTORS FAILS TO PERFORM AS
EXPECTED, OUR OPERATING RESULTS WOULD SUFFER.

We use assembly subcontractors located outside the United States to wirebond and
package large volume orders of integrated circuits. We attempt to maintain more
than one qualified service supplier for each assembly process. From time to

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time we have been unable to achieve this goal because of minimum volume
requirements imposed by suppliers, lack of capacity, service quality issues or
other factors. We have experienced problems procuring assembly services, and we
cannot guarantee that we will avoid similar problems in the future. For example,
an assembly subcontractor in Asia recently ceased production of our products
despite their assurances that they would continue production without
interruption. Our inability to obtain sufficient high quality and timely
assembly service, or the loss of any of our current assembly vendors, would
result in delays or reductions in product shipment and reduced product yields.
Any of these events would materially and adversely affect our operating results.

OUR OPERATING RESULTS ARE DEPENDENT ON THE DEVELOPMENT OF NEW PRODUCTS.

Our future success will depend on our ability to develop new products in a
timely and cost-effective manner. The development of our new products is highly
complex. We have historically experienced delays in completing the development
and introduction of new products. The successful development and introduction of
new products depends on a number of factors, including:

- our timely completion of product designs and development;

- our ability to develop manufacturing processes for new products; and

- commercial acceptance of our new products and enhancements.

OUR FAILURE TO KEEP PACE WITH RAPID TECHNOLOGICAL CHANGES IN THE WIRELESS
COMMUNICATIONS INDUSTRY WOULD IMPAIR OUR GROWTH.

The wireless communications markets are characterized by frequent introductions
of new products and services. New products and services respond to evolving
product and process technologies and consumer demand for greater functionality,
lower costs, smaller products and better performance. As a result, we have
experienced, and will continue to experience, product design obsolescence. We
must continue to improve our product designs and develop new products with new
technologies to meet our customers' demands.

We believe that the next generation of consumer wireless data applications will
offer such features as Internet access, e-mail and home automation. If we fail
to develop products for this potential market, our operating results could be
materially and adversely affected.

WE OPERATE IN VERY COMPETITIVE INDUSTRIES AND WE MAY BE UNABLE TO COMPETE
SUCCESSFULLY.

Competition in the markets for our products is intense. We compete with several
companies primarily engaged in the business of designing, manufacturing and
selling integrated circuits, discrete semiconductors and ceramic products, as
well as suppliers of other discrete products. Our competitors could develop new
process technologies that may be superior to ours. In addition, many of our
existing and potential customers manufacture or assemble wireless communications
devices and have substantial in-house technological capabilities. If one of our
large customers decided to design and manufacture integrated circuits
internally, it could have an adverse effect on our operating results. For
example, we compete with our largest customer in the production of power
amplifiers.

Many of our existing and potential competitors have strong market positions,
considerable internal manufacturing capacity, established intellectual property
rights and substantial technological capabilities. Many of our existing and
potential competitors have greater financial, technical, manufacturing and
marketing resources than we do. We cannot guarantee that we will be able to
compete successfully with our competitors.

We expect competition to increase. This could mean lower prices for our products
or reduced demand for our products. Any of these developments would have an
adverse effect on our operating results.

AVERAGE SELLING PRICES FOR OUR PRODUCTS TYPICALLY DECLINE OVER TIME.

Average selling prices for our products decline over time. Many of our
manufacturing costs are fixed. For a given level of sales, when our
manufacturing costs decline, our gross margins improve, and when our
manufacturing costs increase, our gross margins decline. Our operating results
suffer when gross margins decline. We may experience these problems in the
future and we cannot predict when they may occur or their severity.
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OUR OPERATING RESULTS WOULD SUFFER IF ONE OF OUR KEY SUPPLIERS FAILS TO DELIVER
MATERIALS FOR THE FABRICATION OF OUR PRODUCTS.

We currently procure certain materials and services for our products from one or
a limited number of suppliers. For example, we procure GaAs substrates, a
critical raw material, from only two suppliers. In addition, we obtain some GaAs
wafers from a single external foundry. Further, we procure silicon substrates
for semiconductors and certain chemical powders for ceramic manufacturing from
single sources. We purchase these materials and services on a purchase order
basis. We do not carry significant inventories or have any long-term supply
contracts with our vendors. Our inability to obtain these materials or services
in required quantities or in acceptable quality would result in significant
delays or reductions in product shipments. This would materially and adversely
affect our operating results.

OUR OPERATING RESULTS MAY FLUCTUATE SIGNIFICANTLY.

Our sales, earnings and other operating results have fluctuated significantly in
the past and may fluctuate significantly in the future primarily as a result of
the following:

- timing and receipt of our customers' orders; and

- the potential for delay or deferral of customer implementation of our
technology into their products.

OUR GROWTH IS DEPENDENT ON THE GROWTH OF WIRELESS COMMUNICATIONS MARKETS.

We depend on the development and growth of markets for wireless communications
products and services, including cellular and personal communications services,
or PCS, telephones and other wireless applications. We cannot be sure as to the
rate at which these markets will develop, if at all. Any slowdown in the rate of
growth of the wireless communications market would have a material adverse
affect on our operating results.

OUR BUSINESS COULD BE ADVERSELY AFFECTED BY OUR FAILURE TO DEVELOP GAAS HBT
TECHNOLOGY.

We are developing GaAs HBT process technology primarily to manufacture power
amplifiers and certain other components. We are pursuing this development effort
with a third party designer and a third party foundry. We believe GaAs HBT
components will be successfully designed into wireless telephone and wireless
data handsets. Although we believe that we will be successful in developing and
introducing a line of GaAs HBT products, we cannot guarantee that our efforts
will result in commercially successful GaAs HBT products in the anticipated time
or on budget, if at all. Certain of our competitors are already offering this
capability and our customers may purchase their requirements for these products
from our competitors. Our third party designer and our third party foundry may
delay or fail to deliver to us GaAs HBT technology and products. Our business
and prospects could be materially and adversely affected by our failure to
develop this technology.

THE BENEFITS OF OUR GAAS PRODUCTS COMPARED TO SILICON ALTERNATIVES MAY NOT
CONTINUE.

The production of GaAs integrated circuits is more costly than the production of
silicon circuits. As a result, we must offer GaAs products that provide superior
performance to that of silicon for specific applications to be competitive with
silicon products. If we do not continue to offer products that provide
sufficiently superior performance to offset the cost differential, our operating
results may be materially and adversely affected. We believe our costs of
producing GaAs integrated circuits will continue to exceed the costs associated
with the production of silicon circuits. The costs differ because of higher
costs of raw materials for GaAs, lower production yields in GaAs technology and
higher unit costs associated with lower production volumes. Silicon
semiconductor technologies are widely used process technologies for certain
integrated circuits and these technologies continue to improve in performance.
We cannot assure you that we will continue to identify markets that require
performance superior to that offered by silicon solutions.

OUR FIXED COSTS MAY REDUCE OPERATING RESULTS IF OUR SALES FALL BELOW
EXPECTATIONS.

Our expense levels are based, in part, on our expectations as to future sales.
Many of our expenses, particularly those relating to our capital equipment and
manufacturing overhead, are relatively fixed. We may be unable to reduce
spending quickly enough to compensate for reductions in
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sales. Accordingly, shortfalls in sales may materially and adversely affect our
operating results.

WE ARE NOT PROTECTED BY LONG-TERM CONTRACTS WITH OUR CUSTOMERS.

We generally do not enter into long-term contracts with our customers and we
cannot be certain as to future order levels from our customers. When we do enter
into a long-term contract, the contract generally is terminable for the
convenience of the customer. In the event of an early termination of a contract
by one of our major customers, it is unlikely that we will be able to identify
an alternative purchaser for that product.

OUR RELIANCE ON GOVERNMENT CONTRACTS FOR A SIGNIFICANT PORTION OF OUR SALES
COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR RESULTS OF OPERATIONS.

Although we have reduced our dependence upon sales to the United States
Government, we estimate that approximately 20.8% of our sales in fiscal 1997,
17.6% of our sales in fiscal 1998 and 17.2% of our sales in fiscal 1999 were
derived from United States defense related sources. If we experience significant
reductions or delays in procurements of our products by the United States
Government or terminations of government contracts or subcontracts, our
operating results could be materially and adversely affected. Generally, the
United States Government and its contractors and subcontractors may terminate
their contracts with us for cause or for convenience. We have in the past
experienced terminations of government contracts. We cannot guarantee that we
will not experience terminations of government contracts in the future.

WE FACE SIGNIFICANT CHALLENGES MANAGING OUR GROWTH.

We are experiencing a period of significant growth that will continue to place a
strain on our resources. We have grown from 860 employees on December 27, 1998
to 935 employees on March 28, 1999. To manage our growth effectively, we must
continue to:

- improve operational systems;

- maintain adequate physical plant, manufacturing facilities and equipment
to meet customer demand;

- add experienced senior level managers; and

- attract and retain qualified people with experience in engineering,
design and manufacturing.

We will spend substantial amounts of money in connection with our growth and may
have additional unexpected costs. Our manufacturing equipment may not be
adequate to support rapid increases in orders for our products, and we may not
be able to expand quickly enough to exploit potential market opportunities. If
we cannot attract qualified people or manage growth effectively, our business,
operating results and financial condition could be adversely affected.

THERE MAY BE UNANTICIPATED COSTS ASSOCIATED WITH INCREASING OUR CAPACITY.

We anticipate that any future growth of our business will require increased
manufacturing capacity. We expect to complete the current expansion of our GaAs
production capabilities by the summer of 1999 at a total cost of approximately
$18 million. We may be required to purchase significant additional equipment or
further expand our facilities if the increased demand for our products that we
experienced in fiscal 1999 continues. Expansion activities such as these are
subject to a number of risks, including:

- unavailability or late delivery of the advanced, and often customized,
equipment used in the production of our products;

- delays in bringing new production equipment on-line;

- work stoppages and delays in supplying products for our existing
customers during expansion activities; and

- unforeseen environmental or engineering problems relating to existing or
new facilities.

These and other risks may affect the ultimate cost and timing of our present
expansion or any future expansion of our capacity.

THE VOLATILITY OF OUR STOCK PRICE COULD AFFECT YOUR INVESTMENT IN OUR STOCK.

The market price of our common stock has fluctuated widely. For example, between

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February 1, 1999 and March 2, 1999 the price of our common stock dropped from
approximately $27.92 to $13.50 per share. Between March 2, 1999 and April 29,
1999, the price of our common stock rose from approximately $13.50 to $34.25 per
share. Consequently, the current market price of our common stock may not be
indicative of future market prices, and we may not be able to sustain or
increase the value of your investment in our common stock. Factors affecting our
stock price may include:

- variations in operating results from quarter to quarter;

- changes in earnings estimates by analysts or our failure to meet
analysts' expectations;

- market conditions in the industry; and

- general economic conditions.

WE DEPEND ON A FEW KEY EMPLOYEES WHO HAVE EXPERIENCE WITH OUR COMPLEX PRODUCTS.

Our success depends in part on retaining key technical and management personnel.
In particular, the number of individuals with experience in the production of
our complex products and related processes is very limited, and our future
success depends in part on retaining those individuals who are already
employees. We must also continue to attract and retain qualified personnel in a
very competitive environment. We cannot guarantee that we will be able to
continue to attract and retain these personnel.

OUR INTERNATIONAL SALES COULD DECLINE AS A RESULT OF CURRENCY EXCHANGE
FLUCTUATIONS AND OTHER FACTORS.

Our sales outside of the United States were approximately $32.1 million in
fiscal 1997, $46.0 million in fiscal 1998 and $53.7 million in fiscal 1999.
Because most of our foreign sales are denominated in United States dollars, our
products, particularly our ceramics products, become less price competitive with
products manufactured by competitors based in countries whose currencies decline
in value against the dollar. International sales involve a number of additional
risks, including:

- imposition of government controls;

- potential insolvency of international distributors and representatives;

- fluctuation of economies outside the United States;

- political instability outside the United States;

- generally longer receivables collection periods for foreign customers;
and

- tariffs and other trade barriers.

In addition, due to the technological advantage provided by GaAs in many
military applications, a portion of our sales outside of North America must be
licensed by the Bureau of Export Administration of the United States Department
of Commerce or the Office of Defense Trade Controls of the United States
Department of State. Although we have not experienced any difficulty in
obtaining these licenses, failure to obtain such licenses in the future could
have a material adverse effect on our operating results.

OUR COMPLIANCE WITH ENVIRONMENTAL REGULATIONS MAY BE COSTLY.

We are subject to a variety of federal, state and local requirements governing
the protection of the environment. These requirements relate to the use,
storage, handling, discharge and disposal of toxic or otherwise hazardous
materials used in our manufacturing processes. We may incur significant expense
in complying with these requirements, and these requirements may become more
stringent in the future. In the past, compliance with environmental regulations
and our response to environmental claims and litigation has been costly. Failure
to comply with environmental regulations could subject us to substantial
liability or force us to change our manufacturing operations. In addition, under
some of these regulations, we could be held financially responsible for remedial
measures if our properties are contaminated, even if we did not cause the
contamination.

WE MAY HAVE DIFFICULTY IN PROTECTING OUR INTELLECTUAL PROPERTY.

Our ability to compete is affected by our ability to protect our intellectual
property. A significant aspect of our intellectual property is our product and
process technology. We rely primarily on trade secret laws, confidentiality
procedures and licensing arrangements to protect our intellectual property. The
laws of certain foreign countries in which our products are or may be developed,

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manufactured or sold may not protect our products or intellectual property
rights to the same extent as do the laws of the United States. This may make the
possibility of piracy of our technology and products more likely. We cannot
assure you that the steps taken by us to protect our intellectual property will
be adequate to prevent misappropriation of our technology.

OUR OPERATIONS COULD INFRINGE ON THE INTELLECTUAL PROPERTY RIGHTS OF OTHERS.

Particular aspects of our technology could be found to infringe on the
intellectual property rights or patents of others. Other companies may hold or
obtain patents on inventions or may otherwise claim proprietary rights to
technology necessary to our business. We cannot predict the extent to which we
may be required to seek licenses. We cannot guarantee that the terms of any
licenses we may be required to seek will be reasonable.

WE MAY HAVE DIFFICULTY IN MANAGING AND INTEGRATING ACQUISITIONS.

From time to time, we explore opportunities to acquire businesses to expand our
production capacity and our product offerings. Acquisitions involve numerous
risks, including:

- difficulties in integrating operations, products and corporate cultures;

- difficulties in completing the development of acquired technologies;

- the ability to manage different geographic units;

- entering markets or businesses in which we have limited experience; and

- the loss of key employees of the acquired businesses.

Moreover, any delay or failure to integrate an acquired company, technology or
product line could result in the additional expenditure of money and in
increased demands on our management's time. These expenditures and demands could
have a material adverse effect on our business, financial condition and results
of operations and on the price of our common stock. Acquisitions may involve
expending significant funds and the issuance of additional securities, which may
be dilutive to stockholders.

YEAR 2000 READINESS; YEAR 2000 PROBLEMS COULD DISRUPT OUR BUSINESS.

We have evaluated our internal software and products for Year 2000 concerns. We
believe that our products and business will not be substantially affected by the
Year 2000 and that we have no significant exposure to liabilities related to the
Year 2000 issue for the products we have sold. We have also communicated with
others, including vendors, suppliers and customers whose computer systems'
functionality could directly impact our operations.

Although we believe our planning efforts are adequate to address our Year 2000
concerns, we cannot be sure that we will not experience negative consequences or
significant costs caused by undetected Year 2000 errors or defects in the
technology used in our internal systems. We also cannot be sure that our
vendors, suppliers, customers or businesses that we may acquire will not
experience similar consequences or costs. Such consequences or costs could have
a material adverse effect on us.

11
<PAGE> 12

FORWARD-LOOKING STATEMENTS

This prospectus and the documents we have filed with the Securities and Exchange
Commission which we have referenced under "Where You Can Find More Information"
on page 40 contain forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements represent our judgment regarding future events.
Although we would not make forward-looking statements unless we believe we have
a reasonable basis for doing so, we cannot guarantee their accuracy and actual
results may differ materially from those we anticipated due to a number of
uncertainties, many of which we are not aware. We urge you to consider the risks
and uncertainties discussed under "Risk Factors" and elsewhere in this
prospectus and in the other documents filed with the SEC in evaluating our
forward-looking statements. We have no plans to update our forward-looking
statements to reflect events or circumstances after the date of this prospectus.
We generally identify forward-looking statements with the words "plans,"
"expects," "anticipates," "estimates," "will," "should" and similar expressions.

