PDF Solutions(R) and Fabbrix to Collaborate on Optimizing Manufacturability of IP Infrastructure Blocks at sub-65 Nanometers.

Joint Development Plans to Enable Fabbrix to Leverage PDF Solutions' Industry Leading Silicon Characterization Technology to Identify and Optimize Key Design Fabrics

SAN JOSE, Calif. -- PDF Solutions, Inc. (NASDAQ:PDFS), the leading provider of process-design integration technologies to enhance IC manufacturability, today announced a plan to collaborate with Fabbrix, a venture backed company delivering design solutions for nanoscale technologies. The collaboration will address the yield challenges inherent in sub-65 nanometer (nm) processes. Fabbrix has developed a proprietary solution for overcoming the shortfalls of restricted design rules necessary to achieve high yields without sacrificing area utilization at advanced nodes. The Fabbrix solution is based on implementing RTL with a limited set of bricks built out of regular design patterns. These design patterns, known as design fabrics, must be created and optimized to achieve maximum manufacturability.

"Arming semiconductor firms with the tools they need to achieve superior yields is the top priority for PDF," said Dr. John Kibarian, Chief Executive Officer of PDF Solutions. "By coupling PDF Solutions' experience and expertise in silicon characterization and yield modeling with best-in-class design solutions from technology leaders such as Fabbrix, we continue to position PDF to be able to improve clients' product yields in a manner that cannot be achieved through process improvements alone."

"Collaborating with PDF Solutions will enable Fabbrix to approach customers with a complete solution for silicon optimized design flows at advanced process nodes," said Dr. Larry Pileggi, Chief Technology Officer and Co-Founder of Fabbrix. "PDF Solutions has demonstrated the ability to achieve rapid and significant results for identifying and correcting sources of yield loss within our targeted customer base. With a joint development project for us to leverage PDF Solutions' technical infrastructure, Fabbrix will be positioned to deliver on the promise of yield optimized chips while achieving the full area reduction potential of advanced process nodes necessary to justify the costs of migrating beyond 65 nanometer processes."

The PDF Solutions Integrated Yield Ramp

PDF Solutions' Integrated Yield Ramp engagements combine patented and patent-pending tools and methodologies with a cross-functional team of engineers working on-site together with the client to improve client profitability through accelerated yield learning and improved product performance at any stage of IC manufacturing. PDF Solutions' CV([R]) Infrastructure includes a set of short-flow Characterization Vehicle([R]) test chips, pdFasTest([R]) hardware and pdCV([TM]) analysis software. The CV([R]) Infrastructure is designed to enable fast detection, root-cause analysis, and resolution of systematic and random IC failure mechanisms that limit process yield, as well as provide process and library characterization required by yield-aware DFM tools. This characterization data is also used in PDF Solutions' Yield Ramp Simulator([R]) (YRS([R])) software, which enables quantification of the product yield effect of both random and systematic failure mechanisms and can, for example, be used to prioritize process improvements.

About Fabbrix

Fabbrix delivers design solutions based on a regular structures implementation of nanoscale process technologies. The result of over 10 years of advanced research, the Fabbrix approach results in higher yields, simpler design flows, less expensive masks, reduced transistor variation, more effective resolution enhancement and better use of process technology.

Fabbrix offers a unique combination of physical building blocks, implementation and analysis tools and design methodologies. Fabbrix based designs are characterized by extreme regularity, predictability and simplicity and are precisely matched to the realities of nanoscale manufacturing.

About PDF Solutions

PDF Solutions, Inc. (NASDAQ:PDFS) is the leading provider of process-design integration technologies and services for manufacturing integrated circuits (ICs). PDF Solutions enables semiconductor companies to create IC designs that can be more easily manufactured using manufacturing processes that are more capable. By simulating deep sub-micron product and process interactions, the PDF solution offers clients reduced time to market, increased IC yield and performance, and enhanced product reliability and profitability. PDF Solutions also offers the industry leading Yield Management System (YMS) software, dataPOWER([R]), and Fault Detection and Classification (FDC) software, Maestria[TM], to enhance yield improvement and production control activities at leading fabs around the world. Headquartered in San Jose, Calif., PDF Solutions operates worldwide with additional offices in China, Europe, and Japan. For the company's latest news and information, visit http://www.pdf.com/.

Characterization Vehicle, CV, dataPOWER, pdFasTest, PDF Solutions, and the PDF Solutions logo are registered trademarks, and Maestria and pdCV trademarks, of PDF Solutions, Inc. All other trademarks are the property of their respective owner(s).

Forward-Looking Statements:

The statements in this press release regarding potential collaboration between PDF Solutions' and Fabbrix, including planned joint development projects, are forward looking. Actual results could differ materially from those expressed in these forward-looking statements. Risks and uncertainties that could cause results to differ materially include risks associated with: negotiations regarding a legal agreement for any such projects, any unforeseen industry changes; and changes in the marketplace for our solutions or a jointly developed solution, including the introduction of competitive products or services. Readers should also refer to the risk disclosures set forth in PDF Solutions' periodic public filings with the Securities and Exchange Commission, including, without limitation, its annual report on Form 10-K, most recently filed on March 16, 2006, and its quarterly reports on Form 10-Q, most recently filed on November 21, 2006. The forward-looking statements contained in this release are made as of the date hereof, and PDF Solutions does not assume any obligation to update such statements nor the reasons why actual results could differ materially from those projected in such statements.