Exhibit 13 - Annual Report

Financial Highlights
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
          1996      1995      1994       1993      1992
<S>       <C>       <C>       <C>        <C>       <C>
Revenue   $219,997  $269,162  $194,196   $168,577  $162,949
Income    $30,115   $40,535   $10,527    $7,785    $6,984
From
Operatio
ns
Net       $29,684   $29,212   $6,465     $2,817    $998
Income
Earnings  $1.78     $1.86     $0.45      $0.20     $0.07
Per
Share
Return    15%       16%       7%         4%        1%
On
Equity


</TABLE>
During 1996, Burr-Brown focused its resources on accomplishing
two major objectives: First, to achieve the optimum financial
results possible in 1996; second to position the Company so it
could realize maximum growth in 1997 and beyond. Financially, the
Company delivered results which in many ways met or exceeded
those of 1995 during which we achieved 352% growth in net
earnings. As to positioning the Company for growth, we were very
successful in improving, expanding and strengthening our
capabilities in new product develop-ment, new process
technologies, manufacturing, sales and marketing, and overall
worldwide infrastructure. Moreover, during the year we further
solidified our relationships with key customers by forming
partnerships with them to develop our next generation products.

Financial Highlights: Net profit for 1996 was $29.7 million or
13.5% of sales, up from $29.2 million or 10.9% of sales in 1995.

During the year, we divested our ownership in a subsidiary, Power
Convertibles Corporation (PCC), for $10.1 million and realized a
net gain of $5.3 million. This business, which offered battery
chargers and discrete DC/DC converters, was not synergistic with
our core business of analog and mixed signal integrated circuits.
The divestiture will enable us to more intensely focus on our
core business.

Exclusive of this one time gain, 1996 was the second most
profitable year in Burr-Brown's history. Despite an 18% (11% when
excluding PCC) decline in revenue, we achieved a net income of
$24.3 million on revenue of $220 million. Profit margin at 11.1%
of sales was improved slightly over 10.9% in 1995. We were able
to achieve these results by creating greater efficiencies in our
manufacturing operations, and managing operating expenses very
closely. Consequently, our gross margins actually improved from
48.6% in 1995 to 50.4% in 1996. Moreover, the total operating
expense level was reduced by $9.7 million, or 11%, from the 1995
level. More specifically, compared to 1995, sales, marketing,
general and administrative (SMG&A) expenses were reduced by $12.4
million, or 19%; while research and development grew $2.7
million, or 11%, in order to accelerate the momentum in new
product development. Our overall plan is to restrict the growth
rate in SMG&A expenses to a fraction of the growth rate in sales,
while maintaining our investments in R&D within a range of 13-15%
of sales.

The Balance Sheet remains very sound. Despite a $10 million stock
re-purchase, and a $32 million investment in capital assets;
cash, cash equivalents, and investments increased by $3.2 million
to $89.4 million. Further, stockholders' equity increased by
$20.3 million, or in excess of 11%.

Positioning for Growth: The most crucial aspect of Burr-Brown
position-ing itself for growth has been to build significant
momentum in developing innovative new products. To this end, our
new product strategy has focused on developing Standard Linear
ICs (SLICs), which, even though highly proprietary, are used by a
broad customer base across many markets. We have also
concentrated on developing Application Specific Standard Products
(ASSPs), which are unique to high growth applications and used by
a targeted customer base. During 1996, the Company was highly
successful in introducing a record number of 65 new products;
nearly double the previous record. Moreover, due to the increased
level of innovation and cost effectiveness of these products,
they have been very well received by our customers and will
result in significant revenue in 1997 and beyond. To further
accelerate this momentum, we have made substantial additional
investments in advanced fabrication equipment to develop new
proprietary semiconductor processes. These new process
technologies are expected to have a very positive impact on the
next generation of products and are designed to enable Burr-Brown
to offer cost effective, innovative products for emerging fast
growth applications.

To achieve higher manufacturing efficiencies and expand our
capacity, we have invested in capital equipment for fabrication,
wafer probe, packaging and testing. In the fabrication area, we
have upgraded existing equipment as well as installed new
machines to eliminate bottlenecks and to increase wafer yields.
In a similar manner, we have modernized and expanded capacities
in wafer probe, assembly and testing. Consequently, our overall
product yield improved by over 10% in 1996. Moreover, we now have
sufficient capacity to support three consecutive years of 40%
growth per year without a major capacity expansion program. This
is indicative of our operating leverage potential and ability to
expand gross margins with revenue growth.

During the year, we continued to realign our sales and marketing
organization to better focus on key opportunities and emerging
growth markets. Through expanded use of third party distribution
in the U.S. and Europe, we can now better serve our diversified
customer base of some 25,000 customers; at the same time, we have
focused our direct sales force on key and corporate accounts.
This has resulted in closer collaboration on new product
development and more effective management of large opportunities.
This strategy has and will continue to drive market penetration
and thus revenue growth. Another step to improve the
effectiveness of our sales and marketing has been to establish a
regional service center in Europe to consolidate all
administrative, finance, and logistic functions for our sales
subsidiaries in the UK, Germany, France, Italy, Holland and
Switzerland. These initiatives, along with others, will enable us
to better address many fast growing segments of our served
markets.

In our Annual Report last year, I referred to the implemen-tation
of a suite of information systems which will integrate together
all worldwide functions relating to sales and marketing, finance,
materials management, product distribution, production planning,
and manufacturing. I am pleased to further report that we have
made very significant progress in completing the implementation
in the U.S. and Europe. Our plans for 1997 are to enhance this
capability in Europe and initiate implementation in Japan and
Southeast Asia. We believe this capability will continue to
reduce the overall SMG&A expenses and at the same time offer the
Company a robust infrastructure which can support us for many
years of growth.

Outlook: As 1997 begins, we are very confident that our core
competencies in developing, manufacturing and marketing analog
and mixed signal ICs can provide sustained growth for the next
decade. We are particularly pleased with the progress we are
making in the fast growth markets of communications and personal
computing. At the same time, our traditional markets of
industrial and process control, test and instrumentation, and
digital audio and video offer us very solid profitable growth in
many existing and emerging applications.

We expect our new product development will continue to gather
momentum, and our effort to increase manufacturing efficiencies
and to manage overhead costs, will provide us with opportunities
to expand revenue and margins during 1997.

We are grateful to the employees of Burr-Brown who have made all
this progress possible and to our customers who have given us the
opportunity to serve them. Finally, we thank you, our
shareholders, for your support and we remain committed to
optimizing your investment in Burr-Brown.


Syrus P. Madavi
President and CEO


Markets & Customers
As 1997 begins, Burr-Brown is well positioned for growth. The
Company continues to build on its forty years experience in the
design, commercial-ization, and production of high performance
analog and mixed signal integrated circuits (ICs). Analog ICs
deal with continuous "real-world" signals for physical quantities
such as voltage, current, pressure, and temperature. The
worldwide market for analog and mixed signal ICs is estimated at
$18 billion, 15% of total semiconductor sales.1 The technology
trends driving the growth of digital ICs, increased use of
microprocessors, portability, lower power consumption, and higher
speed require- ments are also driving demand for high performance
analog and mixed signal ICs. The total analog and mixed signal IC
market is estimated to increase 15-20% annually through the year
2000.1 Higher performance analog ICs are becoming increasingly
more prevalent in such rapidly growing product areas as
communications and computers. As a result, high performance
analog and mixed signal products will realize annual growth rates
in the 20-30% range, significantly greater than the overall
analog market.  Burr-Brown's primary focus is this high
performance segment of the market.