12
<PAGE> 13

USE OF PROCEEDS

We estimate that the net proceeds from the sale of the 3,000,000 shares of
common stock we are offering will be approximately $99.0 million. If the
underwriters fully exercise the over-allotment option, the net proceeds will be
approximately $113.9 million. "Net proceeds" is what we expect to receive after
we pay the underwriting discount and other estimated expenses for this offering.

We expect to use the net proceeds for working capital and general corporate
purposes, which may include the purchase of equipment and the expansion of
facilities. We also may use a portion of the net proceeds for acquisitions to
expand our production capacity and our product offerings. From time to time we
have discussed potential strategic acquisitions with third parties. We are not
currently in discussions regarding an acquisition and have no agreements or
commitments to complete an acquisition. Pending our uses of the proceeds, we
intend to invest the net proceeds of this offering primarily in short-term,
interest-bearing instruments.

DIVIDEND POLICY

We have not paid cash dividends on our common stock since fiscal 1986, and we do
not anticipate paying cash dividends in the foreseeable future. Our current
policy is to retain all of our earnings to finance future growth. We are subject
to financial and operating covenants, including restrictions on the payment of
cash dividends, under our bank financing agreements. On February 19, 1999, we
distributed a three-for-two common stock split.

13
<PAGE> 14

PRICE RANGE OF COMMON STOCK

On June 2, 1998, our common stock started trading on the Nasdaq National Market
under the symbol AHAA. Prior to that our common stock traded on the American
Stock Exchange under the symbol AHA. The following table sets forth, for the
periods indicated, the high and low sales prices for the common stock, as
reported on the Nasdaq National Market or the American Stock Exchange, as
applicable.

<TABLE>
<CAPTION>
HIGH LOW
------- -------
<S> <C> <C>
FISCAL 1998:
First Quarter............................................... $ 5.875 $ 3.667
Second Quarter.............................................. 10.917 5.500
Third Quarter............................................... 13.750 8.583
Fourth Quarter.............................................. 13.333 9.333

FISCAL 1999:
First Quarter............................................... $12.583 $ 7.833
Second Quarter.............................................. 11.500 6.167
Third Quarter............................................... 22.958 5.750
Fourth Quarter.............................................. 27.917 13.500

FISCAL 2000:
First Quarter (through May 26, 1999)........................ $47.500 $17.625
</TABLE>

On May 26, 1999, the last reported sale price reported on the Nasdaq National
Market for the common stock was $36.75 per share. On May 26, 1999, there were
approximately 978 holders of record of the common stock.

14
<PAGE> 15

CAPITALIZATION

The following table presents our capitalization as of March 28, 1999 on an
actual basis and as adjusted to reflect the sale of 3,000,000 shares of common
stock that we are offering with this prospectus at an offering price of $35.00
per share, and the application of the proceeds, net of the underwriting discount
and our estimated expenses for this offering.

The total number of shares of outstanding common stock, as adjusted for this
offering, excludes at March 28, 1999: (1) 1,761,523 shares of common stock
issuable upon exercise of outstanding stock options at a weighted average price
of $6.70 per share; (2) 124,975 shares of common stock reserved for issuance
pursuant to our Employee Stock Purchase Plan; and (3) 919,909 shares of common
stock reserved for issuance pursuant to stock options not yet granted under all
of our stock option plans. This total also excludes 675,000 shares of common
stock reserved by our Board of Directors on April 27, 1999 for issuance upon the
exercise of options which may be granted in the future to our employees who are
not also officers or Directors.

<TABLE>
<CAPTION>
MARCH 28, 1999
----------------------
ACTUAL AS ADJUSTED
------- -----------
(IN THOUSANDS)
<S> <C> <C>
Cash, cash equivalents and short-term investments........... $23,760 $122,748
======= ========
Long-term debt, less current portion........................ $ 713 $ 713
Stockholders' equity:
Common stock, $0.25 par value: 30,000,000 shares
authorized; 16,051,311 shares actual and 19,051,311
shares, as adjusted, issued............................ 4,013 4,763
Additional paid-in capital................................ 58,872 157,110
Retained earnings......................................... 18,276 18,276
Less -- Treasury shares 62,379 at cost.................... (133) (133)
Unearned compensation -- restricted stock................. (14) (14)
------- --------
Total stockholders' equity............................. 81,014 180,002
------- --------
Total capitalization................................. $81,727 $180,715
======= ========
</TABLE>

15
<PAGE> 16

SELECTED CONSOLIDATED FINANCIAL DATA

We derived the statement of operations data for the years ended March 30, 1997,
March 29, 1998 and March 28, 1999 and balance sheet data as of March 29, 1998
and March 28, 1999 from the audited financial statements in this prospectus.
Those financial statements were audited by KPMG LLP, independent accountants. We
derived the statement of operations data for the years ended April 2, 1995 and
March 31, 1996 and balance sheet data as of April 2, 1995, March 31, 1996 and
March 30, 1997 from audited financial statements that are not included in this
prospectus. Historical results are not necessarily indicative of results of
operations to be expected in the future. The following selected consolidated
financial data should be read in conjunction with our consolidated financial
statements and notes thereto, and with Management's Discussion and Analysis of
Financial Condition and Results of Operations included elsewhere in this
prospectus.

During fiscal 1996, we recorded a $320,000 repositioning benefit attributable to
the reversal of certain accruals for estimated carrying costs as a result of an
earlier than expected disposition of our Methuen, Massachusetts facility. During
fiscal 1997, we recorded repositioning expenses of $2.1 million, related
primarily to the reduction of our ceramics operations and the sale of a
nonstrategic product line.

<TABLE>
<CAPTION>
YEARS ENDED
--------------------------------------------------------
APRIL 2, MARCH 31, MARCH 30, MARCH 29, MARCH 28,
1995 1996 1997 1998 1999
-------- --------- --------- --------- ---------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Sales......................................... $78,254 $96,894 $ 85,253 $116,881 $126,339
Cost of sales................................. 54,376 65,986 68,519 72,799 71,131
------- ------- -------- -------- --------
Gross profit.................................. 23,878 30,908 16,734 44,082 55,208
Research and development expenses............. 4,154 9,148 9,545 10,035 12,886
Selling and administrative expenses........... 15,727 17,226 20,441 22,359 22,767
Repositioning expenses (benefit).............. -- (320) 2,074 -- --
------- ------- -------- -------- --------
Operating income (loss)....................... 3,997 4,854 (15,326) 11,688 19,555
Other income (expense), net................... (648) (391) (246) (241) 670
------- ------- -------- -------- --------
Income (loss) before income taxes............. 3,349 4,463 (15,572) 11,447 20,225
Provision (benefit) for income taxes.......... 502 669 -- 1,145 (1,265)
------- ------- -------- -------- --------
Net income (loss)............................. $ 2,847 $ 3,794 $(15,572) $ 10,302 $ 21,490
======= ======= ======== ======== ========
Net income (loss) per share:
Basic....................................... $ 0.25 $ 0.30 $ (1.05) $ 0.67 $ 1.36
======= ======= ======== ======== ========
Diluted..................................... $ 0.24 $ 0.29 $ (1.05) $ 0.66 $ 1.31
======= ======= ======== ======== ========
Shares used in per share calculation:
Basic....................................... 11,410 12,551 14,772 15,302 15,824
======= ======= ======== ======== ========
Diluted..................................... 11,823 13,126 14,772 15,711 16,351
======= ======= ======== ======== ========
</TABLE>

<TABLE>
<CAPTION>
APRIL 2, MARCH 31, MARCH 30, MARCH 29, MARCH 28,
1995 1996 1997 1998 1999
-------- --------- --------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Cash, cash equivalents and short-term
investments................................. $ 3,510 $15,469 $ 7,033 $15,849 $ 23,760
Working capital............................... 10,983 32,647 18,409 26,061 42,687
Total assets.................................. 50,167 75,423 65,253 76,929 106,681
Long-term debt, including current portion..... 8,083 2,897 6,545 3,501 1,625
Stockholders' equity.......................... 27,674 57,533 43,386 55,822 81,014
</TABLE>

16
<PAGE> 17

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

All statements, trend analysis and other information contained in the following
discussion relative to markets for our products and trends in sales, gross
profit and anticipated expense levels, as well as other statements, including
words such as "may," "will," "anticipate," "believe," "plan," "estimate,"
"expect" and "intend" and other similar expressions constitute forward-looking
statements. These forward-looking statements are subject to business and
economic risks and uncertainties, and our actual results of operations may
differ materially from those contained in the forward-looking statements.
Factors that could cause or contribute to such differences include, but are not
limited to, those discussed in "risk factors" as well as other risks and
uncertainties referenced in this prospectus.

OVERVIEW

We design, develop, manufacture and market proprietary radio frequency,
microwave frequency and millimeter wave frequency integrated circuits and
discrete semiconductors for wireless voice and data communications.
Historically, we have focused on two operating divisions: Alpha Microwave and
Trans-Tech. During fiscal 1998, we reorganized the Alpha Microwave division into
two groups, Wireless Semiconductor Products and Application Specific Products,
in order to address the distinct dynamics of different markets. Trans-Tech has
been designated the Ceramic Products Group. Our operations are currently
organized into three reportable segments:

The Ceramics Products Group uses electrical ceramic and ferrite technologies to
supply resonators and filters, primarily for wireless base station equipment.
This group represented 20.2% of our total sales in fiscal 1999.

We derived approximately 83% of our sales in fiscal 1999 from standard and
custom designed products sold to the commercial market. The remaining sales are
derived from sales to defense customers. Over the past several years, we have
continued to reduce our reliance on defense business to increase our emphasis on
the commercial wireless market. Sales are recognized when a product is shipped
and services are performed.

Our customers include leading OEMs in the wireless communications industry and
their principal suppliers. During fiscal 1999, sales to our 15 largest customers
accounted for 64.3% of our total sales. During that period, sales to Motorola
accounted for 28.1% of total sales and sales to Ericsson accounted for 8.2% of
total sales.

17
<PAGE> 18

RESULTS OF OPERATIONS

The following table shows our statement of operations data expressed as a
percentage of sales for the periods indicated:

<TABLE>
<CAPTION>
YEARS ENDED
-----------------------------------
MARCH 30, MARCH 29, MARCH 28,
1997 1998 1999
--------- --------- ---------
<S> <C> <C> <C>
Sales....................................................... 100.0% 100.0% 100.0%
Cost of sales............................................... 80.4 62.3 56.3
------ ----- -----
Gross margin................................................ 19.6 37.7 43.7
Research and development expenses........................... 11.2 8.6 10.2
Selling and administrative expenses......................... 24.0 19.1 18.0
Repositioning expenses...................................... 2.4 -- --
------ ----- -----
Operating income (loss)..................................... (18.0) 10.0 15.5
Other income (expense), net................................. (0.3) (0.2) 0.5
------ ----- -----
Income (loss) before income taxes........................... (18.3) 9.8 16.0
Provision (benefit) for income taxes........................ -- 1.0 (1.0)
------ ----- -----
Net income (loss)........................................... (18.3)% 8.8% 17.0%
====== ===== =====
</TABLE>

FISCAL YEARS ENDED MARCH 28, 1999, MARCH 29, 1998 AND MARCH 30, 1997

Sales. Sales increased 8.1% to $126.3 million in fiscal 1999 from $116.9
million in fiscal 1998. The increase was primarily attributable to increased
demand for wireless products and our penetration into additional handset
platforms. Deliveries to Motorola represented 28.1% of our total sales in fiscal
1999 compared to 24.7% in fiscal 1998. We continued to increase our focus on the
commercial wireless markets, which lowered our defense sales to 17.2% in fiscal
1999 from 17.6% in fiscal 1998. We continue to participate in defense programs
that require minimal investment.

Sales increased 37.1% to $116.9 million in fiscal 1998 from $85.3 million in
fiscal 1997. The increase in sales was largely due to greater volume resulting
from increased penetration into several handset platforms. Deliveries to
Motorola represented 24.7% of our total sales in fiscal 1998 compared to 10.6%
in fiscal 1997. Defense sales represented 17.6% of total sales in fiscal 1998
compared to 20.8% in fiscal 1997.

Gross Profit. Gross profit increased 25.2% to $55.2 million in fiscal 1999 from
$44.1 million in fiscal 1998. Gross margin increased to 43.7% in fiscal 1999
from 37.7% in fiscal 1998. These increases were primarily a result of improved
operating efficiencies in all three business segments, particularly in Wireless
Semiconductors, which continued to leverage capacity, improve yields and reduce
material costs.

Gross profit increased 163.4% to $44.1 million in fiscal 1998 from $16.7 million
in fiscal 1997. Gross margin increased to 37.7% in fiscal 1998 from 19.6% in
fiscal 1997. The following non-recurring costs were included in fiscal 1997
gross profit: (1) excess manufacturing capacity in the Ceramics group that was
reduced in the fourth quarter with the divestiture of the group's French
subsidiary and consolidation in this Group; (2) carrying costs for divested
operations (incurred prior to divestiture); and (3) a $2.6 million inventory
write-down in Ceramics resulting from shifts in demand away from certain ceramic
products. In addition, we continued expanding capacity for Wireless
Semiconductors during fiscal 1997 despite lower sales volumes for the first half
of the year. The gross margin improvement in fiscal 1998 was attributable to
increased sales volume and the leveraging of capacity of our Wireless
Semiconductor operation, as well as reduced manufacturing costs and improved
operating efficiencies in our Ceramics Group.

Research and Development Expenses. Research and development expenses increased
28.4% to $12.9 million or 10.2% of sales in fiscal 1999 from $10.0 million or
8.6% of sales in fiscal 1998. The increase in

18
<PAGE> 19

research and development expenses was primarily attributable to the development
of processes and products in the Wireless Semiconductor Products Group. Over 75%
of our total research and development expenses in fiscal 1999 and 1998 were
focused on the Wireless Semiconductor Products Group's efforts in developing
GaAs integrated circuits and other high volume wireless products.

Research and development expenses increased 5.1% to $10.0 million or 8.6% of
sales in fiscal 1998 from $9.5 million or 11.2% of sales in fiscal 1997. The
increase in research and development expenses was the result of increased
investments in the Wireless Semiconductor operation offset by decreases in
investment in our Ceramics Group during the rebuilding of its business.

Selling and Administrative Expenses. Selling and administrative expenses
increased 1.8% to $22.8 million or 18.0% of sales in fiscal 1999 from $22.4
million or 19.1% of sales in fiscal 1998. The increase in selling and
administrative expenses was attributable to increased sales commissions
resulting from higher sales volumes, while the decrease in selling and
administrative expenses as a percentage of sales was attributable to our
continued efforts to control administrative costs.

Selling and administrative expenses increased 9.4% to $22.4 million or 19.1% of
sales in fiscal 1998 from $20.4 million or 24.0% of sales in fiscal 1997.
Selling and administrative expenses in fiscal 1997 included non-recurring costs
of approximately $1.5 million for recruiting and consolidation costs for our
Ceramics Products Group and for severance costs. The increased selling and
administrative expenses reflect the continued investment in sales, marketing and
administrative activities. Significant components of the increase included the
addition of dedicated account managers for key wireless OEMs, improvements to
our information systems, training costs and recruiting costs for key positions.

Other Income (Expense), Net. Interest expense in fiscal 1999 decreased $204,000
compared to fiscal 1998 due to a decline in outstanding borrowings. Interest
income in fiscal 1999 increased $597,000 as a result of higher levels of cash,
cash equivalents and short-term investments. Other expenses decreased $110,000
in fiscal 1999 compared to fiscal 1998 due to losses resulting from the disposal
of equipment in fiscal 1998.

Interest expense in fiscal 1998 decreased $83,000 compared to fiscal 1997 as a
result of a lower level of outstanding borrowings. Other expenses increased
$59,000 in fiscal 1998 compared to fiscal 1997 due to losses resulting from the
disposal of equipment in fiscal 1998.

Provision (Benefit) for Income Taxes. The benefit for income taxes in fiscal
1999 was $1.3 million compared to a provision for income taxes of $1.1 million
in fiscal 1998. The fiscal 1999 benefit reflects a 10% tax rate offset by a $3.3
million tax benefit recorded in the fourth quarter of fiscal 1999. The tax
benefit of $3.3 million resulted from a reduction in the valuation allowance
against deferred tax assets because of the expected use of net operating loss
carryforwards in future periods. We will begin reporting income at a fully taxed
rate, assumed to be 36%, during the first quarter of fiscal 2000, which ends in
June 1999.

The provision for income taxes in fiscal 1998 was $1.1 million. Our effective
tax rate for fiscal 1998 was 10% due to the utilization of net operating loss
carryforwards. We did not record a tax provision for fiscal 1997. No federal
taxes were due, and state and foreign taxes were offset by a state loss
carryback.

