Revenues for the first quarter decreased to $50,448,000, compared to $53,469,000 for the corresponding period a year ago and $51,324,000 for the fourth quarter of 2008. Gross margin decreased to $21,831,000 for the first quarter of 2009, compared to $22,460,000 for the corresponding period a year ago and $20,809,000 for the fourth quarter of 2008. Gross margin, as a percentage of revenue, increased to 43.3% for the first quarter of 2009 compared to 42.0% for the first quarter of 2008, and increased on a sequential basis from 40.5% for the fourth quarter of 2008. Net loss for the first quarter was $(2,543,000), or $(0.06) per diluted share, compared to net income of $620,000, or $0.01 per diluted share, for the corresponding period a year ago and a net loss of $(3,501,000), or $(0.08) per diluted share, for the fourth quarter of 2008. The net loss for the quarter was primarily due to a pre-tax charge of $3,098,000 for the cost of severance and other employee-related costs in connection with the Company's previously announced plan to reduce its workforce, which was completed in January 2009.

The book-to-bill ratio for the first quarter of 2009 was 0.99:1, as compared to 0.93:1 for the fourth quarter of 2008. Backlog at the end of the first quarter of 2009 was $52,068,000, as compared to $52,724,000 at the end of 2008.

Commenting on the first quarter performance, Patrizio Vinciarelli, Chairman of the Board, President and Chief Executive Officer, stated, "Despite a double digit contraction in global shipments of electronic products, Vicor's first quarter revenue declined less than two percent sequentially, evidence of the strength of our business model and broad product portfolio. Nevertheless, we remain cautious about the near term outlook."

Dr. Vinciarelli added, "As disclosed, Vicor took the difficult step of reducing its workforce by approximately eight percent during the first quarter. We also undertook other initiatives to reduce our overall cost structure. These steps have had a negative impact on our first quarter costs which included a one-time severance charge of $3.1 million. We are determined to achieve a more favorable, long term cost structure and robust profitability while pursuing a high level of investment in product development and future growth."

Depreciation and amortization for the first quarter of 2009 was approximately $2,625,000, and capital additions totaled $1,029,000. For the same period of 2008, depreciation and amortization was $2,586,000 and capital additions totaled $2,325,000. Cash, restricted cash equivalents and short-term investments increased by $1,877,000 to approximately $26,465,000 at the end of the first quarter of 2009 from $24,588,000 at the end of 2008. There were no share repurchases during the quarter, and approximately $8,500,000 remains authorized for additional purchases under the Company's stock repurchase plan. The Company had previously announced an indefinite suspension of its semi-annual dividend.

As of March 31, 2009, the Company held approximately $38,300,000, at par value, of auction rate securities. As previously disclosed, conditions in the market for auction rate securities and the repeated failure of auctions by which such securities are priced have led the Company to continue to classify its holdings as long-term investments. Based on the Company's ability to access cash and other short-term investments and its expected operating cash flows, management does not anticipate the current lack of liquidity of holdings of auction rate securities will affect the Company's ability to execute its current operating plan.

The tax provision in 2009 has been provided for estimated income taxes due in various state and international taxing jurisdictions for which losses incurred by the Company cannot be offset and for estimated federal and state income taxes for certain minority-owned subsidiaries that are not part of the Company's consolidated income tax returns. In 2008, the tax provision was based on the estimated annual effective tax rate for 2008, which included estimated federal, state and foreign income taxes on the Company's projected annual pre-tax income and estimated federal and state income taxes for certain minority-owned subsidiaries that are not part of the Company's consolidated income tax returns, offset by the expected utilization of federal and foreign net operating loss carryforwards.