The uses for analog and mixed signal ICs are varied and many. The
market is broadly segmented into industrial and process control,
test and instrumentation, communications, computer, military and
consumer applications. Burr-Brown participates most fully in the
industrial and process control and the test and instrumentation
segments. These applications continue to have high performance
requirements. In addressing these markets, the Company has
successfully acquired a premier reputation for delivering cost-
effective solutions to difficult signal processing problems. Over
half of 1996 revenue was derived from these segments. The Company
continues to build on its leadership position in these markets,
in order to protect and enhance market share. In addition, the
core capabilities developed in these traditional markets are
successfully used to penetrate the larger and faster growing
communications, personal computing, and digital audio and video
markets. The Company has established a strong position in high-
end digital audio and video products within the consumer segment.
An increasing proportion of revenue is derived from the
communications sector in broadband and wireless applications.
Multimedia and power management products are increasing our
participation in the PC arena. By pursuing a strategy which
allows it to leverage core competencies across a variety of
markets with similar needs, the Company has been able to
accelerate revenue growth and enhance return on valuable
technical resources.

Industrial and Process Control: This market provided
approximately 30% of  revenue in 1996 and the Company's
opportunity within it is growing at 15-20% per year. A primary
industrial use of analog and mixed signal circuitry involves
acquiring and conditioning real-world signals from sensors and
then converting them into digital format for processing. The
process is then reversed to provide control inputs back into the
system. Burr-Brown's signal conditioning and data conversion
products address all aspects of this cycle. Given the universal
nature of this need, these products are present in a vast array
of applications such as motor control, robotics, factory
automation, process control, and industrial imaging. Burr-Brown
customers include the most prominent names in industrial control
equipment such as Rockwell, Siemens, Elsag Bailey, Omron, and
Toshiba as well as thousands of other producers of systems and
subsystems for this market. Increased demand is being driven by
the proliferation of microprocessors and microcontrollers, which
facilitate distributed control in systems, and the need for
greater accuracy and lower power. Burr-Brown's broad product line
and extensive market experience position it well to outperform in
this market.

Test and Instrumentation:
Measurement systems deal with real-world "analog" phenomena that
need to be sensed, measured, tracked, collected, analyzed, and
displayed. The highly diversified market involved in performing
these functions has three segments of prime interest to the
Company: medical, analytical, and automatic test equipment (ATE).
In 1996, about 25% of the Company's revenue came from this
sector. Detection and resolution of low level and noisy signals
are required in these applications, thus making analog and mixed
signal ICs critical to these markets. Burr-Brown is a major
supplier of sensor interface and data conversion solutions to
leading manufacturers of CAT scan equipment such as Siemens and
Toshiba. It maintains a strong position in the semiconductor ATE
market through major producers like Advantest and Teradyne.
Instrument suppliers such as Hewlett-Packard, National
Instruments, Tektronics, and Yokogawa Electric are also key
customers. As with industrial and process control, the
requirements of the test and instrumentation market are
synergistic across our entire product line with all applications
making extensive use of data conversion and signal conditioning
ICs. Increased portability of instruments and the need for more
precise measurement are driving requirements for lower power,
higher speed, smaller size, and multi-channel performance. These
developments favor Burr-Brown's high performance product line and
its well established position in this market.

Communications: The communications revolution represents an
explosive growth opportunity for all semiconductor companies. The
Company has specifically targeted wireless base stations and
wired broadband applications_two of the fastest growing sectors
of the communications market. Burr-Brown sales to this market
have more than doubled in the last two years and now account for
about 15% of revenue. These applications have great demand for
high speed data converters and operational amplifiers as well as
more highly integrated, application specific, mixed signal
solutions. Significant relationships have been established with
Nokia, Northern Telecom, Lucent, and NEC for basestation
applications. We will broaden participation as wireless
communication expands to micro-cells, personal communications
systems (PCS), and wireless local loops. Our wired broadband
efforts have been focused on Digital Subscriber Line (xDSL)
technology which allows for expanded data transmission rates over
the existing telephone infrastructure. Working in partnership
with such recognized industry leaders as PairGain Technologies,
AdTran, and ECI Telecom, we have developed a family of
application specific standard products (ASSPs) optimized for High
data-rate Digital Subscriber Lines (HDSL) providing key mixed
signal technology at a highly competitive price. As measured by
installed lines, the market for this equipment is expected to
maintain a compound annual growth rate in excess of 40% per year
through the end of the decade (see HDSL Line Forecast chart). As
communications technology evolves to the transmission rates
necessary to support high speed Internet access, video on demand,
and real-time interactive services, and becomes a larger
component of Burr-Brown's product portfolio, these inherently
higher growth rates are expected to favorably impact the
Company's overall performance.

Digital Audio and Video: Burr-Brown has long maintained a leading
position in the merchant market for digital-to-analog converters
(DACs) used in audio applications. Recently, product offerings
have been expanded to include analog-to-digital converters (ADCs)
and codecs. Through its SoundPLUS line, it offers the broadest
selection of CD-quality digital audio products and the best
performance-to-price ratio in the industry. The customer base,
comprised of premier producers of audio products, includes Sony,
Samsung, Yamaha, Pioneer, Roland, NEC, Alpine, Denon, and Alesis.
Digital audio and video products now generate about 20% of the
Company's revenue. Building on extensive knowledge of customers
and their applications, the product line has been broadened in a
number of important dimensions. Targeted applications have moved
beyond professional and con-sumer audio into the rapidly growing
markets for CD-ROM, video CD, DVD, and T.V. set-top boxes.
Building on its applications knowledge in consumer products, the
Company has brought its high speed signal processing to bear and
introduced a family of high speed, ADCs for this market.
Significant design-ins have been achieved in camcorder
applications with several major producers, marking entry into the
complementary video imaging market. Other target applications for
this technology include copiers, flat-bed scanners, digital
cameras, and set-top boxes. Geographically, increased pene-
tration into the substantial consumer products industry in China,
Korea, Hong Kong, & Taiwan makes Asia the fastest growing region
served by the Company. All of these actions not only contribute
to Burr-Brown's overall growth rate, but also greatly improve the
stability and profitability of this important segment of the
business. It is Burr-Brown's strategic plan to evolve into a
broad-line supplier of digital audio & video IC components.

