Centillium - Press Release No: 222005-42914-PM

FREMONT, Calif., Feb. 2, 2005 � Centillium Communications, Inc. (NASDAQ: CTLM), a leading provider of broadband access solutions, today announced financial results for the fourth quarter and year ended Dec. 31, 2004.

Revenues in the fourth quarter were $16.4 million, compared with revenues of $20.4 million in the third quarter of 2004. The net loss in the fourth quarter of 2004 was $11.8 million, or a net loss of $0.30 per share, compared with a net loss of $7.6 million, or a net loss of $0.20 per share, in the third quarter of 2004.� The fourth quarter net loss includes $1.3 million in costs related to a workforce reduction and $1.4 million in costs for early termination of a license for software development tools.

For the year ended Dec. 31, 2004, revenues were $71.2 million, compared with $125.0 million in 2003.� The net loss in 2004 was $43.1 million, or a net loss of $1.13 per share, compared with a net loss of $13.4 million, or a net loss of $0.37 per share, in the prior year.

�Centillium is firmly committed to reaching profitability, and we have taken concrete steps to achieve this objective,� said Faraj Aalaei, co-founder and CEO of Centillium.� �During the third and fourth quarters of 2004, we implemented programs to better focus the company on high-growth product and market opportunities, reduce expenses and increase our return on investment.� As a result, we expect operating expenses to decrease to between $15.0 million and $15.5 million in the first quarter of 2005 from $20.0 million in the first quarter of 2004.� This represents a savings of $4.5 million to $5.0 million in the first quarter, or $18.0 million to $20.0 million on an annualized basis,� he said.

�We continued to diversify our business within broadband access to other technologies and geographies in 2004,� said Aalaei. �In 2005, we will focus on growing our DSL business outside of Japan and on further growth opportunities in our Optical and VoIP businesses.

�During the fourth quarter, revenues from the non-Japanese side of our DSL business increased compared with the prior quarter.� We continue to see interest from service providers worldwide for our ADSL2+ technology, and we are making solid progress in China, Taiwan, Korea and Europe,� said Aalaei.

�In our Optical business, we continued to make progress in the growing Fiber-to-the-Premises (FTTP) market with increased customer traction. We believe that we are the only vendor offering a full line of end-to-end Gigabit Ethernet Passive Optical Networks (GEPON) solutions, and we intend to become one of the major players in the GEPON market,� said Aalaei.

At the January Consumer Electronics Show, Uniden America Corporation unveiled its new 5.8GHz digital expandable corded/cordless phone with built-in VoIP capability, powered by Centillium�s Voice Services Platform (VSP). �In the third quarter, Centillium and Uniden announced a strategic relationship for the development and delivery of consumer and small-office/home-office VoIP products, powered by Centillium�s VSP and developed in partnership with AT&T.� In addition, Centillium�s VSP was selected Internet Telephony magazine�s Product-of-the-Year for 2004.

A conference call discussing the fourth quarter and 2004 financial results will follow this release at

2:00 p.m. Pacific time/5:00 p.m. Eastern time.� To listen to the call, please dial (312) 470-0008, pass code: Centillium.� A replay will be made available approximately one hour after the conclusion of the call and will remain available for approximately two weeks.� To access the replay, dial (203) 369-0797. The conference call will also be webcast over the Internet; visit the Investor Relations section of the Centillium Communications website at www.centillium.com to access the call from the website.� This webcast will be recorded and available for replay on the Centillium website approximately two hours after the conclusion of the conference call for approximately two weeks.

About Centillium Communications

Centillium Communications, Inc. is a leading provider of broadband access solutions with innovative systems-level products for the consumer, enterprise and service provider markets.� The company�s high-performance and cost-effective infrastructure and service enabler products give its customers the winning edge in broadband access.� Centillium Communications� products include digital and mixed-signal integrated circuits and related hardware and software applications for Digital Subscriber Line (DSL) and Optical Networking equipment deployed in central offices and customer premises and Voice-over-Internet Protocol (VoIP) products for carrier- and enterprise-class gateways and consumer telephony.� The Centillium Communications headquarters are located at 215 Fourier Avenue, Fremont, CA 94539.� Additional information is available at www.centillium.com.

