EL SEGUNDO, CA. - October 25, 2001 -- International Rectifier Corporation (IRF/NYSE) today reported net income of $9.6 million (or $0.15 per share) on revenues of $168.5 million for the first fiscal quarter ended September, compared to net income of $42.1 million (or $0.63 per share) on revenues of $249.4 million in the comparable year-ago quarter. In the June quarter, the company reported revenues of $185.1 million and income of $15.1 million (or $0.23 per share), excluding an $86.4 million pretax restructuring charge. Including the charge, the company reported a net loss of $48.8 million (or $0.78 per share) in the June quarter.

Revenues from proprietary products (analog ICs, advanced-circuit devices, and power systems) rose by 8 percent year-to-year. These now comprise 48 percent of total product revenues, compared to 30 percent in the prior-year quarter. Orders for proprietary products grew 4 percent sequentially and, for the third consecutive quarter, represented more than half of total bookings. Overall orders grew 3 percent.

September-quarter gross margin was 35.6 percent, compared to 39.6 percent in the year-ago quarter. In the prior quarter, the gross margin was 38.8 percent before and 18.1 percent after the restructuring charge. Strength in higher-margin proprietary products helped to counter the impact of lower production volumes for components, a decline in component prices, and severance costs.

Shipments to the defense/aerospace, consumer products, and automotive markets increased by 37 percent year-to-year and helped to offset the weakness in the information technology and industrial markets.

During the quarter, IR proprietary products gained sole-source positions in seven new defense programs and six new satellite programs for industry leaders including Lockheed Martin, Raytheon, Boeing, and Northrup Grumman. Proprietary analog ICs, advanced circuit devices, and recently-introduced iPOWIR modules won key designs for powering Intel's latest- and next-generation processors. IR now dominates power management for high-end mobile processors and holds its highest share ever in Pentium-generation desktops and workstations from Dell, IBM, Hewlett-Packard, and Compaq, as well as a large number of tier-two white box suppliers. IR holds a commanding lead in power mangement for energy-efficient appliances, most recently winning sole-source position on the motor drive for next-generation washers from Sharp Electronics. The company began shipping proprietary electric power steering (EPS) modules for a leading European automaker's model year 2002 vehicles.

The company expects revenues to be flat-to-up $5 million in the December quarter and increase by another $5 to $10 million sequentially in the March quarter.

Chief Executive Officer Alex Lidow noted, "IR's business model has significantly lessened the impact of the worst downturn in semiconductor history. Just this week, the World Semiconductor Trade Statistics organization estimated that industry revenues dropped by 29 percent in the nine months ended September. Over the same period, our revenues have declined by only 7 percent. Our gross margin remains just 6 percentage points off their peak, at what we believe is the bottom of this industry cycle. We continue to capture more silicon content in target applications and believe our design wins will add significant momentum when business turns up. In addition, a cash balance of $815 million supports the company's strong financial position and gives IR tremendous flexibility to underwrite our strategic interests."

Unaudited Consolidated Statement of Income
Consolidated Balance Sheet

International Rectifier is a world leader in power management technology that improves functionality, speed, compactness, and portability in information technology and other end products. IR's analog ICs, advanced-circuit devices, power systems, and components enable Internet hardware to gain speed and reliability, allow portable electronics to run longer off a single charge, improve automotive fuel efficiency, and cut energy consumption in home appliances and industrial motors. The company is the pioneer and market leader in the $4 billion power MOSFET industry, and over 20 companies are licensed under its power MOSFET patents. IR serves market leaders around the world, and more than half its revenue comes from outside the United States.

The foregoing material includes some forward-looking statements made pursuant to safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We caution that such statements are subject to a number of uncertainties, and actual results may differ materially. Factors that could affect the company's actual results include the failure of market demand to materialize as anticipated; greater-than-expected weakness or program or order postponements in the information technology segments of our business; the effectiveness of cost controls and cost reductions; litigation and other unexpected costs associated with cost-reduction efforts, including reductions in force and the transfer and consolidation of product lines; the effectiveness of integration of acquisitions into our operations and the transfer and consolidation of product lines; the ability or the timing of the company to achieve strategic acquisitions and the effect of associated costs; the accuracy of customers' forecasts; push-out of delivery dates; product returns; market and sector conditions that affect our customers, licensees, and suppliers; introduction, acceptance, availability, and continued demand and growth of new and high- performance products; delays in transferring and ramping production lines or completing customer qualifications; company and market impact due to the cancellation of customer and/or industry programs; the company's mix of product shipments; availability of adequate capacity and unanticipated costs of refurbishment or replacement of equipment; pricing pressures; failure of suppliers and subcontractors to meet their delivery commitments; unfavorable changes in industry and competitive conditions; impact of any disruption in, or increased cost of, electricity and/or other critical supplies; economic conditions in the company's markets around the world and the timing of changes in market conditions; changes in interest and investment rates; impacts on our business or financial condition due to changes in currency valuation or to the euro conversion; impact of changes in accounting methods; the impact of changes in laws and regulations, including tax, trade, and export regulations and policies; the actual results of any outstanding litigation; and other uncertainties disclosed in the company's filings with the Securities and Exchange Commission, including its most recent report on form 10-K. To the foregoing factors should be added the financial and other ramifications of terrorist actions.

NOTE:
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