Computer and Multimedia: Although the computer market currently
accounts for only 6% of total Burr-Brown revenue, it is one of
our fastest growing segments. It is the largest market served by
the Company and consequently represents one of its best
opportunities. Increased portability and expanded multimedia
functionality are two important drivers to growth of analog &
mixed signal ICs in personal computers. The Company has been able
to leverage its digital audio expertise to address multimedia app-
lications which require CD-quality sound. Our audio products are
designed into high volume applications such as CD-ROMs, high-end
game players, optical disk drives, and add-in multimedia cards
for PCs. In the area of power management, the Company has
introduced a family of regulators that provide precise power
supply management for computer peripherals. It is the Company's
objective to further develop power op amps, DC/DC converters,
regulator circuits, and ASSPs with integrated functionality, all
targeting applications in this segment.



Products & Technology
As 1997 begins, Burr-Brown is well positioned to increase its
competitive advantage through its performance in new product
development. The increasing level of research and development
investment over the last several years demonstrates the Company's
commitment to this area. Results have been convincing. In 1996, a
record 65 new products were introduced; nearly double the
previous record. Among these products are a number of highly
innovative ASSPs. A further 100 new products are now in
development. The focus has been on developing highly innovative
and versatile core designs to be used as building blocks for
standard product extensions. Elements of these standard products
can be then integrated to produce ASSPs when a business
opportunity warrants. To further support the new product effort,
significant investments have been made in computer-aided design
(CAD), process development tools, and state-of-the-art test
equipment. Product strategy is to leverage core competencies to
expand participation into the higher growth, larger volume
opportunities afforded by market areas relatively new to the
Company.

In addition to design expertise, access to a diversified
portfolio of semiconductor processes also presents an important
advantage. A single process is not sufficient to optimally
address the great variety of analog applications. The broader the
process capability, the more likely the Company can optimize
design trade-offs to produce the most competitive IC. Sixty
percent of the Company's wafer requirements are met internally
from a rich selection of proprietary Bipolar processes. Through
foundry relationships and development partnerships, Burr-Brown
has access to a contractually assured source of supply of BiCMOS,
Complementary Bipolar (CB), and sub-micron CMOS wafers. In
addition, several highly proprietary semiconductor processes are
being developed internally. The Company's process technology
development strategy is to continue to meet the majority of its
specialized analog process needs internally while relying on
external sources for standard sub-micron CMOS wafers. This
significantly reduces capital requirements, resulting in lower
manufacturing costs, higher product margins, and greater return
on investment.

The linear circuit product line includes operational amplifiers,
instrumentation amplifiers, programmable gain amplifiers, and
other signal conditioning components. Linear circuits provide
over a third of total revenue. This line is being expanded to
better address rapidly increasing requirements for low power,
small size, single power supply, and lower cost. A number of
Company "firsts" were added to the op amp line during 1996_the
first single supply family (OPA234), first micro-power family
(OPA237), first micro-sized op amp (OPA237 in an SOT-23 package),
and first op amp optimized for audio applications (OPA134).
Product offerings within our broad and price-competitive
instrumentation amp (INA) line also includes a number of world's
"firsts". Among these are the world's first micro-power
difference amp (INA132), the first dual instrumentation amp
(INA2128), and, at 3 femtoamps, the lowest bias current
instrumentation amp (INA116).

Burr-Brown's power products include amplifiers, regulators, and
DC/DC converters. The need for more efficient power management
and reduced board space is driving demand for these products.
Regulator and power management ICs are essential elements of
portable systems such as laptop computers. Among 1996 additions
to this line was the DCP01, the world's first isolated DC/DC
converter in a standard IC package with demonstrated
semiconductor reliability.

Increased requirements for speed and precision in a wide range of
applications are driving demand for data conversion products.
Data conversion products include analog-to-digital converters
(ADCs) and digital-to-analog converters (DACs). These products
encompass many areas of high performance, high speed conversion
and audio products. Data conversion products accounted for more
than half of new products introduced in 1996, including the
ADS1210 which set a new price-to-resolution industry standard for
a 24-bit ADC. New audio product offerings reflect more complete
functional capability and higher value-added options with the
inclusion of audio Phase Locked Loop (PLL) DACs (PCM1726) and
audio codecs (PCM3000/3001). This entire product area clearly
represents an opportunity for accelerated growth.

ASSPs represent the synthesis of all of the Company's core
competencies fused together by knowledge of customer
applications. By their nature, they require close collaboration
with the customer early in the design cycle. This provides both
competitive advantage and unique access to further opportunities.
ASSPs by design have a clearly defined customer base, large
revenue potential, faster time to peak sales, and strategic
focus. ASSPs are currently being sold into motor control, medical
imaging, digital audio and video, power management, and broadband
communications applications. In 1996, both the AFE1100 family of
products for HDSL and the DRV1100 for ADSL were introduced. The
first of a line of imaging products was brought to market in the
ADS932, optimized for interfacing with charged couple device
(CCD) applications such as camcorders. Early reception has been
very encouraging and all of these products are expected to
contribute significantly to near-term revenue.

We are confident our products and technology are well-aligned to
the markets we serve, and that we possess the capabilities and
resources necessary to take full advantage of the opportunities
presented by these markets.


Organization & Infrastructure
As 1997 begins, Burr-Brown is well positioned to increase
profitability. Financially, the last two years have been the most
successful in the Company's history. Improvements within Burr-
Brown's infrastructure have made a substantial contribution to
this success.

Organization: A new management team and technical personnel with
broad experience from some of the best companies in the industry
have joined the Company during the last several years. Those new
to Burr-Brown have meshed well with the very talented workforce
already existing at the Company to create an organization  much
stronger and highly unified in purpose. A new management control
system coordinates individual goals and objectives throughout the
organization and is structured to motivate people to maximize
overall Company performance. Through quarterly company-wide
meetings, the management team continuously communicates strategy,
competitive position, and annual/quarterly goals and results to
keep the Company on a cohesive path to success. As the results of
the past two years indicate, the manage- ment process at Burr-
Brown is highly focused on improvement.

Quality: In a recent annual survey, customers judged Burr-Brown's
overall quality as "high", giving us superior marks relative to
our competitors in respon-siveness to problems and in providing
technical assistance. Overall customer satisfaction has risen
over last year. Product reliability, as measured by FITs
(Failures In Time, failures per billion device hours of
operation), has been improved by a factor of two in the past
three years. The Company continues to maintain the ISO9001
certification it earned in 1994 and has successfully passed
several comprehensive quality audits by major new OEM customers.
By most significant measures, the quality of the Company and its
products is continuously improving.

Sales and Distribution: Great changes have occurred in the way
the Company goes to market. The use of third party distribution
has been greatly expanded such that 40% of revenue is received
through this channel. In 1996, Anthem Electronics was added as a
U.S. distributor, Digi-Key as a major catalog distributor, and
several new regional distributors were appointed in Europe and
Asia. The use of distribution has provided broader access to
customers. Through technical training and close collaboration,
our large base of some 25,000 customers is being better served.
At the same time, our substantial direct technical sales
resources are able to focus more fully on the select group of key
accounts so vital to our growth.