BUSINESS SEGMENTS

The table below displays sales and operating income by business segment for
fiscal 1998 and 1999. See Note 10 to the consolidated financial statements. It
is not practicable to present information for fiscal 1997 because such
information for that year is not available.

19
<PAGE> 20

<TABLE>
<CAPTION>
YEARS ENDED
----------------------
MARCH 29, MARCH 28,
1998 1999
--------- ---------
<S> <C> <C>
Sales
Wireless Semiconductor Products............................. $ 52,612 $ 65,822
Application Specific Products............................... 37,118 34,977
Ceramic Products............................................ 27,151 25,540
-------- --------
$116,881 $126,339
======== ========
Operating Income
Wireless Semiconductor Products............................. $ 2,799 $ 7,435
Application Specific Products............................... 7,210 10,241
Ceramic Products............................................ 1,679 1,879
-------- --------
$ 11,688 $ 19,555
======== ========
</TABLE>

Wireless Semiconductor Products. Sales for the Wireless Semiconductor Products
Group increased 25.1% to $65.8 million in fiscal 1999 from $52.6 million in
fiscal 1998. The increase was primarily attributable to increased demand for
wireless products and our penetration into additional handset platforms.

Operating income for the Wireless Semiconductor Group increased 165.6% to $7.4
million in fiscal 1999 from $2.8 million in fiscal 1998. The increase in
operating income was primarily attributable to improved operating efficiencies.
This Group continued to leverage capacity, improve yields and reduce material
costs. In addition, this Group focused on the development of processes and
products for the wireless market, while continuing efforts to control
administrative costs.

Application Specific Products. Sales for the Application Specific Products
Group decreased 5.8% to $35.0 million in fiscal 1999 from $37.1 million in
fiscal 1998. The decrease was primarily attributable to our increasing focus on
the commercial market and a continuing shift away from the defense market.

Operating income for the Application Specific Products Group increased 42.0% to
$10.2 million in fiscal 1999 from $7.2 million in fiscal 1998. The increase in
operating income was primarily attributable to improved operating efficiencies,
including improved yields and reduced material costs. In addition, the Group's
selling and administrative activities were significantly reduced as the Group
focused on controlling costs.

Ceramic Products. Sales for the Ceramics Group decreased 5.9% to $25.5 million
in fiscal 1999 from $27.2 million in fiscal 1998. The decrease was primarily
attributable to a decreased level of sales for the first half of fiscal 1999
mainly due to lower than expected demand for wireless infrastructure and price
competition from Japanese competitors whose currency declined in value against
the U.S. dollar.

Operating income for the Ceramics Group increased 11.9% to $1.9 million in
fiscal 1999 from $1.7 million in fiscal 1998. The increase in operating income
was primarily attributable to the reduction of material costs and improved
operating efficiencies, including the leveraging of capacity and increased
manufacturing automation.

20
<PAGE> 21

QUARTERLY RESULTS OF OPERATIONS

The following table shows unaudited quarterly results of operations in dollar
amounts and as a percentage of sales for the periods indicated. We have prepared
this information on a basis consistent with our audited consolidated financial
statements and included all adjustments that we consider necessary for a fair
presentation of the information for the periods presented. Results of operations
for any fiscal quarter are not necessarily indicative of results for any future
period.

<TABLE>
<CAPTION>
THREE MONTHS ENDED
-----------------------------------------------------------------------------------------
JUNE 29, SEPT. 28, DEC. 28, MARCH 29, JUNE 28, SEPT. 27, DEC. 27, MARCH 28,
1997 1997 1997 1998 1998 1998 1998 1999
-------- --------- -------- --------- -------- --------- -------- ---------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Sales.............................. $25,705 $28,571 $30,751 $31,854 $29,955 $29,626 $32,489 $34,269
Cost of sales...................... 16,808 17,942 18,928 19,121 17,132 16,763 18,151 19,085
------- ------- ------- ------- ------- ------- ------- -------
Gross profit....................... 8,897 10,629 11,823 12,733 12,823 12,863 14,338 15,184
Research and development
expenses......................... 2,319 2,422 2,545 2,749 3,022 2,891 3,397 3,576
Selling and administrative
expenses......................... 5,262 5,513 5,684 5,900 5,497 5,422 5,809 6,039
------- ------- ------- ------- ------- ------- ------- -------
Operating income................... 1,316 2,694 3,594 4,084 4,304 4,550 5,132 5,569
Other income (expense), net........ (83) (89) (87) 18 112 134 170 254
------- ------- ------- ------- ------- ------- ------- -------
Income before income taxes......... 1,233 2,605 3,507 4,102 4,416 4,684 5,302 5,823
Provision (benefit) for income
taxes............................ 123 261 351 410 442 468 530 (2,705)
------- ------- ------- ------- ------- ------- ------- -------
Net income......................... $ 1,110 $ 2,344 $ 3,156 $ 3,692 $ 3,974 $ 4,216 $ 4,772 $ 8,528
======= ======= ======= ======= ======= ======= ======= =======
Net income per share:
Basic............................ $ 0.07 $ 0.15 $ 0.20 $ 0.24 $ 0.25 $ 0.27 $ 0.30 $ 0.54
======= ======= ======= ======= ======= ======= ======= =======
Diluted.......................... $ 0.07 $ 0.15 $ 0.20 $ 0.23 $ 0.25 $ 0.26 $ 0.29 $ 0.51
======= ======= ======= ======= ======= ======= ======= =======
Shares used in per share calculation:
Basic............................ 14,987 15,207 15,420 15,593 15,708 15,772 15,835 15,980
======= ======= ======= ======= ======= ======= ======= =======
Diluted.......................... 15,233 15,654 15,961 16,012 16,098 16,131 16,402 16,769
======= ======= ======= ======= ======= ======= ======= =======
</TABLE>

21
<PAGE> 22

LIQUIDITY AND CAPITAL RESOURCES

As of March 28, 1999, we had working capital of $42.7 million, including $23.8
million in cash, cash equivalent and short term investments. In fiscal 1999,
operations generated $25.6 million of cash primarily attributable to net income
of $21.5 million. Uses of cash included $17.7 million for capital expenditures,
$8.2 million for net purchases of short term investments and $1.9 million for
the repayment of long-term debt. We continued our investment in capital
expenditures particularly for the semiconductor GaAs wafer fabrication operation
and the integrated circuit and discrete semiconductor assembly and test areas,
as well as for improved manufacturing capabilities at the ceramics manufacturing
facility.

During fiscal 1999, we incurred capital expenditures of $17.7 million of which
$14.3 million was related to the Wireless Semiconductor Products Group. The
expenditures for this group related primarily to the expansion of the GaAs
fabrication facility which is estimated to cost $18 million in total and is
scheduled to be completed during the summer of 1999. This expansion is expected
to significantly increase capacity.

We may use a portion of the net proceeds of this offering for the purchase of
equipment, the expansion of facilities and the acquisition of businesses,
technologies or products that complement our business. From time to time we have
discussed strategic acquisitions with third parties. We are not currently in
discussions regarding acquisitions and have no agreements or commitments to
complete an acquisition.

We maintain a $7.5 million working capital line of credit and a $7.5 million
equipment line of credit which expire on September 30, 1999. We expect to renew
these agreements. There are no outstanding borrowings under these agreements.

We believe that anticipated cash from operations, available funds and borrowings
under our bank lines of credit, together with the net proceeds from the sale of
our common stock in this offering, will be adequate to fund our currently
planned working capital and capital expenditure requirements through fiscal
2000.

YEAR 2000 READINESS

The Year 2000 issue relates to the inability of certain computer software
programs to properly recognize and process date sensitive information relative
to the Year 2000 and beyond. To address this issue, we have initiated a
company-wide Year 2000 project under the direction of senior management. We have
evaluated our products and have determined that our products are not date
sensitive. We do not expect Year 2000 exposure for products sold.

We have completed a comprehensive inventory of our internal information systems.
Over the last several years, we have invested in new computer hardware and
software to improve our business operations. All such systems were required to
be Year 2000 compliant as a condition of purchase. We have completed testing of
our critical information systems. As a result of this testing, we do not believe
that any critical systems will cause a significant interruption of our business.
Certain systems require minor upgrades. These upgrades are expected to be
completed by September 1999 and the costs are not expected to be material.

We have also completed a comprehensive inventory of our equipment and
facilities. We have substantially completed testing of critical items to ensure
that they are compliant. As a result of our testing to date, we do not believe
that any critical items will result in a significant disruption to our business.
Minor upgrades are planned for certain items. These upgrades are expected to be
completed by September 1999 and the costs are not expected to be material.

We have completed formal communication with significant suppliers, customers,
financial institutions and other third parties with which we have a material
relationship in order to determine whether those entities have adequate plans in
place to ensure their Year 2000 preparedness. As a result of our communications,
we have not identified any issues with respect to these third parties.

At this time, we have not developed a "worst case" scenario or an overall
contingency plan and do not intend to do so unless, as a result of ongoing
testing and evaluation, we believe these plans are warranted. Based upon our
assessment to date and our expectations that our Year 2000 project will be
substantially complete by September 1999, we believe adequate time will be
available to ensure alternatives can be
22
<PAGE> 23

developed, assessed and implemented, if necessary, prior to a Year 2000 issue
having a negative impact on our operations. However, we cannot assure that such
modifications and conversions, if required, will be completed on a timely basis.

We have not prepared estimates of costs to remediate Year 2000 problems.
However, based on currently available information, including the results of our
assessment to date, we do not believe that the costs associated with Year 2000
compliance will have a material adverse effect on our business, results of
operations or financial condition.

Although we believe our planning efforts are adequate to address our Year 2000
compliance concerns, we cannot guarantee that we will not experience
unanticipated negative consequences or material costs caused by undetected
errors or defects in the technology used in our internal systems or that third
parties upon which we rely will not experience similar negative consequences.

23
<PAGE> 24

BUSINESS

OVERVIEW

We design, develop, manufacture and market proprietary radio frequency,
microwave frequency and millimeter wave frequency integrated circuits and
discrete semiconductors for wireless voice and data communications. The primary
applications for our products include wireless handsets for cellular and
personal communication services, or PCS. We also produce integrated circuits,
discrete components, electrical ceramics and ferrites used in wireless base
station equipment, cable television, wireless local loop, wireless personal
digital assistants and wireless local area networks.

We offer a broad range of products, including integrated circuit switches and
controls, power amplifiers, diodes and components that comprise a significant
part of the radio frequency devices used in wireless telephone handsets. We use
a range of technologies, processes and materials to meet our customers'
performance requirements, including gallium arsenide metal semiconductor field
effect transistor, or GaAs MESFET, gallium arsenide pseudomorphic high electron
mobility transistor, or GaAs PHEMT, silicon and electrical ceramic. We currently
are developing power amplifiers and other devices made with a gallium arsenide
heterojunction bipolar transistor, or GaAs HBT, process.

We divide our operations into three groups to address the distinct dynamics of
different markets:

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
WIRELESS SEMICONDUCTOR
PRODUCTS APPLICATION SPECIFIC PRODUCTS CERAMIC PRODUCTS
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Primary Products GaAs Integrated Circuits GaAs Integrated Circuits Electrical Ceramics
Discrete Semiconductors Discrete Semiconductors Ferrites
Components
- -----------------------------------------------------------------------------------------------------------
Primary Markets Wireless Handsets Satellite Communications Wireless Infrastructure
Wireless Data Broadband Data, Defense
- -----------------------------------------------------------------------------------------------------------
</TABLE>

The Wireless Semiconductor Products Group supplies GaAs integrated circuits and
discrete semiconductors in high volume for wireless telephone handsets and
wireless data applications. These products are used in equipment incorporating
the leading digital standards, Global System for Mobile Communications, or GSM,
Code Division Multiple Access, or CDMA and Time Division Multiple Access, or
TDMA. This group generated $65.8 million or 52.1% of our total sales in fiscal
1999.

The Application Specific Products Group supplies radio frequency, microwave
frequency and millimeter wave frequency GaAs integrated circuits, and discrete
semiconductors and components for customized products in the satellite
communications, broadband data and defense markets. We leverage our 30 years of
experience with higher frequency microwave and millimeter wave technologies to
develop high gross margin products and to develop new products for emerging
wireless broadband data applications. This group generated $35.0 million or
27.7% of our total sales in fiscal 1999.

The Ceramics Products Group uses electrical ceramic and ferrite technologies to
supply resonators and filters, primarily for wireless base station equipment.
This group generated $25.5 million or 20.2% of our total sales in fiscal 1999.

INDUSTRY BACKGROUND

Market Growth. The wireless communications industry has grown rapidly as new
technologies, additional radio frequency spectrum and competition have made
wireless communications easier, as well as more useful, available and
affordable. Wireless product original equipment manufacturers, or OEMs, continue
to make their products smaller, add capabilities and increase the standby and
talk times of their battery operated products. As a result, new product
introductions have become more frequent.

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<PAGE> 25

We expect the market for wireless handsets, a key element of the wireless
communications industry, to continue experiencing significant growth. Industry
analysts expect sales of wireless handsets to grow from 163 million units in
1998 to more than 250 million units in 2000, representing a compound annual
growth rate of approximately 25% or more. We believe the introduction of new
handset features, new and less expensive service plans and new markets in
developing countries are driving this sales growth.

Consumer wireless applications are expanding from voice-only to many different
forms of data transmission. We expect that the next generation air interface
standard will be designed with data transmission as a primary function. A
variety of applications enabling wireless access to the Internet and e-mail, as
well as wireless home automation, are under development. Many of these new
wireless data applications need more bandwidth, or capacity, than voice, and
current cellular and PCS frequencies limit the available bandwidth. Higher
frequencies, in the millimeter wave range where there is less traffic, allow
much higher bandwidths. Consequently, the Federal Communications Commission has
allocated millimeter wave frequencies for wireless data applications. We believe
GaAs millimeter wave semiconductor and component technology will be necessary
for the development of products for these wireless voice and data applications.

Frequency Bands and Air Interface Standards. First generation wireless telephone
systems, such as Advanced Mobile Phone Service, use analog signal processing and
operate at frequencies from 829 to 894 MHz, with limited capacity, sound quality
and capabilities. Second generation systems use digital signal processing and
operate at either cellular frequencies ranging from 869 to 894 MHz or at PCS
frequencies ranging from 1930 to 1990 MHz. There are a number of digital air
interface standards in these frequency bands, including GSM, TDMA and CDMA.
These digital standards provide improved capacity, sound quality and
capabilities at cellular and PCS frequency bands, but are incompatible and have
fragmented the market for equipment.

Cellular System Infrastructure. Wireless telephones communicate with base
stations, sometimes referred to as cell sites. These base stations transmit and
receive signals from handsets and, after processing, connect the signals to the
local switching office of the wireline telephone system or some other
telecommunications network. Digital radios with a millimeter wave carrier
frequency are being used to connect base stations to each other and to these
networks. The handsets and base stations designed for each air interface
standard generally require custom radio frequency semiconductor solutions.

To enable consumers to use their handsets across various territories and
interface standards, suppliers of wireless handsets have begun to offer
multimode and multiband handsets. Multimode handsets can switch from one air
interface standard to another. Multiband handsets can switch from one frequency
band to another. The trend to multimode and multiband functions is increasing
the number of radio frequency products necessary for each handset. For example,
some new handsets need as many as five integrated circuit switches and two power
amplifiers.

As a result of rapid market growth, technical challenges and end user demands as
well as a shortage of radio frequency integrated circuit engineers, we believe
it has become difficult for OEMs of subscriber equipment to develop and supply
all their required radio frequency devices in a timely and cost-effective
manner. This has caused some OEMs to rely on third party suppliers for these
products. We also believe that many new entrants to the wireless subscriber
equipment market, such as large consumer electronics companies, are less
vertically integrated than established OEMs. As a result, these companies tend
to rely even more on third party suppliers.

GaAs and Silicon Technology. In first generation wireless communications
equipment, silicon-based semiconductors were used to form complex circuits to
transmit and receive radio frequency signals. The use of silicon integrated
circuits at cellular and PCS frequencies has been limited because of decreased
operating performance. At cellular and PCS frequencies, silicon integrated
circuits consume more power, have relatively higher noise and distortion
parameters and create excess heat. However, certain discrete silicon
semiconductor devices remain the most cost-effective solution for certain
functions in wireless handsets.

25
<PAGE> 26

GaAs has inherent physical properties that permit GaAs devices to operate at
much higher speeds than silicon devices or at the same speeds with lower power
consumption. This is particularly important in battery powered portable
applications such as handsets. Moreover, silicon devices do not perform well at
higher frequencies such as millimeter wave. Accordingly, GaAs semiconductor
technology has emerged as an effective alternative or complement to silicon
technology in many high performance radio frequency, microwave frequency and
millimeter wave frequency applications.