Forward Looking Statements

Except for statements of historical fact, this press release includes statements that are forward-looking statements within the meaning of U.S. Federal securities laws.� Actual results may differ materially from those indicated by such forward-looking statements based on a variety of risks and uncertainties, including without limitation the risks and uncertainties relating to the rate and breadth of deployment of broadband access in

general, especially DSL, Fiber-to-the-Premises and VoIP technologies, and Centillium�s technology solutions in particular; the successful development and market acceptance of Centillium�s new products and technology; Centillium�s dependence on a few significant customers for a substantial portion of its revenue; Centillium�s ability to continue and expand on its relationships with new customers; the timing, rescheduling or cancellation of significant customer orders and Centillium�s ability, as well as the ability of its customers, to manage inventory; Centillium�s ability to specify, develop or acquire, complete, introduce, market and transition to volume production new products and technologies in a cost-effective and timely manner; competitive pressures and other factors such as the qualification, availability and pricing of competing products and technologies and the resulting effects on sales and pricing of Centillium�s products; the timing of customer-industry qualification and certification of Centillium�s products and the risks of non-qualification or non-certification; Centillium�s ability to timely and accurately predict market requirements and evolving industry standards and to identify opportunities in new markets; changes in Centillium�s product or customer mix; the satisfactory completion of the audits of Centillium�s financial statements and systems of internal control; intellectual property disputes and customer indemnification claims and other types of litigation risk; the effectiveness of Centillium�s expense and product cost control and reduction efforts; and Centillium�s ability to attract, retain and motivate qualified personnel, including executive officers and other key management and technical personnel. Centillium undertakes no obligation to update forward-looking statements for any reason. Information about potential factors that could affect Centillium�s financial results is included in Centillium�s Annual Report on Form 10-K and in other documents on file with the Securities and Exchange Commission.

- Summary Financial Data Attached -

Centillium Communications, Inc.
Condensed Consolidated Statement of Operations-Unaudited
(In thousands, except per share data)

				Three Months Ended					Twelve Months Ended
			December 31,		September 30,		December 31,		December 31,		December 31,
			2004		2004		2003		2004		2003
Net revenues	�	$	16,412	$	20,368	$	25,721	$	71,151	$	124,976
Cost of revenues	�		8,500		10,281		18,301		37,679		71,153
Gross profit	�		7,912		10,087		7,420		33,472		53,823
Gross profit margin	�		48.2%		49.5%		28.8%		47.0%		43.1%

Operating expenses	�
Research and development	�		13,963		11,958		12,166		53,743		46,162
Sales and Marketing	�		3,480		3,292		3,287		13,360		12,142
General and administrative	�		2,452		2,632		2,416		10,346		9,734
Amortization of other acquisition - related intangibles	�		�� -		�� -		�� -		�� -		�� 83
Total operating expenses	�		19,895		17,882		17,869		77,449		68,121
Operating loss	�		(11,983)		(7,795)		(10,449)		(43,977)		(14,298)
Interest income, net	�		279		219		222		1,070		1,072
Loss before provision for income taxes	�		(11,704)		(7,576)		(10,227)		(42,907)		(13,226)
Provision for income taxes	�		46		37		43		155		133
Net Loss	�	$	(11,750)	$	(7,613)	$	(10,270)	$	(43,062)	$	(13,359)

Basic and diluted loss per share	�	$	(0.30)	$	(0.20)	$	(0.27)	$	(1.13)	$	(0.37)

Common shares outstanding	�		38,543		38,340		37,704		38,210		36,433
	�
Common shares outstanding- assuming dilution	�		38,543		38,340		37,704		38,210		36,433

Note:� Results for the three months ended December 31, 2004, September 30, 2004 and December 31, 2003 include expenses of $47,000, $48,000 and $367,000, respectively,
for stock based compensation.� Results for the twelve months ended December 31, 2004 and 2003 include expenses of $289,000 and $1,426,000, respectively,
for stock based compensation.


Centillium Communications, Inc.
Consolidated Summary Financial Data-Unaudited
�(In thousands)
			December 31,		�December 31,
			2004		2003

� Balance Sheet Data:
� Cash and cash equivalents and short-term investments	�	$	62,191	$	89,626
� Accounts receivable, net	�		5,348		12,476
� Inventories	�		6,100		11,908
� Other assets	�		8,306		11,614
� Total assets	�	$	81,945	$	125,624

� Accounts payable	�	$	5,599	$	7,434
� Accruals and other current liabilities	�		20,150		22,010
� Long-term liabilities.	�		864		143
� Total liabilities	�		26,613		29,587
� Total stockholders' equity	�		55,332		96,037
� Total liabilities and stockholders' equity	�	$	81,945	$	125,624