Information Systems: Burr-Brown is a worldwide company which is
becoming increasingly more complex. Sales, marketing, design,
development, and manufacturing activities now occur in a number
of locations in North America, Europe, and Asia. In order to
assure the Company continues to be managed efficiently and
effectively as it grows, significant investments have been made
to revitalize its business information systems. In 1996, the
first phase of a project to install the SAP suite of business
applications was completed in the U.S. Europe will be completed
by mid-1997 followed by Asia in early 1998. When completed, all
worldwide financial, logistics, material management, and
production planning activities will be accomplished using this
system. The Consilium Workstream Manufacturing Execution System
(MES) was installed in the Tucson wafer fab facility and will be
fully deployed throughout the factory during 1997. In addition,
an Oracle-based worldwide data warehouse became fully operational
in 1996. These systems are designed to unify the Company, reduce
administrative costs, and provide our people with the tools
necessary to effectively do their jobs today and provide for
future growth without significant increases in overhead expense.

Operating Costs: Burr-Brown's financial operating model calls for
improved gross margins and reduced sales, marketing,  general and
administrative (SMG&A) expenses in order to improve profitability
while allowing for increased investment in research and
development (R&D) to fuel growth. Over the past several years,
considerable progress has been made toward these objectives. The
Company has and will continue to make significant capital
investments in order to further this trend. The deployment of
advanced wafer fabrication equipment has improved yield, reduced
manufacturing cycle time, and increased direct labor
productivity. Standardization of automatic test equipment has
increased yields and throughput, reduced support requirements,
and overall operating costs. Labor-intensive assembly and test
operations continue to migrate from higher cost U.S., Japanese,
and European facilities to more cost-effective Southeast Asian
locations. Our plan is for growth in SMG&A expenses to be
constrained to a rate lower than revenue growth and for expanded
use of third party distribution to further reduce internal
selling expenses. The installation of common worldwide business
information systems will allow for consolidation and reduction of
administrative costs. European administration and logistics
functions are being consolidated at a Regional Service Center
(RSC) at our Livingston, Scotland location. When complete in
1998, all of the Company's administration and logistics functions
will be performed in three RSCs worldwide. In all aspects of
cost, considerable operating leverage will be realized with
continued growth.



Consolidated Statements of Income
Burr-Brown Corporation and Subsidiaries_In thousands, except per
share amounts
<TABLE>
<CAPTION>
Years Ended December 31,      1996    1995    1994
<S>                           <C>     <C>     <C>
Net revenue                   $219,9  $269,1  $194,1
                              97      62      96
Cost of goods sold            109,22  138,25  106,24
                              8       7       2
Gross margin                  110,76  130,90  87,954
                              9       5
% of revenue                  50%     49%     45%
Expenses:
Research and development      28,452  25,733  21,851
% of revenue                  13%     10%     11%
Sales, marketing, general,    52,202  64,637  55,576
and administrative
% of revenue                  24%     24%     29%
Total operating expenses      80,654  90,370  77,427
% of revenue                  37%     34%     40%
Income from operations        30,115  40,535  10,527
% of revenue                  14%     15%     5%
Interest expense              700     1,131   1,725
Gain from sale of subsidiary  (7,180
                              )
Other (income) expense        (3,249  (613)   511
                              )
Income before income taxes    39,844  40,017  8,291
% of revenue                  18%     15%     4%
Provision for income taxes    10,160  10,805  1,826
Effective tax rate            25%     27%     22%
Net income                    $29,68  $29,21  $6,465
                              4       2
% of revenue                  13%     11%     3%
Earnings per common share     1.78    $1.86   $0.45
Shares used in per common     16,671  15,696  14,498
share calculation
</TABLE>
[FN]
See Notes to Consolidated Financial Statements.



Consolidated Statements of Changes in Stockholders' Equity
<TABLE>
<CAPTION>
Burr-Brown Corporation and Subsidiaries_In thousands
       Common        Additio                 Treasury
       Stock         nal                     Stock
        Shar  Amoun  Paid- Retain  Cumulat  Share  Amount  Total
        es    t      In    ed      ive      s
                     Capi  Earnin  Transla
                     tal   gs      tion
                                   Adjustm
                                   ent
<S>      <C>     <C> <C>     <C>      <C>    <C>   <C>     <C>
Balance
at
January  9,666   $97 $26,0   $52,422  $2,08  131   $(1,06  $79,551
1,1994               13                3           4)
Net                          6,465                         6,465
income
Foreign
currency
translat
ion                                   1,421                1,421
adjustme
nt
Stock
options
exercise 48          387                                   387
d
Treasury
stock
acquired                                     14    (157)   (157)

Affiliat                     (45)                          (45)
e's
stock
activity
Balance
at
December 9,714   97  26,40   58,842   3,504   145  (1,221  87,622
31,1994              0                             )
Net                          29,212                        29,212
income
Foreign
currency
translat
ion                                   (342)                (342)
adjustme
nt
Stock
split at 4,859   37  (37)                     81           0
three-
for-two
Stock
options
exercise 213     13  2,094                                 2,107
d
Stock
offering 1,750   18  61,19                                 61,213
                     5
Treasury
stock
acquired                                      26   (460)   (460)
Affiliat
e's                  46      (253)                         (207)
stock
activity
Balance
at
December 16,536  165 89,69   87,801   3,162   252  (1,681  179,145
31, 1995             8                             )
Net                          29,684                        29,684
income
Foreign
currency
translat
ion                                   (281)                (281)
adjustme
nt
Stock
options
exercise 78      1   628                                   629
d
Treasury
stock
acquired                                      492  (9,753  (9,753)
                                                   )
Affiliat
e's                          (18)                          (18)
stock
activity
Balance
at
December 16,614  $16 $90,3   $117,46  $2,881  744  $(11,4  $199,40
31, 1996         6   26      7                     34)     6
</TABLE>
[FN]
See Notes to Consolidated Financial Statements.


Consolidated Balance Sheets
Burr-Brown Corporation and Subsidiaries_In thousands
<TABLE>
<CAPTION>
December 31,                          1996      1995     1994
<S>                                   <C>       <C>      <C>
Assets
Current Assets
Cash and cash equivalents             $38,433   $42,477  $9,925
Short-term investments                14,407    43,738
Trade receivables                     39,546    55,713   39,642
Inventories                           49,570    47,852   40,092
Deferred income taxes                 6,705     3,273    331
Other                                 4,867     3,190    2,182
Total Current Assets                  153,528   196,243  92,172
Long-Term Investments                 36,537
Land, Buildings, and Equipment
Land                                  3,427     3,393    3,396
Buildings and improvements            25,344    23,294   21,988
Equipment                             122,726   100,812  88,584
                                      151,497   127,499  113,968
Less accumulated depreciation         (83,967   (76,075  (68,072
                                      )         )        )
                                      67,530    51,424   45,896
Other Assets                          3,993     4,582    4,940
                                      $261,58   $252,24  $143,00
                                      8         9        8
Liabilities and Stockholders' Equity
Current Liabilities
Notes payable                         $14,533   $17,904  $16,964
Accounts payable                      17,641    17,359   12,747
Accrued expenses                      3,568     8,703    7,485
Accrued employee compensation and     8,194     8,929    4,834
payroll taxes
Deferred profit from distributors     7,462     6,198    1,792
Income taxes payable                  3,129     6,092    1,630
Current portion of long-term debt     1,087     1,150    1,097
Total Current Liabilities             55,614    66,335   46,549
Long-Term Debt                        1,830     1,808    1,839
Deferred Gain                         1,122     2,619    4,116
Deferred Income Taxes                 1,709     159      1,182
Other Long-Term Liabilities           1,907     2,183    1,700
Commitments and Contingencies