GaAs Process Technologies. Most commercial GaAs integrated circuits and discrete
semiconductors are made using the GaAs MESFET process. New GaAs processes
however, such as GaAs PHEMT and HBT, offer many advantages over the MESFET
process. GaAs PHEMT and HBT devices have been developed over the past decade for
defense applications. They are now being applied to the manufacture of
commercial GaAs devices. GaAs devices made with the PHEMT and HBT processes
offer higher power efficiency, although HBT is not suitable for switching. The
different cost and performance characteristics of silicon and the various GaAs
process technologies can each be useful in an OEM's wireless platform design
strategy. We believe it is important that suppliers of GaAs integrated circuits
and discrete semiconductors have the breadth of technologies and production
capabilities to be able to provide an OEM customer with its desired solution.

THE ALPHA APPROACH

Our goal is to be the leading provider of radio frequency, microwave frequency
and millimeter wave frequency products for a broad range of commercial wireless
markets. The key elements of our approach are:

- Continue Focus on Wireless Markets. Much of our recent growth in revenue
and profits has been due to our intense concentration on the expanding
demand for wireless telephony equipment, particularly handsets. By
including multimode or multiband capabilities, handsets have become more
complex and contain two to three times more radio frequency products
than prior generation products. Industry analysts expect unit sales of
handsets to grow at a compound rate of approximately 25.0% per year
through 2000. We also expect the introduction of many new wireless data
applications, including those which merge voice and data into the same
handset. Wireless data products include personal digital assistants with
wireless Internet access. We believe that the trends of increased
complexity and of market growth in handsets and wireless data
applications will combine to create opportunity for continued growth.

- Continue Focus on Wireless Industry Leaders. We focus our sales and
marketing efforts on dominant OEMs in the wireless communications
industry and their principal suppliers. Two of the three largest
producers of handsets in the world, Motorola and Ericsson, were our
largest customers in fiscal 1999, representing 36.3% of our sales in
this period. We have assigned a senior key account executive to each of
these key customers. The task of these key account personnel is to
coordinate all activities needed to support that customer on a worldwide
basis. By remaining in close contact with our customers' design
engineering, manufacturing, purchasing and project management personnel,
we can better understand their needs, rapidly develop customer specific
solutions and successfully design our solutions into our customers' new
products. We emphasize rapid new product development to meet our
customers' shortening development cycles. Our manufacturing capabilities
enable us to quickly convert new products from development to full
production. Since January 1998, we have increased our penetration from
25 products for 13 handset platforms to 81 products for 40 handset
platforms.

- Provide a Broad Array of Products. We offer a broad array of radio
frequency, microwave frequency and millimeter wave frequency products to
the wireless markets, including GaAs integrated circuits switches and
controls, GaAs integrated circuits power amplifiers, silicon discrete
diodes and ceramic resonators and filters. We continue to expand our
product breadth, allowing us to increase the total value of the content
we offer for each handset. The technologies underlying this product
portfolio allow us to address the new wireless data communications
products being developed with limited incremental investment. As the
OEMs in the wireless communications
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<PAGE> 27

industry have been reducing the number of their suppliers, our product
portfolio has helped us become a strategic supplier to Motorola and
Ericsson.

- Maintain High Volume, Efficient Manufacturing. We believe we have a
cost-effective GaAs integrated circuit fabrication facility. We manage
our design and manufacturing processes to meet our customers' rapid
delivery requirements. We combine rigorous statistical control methods
developed in the high volume silicon integrated circuit industry with
our own total quality management philosophy to improve our yields and
consistency and lower our costs. Molecular beam epitaxy layer growth, or
MBE, is a critical factor in the PHEMT and HBT process of GaAs
integrated circuit production. As GaAs integrated circuit production
moves from the MESFET process toward PHEMT and HBT processes, we expect
in-house MBE capability will become a more important competitive factor,
because it is more costly to outsource MBE. Unlike many of our
competitors, we have a large, in-house MBE facility, backed by many
years of experience.

- Pursue Strategic Technology Alliances and Acquisitions. We intend to
pursue strategic alliances and acquisitions to expand our production
capacity, products, technologies, industry expertise and customers. We
expect that our alliances and acquisitions will be complementary to our
current business. In February 1999, we formed a strategic alliance with
Infinesse Corporation for the design of GaAs HBT process products. We
believe the development of GaAs HBT technology will open additional
power amplifier markets to us and complement our existing strength in
GaAs PHEMT and GaAs MESFET. We plan to introduce our initial GaAs HBT
products for OEM qualification during the summer of 1999.

PRODUCTS AND APPLICATIONS

We offer a broad array of radio frequency, microwave frequency and millimeter
wave frequency products to the wireless markets, including GaAs integrated
circuit switches and controls, GaAs integrated circuit power amplifiers, silicon
discrete semiconductors and ceramic resonators and filters. A typical end
product for wireless communications, such as a handset, contains radio
frequency, baseband and digital signal processing components. Radio frequency
components convert, switch, process and amplify the high frequency signals that
carry the information to be transmitted or received. Baseband components process
signals into and from their original electrical form (low frequency voice or
data). The digital components control the overall circuitry and process the
voice or other data to be transmitted and received.

The table below identifies the major product categories and markets our three
operating groups serve.

<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
WIRELESS SEMICONDUCTOR PRODUCTS
------------------------------------------------- APPLICATION
POWER INTEGRATED DISCRETE SPECIFIC CERAMIC
MARKETS AMPLIFIERS CIRCUIT SWITCHES SEMICONDUCTORS PRODUCTS PRODUCTS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Cellular/PCS:
Handset -- -- --
Base Station --
- -----------------------------------------------------------------------------------------------------------------------
Wireless Data:
Narrowband -- -- -- --
Broadband -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------
Cable TV -- -- --
- -----------------------------------------------------------------------------------------------------------------------
Other Wireless -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>

Other Wireless includes wireless local loop, digital radio links, Global
Positioning Systems, or GPS, Direct Broadcast Satellite, or DBS, intrusion
alarms, radar detectors, ID tags and defense applications.

27
<PAGE> 28

WIRELESS SEMICONDUCTOR PRODUCTS

The diagram below illustrates the role of many of our Wireless Semiconductor
Products in a dual band and dual mode wireless telephone handset.
[Cell-phone schematic]

Alpha Products in a Typical Dual Band/Dual Mode Handset
GaAs Radio Frequency Integrated Circuit Switches GaAs Radio Frequency Power
Amplifiers Discrete Semiconductors

There is a picture of a cellular telephone on the right side of the page. To the
left of the telephone is a diagram depicting various parts of a dual band/dual
mode handset and identifying those parts which we supply.

- - Power Amplifiers. Wireless communications systems require amplification
in receiving and transmitting signals. Relatively weak incoming signals
must be amplified without adding background noise. GaAs power amplifiers
are used in handsets because they use battery power more efficiently than
silicon amplifiers, and battery life is a critical system feature in these
portable applications. Our 3-volt GaAs MESFET power amplifier, which
extends battery life, has been in production for the last 18 months.
Further efficiency improvement in amplifiers is now available using GaAs
PHEMT process technology. In addition, we are developing GaAs HBT process
technology, which we believe will open new power amplifier markets to us
and complement our existing strength in the GaAs PHEMT and GaAs MESFET
processes.

- - Integrated Circuit Switches and Controls. Switching and control functions
route and adjust signal levels between the receiver and transmitter and
other processing devices. The number of switching functions increases with
the complexity of the handset design. In the dual band/dual mode handset
illustrated, the switches perform three different routing functions,
including: signal routing to transmitter or receiver; signal routing to
cellular or PCS frequency; and signal routing to digital or analog mode.

Our GaAs integrated circuit switches are used in handsets to provide lower
signal loss and better signal isolation than comparable silicon products.
Further improvements are now available using the GaAs PHEMT process.
Transistors using the GaAs HBT process have not been suitable for
switches.

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<PAGE> 29

- - Discrete Semiconductors. Discrete semiconductors, especially diodes, are
used for signal tuning and switching functions in the handset. We draw on
our microwave frequency and millimeter wave frequency experience to
produce diodes with better circuit performance. We manufacture these
products in very high volumes and some of them are often purchased on a
sole source basis from us.

APPLICATION SPECIFIC PRODUCTS

We offer customized products that address all transmit and receive functions for
radio frequency, microwave frequency and millimeter wave frequency applications,
primarily in the satellite communications, broadband data and defense markets.
The millimeter wave applications are an emerging area of broadband, high
capacity data wireless services, such as Internet access. Systems operating in
this frequency range must use GaAs.

CERAMIC PRODUCTS

Our ceramic products play a critical role in the signal selection, or filtering
process, that is essential to processing communications signals. Ceramic
materials allow for improved power efficiency and miniaturization, which are
being increasingly used in wireless communications infrastructure. Ceramic
products are also critical in the frequency-determining portions of DBS
receivers, radar detectors and intrusion alarms.

CUSTOMERS

Our customers include leading OEMs in the wireless communications industry and
their principal suppliers. During fiscal 1999, sales to our 15 largest customers
accounted for approximately 64.3% of our total sales. During that period, sales
to Motorola accounted for 28.1% of total sales, and sales to Ericsson accounted
for 8.2% of total sales.

SALES AND MARKETING

We sell our products through independent manufacturers' representatives and
through a direct sales staff. We sell through 12 domestic and 23 international
independent manufacturers' representative organizations. Our field support
management staff oversees our manufacturers' representatives and provides them
with sales direction and support. Our direct sales staff manages key customer
accounts and worldwide customer support and identifies and targets sales in the
emerging wireless data markets.

We maintain an internal marketing organization that is responsible for
developing sales and advertising literature, such as product announcements,
catalogs, brochures and magazine articles in trade and other publications. Our
internal marketing organization also prepares technical presentations for
industry conferences.

We believe that the technical and complex nature of our products and markets
demands an extraordinary commitment to close ongoing relationships with our
customers. We strive to maintain close contact with our customers' design,
engineering, manufacturing, purchasing and project management personnel. We
employ a team approach in developing close relationships by combining the
support of design and applications engineers, manufacturing personnel, sales and
marketing staff and senior management. We believe that maintaining close contact
with our customers improves their level of satisfaction, assists us in
anticipating their future product needs and enhances our opportunities for
design wins.

MANUFACTURING

MANUFACTURING CAPABILITIES

Our Wireless Semiconductor Products Group and our Application Specific Products
Group are located at our Woburn, Massachusetts manufacturing facility, which is
ISO 9001 compliant. At this facility, we design, fabricate and test GaAs
integrated circuits, and GaAs and silicon discrete semiconductors and
components.

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<PAGE> 30

The fabrication of GaAs integrated circuits and semiconductor products is highly
complex, requiring production in a highly controlled, clean environment. Minute
impurities, difficulties in the fabrication process or defects in the masks used
to print circuits on the wafer can cause a substantial percentage of the wafers
to be rejected or numerous die on each wafer to be nonfunctional. In addition,
the more brittle nature of GaAs wafers can result in higher processing losses.
To maximize wafer yield and quality, we test our products at various stages in
the fabrication process, continually monitor reliability and conduct numerous
quality control inspections throughout the entire production process.

We have extensive expertise in manufacturing process technologies for GaAs
integrated circuits, discrete silicon semiconductors and ceramic products. We
combine rigorous statistical control methods developed in the high volume
silicon integrated circuit industry with our own total quality management
philosophy to improve our yields and consistency and lower our costs. We attempt
to control all critical steps in the manufacturing process to shorten product
design and manufacturing cycles and improve product quality. Many of our
manufacturing process technologies are proprietary.

Our GaAs manufacturing capabilities include MESFET and PHEMT processes and we
are currently developing GaAs HBT process capability. In addition, we have a
large, in-house MBE facility with personnel with many years of process
experience. Since MBE is critical to the PHEMT and HBT process of GaAs
integrated circuit production, we believe MBE capabilities will allow us to
leverage additional cost savings across both PHEMT and HBT product lines.

Our Ceramic Products Group, located at our facilities in Adamstown and
Frederick, Maryland, manufactures, assembles, packages and tests our ceramic
filters and resonators. Our ceramic manufacturing controls formulation, powder
preparation, forming, firing and finishing, as well as value-added assembly of
our ceramic products.

SUBCONTRACTING ASSEMBLY AND PACKAGING

We have in-house assembly capabilities but we also use several subcontractors in
Asia to wirebond and package very large volume orders of integrated circuits.
Our policy is to have at least two assembly houses located in different
countries for each assembly process. After assembly, the packaged products are
returned by our subcontractors to our United States facilities for final testing
in our automated production test facilities. We qualify our assembly contractors
based on cost and quality. We monitor on an ongoing basis each subcontractor's
processes by reviewing the subcontractor's quality control system, production
process and statistical and reliability program.

RAW MATERIALS AND EQUIPMENT

All of the raw materials and equipment used in the production of our products
are available from multiple sources. However, currently we procure certain
materials for our products from single or limited sources.

PRODUCT AND PROCESS DEVELOPMENT

We are focusing our development efforts on new products, design tools and
manufacturing processes in our Wireless Semiconductor Products group using our
core technologies. We strive to improve existing product performance, improve
design and manufacturing processes and reduce costs. We maintain close
collaborative relationships with many of our customers to help us identify
market demands and target our development efforts to meet those demands.

GaAs HBT Capabilities. We are developing our GaAs HBT process technology
capability with a third party designer and a third party foundry of GaAs HBT
technology. GaAs HBT process technology works at higher frequencies than
traditional silicon semiconductors and requires less power to transmit signals.
For cellular telephones, this permits smaller handsets and longer talk-time
between battery charges. We plan to introduce our initial GaAs HBT products for
OEM qualification during the summer of 1999. We believe that the addition of a
line of GaAs HBT products will complement our existing GaAs PHEMT

30
<PAGE> 31

and GaAs MESFET devices, enabling us to offer our customers the full range of
currently available GaAs applications for use in wireless telephone handsets and
wireless data applications.

Millimeter Wave Technology. We developed much of our millimeter wave technology
in connection with approximately 30 years of defense related contracts involving
sophisticated millimeter wave semiconductor products. We use the techniques,
processes and experience in millimeter wave technology developed in connection
with these government programs for commercial applications.

Our development expenditures were $9.5 million for fiscal 1997, $10.0 million
for fiscal 1998 and $12.9 million for fiscal 1999.

COMPETITION

Wireless communications markets are intensely competitive and are characterized
by rapid technological change, rapid product obsolescence and price erosion. We
compete on the basis of price, performance, quality, reliability, size, ability
to meet delivery requirements and customer service and support. Our primary
competitors include multinational companies and a number of smaller companies.

In order to remain competitive, we plan to continue to expend significant
resources on, among other things, new product development and enhancements, new
process technologies and manufacturing efficiencies.

ENVIRONMENTAL MATTERS

We are subject to a variety of federal, state and local requirements concerning
the protection of the environment. We were notified by federal and state
environmental agencies of our potential liability with respect to one Superfund
site, to which small quantities of our hazardous waste were shipped. We believe
that our volumetric contribution of waste to the Superfund site is minimal and
that our liability will not be material, but we cannot guarantee this. During
fiscal 1997, we settled a second, similar Superfund site claim for a nominal
amount. During fiscal 1999, we successfully completed costly remediation and
monitoring efforts relating to groundwater contamination at our Maryland
facility. We began those efforts in 1989, after entering into a consent decree
with the State of Maryland Department of the Environment.

INTELLECTUAL PROPERTY

We believe that the success of our business will depend more on the technical
competence, creativity and manufacturing and marketing abilities of our
employees than on patents, trademarks and other intellectual property rights. A
significant aspect of our intellectual property is our process technology
know-how. Our objective is to foster continuing technological innovation to
maintain and protect our competitive position.

We rely primarily on trade secret laws, confidentiality procedures and licensing
arrangements to protect our intellectual property rights. We enter into
confidentiality and nondisclosure agreements with our service providers,
customers, employees and others, and attempt to limit access to and distribution
of our proprietary information.

EMPLOYEES

As of March 28, 1999, we had approximately 935 employees, including 678 in
manufacturing, 143 in engineering and development, 55 in marketing and sales,
and 59 in administration and finance. Our employees do not have a collective
bargaining agreement. We have not experienced any work stoppages. We consider
our relations with our employees to be good.

FACILITIES

We own our corporate headquarters located on nine acres of land in Woburn,
Massachusetts. The Woburn facility consists of 158,000 square feet and is
occupied by our Wireless Semiconductor Products and Application Specific
Products Groups. To accommodate expected demand, we are expanding our capacity

31
<PAGE> 32

within the structure of our existing facility without interruption of our
production. We expect the expansion, including the cost of building improvements
and the purchase of manufacturing equipment, to cost approximately $18 million.
We expect to complete the expansion during the summer of 1999.

