Lite-On Semiconductor Company Reports Third Quarter 2006 Earnings.

* Third Quarter Consolidated Revenues of NT $3.1 Billion, up 4.7% from Q2 2006

* Third Quarter Net Income of NT $266 Million, up 23.7% from Q2 2006

TAIPEI, Taiwan -- Lite-On Semiconductor Company ("Lite-On") (TSE:5305), a leading manufacturer and supplier of high-quality image and discrete and analog semiconductor components and the largest global supplier of contact image sensors (CIS), today reported financial results for the third quarter of 2006.

Consolidated Third Quarter 2006

Revenues for the third quarter of 2006 were NT $3.1 billion, an increase of 8.9% from the third quarter of 2005. Gross profit and margin were NT $484 million and 15.5%, respectively, compared to NT $356 million and 12.4% for the same period in 2005, and NT $458 and 15.4% in Q2 2006. Operating income was NT $151 million in the third quarter 2006, which represented a 4.8% operating margin, compared to NT $63 million and a 2.2% margin for the same period in 2005. Net income was NT $266 million, a decrease of 60.5%, compared to NT $674 million for the third quarter of 2005, which included a $444 million after tax gain on the sale of 750,000 shares Diodes, Inc (NASDAQ:DIOD) stock. Basic earnings per share was NT $0.63 in the third quarter 2006, versus NT $1.78 in the third quarter of 2005. Adjusted earnings per share was NT $0.63 in the third quarter 2006 versus NT $1.66 in the third quarter of 2005.

"Lite-On Semiconductor posted another quarter of solid results in the third quarter of 2006, with continued improvement in our gross margin and operating margin, reflecting our shift towards higher value-added products," commented M.K. Lu, President of Lite-On Semiconductor. "More importantly, we continued to make strong progress in our strategic initiatives. We had our first win with a tier-one handset manufacturer, with our CCM products qualified for the next generation of mobile phones starting shipment in the 4th quarter. We experienced very strong design win activity for our analog and power management products. And we prepared for the launch of an important new product in the fourth quarter based on our proprietary sensor technology. Taken together, these factors cause us to feel very positive about the Company's prospects for growth and enhanced profitability in 2007."

Nine Months Results (Equity Method)

Revenues for the nine months ended on September 30, 2006 increased by 22.9% to NT $8.6 billion, versus NT $7.0 billion for the same period in 2005. Gross profit and gross margin were NT $906 million and 10.5%, respectively, for the nine months of 2006, versus NT $379 million and 5.4% for the same period in 2005. Net income was NT $863.6 million during the nine months ended September 30, 2006, compared to NT $1,036 million during the same period in 2005. Net income for the first nine months of 2006 includes an after-tax gain of NT $259 million from the sale of Lite-On's 62% stake in Anachip Corporation to Diodes, Inc. on January 10, 2006. The image, discrete, and foundry divisions accounted for 48%, 37%, and 14% of total revenues, respectively, for the first nine months of 2006.

About Lite-On Semiconductor

Lite-On Semiconductor, a subsidiary of Lite-On Group, is a leading manufacturer of opto-electronic device components and semiconductor solutions. Based in Taipei, Taiwan, the Company operates in three major business divisionsCoimage, discrete components and foundry. The image division produces monochrome contact image sensors (CIS) used primarily in fax machines, color CIS which are used in scanners and multifunctional printers, and CMOS camera modules (CCM) which are components of handset cameras. The discrete division manufactures and sells rectifiers, Surface Mounted Device (SMD) diodes, thrysistors, and metal oxide semiconductor field effect transistors (MOSFET), which are used in telecomm equipment, monitors, power supply devices and automobile parts. The foundry division manufactures analog integrated circuits (IC) and other power management ICs. Lite-On Semiconductor owns 22.6% of Diodes, Inc., a discrete semiconductor manufacturer based in the U.S.

Safe Harbor Statement

Except for statements in respect of historical matters, the statements contained in this Release are "forward-looking statements" within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934. These forward- looking statements were based on our management's expectations, projections and beliefs at the time regarding matters including, among other things, future revenues and costs, financial performance, technology changes, capacity, utilization rates, yields, process and geographical diversification, future expansion plans and business strategy. Such forward looking statements are subject to a number of known and unknown risks and uncertainties that can cause actual results to differ materially from those expressed or implied by such statements. Our release of financial forecasts and forward- looking statements at any particular time does not create any duty of disclosure beyond that which is imposed by law, and we expressly disclaim any obligation to publicly update or revise any forecasts or forward-looking statements, whether as a result of new information, future events or otherwise.

In addition, any financial information contained here within is presented in conformity with accounting principles generally accepted in the Republic of China ("ROC GAAP"). Readers should be cautioned that these accounting principles differ in many material respects from accounting principles generally accepted in the United States of America ("US GAAP"). The unaudited financial information mentioned herein is not necessarily indicative of our future financial results.

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