Stockholders' Equity
Preferred stock, $.01 par
value-authorized 2,000 shares:
none issued or outstanding
Common stock, $.01 par
value-authorized 80,000 shares;
 issued and outstanding, including
treasury shares:
 1996-16,614 shares,1995-16,536
shares,
 1994-14,571 shares                   166       165      97
Additional paid-in capital            90,326    89,698   26,400
Retained earnings                     117,467   87,801   58,842
Equity adjustment from foreign        2,881     3,162    3,504
currency translation
Treasury stock, at cost:
 1996-744 shares, 1995-252 shares,
 1994-218 shares                      (11,434   (1,681)  (1,221)
                                      )
                                      199,406   179,145  87,622
                                      $261,58   $252,24  $143,00
                                      8         9        8
</TABLE>
[FN]
See Notes to Consolidated Financial Statements.



Consolidated Statements of Cash Flows
Burr-Brown Corporation and Subsidiaries_In thousands
<TABLE>
<CAPTION>
Years Ended December 31,                1996     1995     1994
<S>                                     <C>      <C>      <C>
Operating Activities
Net Income                              $29,684  $29,212  $6,465
Adjustments to Reconcile Net Income to
Net Cash Provided by
Operating Activities:
Depreciation and amortization           13,272   12,712   10,615
Amortization of deferred gain           (1,497)  (1,497)  (1,496)
Provision for inventory reserves        379      1,974    1,883
Provision for (benefit from) deferred   (1,908)  (3,983)  707
income taxes
Increase in deferred profit from        1,264    4,406    696
distributors
Gain from sale of subsidiary            (7,180)
Other                                   (129)    778      608
Changes in Operating Assets and
Liabilities:
(Increase) decrease in trade            10,969   (17,256  (2,484)
receivables                                      )
(Increase) decrease in inventories      (5,861)  (10,197  3,179
                                                 )
(Increase) decrease in other assets     (2,400)  (561)    130
Increase (decrease) in accounts payable 2,341    5,269    2,789
Increase (decrease) in accrued expenses (7,921)  10,072   (3,169)
and other liabilities
Net Cash Provided by Operating          31,013   30,929   19,923
Activities

Investing Activities
Purchases of investments                (50,944  (43,738
                                        )        )
Maturities of investments               43,738
Purchases of land, buildings, and       (31,919  (17,574  (12,055
equipment                               )        )        )
Proceeds from sale of equipment         415      191      462
Proceeds from sale of subsidiary        12,804
Net Cash Used In Investing Activities   (25,906  (61,121  (11,593
                                        )        )        )

Financing Activities
Proceeds from short-term and long-term  770      1,374    16,366
borrowings
Payments on short-term and long-term    (1,160)  (1,681)  (27,339
borrowings                                                )
(Payments for) proceeds from capital    (9,142)  62,653   185
stock activity, net
Net Cash (Used In) Provided by          (9,532)  62,346   (10,788
Financing Activities                                      )

Effect of exchange rate changes on cash 381      398      (683)
& cash equivalents
(Decrease) Increase in Cash and Cash    (4,044)  32,552   (3,141)
Equivalents

Cash and cash equivalents at beginning  42,477   9,925    13,066
of year
Cash and Cash Equivalents at End of     $38,433  $42,477  $9,925
Year
</TABLE>
[FN]
See Notes to Consolidated Financial Statements.


Notes to Consolidated Financial Statements
Burr-Brown Corporation and Subsidiaries_In thousands, except per
share amounts
December 31, 1996

Accounting Policies
Organization: Burr-Brown Corporation develops, manufactures, and
markets electronic components including precision linear, data
conversion, and mixed signal integrated circuits. These products
address applications for both analog and digital signal
processing relating to communications, industrial and process
control, test and measurement, medical instrumentation, digital
audio, multimedia, imaging, and personal computer systems.
Principal markets for these products are North America
(principally the United States), Europe (Germany, the United
Kingdom and elsewhere), and Asia (principally Japan). Revenue
from these applications in these markets can be volatile and is
dependent on general economic conditions.

Use of Estimates: The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
amounts reported in the financial statements and accompanying
notes. Actual results could differ from those estimates.

Principles of Consolidation: The consolidated financial
statements include the accounts of Burr-Brown Corporation and its
majority owned subsidiaries (the Company), of which all but one
are wholly-owned. Investments in which ownership is at least 20%
but not over 50% are accounted for under the equity method. Other
investments are accounted for using the cost method. All
significant intercompany accounts and transactions are
eliminated.

Inventories: Inventories are valued at the lower of cost (first-
in, first-out basis) or market. The Company maintains a valuation
reserve which reflects the Company's estimate of the impact on
inventories of potential obsolescence, excess quantities, and
declines in market prices.

Land, Buildings, and Equipment: Land, buildings, and equipment
are stated at cost. Depreciation on buildings and equipment is
computed by the straight-line method over the estimated useful
lives ranging from three to forty years.

Revenue Recognition: A portion of the Company's revenue is from
sales made to domestic distributors under agreements which
provide for certain price protection and limited product return
privileges. As a result, the Company defers recognition of the
gross profit on such sales until the merchandise is sold by the
distributors. All other sales are recognized when the product is
shipped.

Income Taxes: Income taxes are determined utilizing the liability
method. This method gives consideration to the future tax
consequences associated with temporary differences between the
carrying amounts of assets and liabilities for financial
statement purposes and the amounts used for income tax purposes.

Foreign Currency Translation: The financial statements of foreign
subsidiaries have been translated in accordance with Statement of
Financial Accounting Standards (SFAS) No. 52, Foreign Currency
Translation. The gains and losses resulting from the change in
exchange rates from year to year have been reported separately as
a component of stockholders' equity. Transaction gains and
losses, which are not significant for all years presented, are
currently reflected in income.

Concentration of Credit Risk: Financial instruments which could
potentially subject the Company to significant concentrations of
credit risk consist principally of cash equivalents, short-term
investments, long-term investments, and trade receivables.

The Company maintains cash and cash equivalents at various
financial institutions. These financial institutions are located
throughout the world, and Company policy is designed to limit
exposure at any one institution and takes into account the
relative credit standing of these institutions. The Company's
short-term and long-term investments are purchased through high
credit quality financial institutions. The cost of these
investments approximates their fair value for all years
presented.

Credit risk, with respect to trade receivables, is limited due to
the large number of entities comprising the Company's customer
base and their dispersion across many different industries.
Furthermore, management continually monitors and adjusts
allowances associated with these receivables.

Stock Issued to Employees: Stock options are granted to employees
under the Company's Stock Incentive Plan with an exercise price
equal to the fair value of the shares at date of grant. The
Company accounts for stock option grants in accordance with APB
Opinion No. 25, Accounting for Stock Issued to Employees, and
accordingly, recognizes no compensation expense for the stock
option grants.