We also own a 92,000 square foot facility in Adamstown, Maryland, which is our
primary ceramic products manufacturing facility. In addition, we lease a 33,000
square foot facility in Frederick, Maryland for manufacturing ceramic filters.

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<PAGE> 33

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
George S. Kariotis..................... 76 Chairman of the Board of Directors
Thomas C. Leonard...................... 64 President, Chief Executive Officer and Director
Paul E. Vincent........................ 51 Vice President, Treasurer and Chief Financial Officer
David J. Aldrich....................... 41 Vice President
Richard Langman........................ 52 Vice President, and President of Trans-Tech, Inc.
Jean-Pierre Gillard.................... 55 Vice President
James C. Nemiah........................ 45 Secretary, Corporate Counsel
Timothy R. Furey....................... 41 Director
James W. Henderson..................... 56 Director
Arthur Pappas.......................... 62 Director
Raymond Shamie......................... 78 Director
Sidney Topol........................... 74 Director
</TABLE>

George S. Kariotis was Chairman of the Board and Chief Executive Officer from
our inception in 1962 until 1978, and, from 1974 to 1978, he was also our
Treasurer. From 1979 to 1983, Mr. Kariotis was the Secretary of Manpower
Development and Economic Affairs for the Commonwealth of Massachusetts. He was
re-elected Chairman of the Board in 1983 and Chief Executive Officer in 1985.
Mr. Kariotis resigned as Chief Executive Officer in July 1986 while he
campaigned for public office. He resumed his position as Chief Executive Officer
in November 1986, and served in that capacity until 1991.

Thomas C. Leonard was elected our President and Chief Executive Officer in July
1996 and was elected a Director in August 1996. Mr. Leonard joined us in 1992 as
a division General Manager. In 1994, he was elected a Vice President. Mr.
Leonard has over 30 years experience in the microwave industry, having held a
variety of executive and senior level management and marketing positions at
M/A-COM, Inc., Varian Associates, Inc. and Sylvania.

Paul E. Vincent joined us as Controller in 1979 and has been Vice President and
Chief Financial Officer since January 1997. Prior to joining us, Mr. Vincent
worked at Applicon Incorporated and, prior to that, Arthur Andersen & Co. Mr.
Vincent is a CPA.

David J. Aldrich joined us in 1995 as Vice President, Chief Financial Officer
and Treasurer and currently serves as Vice President and General Manager of the
Wireless Semiconductor group and the Application Specific Products group. From
1989 to 1995, Mr. Aldrich held senior management positions at M/A-COM, Inc.,
including Manager Integrated Circuits Active Products, Corporate Vice President
Strategic Planning, Director of Finance and Administration, and Director of
Strategic Initiatives with the Microelectronics Division. Mr. Aldrich is a
Director of Microwave Power Devices, Inc., a manufacturer of microwave products.

Richard Langman joined us in January 1997 as Vice President and President and
General Manager of our Trans-Tech, Inc. subsidiary. Prior to joining us, Mr.
Langman worked for Coors Ceramics Company for 23 years, holding senior executive
positions in operations and sales. Mr. Langman received his B.S. in Ceramic
Engineering from Alfred University and his M.S. in Metallurgy and Material
Science from Lehigh University.

Jean-Pierre Gillard joined us in 1992 as Manager of GaAs integrated circuit
operations and has been Vice President of Business Development since June 1996.
Before 1992, he held a number of management positions at M/A-COM, Inc. in both
marketing and sales.

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<PAGE> 34

James C. Nemiah joined us in November 1995 as Corporate Counsel and Assistant
Secretary. He was named Secretary in September 1996. Prior to joining us, Mr.
Nemiah was Vice President, General Counsel and Clerk at American Science and
Engineering, Inc. from 1987 to 1995.

Timothy R. Furey founded Oxford Associates in 1991 and has been its Chairman and
Chief Executive Officer since then. Prior to 1991, Mr. Furey worked as a
consultant with Boston Consulting Group, Inc., Strategic Planning Associates,
Inc., Kaiser Associates and the Marketing Science Institute.

James W. Henderson has served as the President of Analytical Systems Engineering
Corporation, a provider of expert systems and communications systems and
services, since 1977. Mr. Henderson served as an Executive Vice President of
Analytical Systems Engineering Corporation from 1976 to 1977 and as its Director
of Systems Engineering from 1973 to 1976. Prior to joining Analytical Systems
Engineering Corporation, Mr. Henderson was a design engineer for International
Business Machines Corporation and a research and development program manager for
the United States Air Force.

Arthur Pappas is the co-founder of Datel Systems, Inc., a manufacturer of data
conversion products, Power General Corporation, a manufacturer of switching
power supplies, and Metra-Byte Corporation, a manufacturer of measurement and
control products for personal computers, and President and Chairman of Astrodyne
Corp., a manufacturer of power supplies.

Raymond Shamie was the President of Shamie Management Corporation, an investment
management and consulting company, from 1986 to 1995. Prior to 1986, Mr. Shamie
was Chairman of the Board and Chief Executive Officer of Metal Bellows
Corporation.

Sidney Topol is a Director of Public Broadcasting System, and President of The
Topol Group, Inc., a consulting and investment company. Mr. Topol was a Director
of Wandel & Golterman Technologies, Inc., a manufacturer of test instruments,
from 1996 to 1998. Mr. Topol was President of Scientific-Atlanta, Inc. from 1971
to 1983, Chief Executive Officer from 1975 to 1987 and Chairman of the Board
from 1978 to 1990. Prior to 1971, Mr. Topol held various executive positions
with Raytheon Company.

Our Restated Certificate of Incorporation and Amended and Restated By-Laws
provide for the division of the Board of Directors into three classes, each
having a staggered three-year term of office. The term of one class expires each
year. At each annual meeting of the stockholders following the initial
classification, the directors elected to succeed those directors whose terms
expire are designated as being the same class as the directors they succeed and
are elected to hold office until the third succeeding annual meeting. Directors
may be removed only for cause at a stockholders' meeting upon the vote of
stockholders holding a majority of our common stock, or upon the vote of a
majority of the directors then in office.

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<PAGE> 35

PRINCIPAL SHAREHOLDERS

The following table sets forth certain information regarding beneficial
ownership of our common stock as of March 28, 1999, except as otherwise noted
below, and as adjusted to reflect the sale of the shares offered hereby: (i) by
each person known by us to own beneficially more than five percent of our common
stock; (ii) by each Director; (iii) by each executive officer; and (iv) by all
of our Directors and executive officers as a group. Except as otherwise
indicated, the persons or entities listed below have sole voting and investment
power with respect to all shares of common stock owned by them, except to the
extent such power may be shared with a spouse.

<TABLE>
<CAPTION>
SHARES OF COMMON STOCK SHARES OF COMMON STOCK
BENEFICIALLY OWNED PRIOR BENEFICIALLY OWNED AFTER
TO THE OFFERING THE OFFERING(2)
------------------------ -------------------------
DIRECTORS AND EXECUTIVE OFFICERS(1) NUMBER PERCENT NUMBER PERCENT
----------------------------------- --------- ------- --------- --------
<S> <C> <C> <C> <C>
David J. Aldrich........................ 74,756 (*) 74,756 (*)
Timothy R. Furey........................ 4,500 (*) 4,500 (*)
Jean-Pierre Gillard..................... 17,842 (*) 17,842 (*)
James W. Henderson...................... 1,000 (*) 1,000 (*)
George S. Kariotis...................... 11,864 (*) 11,864 (*)
Richard Langman......................... 61,179 (*) 61,179 (*)
Thomas C. Leonard....................... 184,515 1.2% 184,515 1.0%
James C. Nemiah......................... 6,862 (*) 6,862 (*)
Arthur Pappas........................... 12,000 (*) 12,000 (*)
Raymond Shamie.......................... 28,500 (*) 28,500 (*)
Sidney Topol............................ 44,500 (*) 44,500 (*)
Paul E. Vincent......................... 41,451 (*) 41,451 (*)
Directors and Executive Officers as a
group (12 persons).................... 488,969 3.0% 488,969 2.6%

5% SHAREHOLDERS
----------------------------------------
Harvey Kaylie and Gloria W. Kaylie(3)... 2,079,450 13.0% 2,079,450 10.9%
13 Neptune Avenue,
Brooklyn, NY 11235
FMR Corp.(4)............................ 1,460,100 9.1% 1,460,100 7.7%
82 Devonshire Street
Boston, MA 02109
Westport Asset Management, Inc.(5)...... 1,346,925 8.4% 1,346,925 7.1%
253 Riverside Avenue
Westport, CT 06880
</TABLE>

- ---------------------------

* Less than one percent.

(1) Includes certain shares for each listed individual and group as follows:
Aldrich -- 2,053 shares in his account under our Savings and Retirement
Plan (hereinafter referred to as the "401(k) Plan") and 67,500 shares
subject to currently exercisable stock options; Gillard -- 2,536 shares
in his account under the 401(k) Plan and 11,250 shares subject to
currently exercisable stock options; Kariotis -- 5,582 shares in his
account under our 401(k) Plan and 4,500 shares subject to currently
exercisable stock options; Langman -- 60,000 shares subject to currently
exercisable stock options; Leonard -- 3,207 shares in his account under
the 401(k) Plan and 142,500 shares subject to currently exercisable
stock options; Nemiah -- 1,244 shares in his account under the 401(k)
Plan and 3,900 shares subject to currently exercisable stock options;
Topol -- 4,500 shares subject to currently exercisable stock options;
Vincent -- 4,420 shares in his account under the 401(k) Plan and 16,250
shares subject to currently exercisable stock options; Executive
Officers and Directors as a Group -- 19,036 shares in accounts under the
401(k) Plan and 314,900 shares

35
<PAGE> 36

subject to currently exercisable stock options. Directors and officers
have voting power over the 19,036 shares listed in accounts under the
401(k) Plan.

(2) Assumes the underwriters do not exercise their over-allotment option.

(3) As reported in a Schedule 13D, as amended, dated December 28, 1998,
Scientific Components Corporation, as of December 28, 1999, was the
record and beneficial owner of 2,079,450 shares of our common stock.
Harvey Kaylie and his wife, Gloria W. Kaylie, are each directors,
officers and principal stockholders of Scientific Components
Corporation, and may be deemed to be the beneficial owners of the shares
held of record by Scientific Components Corporation. Mr. and Mrs. Kaylie
have shared power to vote and dispose of all of the aforementioned
shares.

(4) As reported in a Schedule 13G dated February 1, 1999, Fidelity
Management & Research Company ("Fidelity"), a wholly-owned subsidiary of
FMR Corp. and a registered investment adviser, is the beneficial owner
of 1,449,000 shares of common stock as a result of acting as investment
adviser to various registered investment companies. Edward C. Johnson
3d, FMR Corp., through its control of Fidelity, and the Fidelity Funds,
each has sole power to dispose of the 1,449,000 shares owned by the
Funds. Neither FMR Corp. nor Edward C. Johnson 3d, Chairman of FMR
Corp., has the sole power to vote or direct the voting of the shares
owned directly by the Fidelity Funds, which power resides with the
Funds' Boards of Trustees. Fidelity Management Trust Company, a
wholly-owned bank subsidiary of FMR Corp., is the beneficial owner of
11,100 shares of the common stock as a result of its serving as
investment manager of institutional accounts. Edward C. Johnson 3d and
FMR Corp., through its control of Fidelity Management Trust Company,
each has sole dispositive power and sole power to vote or to direct the
voting of the shares of common stock owned by the institutional
accounts. Through their ownership of voting common stock and the
execution of a shareholders' voting agreement, members of the Edward C.
Johnson 3d family and trusts for their benefit may be deemed to be a
controlling group with respect to FMR Corp.

(5) As reported in a Schedule 13G dated February 16, 1999, in which Westport
Asset Management, Inc. claimed sole voting and dispositive power with
respect to 1,350 shares and shared voting and dispositive power with
respect to 897,050 shares. Westport Asset Management, Inc. is a
registered investment advisor. The 1,345,575 shares reported are held in
certain discretionary managed accounts of Westport Asset Management,
Inc., and the 1,350 shares reported are owned by officers and
stockholders of Westport Asset Management, Inc. Westport Asset
Management, Inc. disclaims beneficial ownership with respect to the
shares reported in the filing.

36
<PAGE> 37

CERTAIN TRANSACTIONS

One of our customers is affiliated with one of our major stockholders,
Scientific Components Corporation. Harvey Kaylie and his wife Gloria W. Kaylie
are each directors, officers and principal stockholders of Scientific Components
Corporation. The customer accounted for 5.9% of our total sales for fiscal 1999.
Scientific Components Corporation is currently the owner of 13% of our common
stock. We believe that all transactions with this customer have been negotiated
at arms-length and have been on terms and conditions as favorable to us as we
could have obtained in transactions with an unrelated third party.

37
<PAGE> 38

UNDERWRITING

We have entered into an underwriting agreement with the underwriters named
below. CIBC World Markets Corp., Prudential Securities Incorporated and U.S.
Bancorp Piper Jaffray Inc. are acting as representatives of the underwriters.
The underwriting agreement provides for the purchase of a specific number of
shares of common stock by each of the underwriters. The underwriters'
obligations are several, which means that each underwriter is required to
purchase a specified number of shares, but is not responsible for the commitment
of any other underwriter to purchase shares. Subject to the terms and conditions
of the underwriting agreement, each underwriter has severally agreed to purchase
the number of shares of common stock set forth opposite its name below:

<TABLE>
<CAPTION>
UNDERWRITER NUMBER OF SHARES
- ----------- ----------------
<S> <C>
CIBC World Markets Corp. ................................... 1,260,000
Prudential Securities Incorporated.......................... 770,000
U.S. Bancorp Piper Jaffray Inc. ............................ 770,000
Adams, Harkness & Hill, Inc. ............................... 40,000
Dain Rauscher Wessels....................................... 40,000
Kaufman Bros., L.P. ........................................ 40,000
Needham & Company, Inc. .................................... 40,000
Pacific Growth Equities, Inc. .............................. 40,000
---------

Total.................................................. 3,000,000
=========
</TABLE>

This is a firm commitment underwriting. This means that the underwriters have
agreed to purchase all of the shares offered by this prospectus (other than
those covered by the over-allotment option described below) if any are
purchased. Under the underwriting agreement, if an underwriter defaults in its
commitment to purchase shares, the commitments of non-defaulting underwriters
may be increased or the underwriting agreement may be terminated, depending on
the circumstances.

The representatives have advised us that the underwriters propose to offer the
shares directly to the public at the public offering price that appears on the
cover page of this prospectus. In addition, the representatives may offer some
of the shares to certain securities dealers at such price less a concession of
$1.00 per share. The underwriters may also allow, and such dealers may reallow,
a concession not in excess of $0.10 per share to certain other dealers. After
the shares are released for sale to the public, the representatives may change
the offering price and other selling terms at various times.

We have granted the underwriters an over-allotment option. This option, which is
exercisable for up to 30 days after the date of this prospectus, permits the
underwriters to purchase a maximum of 450,000 additional shares from us to cover
over-allotments. If the underwriters exercise all or part of this option, they
will purchase shares covered by the option at the public offering price that
appears on the cover page of this prospectus, less the underwriting discount. If
this option is exercised in full, the total price to the public will be $120.8
million, and the total proceeds to us will be $114.4 million. The underwriters
have severally agreed that, to the extent the over-allotment option is
exercised, they will each purchase a number of additional shares proportionate
to the underwriter's initial amount reflected in the foregoing table.

38
<PAGE> 39

The following table provides information regarding the amount of the discount to
be paid to the underwriters by us:

<TABLE>
<CAPTION>
TOTAL
-------------------------------------------
WITHOUT EXERCISE OF WITH FULL EXERCISE OF
PER SHARE OVER-ALLOTMENT OVER-ALLOTMENT
--------- ------------------- ---------------------
<S> <C> <C> <C> <C>
$1.8375 $5,512,500 $6,339,375
</TABLE>

We estimate that the total expenses of the offering, excluding the underwriting
discount, will be approximately $500,000.

We have agreed to indemnify the underwriters against certain liabilities,
including liabilities under the Securities Act of 1933.

We, as well as our executive officers and Directors, have agreed to a 90-day
"lock up" with respect to approximately 174,069 shares of common stock, and
certain other of our securities that they beneficially own, including securities
that are convertible into shares of common stock and securities that are
exchangeable or exercisable for shares of common stock. This means that, subject
to certain exceptions, for a period of 90 days following the date of this
prospectus, we and such persons may not offer, sell, pledge or otherwise dispose
of these securities without the prior written consent of CIBC World Markets
Corp.