Earnings per Share: Earnings per share is based on the weighted
average number of shares of common stock outstanding during the
year plus incremental common equivalent shares. The treasury
stock method is used in computing the incremental common stock
equivalents which would result from exercise of outstanding
dilutive stock options based upon the average market value of
common stock.


Cash Equivalents and Investments
The Company's investments are classified based on their original
maturity dates. Cash equivalents consist of investments that have
maturities of three months or less when purchased. Short-term
investments have maturities ranging from three to twelve months,
and long-term investments have maturities that extend beyond one
year. At December 31, 1996, the Company had no investments
maturing after August, 1998.

Cash equivalents and investments at December 31, 1996, classified
as available for sale and at December 31, 1995, classified as
held to maturity and all of which approximated market value
consisted of:
<TABLE>
<CAPTION>
                                 1996     1995
<S>                              <C>      <C>
U.S. Treasury and                $21,963  $78,67
GovernmentAgency Securities               7
Municipal Bonds                  25,979
Mutual Funds investing in        27,869
various debt securities
                                 $75,811  $78,67
                                          7
</TABLE>
Income received from cash equivalents and investments was $3,740,
$1,160, and $425 in 1996, 1995, and 1994; respectively. The
Company did not sell any investments classified as available for
sale in 1996.

Inventories
Inventories consist of the following:
December 31,    1996     1995     1994
Finished goods  $18,383  $16,180  $15,133
Work-in-        20,227   17,830   12,789
process
Raw materials   10,960   13,842   12,170
                $49,570  $47,852  $40,092

Foreign Currency Forward Contracts
As a result of selling its products in overseas markets, the
Company is exposed to the effect of foreign exchange rate
fluctuations on the U.S. dollar value of its foreign currency
receivables. The Company currently nets the receivables and
payables, due from subsidiaries to the Company, creating a
natural hedge against foreign currency rate fluctuations. Net
receivables are further hedged through the purchase of foreign
currency forward contracts. The Company marks to market both the
hedges and the underlying transactions at the end of each
reporting period. The realized and unrealized gains and losses
resulting in the changes in exchange rates are included in income
in the period in which the changes occur. Such realized and
unrealized gains and losses are insignificant for all periods
presented.

The Company maintains relationships with several major U.S. and
foreign banks and arranges foreign currency hedging products with
such banks. As of December 31, 1996, such hedging products
consisted entirely of forward contracts with a major U.S. bank to
sell Japanese Yen, German Marks, British Pounds and Italian Lira.
Such forward contracts had maturity dates from January 10, 1997
to April 11, 1997. As of December 31, 1996, outstanding forward
contracts had a value of $6,304 and a fair market value of
$6,337.

Notes Payable
The Company has available short-term credit facilities of
approximately $48,477 with $14,533 outstanding as of  December
31, 1996. There are no compensating balance requirements.
Approximately $39,400 of the available short-term credit
facilities are in foreign currencies and are used to support the
Company's foreign operations. Interest rates are tied to
prevailing national base rates, and the weighted average rates
for 1996, 1995, and 1994 were 3.3%, 3.6%, and 4.1%; respectively.
These credit facilities are renewable annually at various dates.

Long-Term Debt
Long-term debt consists of the following:
<TABLE>
<CAPTION>
December 31,                              1996  1995   1994
<S>                                       <C>   <C>    <C>
Capitalized lease arrangements_various    $2,81 $2,74  $2,00
terms and interest rates                  2     5      3
Other                                     105   213    933
                                          2,917 2,958  2,936
Less current portion                      1,087 1,150  1,097
                                          $1,83 $1,80  $1,83
                                          0     8      9
</TABLE>
The Company has a $10,000 revolving line of credit with a major
U.S. bank. The Company can borrow at LIBOR + 1.25%, the bank's
Prime rate or the bank's "bid rate." The Company may select terms
of 30, 60, 90 and 120 days for LIBOR borrowings. The revolving
line of credit carries an annual commitment fee of 1/4% on the
unused portion of the commitment. The loan agreement has debt,
net worth and debt coverage convenants. As of December 31, 1996,
the Company is in compliance with all covenants and conditions
contained in the loan agreement. The loan agreement does not
require compensating balances. The Company's revolving line of
credit terminates as of May 1, 1998, but the bank may extend such
date after its annual review.

Under the various long-term debt agreements consisting primarily
of capital lease obligations, the Company is obligated to pay the
following principal amounts for each of the next five years:
     1997 $1,087
     1998 $717
     1999 $573
     2000 $447
     2001 $93
Interest paid on all debt amounted to $566, $947, and $1,988 in
1996, 1995, and 1994; respectively.

Income Taxes
Income before income taxes is comprised as follows:
Years Ended December    1996    1995    1994
31,
Domestic                $36,46  $31,07  $5,063
                        8       7
Foreign                 3,376   8,940   3,228
                        $39,84  $40,01  $8,291
                        4       7

The components of the provision (benefit) for income taxes are as
follows:
Years Ended December    1996    1995    1994
31,
Current:
U.S. Federal            $8,183  $8,785  $(141)
State                   1,577   2,701   (186)
Foreign                 2,282   3,284   1,485
                        12,042  14,770  1,158
Deferred:
U.S. Federal            (1,983  (3,617  118
                        )       )
State                   145     (406)   381
Foreign                 (44)    58      169
                        (1,882  (3,965  668
                        )       )
                        $10,16  $10,80  $1,826
                        0       5


Actual current tax liabilities are lower than the amounts
reflected above by the tax benefit from stock option activity of
$155 and $841 in 1996 and 1995, respectively. The tax benefit
from stock option activity is recorded as a reduction in current
income taxes payable and an increase in additional paid-in
capital.

Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used
for income tax purposes. Significant components of the Company's
deferred tax liabilities and assets are as follows:
<TABLE>
<CAPTION>
December 31,            1996      1995     1994
<S>                     <C>       <C>      <C>
Deferred tax
liabilities:
Depreciation            $(1,910)  $(2,331  $(1,935)
                                  )
Other, net                                 (435)
Total deferred tax      (1,910)   (2,331)  (2,370)
liabilities
Deferred tax assets:
Inventory reserves and  2,471     2,809    2,965
capitalization
Tax credit              1,300              4,612
carryforwards
Sale leaseback          456       1,057    1,652
Intercompany            1,247     1,816    3
transactions
Foreign loss            637       520      664
carryforwards
Distributor reserves    3,030     2,583    719
Employee benefits       592       1,102    531
reserves
Other, net              781       1,319    169
Total deferred tax      10,514    11,206   11,315
assets
Valuation allowance     (3,608)   (5,761)  (9,796)
Net deferred tax assets 6,906     5,445    1,519
Net deferred tax assets $4,996    $3,114   $(851)
(liabilities)
</TABLE>
The valuation allowances are recorded to offset deferred tax
assets which can only be realized by earning taxable income in
future years. Management established the valuation allowances
because it could not be assured that such income would be earned.

A reconciliation of the U.S. Federal statutory income tax rate to
the effective tax rate follows:
          Percent of Pretax Income
<TABLE>
<CAPTION>
Years Ended December 31,                  1996    1995  1994
<S>                                       <C>     <C>   <C>
U.S. Federal statutory rate               35.0%   35.0% 34.0%
State taxes, net of federal benefit       2.8     3.7   2.3
Foreign taxes in excess of (less than)    0.3     (0.8) 6.7
U.S. Federal statutory rate
Foreign sales corporation                 (2.5)   (1.5)
Research and development credit           (0.8)
Tax exempt investment income              (0.7)
Research and development and minimum tax          (10.2
credit carryforwards                              )
Domestic temporary differences not        (9.4)         (18.6)
previously benefited
Other                                     0.8     0.8   (2.4)
Effective tax rate                        25.5%   27.0% 22.0%
</TABLE>
Undistributed earnings of foreign subsidiaries were $12,226 at
December 31, 1996. No provision for U.S. tax has been made on
these undistributed earnings as they are intended to be
permanently reinvested. Substantially all tax expense associated
with the receipt of such undistributed earnings would be offset
by foreign tax credits.

Certain foreign subsidiaries have net operating loss
carryforwards totaling $1,279, of which $607 can be carried
forward indefinitely with the remainder expiring at various dates
beginning in 1997. No financial statement benefit has been
recognized for the foreign operating loss carryforwards.

Net income taxes paid amounted to $12,987, $8,970, and $2,968 in
1996, 1995, and 1994; respectively.

Stockholders' Equity_Share amounts in thousands
The Company adopted an Incentive Stock Plan in 1981 which was
amended and restated in 1983. Under this plan, options were
granted to key employees, subject to certain limitations to
purchase an aggregate of 1,407 shares of  common stock at not
less than the fair market value on the date of the grant. All
options under the plan must be exercised within ten years from
the date of the grant. This plan expired in 1993, and no further
options will be granted under this plan. However, all options
outstanding under this plan will continue to have full force and
effect in accordance with their terms.

In 1993, the Company adopted the 1993 Stock Incentive Plan. This
plan is intended to benefit the Company by providing an incentive
to certain key employees, directors, and consultants. The
aggregate number of shares which may be issued under this plan
shall not exceed 2,117 shares, including 717 shares available
from the 1981 Plan. This plan is administered by a committee of
the Board of Directors. The option price per share shall be fixed
by the committee, but in no event shall the option price per
share be less than the fair market value on the date of the
grant. The committee also determines the date on which granted
options will become exercisable, although all options under this
plan must be exercised within ten years from the date of grant.

As of December, 1996, the Company had a plan in place to purchase
up to 1,000 shares of the Company's common stock in the open
market. Purchase activity will be ongoing and timed to take
advantage of what the Company considers to be a favorable price
for its stock. The acquired shares will be used to provide shares
for the employee stock option programs.

Pro forma information regarding net income and earnings per share
is required by SFAS No. 123, Accounting for Stock-Based
Compensation, and has been determined as if the Company had
accounted for its employee stock options under the fair value
method of that Statement. The fair value for these options was
estimated at the date of grant using a Black-Scholes option
pricing model with the following assumptions for 1996 and 1995,
respectively: risk-free interest rates ranging from 5.00% to
5.34% and from 5.30% to 6.12%; dividend yields of 0.0%;
volatility factor of the expected market price of the Company's
common stock of .508; and an expected life of an option of 7
years.

The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options which have no vesting
restrictions and are fully transferable. In addition, option
valuation models require the input of highly subjective
assumptions including the expected stock price volatility.
Because the Company's employee stock options have characteristics
significantly different from those of traded options, and because
changes in the subjective input assumptions can materially affect
the fair value estimate, in management's opinion, the existing
models do not necessarily provide a reliable single measure of
the fair value of its employee stock options.

SFAS No. 123 requires the Company to present pro forma
disclosures for options granted in 1995 and thereafter. Because
prior years' awards were not included in these disclosures, they
would not be indicative of future amounts.

For purposes of pro forma disclosures, the estimated fair value
of the options was amortized to expense over the options' vesting
period. The Company's pro forma information follows:
Years Ended         1996         1995
December 31,
Net Income
As reported         $29,684      $29,212
Pro forma           $29,202      $29,042
Primary earnings
per share
As reported         $1.78        $1.86
Pro forma           $1.75        $1.85

A summary of the Company's stock option activity, and related
information follows:
<TABLE>
<CAPTION>
                          Shares    Option       Weighted-
                          Under     Price Per    Average
                          Option    Share        Exercise
                                                 Price
<S>                       <C>       <C>          <C>
Balance at January 1,     373       $4.50 -
1994                                $10.67
Granted                   771       4.33 - 5.83
Exercised                 (72)      4.67 - 5.87
Canceled                  (75)      4.67 -
                                    10.50
Balance at December 31,   997       4.33 -       $5.19
1994                                10.67
Granted                   300       8.50 -       13.20
                                    35.00
Exercised                 (215)     4.33 -       6.03
                                    10.67
Canceled                  (36)      4.50 - 8.50  6.33
Balance at December 31,   1,046     4.33 -       7.27
1995                                35.00
Granted                   337       17.00 -      18.88
                                    23.75
Exercised                 (78)      4.33 -       6.34
                                    16.00
Canceled                  (121)     4.33 -       10.58
                                    33.00
Balance at December 31,   1,184     $4.50 -      $10.29
1996                                $35.00
</TABLE>
The weighted-average fair value of options granted during 1996
and 1995 was $11.02 and $7.02, respectively. The weighted-average
remaining contractual life for options outstanding as of December
31, 1996, was 7.9 years.

Stock options for 424, 303, and 278 shares were exercisable at
December 31, 1996, 1995, and 1994, respectively. The weighted
average exercise price for exercisable options was $6.19 and
$5.67 at December 31, 1996 and 1995, respectively.

During 1989, the Board of Directors declared a dividend
distribution of one common stock purchase right for each
outstanding share of common stock. The rights are exercisable
only if a person or group acquires 20% or more of the Company's
common stock or announces a tender offer which would result in
ownership by a person or group of 20% or more of the common
stock. At that time, a right plus $0.3167 may be exchanged for
one one-hundredth share of common stock of the Company. Upon the
acquisition of 40% or more of the Company's common stock (unless
at least 80% is acquired in a cash tender offer), the holders of
rights (other than the acquirer) will have the right to purchase
shares of the Company's common stock at half its market value. In
addition, the rights provide that upon the merger or transfer of
50% or more of the assets or earning power of the Company to a
person who has acquired at least 20% of the common stock, the
holders of rights will have the right to purchase shares of the
acquirer's common stock at half its market value.

The rights are subject to mandatory redemption for $0.0067 per
right at the discretion of the Company's Board of Directors. All
rights expire on August 9, 1999, unless extended or redeemed by
the Company and do not have dividend or voting privileges while
outstanding.

On March 4, 1997, the Company's Board of Directors announced a
three-for-two stock split effected in the form of a stock
distribution.  One additional share of common stock will be
distributed for every two shares of common stock outstanding to
stockholders of record on March 18, 1997.