Rules of the Securities and Exchange Commission may limit the ability of the
underwriters to bid for or purchase shares before the distribution of the shares
is completed. However, the underwriters may engage in the following activities
in accordance with the rules:

- Stabilizing transactions -- The representatives may make bids or
purchases for the purpose of pegging, fixing or maintaining the price of
the shares, so long as stabilizing bids do not exceed a specified
maximum.

- Over-allotments and syndicate covering transactions -- The underwriters
may create a short position in the shares by selling more shares than
are set forth on the cover page of this prospectus. If a short position
is created in connection with the offering, the representatives may
engage in syndicate covering transactions by purchasing shares in the
open market. The representatives may also elect to reduce any short
position by exercising all or part of the over-allotment option.

- Penalty bids -- If the representatives purchase shares in the open
market in a stabilizing transaction or syndicate covering transaction,
they may reclaim a selling concession from the underwriters and selling
group members who sold those shares as part of this offering.

- Passive market making -- Market makers in the shares who are
underwriters or prospective underwriters may make bids for or purchases
of shares, subject to certain limitations, until the time, if ever, at
which a stabilizing bid is made.

Stabilization and syndicate covering transactions may cause the price of the
shares to be higher than it would be in the absence of such transactions. The
imposition of a penalty bid might also have an effect on the price of the shares
if it discourages resales of the shares.

Neither we nor the underwriters make any representation or prediction as to the
effect that the transactions described above may have on the price of the
shares. These transactions may occur on the Nasdaq National Market or otherwise.
If such transactions are commenced, they may be discontinued without notice at
any time.

39
<PAGE> 40

LEGAL MATTERS

Brown, Rudnick, Freed & Gesmer, P.C., One Financial Center, Boston,
Massachusetts 02111, will pass upon certain legal matters in connection with
this offering for us. Hale and Dorr LLP, 60 State Street, Boston, Massachusetts
02109, will pass upon certain legal matters in connection with this offering for
the underwriters.

EXPERTS

We include in this prospectus our consolidated balance sheets as of March 29,
1998 and March 28, 1999, and our consolidated statements of operations, cash
flows and stockholders' equity for each of the years in the three-year period
ended March 28, 1999 in reliance on the report of KPMG LLP, independent
certified public accountants, given on the authority of that firm as experts in
accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and current reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference room at 450 Fifth Street, NW, Washington, D.C., 20549,
and at the SEC's public reference rooms in Chicago, Illinois and New York, New
York. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference rooms. Our SEC filings are also available to the public on the
SEC's Website at "http://www.sec.gov."

We have filed with the SEC a registration statement on Form S-3 under the
Securities Act of 1933, as amended, with respect to the common stock offered in
connection with this prospectus. This prospectus does not contain all of the
information set forth in the registration statement. We have omitted certain
parts of the registration statement in accordance with the rules and regulations
of the SEC. For further information with respect to us and the common stock, you
should refer to the registration statement. Statements contained in this
prospectus as to the contents of any contract or other document are not
necessarily complete and, in each instance, you should refer to the copy of such
contract or document filed as an exhibit to or incorporated by reference in the
registration statement. Each statement as to the contents of such contract or
document is qualified in all respects by such reference. You may obtain copies
of the registration statement from the SEC's principal office in Washington,
D.C. upon payment of the fees prescribed by the SEC, or you may examine the
registration statement without charge at the offices of the SEC described above.

The SEC allows us to "incorporate by reference" the information we file with
them, which means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is considered
to be part of this prospectus, and information that we file later with the SEC
will automatically update and supersede this information. We incorporate by
reference the documents listed below and any future filings we will make with
the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act
of 1934.

1. Annual Report on Form 10-K for the fiscal year ended March 29, 1998;

2. Quarterly Reports on Form 10-Q for the fiscal quarters ended June 28,
1998, September 27, 1998 and December 27, 1998;

3. Proxy statement used for our annual meeting of stockholders held on
September 14, 1998; and

4. The description of our common stock contained in the registration
statement on Form 8-A filed on May 29, 1998, including all amendments or reports
filed for the purpose of updating such description.

40
<PAGE> 41

You may request a copy of these filings at no cost, by writing or telephoning
our general counsel at the following address:

Alpha Industries, Inc.
20 Sylvan Road
Woburn, Massachusetts 01801
(781) 935-5150

You should rely only on the information or representations provided in this
prospectus. We have authorized no one to provide you with different information.
We are not making an offer of these securities in any state where the offer is
not permitted. You should not assume that the information in this prospectus is
accurate as of any date other than the date on the front of the document.

41
<PAGE> 42

ALPHA INDUSTRIES, INC.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Independent Auditors' Report................................ F-2
Consolidated Balance Sheets as of March 29, 1998 and March
28, 1999.................................................. F-3
Consolidated Statements of Operations for the years ended
March 30, 1997, March 29, 1998 and March 28, 1999......... F-4
Consolidated Statements of Cash Flows for the years ended
March 30, 1997, March 29, 1998 and March 28, 1999......... F-5
Consolidated Statements of Stockholders' Equity for the
years ended March 30, 1997, March 29, 1998 and March 28,
1999...................................................... F-6
Notes to Consolidated Financial Statements.................. F-7
</TABLE>

F-1
<PAGE> 43

INDEPENDENT AUDITORS' REPORT

The Board of Directors and Stockholders
Alpha Industries, Inc.:

We have audited the consolidated balance sheets of Alpha Industries, Inc. and
subsidiaries as of March 29, 1998 and March 28, 1999 and the related
consolidated statements of operations, cash flows and stockholders' equity for
each of the years in the three-year period ended March 28, 1999. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Alpha Industries,
Inc. and subsidiaries at March 29, 1998 and March 28, 1999, and the results of
their operations and their cash flows for each of the years in the three-year
period ended March 28, 1999 in conformity with generally accepted accounting
principles.

/s/ KPMG LLP
Boston, Massachusetts
April 30, 1999

F-2
<PAGE> 44

ALPHA INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

<TABLE>
<CAPTION>
MARCH 29, MARCH 28,
1998 1999
--------- ---------
<S> <C> <C>
ASSETS (NOTE 3)
Current assets
Cash and cash equivalents................................. $14,356 $ 14,029
Short-term investments.................................... 1,493 9,731
Accounts receivable, trade, less allowance for doubtful
accounts of $634 and $741.............................. 18,500 22,972
Inventories (Note 2)...................................... 7,941 8,773
Prepayments and other current assets...................... 883 796
Deferred tax assets....................................... -- 6,522
------- --------
Total current assets................................. 43,173 62,823
Property, plant and equipment
Land...................................................... 437 437
Building and improvements................................. 23,000 26,488
Machinery and equipment................................... 70,051 77,776
------- --------
93,488 104,701
Less-accumulated depreciation and amortization............ 60,824 62,204
------- --------
32,664 42,497
Other assets................................................ 1,092 1,361
------- --------
Total assets......................................... $76,929 $106,681
======= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current maturities of long-term debt (Note 3)............. $ 1,876 $ 912
Current maturities of capital lease obligations........... 8 --
Accounts payable.......................................... 5,725 10,700
Accrued liabilities
Payroll, commissions and related expenses.............. 6,724 7,292
Other.................................................. 2,779 1,232
------- --------
Total current liabilities............................ 17,112 20,136
Long-term debt (Note 3)..................................... 1,625 713
Other long-term liabilities................................. 2,370 1,626
Deferred tax liabilities.................................... -- 3,192
Commitments and contingencies (Note 8)
Stockholders' equity (Notes 3 and 6)
Common stock par value $0.25 per share; authorized
30,000,000 shares; issued 15,817,751 and 16,051,311.... 3,954 4,013
Additional paid-in capital................................ 55,440 58,872
Retained earnings (accumulated deficit)................... (3,214) 18,276
------- --------
56,180 81,161
Less -- Treasury shares 150,293 and 62,379 at cost........ 315 133
Unearned compensation-restricted stock.................... 43 14
------- --------
Total stockholders' equity........................... 55,822 81,014
------- --------
Total liabilities and stockholders' equity........... $76,929 $106,681
======= ========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-3
<PAGE> 45

ALPHA INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------
MARCH 30, MARCH 29, MARCH 28,
1997 1998 1999
--------- ---------- ---------
<S> <C> <C> <C>
Sales.................................................. $ 85,253 $116,881 $126,339
Cost of sales.......................................... 68,519 72,799 71,131
Research and development expenses...................... 9,545 10,035 12,886
Selling and administrative expenses.................... 20,441 22,359 22,767
Repositioning expenses (Note 4)........................ 2,074 -- --
-------- -------- --------
Total operating expenses..................... 100,579 105,193 106,784
-------- -------- --------
Operating income (loss)................................ (15,326) 11,688 19,555
Other income (expense)
Interest expense..................................... (554) (471) (267)
Interest income...................................... 415 396 993
Other expense, net................................... (107) (166) (56)
-------- -------- --------
Total other income (expense)................. (246) (241) 670
-------- -------- --------
Income (loss) before income taxes...................... (15,572) 11,447 20,225
Provision (benefit) for income taxes (Note 5).......... -- 1,145 (1,265)
-------- -------- --------
Net income (loss)...................................... $(15,572) $ 10,302 $ 21,490
======== ======== ========
Net income (loss) per share:
Basic................................................ $ (1.05) $ 0.67 $ 1.36
======== ======== ========
Diluted.............................................. $ (1.05) $ 0.66 $ 1.31
======== ======== ========
Shares used in per share calculation:
Basic................................................ 14,772 15,302 15,824
======== ======== ========
Diluted.............................................. 14,772 15,711 16,351
======== ======== ========
</TABLE>

The accompanying notes are an integral part of these financial statements.
F-4
<PAGE> 46

ALPHA INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------
MARCH 30, MARCH 29, MARCH 28,
1997 1998 1999
--------- ---------- ---------
<S> <C> <C> <C>
CASH PROVIDED BY (USED IN) OPERATIONS:
Net income (loss).......................................... $(15,572) $ 10,302 $ 21,490
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operations:
Depreciation and amortization of property, plant, and
equipment............................................. 5,886 6,742 7,851
Deferred taxes........................................... -- -- (2,627)
Amortization of unearned compensation -- restricted
stock................................................. 35 31 90
Unearned compensation.................................... (11) -- --
Loss on sales and retirements of property, plant, and
equipment............................................. -- 132 12
Noncash portion of repositioning charges................. 660 -- --
Decrease (increase) in other assets...................... (262) 375 (285)
Increase (decrease) in other liabilities and long-term
benefits.............................................. 630 884 (744)
Issuance of treasury stock to 401(k) plan................ 831 833 960
Change in assets and liabilities:
Accounts receivable................................... 771 (1,481) (4,472)
Inventories........................................... 770 2,326 (832)
Prepayments and other current assets.................. 318 (26) 87
Accounts payable...................................... (1,455) 105 4,975
Accrued liabilities................................... 818 2,631 (979)
Repositioning reserve................................. 1,106 (1,106) --
-------- -------- --------
Net cash provided by (used in) operations................ (5,475) 21,748 25,526
-------- -------- --------
CASH USED IN INVESTING:
Additions to property, plant and equipment excluding
capital leases........................................... (7,951) (11,039) (17,730)
Purchases of short-term investments........................ (4,030) (2,335) (17,943)
Maturities of short-term investments....................... 6,955 2,060 9,705
Net proceeds from divestitures............................. 1,191 -- --
Proceeds from sale of property, plant and equipment........ -- 109 34
-------- -------- --------
Net cash used in investing............................... (3,835) (11,205) (25,934)
-------- -------- --------
CASH PROVIDED BY (USED IN) FINANCING:
Proceeds from notes payable................................ 4,952 -- --
Payments on notes payable.................................. (1,304) (3,044) (1,876)
Payments on capital lease obligations...................... (437) (230) (8)
Deferred charges related to long-term debt................. 18 2 16
Exercise of stock options and warrants..................... 462 1,400 1,724
Proceeds from sale of stock................................ 108 138 225
Repurchase of treasury shares.............................. -- (268) --
-------- -------- --------
Net cash provided by (used in) financing................. 3,799 (2,002) 81
-------- -------- --------
Net (decrease) increase in cash and cash equivalents....... (5,511) 8,541 (327)
Cash and cash equivalents, beginning of year............... 11,326 5,815 14,356
-------- -------- --------
Cash and cash equivalents, end of year..................... $ 5,815 $ 14,356 $ 14,029
======== ======== ========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-5
<PAGE> 47

ALPHA INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS)

<TABLE>
<CAPTION>
RETAINED UNEARNED
COMMON STOCK ADDITIONAL EARNINGS COMPENSATION
------------------ PAID-IN (ACCUMULATED TREASURY RESTRICTED
SHARES PAR VALUE CAPITAL DEFICIT) STOCK STOCK
------ --------- ---------- ------------- -------- ------------
<S> <C> <C> <C> <C> <C> <C>
Balance at March 31, 1996......... 14,908 $3,727 $52,225 $ 2,056 $(321) $(154)
Net loss.......................... -- -- -- (15,572) -- --
Employee Stock Purchase Plan...... 23 5 103 -- -- --
Amortization of unearned
compensation restricted stock... -- -- -- -- -- 35
Issuance of 150,870 treasury
shares to 401(k) plan........... -- -- 702 -- 129 --
Repurchase of 19,000 shares of
restricted stock................ -- -- (53) -- (3) 45
Exercise of stock options......... 259 65 397 -- -- --
------ ------ ------- -------- ----- -----
Balance at March 30, 1997......... 15,190 3,797 53,374 (13,516) (195) (74)
Net income........................ -- -- -- 10,302 -- --
Employee Stock Purchase Plan...... 30 7 131 -- -- --
Amortization of unearned
compensation restricted stock... -- -- -- -- -- 31
Issuance of 124,170 treasury
shares to 401(k) plan........... -- -- 685 -- 148 --
Repurchase of 32,754 shares....... -- -- -- -- (268) --
Exercise of stock options......... 523 131 1,081 -- -- --
Exercise of stock warrants........ 75 19 169 -- -- --
------ ------ ------- -------- ----- -----
Balance at March 29, 1998......... 15,818 3,954 55,440 (3,214) (315) (43)
Net income........................ -- -- -- 21,490 -- --
Employee Stock Purchase Plan...... 25 7 218 -- -- --
Issuance of restricted stock...... 6 1 60 -- -- (61)
Amortization of unearned
compensation restricted stock... -- -- -- -- -- 90
Issuance of 87,914 treasury shares
to 401(k) plan.................. -- -- 778 -- 182 --
Exercise of stock options......... 202 51 1,673 -- -- --
Tax benefit from the exercise of
stock options................... -- -- 703 -- -- --
------ ------ ------- -------- ----- -----
Balance at March 28, 1999......... 16,051 $4,013 $58,872 $ 18,276 $(133) $ (14)
====== ====== ======= ======== ===== =====
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-6
<PAGE> 48

ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The financial statements include the accounts of the Company and its
subsidiaries. All significant intercompany accounts and transactions have been
eliminated in consolidation. The Company's fiscal year ends on the Sunday
closest to March 31. There were 52 weeks in fiscal 1997, 1998 and 1999.

Use of Estimates

The preparation of consolidated financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses. Actual results
could differ from those estimates.

Revenue Recognition

Revenue is recognized when a product is shipped and services are performed.

Foreign Currency Translation

The accounts of foreign subsidiaries are translated in accordance with Statement
of Financial Accounting Standards ("SFAS") No. 52. Foreign operations are
remeasured as if the functional currency were the U.S. dollar. Monetary assets
and liabilities are translated at the year end rates of exchange. Revenues and
expenses (except cost of sales and depreciation) are translated at the average
rate for the period. Non-monetary assets, equity, cost of sales and depreciation
are remeasured at historical rates. Remeasurement gains and losses are reflected
currently in operations and are not material.

Research and Development Expenditures

Research and development expenditures are charged to income as incurred.

Cash, Cash Equivalents and Short-term Investments

Cash and cash equivalents include cash deposited in demand deposits at banks and
highly liquid investments with original maturities of 90 days or less.

The Company's short-term investments are classified as held-to-maturity. These
investments consist primarily of commercial paper and securities issued by
various federal agencies with original maturities of more than 90 days. Such
short-term investments are carried at amortized cost, which approximates fair
value, due to the short period of time to maturity. Gains and losses are
included in investment income in the period they are realized.

Inventories

Inventories are stated at the lower of cost, determined on a first-in, first-out
basis, or market.

Property, Plant and Equipment

Property, plant and equipment are carried at cost. Depreciation is provided on
the straight-line method for financial reporting and accelerated methods for tax
purposes.

F-7
<PAGE> 49
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Estimated useful lives used for depreciation purposes are 5 to 30 years for
buildings and improvements and 3 to 10 years for machinery and equipment.

During fiscal 1999, the Company removed $6.5 million of fully depreciated fixed
assets from the related property, plant and equipment and accumulated
depreciation accounts.

Fair Value of Financial Instruments

Financial instruments of the Company consist of cash, cash equivalents, accounts
receivable, accounts payable and accrued liabilities. The carrying value of
these financial instruments approximates their fair value because of the short
maturity of these instruments. Based upon borrowing rates currently available to
the Company for issuance of similar debt with similar terms and remaining
maturities, the estimated fair value of long-term debt approximates their
carrying amounts. The Company does not use derivative instruments.

Income Taxes

The Company uses the asset and liability method of accounting for income taxes.
Under the asset and liability method, deferred tax assets and liabilities are
recognized for the estimated future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets and
liabilities and their respective tax bases. This method also requires the
recognition of future tax benefits such as net operating loss carryforwards, to
the extent that realization of such benefits is more likely than not. Deferred
tax assets and liabilities are measured using enacted tax rates expected to
apply to taxable income in the years in which those temporary differences are
expected to be recovered or settled. The effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in the period that
includes the enactment date.

Net Income per Common Share

Basic earnings per share is calculated by dividing net income by the weighted
average number of common shares outstanding. Diluted earnings per share includes
the dilutive effect of stock options and warrants, if their effect is dilutive,
using the treasury stock method.

A reconciliation of the weighted average number of shares outstanding used in
the computation of the basic and diluted earnings per share for each of the
following years:

<TABLE>
<CAPTION>
YEARS ENDED
-----------------------------------
MARCH 30, MARCH 29, MARCH 28,
1997 1998 1999
--------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C>
Weighted average shares (basic)..................... 14,772 15,302 15,824
Effect of dilutive stock options.................... -- 409 527
------ ------ ------
Weighted average shares (diluted)................... 14,772 15,711 16,351
====== ====== ======
</TABLE>

Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed of

The Company adopted the provisions of SFAS No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of,"
during fiscal 1997. This statement requires that long-lived assets and certain
identifiable intangibles be reviewed for impairment whenever events or changes
in circumstances indicate that the carrying amount of an asset may not be
recoverable. Recoverability of assets to be held and used is measured by a
comparison of the carrying amount of an asset to undiscounted future net cash
flows expected to be generated by the asset. If such assets are

F-8
<PAGE> 50
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

considered to be impaired, the impairment to be recognized is measured by the
amount by which the carrying amount of the assets exceeds the fair value of the
assets. Assets to be disposed of are reported at the lower of the carrying
amount or fair value less costs to sell. Adoption of this Statement did not have
a material impact on the Company's financial position, results of operations, or
liquidity.

Stock Option Plans

Prior to fiscal 1997, the Company accounted for its stock option plan in
accordance with the provisions of Accounting Principles Board ("APB") Opinion
No. 25, "Accounting for Stock Issued to Employees," and related interpretations.
As such, compensation expense would be recorded on the date of grant only if the
current market price of the underlying stock exceeded the exercise price. During
fiscal 1997, the Company adopted SFAS No. 123, "Accounting for Stock-Based
Compensation," which permits entities to recognize as expense over the vesting
period the fair value of all stock-based awards on the date of grant.
Alternatively, SFAS No. 123 also allows entities to continue to apply the
provisions of APB Opinion No. 25 and provide pro forma net income and pro forma
earnings per share disclosures for employee stock option grants made in 1995 and
future years as if the fair-value-based method defined in SFAS No. 123 had been
applied. The Company has elected to continue to apply the provisions of APB
Opinion No. 25 and provide the pro forma disclosure provisions of SFAS No. 123.

Comprehensive Income (Loss)

During fiscal 1999, the Company adopted the provisions of SFAS No. 130,
"Reporting Comprehensive Income." SFAS No. 130 is a financial statement
presentation standard which requires the Company to disclose non-owner changes
included in equity but not included in net income or loss. There were no
differences between net income (loss) and comprehensive income (loss) for fiscal
1997, 1998 and 1999.

Recent Accounting Pronouncements

SFAS No. 133, "Accounting for Derivative Instruments and Hedging Instruments"
establishes accounting and reporting standards for derivatives and hedging
activities. It requires that an entity recognize all derivatives as either
assets or liabilities in the balance sheet and measure those instruments at fair
value. SFAS No. 133 will be effective for the Company's fiscal year 2001. The
Company does not expect this new statement to have a material effect on its
consolidated financial position, results of operations or cash flow.

NOTE 2 -- INVENTORIES

Inventories consisted of the following:

<TABLE>
<CAPTION>
MARCH 29, MARCH 28,
1998 1999
--------- ---------
(IN THOUSANDS)
<S> <C> <C>
Raw materials............................................. $3,916 $3,852
Work-in-process........................................... 2,259 3,034
Finished goods............................................ 1,766 1,887
------ ------
$7,941 $8,773
====== ======
</TABLE>

NOTE 3 -- BORROWING ARRANGEMENTS AND COMMITMENTS

Lines Of Credit

The Company has a $7.5 million Working Capital Revolving Line of Credit
Agreement which expires September 30, 1999. This line of credit is
collateralized by the assets of the Company, excluding real

F-9
<PAGE> 51
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

property, not otherwise collateralized. A commitment fee of 1/2% per year is
due quarterly under the Agreement. There were no borrowings under this Credit
Agreement at March 29, 1998 and March 28, 1999.

The Company also has a $7.5 million Equipment Line of Credit Agreement which
expires on September 30, 1999. Prior to expiration, the Equipment Line of Credit
Agreement may be converted, at the option of the Company, to a four-year term
loan. This equipment line of credit is collateralized by equipment financed. A
facility fee of $15,000 is payable on October 1, 1999 only if the Company does
not borrow at least half of the loan amount prior to expiration. There were no
borrowings under this Agreement at March 29, 1998 and March 28, 1999.

Long-Term Debt

Long-term debt consisted of the following:

<TABLE>
<CAPTION>
MARCH 29, MARCH 28,
1998 1999
--------- ---------
(IN THOUSANDS)
<S> <C> <C>
Equipment Term Note....................................... $2,344 $ 689
Industrial Revenue Bond................................... 444 334
CDBG Grant................................................ 713 602
------ ------
3,501 1,625
Less -- current maturities................................ 1,876 912
------ ------
$1,625 $ 713
====== ======
</TABLE>

The Equipment Term Note is at LIBOR (5.672% at March 29, 1998 and 4.963% at
March 28, 1999) plus 2.5% and 1.5%, respectively. This note is collateralized by
the assets of the Company, excluding real property, not otherwise
collateralized. Principal payments of approximately $138,000 plus interest are
due monthly until August 1999.

The Industrial Revenue Bond is held by the Farmers and Mechanics National Bank.
The interest rate on this bond is prime (8.5% and 7.75% at March 29, 1998 and
March 28, 1999) and quarterly principal payments of approximately $28,000 are
due until March 2002. The bond is secured by various property, plant and
equipment with a net book value of $2.1 million at March 28, 1999.

The Company obtained a ten year $960,000 loan from the State of Maryland under
the Community Development Block Grant program. Quarterly payments are due
through December 2003 and represent principal plus interest at 5% of the
unamortized balance.

Aggregate annual maturities of long-term debt are as follows:

<TABLE>
<CAPTION>
FISCAL YEAR (IN THOUSANDS)
<S> <C>
2001................................................... $234
2002................................................... 240
2003................................................... 135
2004................................................... 104
----
$713
====
</TABLE>

Cash payments for interest were $470,000, $492,000 and $253,000, in fiscal 1997,
1998 and 1999, respectively.

F-10
<PAGE> 52
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The bond, lines of credit and term loan agreements include various covenants
that require maintenance of certain financial ratios and balances and restrict
creation of funded debt and payment of dividends.

NOTE 4 -- REPOSITIONING CHARGE

During fiscal 1997, the Company successfully completed the resizing of
Trans-Tech, Inc. ("TTI"), its Maryland subsidiary, which included the sale of
Trans-Tech Europe, its French ceramic manufacturing operation, and the closing
of the TTI California facility. The Company also completed the sale of the
digital radio product line. The above actions resulted in a repositioning charge
which was recorded in the fourth quarter of fiscal 1997. The charge included the
following items:

<TABLE>
<CAPTION>
(IN THOUSANDS)
<S> <C>
Employee severance at TTI................................... $ 493
Lease commitments on unoccupied facilities at TTI........... 512
Write-off of excess equipment at TTI........................ 263
Net loss on divestitures.................................... 806
------
Total repositioning charge............................. $2,074
======
</TABLE>

The severance charges were related to a reduction in force of 47 employees,
largely among support personnel, and were completed in the fourth quarter of
fiscal 1997.

The cash payments relating to the repositioning charge totaled approximately
$1.4 million. Cash payments totaling $308,000 and $1.1 million were made during
fiscal 1997 and 1998, respectively.

During fiscal 1997, the Company also recorded in cost of sales a $2.6 million
write-down of inventory resulting from shifts in demand away from ceramic
products.

NOTE 5 -- INCOME TAXES

Income (loss) before income taxes consisted of:

<TABLE>
<CAPTION>
YEARS ENDED
-----------------------------------
MARCH 30, MARCH 29, MARCH 28,
1997 1998 1999
--------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C>
Domestic.................................................... $(13,520) $11,027 $19,443
Foreign..................................................... (2,052) 420 782
-------- ------- -------
Total....................................................... $(15,572) $11,447 $20,225
======== ======= =======
</TABLE>

The income tax provision (benefit) consisted of the following:

<TABLE>
<CAPTION>
FISCAL 1999 CURRENT DEFERRED TOTAL
----------- ------- -------- -------
(IN THOUSANDS)
<S> <C> <C> <C>
Federal.................................................... $ 447 $(2,530) $(2,083)
State...................................................... 670 (97) 573
Foreign.................................................... 245 -- 245
------ ------- -------
Total...................................................... $1,362 $(2,627) $(1,265)
====== ======= =======
</TABLE>

<TABLE>
<CAPTION>
FISCAL 1998 CURRENT DEFERRED TOTAL
----------- ------- -------- -------
<S> <C> <C> <C>
Federal.................................................... $ 221 $ -- $ 221
State...................................................... 683 -- 683
Foreign.................................................... 241 -- 241
------ ------- -------
Total...................................................... $1,145 $ -- $ 1,145
====== ======= =======
</TABLE>

F-11
<PAGE> 53
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

<TABLE>
<CAPTION>
FISCAL 1997 CURRENT DEFERRED TOTAL
----------- ------- -------- -------
<S> <C> <C> <C>
Federal.................................................... $ -- $ -- $ --
State...................................................... (119) -- (119)
Foreign.................................................... 119 -- 119
------ ------- -------
Total...................................................... $ -- $ -- $ --
====== ======= =======
</TABLE>

Income tax expense (benefit) for income taxes is different from that which would
be obtained by applying the statutory federal income tax rates of 34% to pretax
income in 1997 and 1998 and 35% in 1999, as a result of the following:

<TABLE>
<CAPTION>
YEARS ENDED
-----------------------------------
MARCH 30, MARCH 29, MARCH 28,
1997 1998 1999
--------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C>
Tax expense (benefit) at U.S. statutory rate......... $(5,294) $ 3,892 $ 7,079
Alternative minimum tax.............................. -- 221 --
Foreign tax rate difference.......................... -- -- (29)
State income taxes, net of federal benefit........... 79 451 372
Change in valuation allowance........................ 5,189 (3,375) (9,298)
Other, net........................................... 26 (44) 611
------- ------- -------
Total................................................ $ -- $ 1,145 $(1,265)
======= ======= =======
</TABLE>

F-12
<PAGE> 54
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The tax effects of temporary differences that give rise to significant portions
of the deferred tax assets and deferred tax liabilities are as follows:

<TABLE>
<CAPTION>
MARCH 29, MARCH 28,
1998 1999
--------- ---------
(IN THOUSANDS)
<S> <C> <C>
Deferred tax assets:
Accounts receivable due to bad debts...................... $ 235 $ 242
Inventories due to reserves and inventory
capitalization......................................... 1,238 1,377
Accrued liabilities....................................... 2,494 892
Deferred compensation..................................... 140 670
Other..................................................... 24 --
Net operating loss carryforward........................... 8,723 3,687
Charitable contribution carryforward...................... 30 --
Minimum tax credit and state tax credit carryforwards..... 1,045 1,007
-------- -------
Total gross deferred tax assets........................ 13,929 7,875
Less valuation allowance............................... (10,128) (830)
-------- -------
Net deferred tax assets................................ 3,801 7,045
-------- -------
Deferred tax liabilities:
Property, plant and equipment due to depreciation......... (3,801) (3,715)
-------- -------
Total gross deferred tax liability..................... (3,801) (3,715)
-------- -------
Net deferred tax assets................................ $ -- $ 3,330
======== =======
</TABLE>

Deferred income taxes are presented in the accompanying consolidated
balance sheets as follows:

<TABLE>
<CAPTION>
MARCH 29, MARCH 28,
1998 1999
--------- ---------
(IN THOUSANDS)
<S> <C> <C>
Current deferred tax assets............................ $ -- $ 6,522
Non-current deferred tax liabilities................... -- 3,192
-------- -------
Net deferred tax assets........................... $ -- $ 3,330
======== =======
</TABLE>

The valuation allowance for deferred tax assets as of March 29, 1998 and March
28, 1999 was $10.1 million and $830,000, respectively. The net change in the
total valuation allowance for the years ended March 29, 1998 and March 28, 1999
was a decrease of $3.4 million and $9.3 million, respectively. During fiscal
1999, the Company reduced the valuation allowance to reflect the deferred tax
assets utilized in fiscal 1999 to reduce the current income taxes and to
recognize additional net deferred tax asset. Management believes that the
Company will generate sufficient future taxable income to realize substantially
all of the deferred tax asset prior to expiration of any net operating loss
carryforwards. As of March 28, 1999, the Company has available for income tax
purposes approximately $10.5 million in federal net operating loss carryforwards
which are available to offset future taxable income. These loss carryforwards,
if not utilized, begin to expire in fiscal 2004. Should the Company undergo an
ownership change as defined in Section 382 of the Internal Revenue Code, the
Company's tax net operating loss

F-13
<PAGE> 55
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

carryforwards generated prior to the ownership change will be subject to an
annual limitation which could reduce or defer the utilization of these losses.
The Company also has minimum tax credit carryforwards of approximately $546,000
which are available to reduce future federal regular income taxes, if any, over
an indefinite period. In addition, the Company has state tax credit
carryforwards of $461,000 which are available to reduce state income taxes over
an indefinite period.

Cash payments for income taxes were $149,000, $342,000 and $915,000 in fiscal
1997, 1998 and 1999, respectively.

The Company has not recognized a deferred tax liability of approximately
$502,000 for the undistributed earnings of its 100% owned foreign subsidiaries
that arose in 1999 and prior years because the Company currently does not expect
those unremitted earnings to reverse and become taxable to the Company in the
foreseeable future. A deferred tax liability will be recognized when the Company
expects that it will recover those undistributed earnings in a taxable manner,
such as through receipt of dividends or sale of the investments. As of March 28,
1999, the undistributed earnings of these subsidiaries were approximately $1.4
million.

NOTE 6 -- COMMON STOCK

Common Stock Split

On January 28, 1999, the Board of Directors declared a three-for-two split of
the Company's common stock effected in the form of a stock dividend paid on
February 19, 1999 to shareholders of record as of February 8, 1999. All
agreements concerning stock options and other commitments payable in shares of
the Company's common stock provide for the issuance of additional shares due to
the declaration of the stock split. An amount equal to the par value of the
common shares issued plus cash paid in lieu of fractional shares was transferred
from additional paid-in capital to the common stock account. All share and per
share data in these consolidated financial statements and related footnotes has
been restated to reflect the stock split on a retroactive basis for all periods
presented.

Long-Term Incentive Plans

The Company has long-term incentive plans adopted in 1986 and 1996 pursuant to
which stock options, with or without stock appreciation rights, may be granted
and restricted stock awards and book value awards may be made.

Common Stock Options

These options may be granted in the form of incentive stock options or
non-qualified stock options. The option price may vary at the discretion of
the Compensation Committee but shall not be less than the greater of fair
market value or par value. The option term may not exceed ten years. The
options may be exercised in cumulative annual increments commencing one
year after the date of grant. A total of 4,200,000 shares are authorized
for grant under the Company's long-term incentive plans. The number of
common shares reserved for granting of future awards was 492,750, 113,325
and 840,409, at March 30, 1997, March 29, 1998 and March 28, 1999,
respectively.

Restricted Stock Awards

For fiscal 1999, a total of 6,066 restricted shares of the Company's common
stock were granted to certain employees. The market value of these shares
was $61,000 and the vesting period was one year. This amount was recorded
as unearned compensation -- restricted stock and is shown as a separate
component of stockholders' equity. Unearned compensation is being amortized
to expense over the vesting period and such expense amounted to $35,000,
$31,000 and $90,000 in fiscal 1997, 1998 and

F-14
<PAGE> 56
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

1999, respectively. No restricted shares of the Company's common stock were
issued during fiscal 1997 or 1998.

Long-Term Compensation Plan

On October 1, 1990, the Company adopted a Supplemental Executive Retirement Plan
("SERP") for certain key executives. Benefits payable under this plan are based
upon the participant's base pay at retirement reduced by proceeds from the
exercise of certain stock options. Options vest over a five-year period.
Benefits earned under the SERP are fully vested at age 55; however, the benefit
is ratably reduced if the participant retires prior to age 65. Compensation
expense related to the plan was $106,000, $127,000 and $27,000 in fiscal 1997,
1998 and 1999, respectively. Total benefits accrued under these plans were
$308,000 at March 29, 1998 and $335,000 at March 28, 1999.

A summary of stock option and restricted stock award transactions follows:

<TABLE>
<CAPTION>
WEIGHTED AVERAGE
EXERCISE PRICE OF
SHARES SHARES UNDER PLAN
--------- -----------------
<S> <C> <C>
Balance outstanding at March 31, 1996....................... 1,259,081 $2.92
---------
Granted................................................... 897,750 5.57
Exercised................................................. (259,125) 1.82
Restricted................................................ (34,746) --
Cancelled................................................. (279,755) 5.74
---------

Balance outstanding at March 30, 1997....................... 1,583,205 4.14
---------
Granted................................................... 390,000 7.58
Exercised................................................. (518,991) 2.30
Restricted................................................ (17,499) --
Cancelled................................................. (43,549) 6.11
---------

Balance outstanding at March 29, 1998....................... 1,393,166 5.65
---------
Granted................................................... 488,066 8.06
Exercised................................................. (179,455) 5.06
Restricted................................................ (16,004) --
Cancelled................................................. (42,750) 6.52
---------

Balance outstanding at March 28, 1999....................... 1,643,023 $6.46
=========
</TABLE>

The fair value of each option grant was estimated on the grant date using the
Black Scholes Option Pricing Model with the following weighted average
assumptions:

<TABLE>
<CAPTION>
1997 1998 1999
---- ---- ----
<S> <C> <C> <C>
Expected volatility......................................... 85% 71% 85%
Risk free interest rate..................................... 7% 6% 5%
Dividend yield.............................................. -- -- --
Expected option life (years)................................ 9.95 4.4 4.0
</TABLE>

F-15
<PAGE> 57
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Options exercisable at the end of each fiscal year:

<TABLE>
<CAPTION>
WEIGHTED
AVERAGE
SHARES EXERCISE PRICE
------- ---------------
<S> <C> <C>
1997........................................................ 634,404 $2.17
1998........................................................ 344,033 $3.95
1999........................................................ 413,960 $4.80
</TABLE>

Weighted average fair value of options granted during the year:

The following table summarizes information concerning currently outstanding and
exercisable options as of March 28, 1999:

<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
REMAINING AVERAGE WEIGHTED
NUMBER CONTRACTUAL OUTSTANDING OPTIONS AVERAGE
RANGE OF EXERCISE PRICES OUTSTANDING LIFE (YEARS) OPTION PRICE EXERCISABLE EXERCISE PRICE
------------------------ ----------- ------------ ------------ ----------- --------------
<S> <C> <C> <C> <C> <C>
$ 1.58 - $ 5.00.................... 482,523 6.63 $ 3.97 224,023 $ 3.11
$ 5.01 - $10.00.................... 1,027,834 8.29 $ 7.13 177,637 $ 6.52
$10.01 - $15.00.................... 113,100 8.94 $11.48 12,300 $10.68
$15.01 - $20.00.................... 2,000 9.93 $17.38 - -
$20.01 - $23.00.................... 1,500 9.78 $23.00 - -
Restricted....................... 16,066 6.86 - - -
--------- -------
1,643,023 413,960
========= =======
</TABLE>

The Company applies APB Opinion No. 25, "Accounting for Stock Issued to
Employees" and related interpretations in accounting for its stock option and
employee stock purchase plans, accordingly, no compensation expense has been
recognized in the consolidated financial statements for such plans. Had
compensation cost for the Company's stock option plans been determined based
upon the fair value at the grant date for awards under these plans consistent
with the methodology prescribed under SFAS No. 123, "Accounting for Stock-based
Compensation," the Company's net income (loss) would have been as follows:

<TABLE>
<CAPTION>
YEARS ENDED
-----------------------------------
MARCH 30, MARCH 29, MARCH 28,
1997 1998 1999
--------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Net income (loss)....................... As reported $(15,572) $10,302 $21,490
======== ======= =======
Pro forma $(15,921) $ 9,650 $20,433
======== ======= =======
Net income (loss) per share............. As reported $ (1.05) $ 0.66 $ 1.31
======== ======= =======
Pro forma $ (1.08) $ 0.61 $ 1.25
======== ======= =======
</TABLE>

The effect of applying SFAS No. 123 as shown in the above pro forma disclosure
is not representative of the pro forma effect on net income in future years
because it does not take into consideration pro forma compensation expense
related to grants made prior to fiscal year 1996.

F-16
<PAGE> 58
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Stock Purchase Warrants

In April 1994, the Company amended its line of credit agreement and issued
75,000 stock purchase warrants to Silicon Valley Bank. The warrants were
exercisable at $2.50 per share and were scheduled to expire on April 1, 1999.
During fiscal 1998, Silicon Valley Bank exercised the 75,000 stock purchase
warrants.

Stock Option Plan For Non-Employee Directors

The Company has two stock option plans for non-employee directors -- the 1994
Non-Qualified Stock Option Plan and the 1997 Non-Qualified Stock Option Plan.
Under the two plans, a total of 225,000 shares have been authorized for option
grants. The two plans have substantially similar terms and conditions and are
structured to provide options to non-employee directors as follows: a new
Director receives a total of 22,500 options upon becoming a member of the Board;
and continuing Directors receive 7,500 options after each Annual Meeting of
Shareholders. Under both of these plans the option price is the fair market
value at the time the option is granted. Options become exercisable 20% per year
beginning one year from the date of grant. During fiscal 1998 and 1999, 112,500
and 30,000 shares were granted at prices of $10.33 or $13.17, respectively. No
options were granted during fiscal 1997. At March 28, 1999 a total of 172,500
options have been granted under these two plans. During fiscal 1999, 22,500
options were exercised at a weighted average exercise price of $6.48. At March
28, 1999, 12,000 shares were exercisable.

Stock Purchase Plan

The Company maintains an employee stock purchase plan. Under the plan, eligible
employees may purchase common stock through payroll deductions of up to 10% of
compensation. The price per share is the lower of 85% of the market price at the
beginning or end of each six-month offering period. The plan provides for
purchases by employees of up to an aggregate of 450,000 shares through December
31, 2001. Shares of 22,614, 29,640 and 25,753 were purchased under this plan in
fiscal 1997, 1998 and 1999, respectively.

NOTE 7 -- EMPLOYMENT BENEFIT PLAN

The Company maintains a 401(k) plan covering substantially all of its employees.
All of the Company's employees who are at least 21 years old and have completed
six months of service (1,000 hours in a 12 month period) with the Company are
eligible to receive a Company contribution. Discretionary Company contributions
are determined by the Board of Directors and may be in the form of cash or the
Company's stock. The Company contributes a match of 100% of the first 1% and a
50% match on the next 4% of an employee's salary for employees with 5 years or
less of service. For employees with more than 5 years of service the Company
contributes a 100% match on the first 1% and a 75% match on the next 5% of an
employee's salary. For fiscal 1997, 1998 and 1999, the Company contributed
166,434, 92,621 and 80,668, shares, respectively of the Company's common stock
valued at $835,000, $833,000 and $960,000 to the 401(k) plan.

NOTE 8 -- COMMITMENTS AND CONTINGENCIES

The Company has various operating leases primarily for computer equipment and
buildings. Rent expense amounted to $1.9 million, $1.8 million and $1.3 million
in fiscal 1997, 1998 and 1999, respectively.

F-17
<PAGE> 59
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Purchase options may be exercised at various times for some of these leases.
Future minimum payments under these leases are as follows:

<TABLE>
<CAPTION>
FISCAL YEAR (IN THOUSANDS)
----------- --------------
<S> <C>
2000........................................................ $ 698
2001........................................................ 535
2002........................................................ 377
2003........................................................ 306
Thereafter.................................................. --
------
$1,916
======
</TABLE>

The Company has been notified by federal and state environmental agencies of its
potential liability with respect to the Spectron, Inc. Superfund site in Elkton,
Maryland. Several hundred other companies have also been notified about their
potential liability regarding this site. The Company continues to deny that it
has any responsibility with respect to this site other than as a de minimis
party. Management is of the opinion that the outcome of the aforementioned
environmental matter will not have a material effect on the Company's operations
or financial position.

The Company is party to suits and claims arising in the normal course of
business. Management believes these are adequately provided for or will result
in no significant additional liability to the Company.

NOTE 9 -- RELATED PARTY TRANSACTIONS

The Company has had transactions in the normal course of business with various
related parties. Scientific Components Corporation, currently an owner of the
Company's common stock, purchased approximately $5.1 million, $8.9 million and
$7.4 million of products during fiscal 1997, 1998 and 1999, respectively. In
addition, a Director of the Company is also a former Director of Scientific
Atlanta, Inc. During fiscal 1997, 1998 and 1999, Scientific Atlanta, Inc.
purchased approximately $1.0 million, $471,000 and $673,000 of product,
respectively.

NOTE 10 -- SEGMENT INFORMATION

The Company is engaged in the design and manufacture of discrete semiconductors,
integrated circuits and electrical ceramic components for a wide range of
applications in the wireless communications industry.

The Company has adopted SFAS No. 131, "Disclosures About Segments of an
Enterprise and Related Information." SFAS No. 131 establishes standards for the
way public business enterprises report information about operating segments in
annual financial statements and in interim reports to shareholders. The method
for determining what information to report is based on the way that management
organizes the segments within the Company for making operating decisions and
assessing financial performance. In evaluating financial performance, management
uses sales and operating profit as the measure of the segments profit or loss.

The Company is organized into three reportable segments as follows:

Wireless Semiconductor Products Group

The Wireless Semiconductor segment designs and manufactures gallium arsenide
integrated circuits and other discrete semiconductors to the global market for
wireless telephone handsets, wireless data and other applications.

F-18
<PAGE> 60
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Application Specific Products Group

The Application Specific segment designs and manufactures a broad range of
gallium arsenide and silicon devices and components to satellite,
instrumentation, defense and other communications markets.

Ceramic Products Group

The Ceramics segment designs and manufactures technical ceramic and magnetic
products for wireless telephony infrastructure and other wireless markets.

The table below presents selected financial data by business segment for fiscal
1998 and 1999. It is not practicable to present information for fiscal 1997 as
the Company was not segmented in this manner at that time. The accounting
policies of the segments are the same as those described in the "Summary of
Significant Accounting Policies."

<TABLE>
<CAPTION>
YEARS ENDED
----------------------
MARCH 29, MARCH 28,
SALES 1998 1999
----- --------- ---------
(IN THOUSANDS)
<S> <C> <C>
Wireless Semiconductor Products............................. $ 52,612 $ 65,822
Application Specific Products............................... 37,118 34,977
Ceramic Products............................................ 27,151 25,540
-------- --------
$116,881 $126,339
======== ========
</TABLE>

<TABLE>
<CAPTION>
Operating Income
----------------
<S> <C> <C>
Wireless Semiconductor Products............................. $ 2,799 $ 7,435
Application Specific Products............................... 7,210 10,241
Ceramic Products............................................ 1,679 1,879
-------- --------
$ 11,688 $ 19,555
======== ========
</TABLE>

<TABLE>
<CAPTION>
MARCH 29, MARCH 28,
1998 1999
--------- ---------
Net Long-Lived Assets (IN THOUSANDS)
------------------------------------------------------------
<S> <C> <C>
Wireless Semiconductor Products............................. $ 18,712 $ 27,646
Application Specific Products............................... 3,357 3,657
Ceramic Products............................................ 10,497 11,128
Corporate................................................... 98 66
-------- --------
$ 32,664 $ 42,497
======== ========
</TABLE>

<TABLE>
<CAPTION>
Total Assets
------------
<S> <C> <C>
Wireless Semiconductor Products............................. $ 29,596 $ 41,508
Application Specific Products............................... 11,327 10,751
Ceramic Products............................................ 16,685 20,119
Corporate................................................... 19,321 34,303
-------- --------
$ 76,929 $106,681
======== ========
</TABLE>

Customer Concentration

During fiscal year 1997, 1998 and 1999, one customer, an OEM, accounted for 11%,
25% and 28%, respectively, of the Company's total sales. For fiscal 1999 sales
to its two largest customers and their suppliers, represented approximately 40%
of the Company's total sales. In fiscal 1997 and 1998, sales to

F-19
<PAGE> 61
ALPHA INDUSTRIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

these OEMs and their suppliers represented approximately 21% and 37% of the
Company's total sales, respectively. In fiscal 1999, sales to the Company's 15
largest customers accounted for 64% of total sales. In fiscal 1997 and 1998,
sales to these customers accounted for 44% and 63%, respectively. While the
Company believes that these emerging wireless markets afford great
opportunities, such customer concentration could have an adverse affect on the
business.

Geographic Information

Sales include export sales primarily to Europe and to a lesser extent Asia, of
$26.7 million, $39.2 million and $53.7 million, in fiscal 1997, 1998 and 1999,
respectively. During fiscal 1997, 1998 and 1999, the Company operated a sales
subsidiary in the United Kingdom. At the end of fiscal 1997, the Company sold
its ceramic manufacturing operation in France. The following table shows certain
financial information relating to the Company's operations in various geographic
areas:

<TABLE>
<CAPTION>
YEARS ENDED
-----------------------------------
MARCH 30, MARCH 29, MARCH 28,
1997 1998 1999
--------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C>
Sales
United States
Customers............................................. $ 76,004 $110,108 $118,460
Intercompany.......................................... 6,472 5,665 6,497
Europe
Customers............................................. 9,249 6,773 7,879
Eliminations............................................. (6,472) (5,665) (6,497)
-------- -------- --------
Net sales.................................................. $ 85,253 $116,881 $126,339
======== ======== ========
Income (loss) before taxes
United States............................................ $(13,520) $ 11,027 $ 19,443
Europe................................................... (2,052) 420 782
-------- -------- --------
Income (loss) before taxes................................. $(15,572) $ 11,447 $ 20,225
======== ======== ========
</TABLE>

<TABLE>
<CAPTION>
MARCH 30, MARCH 29, MARCH 28,
1997 1998 1999
--------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C>
Assets
United States............................................ $ 61,547 $ 72,165 $101,212
Europe................................................... 3,706 4,764 5,469
-------- -------- --------
Total assets.......................................... $ 65,253 $ 76,929 $106,681
======== ======== ========
</TABLE>

Substantially all of the Company's long-lived assets are located in the United
States. Transfers between geographic areas are made at terms that allow for a
reasonable profit to the seller.

NOTE 11 -- SUBSEQUENT EVENT (UNAUDITED)

On April 27, 1999, the Board of Directors approved a plan to reserve up to
675,000 shares of common stock for future grants of stock options to employees.
Directors and officers are not eligible to participate in this plan.

F-20
<PAGE> 62

- --------------------------------------------------------------------------------

[alpha logo]

ALPHA INDUSTRIES, INC.

3,000,000 SHARES

COMMON STOCK

---------------------------

PROSPECTUS
---------------------------

May 26, 1999

CIBC WORLD MARKETS

PRUDENTIAL SECURITIES

U.S. BANCORP PIPER JAFFRAY

- --------------------------------------------------------------------------------

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. NO DEALER,
SALESPERSON OR OTHER PERSON IS AUTHORIZED TO GIVE INFORMATION THAT IS NOT
CONTAINED IN THIS PROSPECTUS. THIS PROSPECTUS IS NOT AN OFFER TO SELL NOR IS IT
SEEKING AN OFFER TO BUY THESE SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR
SALE IS NOT PERMITTED. THE INFORMATION CONTAINED IN THIS PROSPECTUS IS CORRECT
ONLY AS OF THE DATE OF THIS PROSPECTUS, REGARDLESS OF THE TIME OF THE DELIVERY
OF THIS PROSPECTUS OR ANY SALE OF THESE SECURITIES.