Foreign Operations, Geographic, and Segment Data
The Company operates predominately in one segment, the electronic
component industry.

The consolidated financial statements include the accounts of
wholly-owned foreign subsidiaries. Transfers of inventories to
these foreign subsidiaries are negotiated based on market prices.

The following summary, by operational area, includes both net
revenue from unaffiliated customers and transfers between
geographic areas. The Far Eastern Operations consist of activity
primarily from Japan. The United States operations include
corporate activity that benefits the Company as a whole.
<TABLE>
<CAPTION>
Years Ended December    1996      1995       1994
31,
<S>                     <C>       <C>        <C>
Net Revenue:
North American
Operations:
Unaffiliated customers  $75,757   $95,667    $73,927
Foreign unaffiliated    5,376     17,250     13,858
customers
Consolidated            83,044    87,721     77,290
subsidiaries
                        164,177   200,638    165,075
European Operations:
Unaffiliated customers  55,679    64,794     48,606
Consolidated            12,165    13,225     10,981
subsidiaries
                        67,844    78,019     59,587
Far Eastern Operations:
Unaffiliated customers  83,185    91,451     57,805
Consolidated            3,632     4,037      4,160
subsidiaries
                        86,817    95,488     61,965
Eliminations            (98,841)  (104,983)  (92,431
                                             )
                        $219,997  $269,162   $194,19
                                             6
Income (Loss) Before
Income Taxes:
North American          $45,920   $33,446    $5,015
Operations
European Operations     1,074     5,428      397
Far Eastern Operations  2,271     3,402      2,820
Eliminations -          (9,421)   (2,259)    59
primarily United States
                        $39,844   $40,017    $8,291
Identifiable Assets:
North American          $226,444  $206,405   $105,02
Operations                                   8
European Operations     25,075    28,790     19,300
Far Eastern Operations  32,541    43,642     32,538
Eliminations            (22,472)  (26,588)   (13,858
                                             )
                        $261,588  $252,249   $143,00
                                             8
</TABLE>
Commitments and Contingencies
The Company was involved in one ground water claim at December
31, 1995. On August 7, 1996, the Company was dismissed from this
claim due to insufficient evidence that the ground water beneath
Burr-Brown's site commingled with the contaminated water.

As is typical in the semiconductor industry, the Company has been
sued for patent infringement by a competitor. The Company
believes the competitor's claim is not supportable and is
vigorously contesting the suit. In addition, the claimed
infringement relates to products that account for an immaterial
level of the Company's net revenue. The case is still in its
early stages and patent litigation is inherently uncertain.
Therefore, there can be no assurances as to the ultimate outcome
of the case. However, management is of the opinion that the
disposition of this suit will not result in any material change
in the Company's financial condition, results of operations, or
cash flows.

In October, 1992, the Company sold and leased back $10,000 of
production and manufacturing equipment, utilizing the proceeds to
repay existing bank debt. A gain of $7,483 generated by the sale
transactions was deferred and is being amortized over the five-
year lease terms. Under the terms and conditions of such leases
the Company may purchase the equipment at fair market value or
return the equipment to the lessor. The leases are classified as
operating leases. Rents under these leases are $2,196 annually
and the table below includes future rents due under such leases.

Approximate aggregate future commitments under noncancelable
operating leases, primarily for equipment and office facilities,
are summarized as follows:
     1997 $4,047
     1998 $1,707
     1999 $1,123
     2000 $887
     2001 $592
Rental expense was $4,932, $5,352, and $6,324 in 1996, 1995, and
1994; respectively.

Employee Benefit Plans
The Company has a defined contribution plan, the Future
Investment Trust (FIT). The FIT is a 401(k) salary deferral plan
and allows eligible participating U.S. employees to defer up to
15% of their salaries. Employee contributions are matched by the
Company at a rate of 25% of the employee's contribution. The
Company's contributions vest at 25% per year and become fully
vested to the employee after four years of service. Additional
voluntary Company contributions may be made to FIT participants'
profit sharing accounts.

The Company has a noncontributory defined benefit pension plan
which covers all eligible U.S. employees and generally provides
benefits to retired employees based on their length of service,
age, and a percentage of qualifying compensation during the final
years of employment. Contributions are intended to provide not
only for benefits attributed to service to date, but also for
those expected to be earned in the future. The Company's policy
is to contribute amounts sufficient to at least meet the Employee
Retirement Income Security Act's minimum funding requirements.

A summary of the components of net periodic pension expense
follows:
<TABLE>
<CAPTION>
                     1996   1996    1995    1995    1994   1994
                     U.S.   Foreig  U.S.    Foreig  U.S.   Foreign
                            n               n
<S>                  <C     <C>     <C>     <C>     <C>    <C>
Years Ended          Plans  Plans   Plans   Plans   Plans  Plans
December 31,
Defined benefit
pension plans:
Service cost-
benefits earned      $478   $351    $392    $321    $492   $334
during the period
Interest cost on
projected benefit    665    155     620     189     608    166
obligation
Net amortization     770    11      1,142   4       (363)  (20)
Return on plan       (1,505 (33)    (1,732  (49)    21     (43)
assets               )              )
Net periodic
pension expense of   408    484     422     465     758    437
defined benefit
plans
Defined
contribution plan -  747            626             507
Matching FIT
Total employee
benefit expense      $1,155 $484    $1,048  $465    $1,26  $437
                                                    5
</TABLE>
Assumptions used in computing pension expense for the defined
benefit plans were as follows:
<TABLE>
<CAPTION>
Years Ended        1996  1996     1995  1995      1994   1994
December 31,
                   U.S.  Foreign  U.S.  Foreign   U.S.   Foreign
                   Plan  Plans    Plan  Plans     Plans  Plans
                   s              s
<S>                <C>   <C>      <C>   <C>       <C>    <C>
Weighted-average
discount rate      7.75  2.5%-    8.5%  5.5%-     7.5%   5.5%-
                   %     7.0%           7.5%             7.0%
Rates of increase
in compensation    4.5%  3.0%     5.0%  4.5%      5.0%   4.5%
levels
Expected long-term
rate of return on  9.5%  3.7%-    8.5%  4.1%-     8.5%   5.5%-
assets                   7.0%           7.0%             7.0%
</TABLE>
The following table sets forth the funded status and amounts
recognized in the consolidated balance sheets at December 31,
1996, 1995, and 1994; for the Company's defined benefit pension
plans:
<TABLE>
<CAPTION>
December 31,      1996     1996    1995     1995     1994    1994
                  U.S.     Foreig  U.S.     Foreign  U.S.    Foreig
                           n                                 n
                  Plans    Plans   Plans    Plans    Plans   Plans
Actuarial present value of benefit
obligations:
<S>               <C>      <C>     <C>      <C>      <C>     <C>
Vested benefit    $6,148   $2,083  $6,036   $1,879   $3,773  $1,502
obligation
Accumulated       $7,351   $2,684  $7,155   $2,225   $4,294  $1,863
benefit
obligation
Projected
benefit           $(9,439  $       $(9,208  $(3,004  $(7,773 $(2,74
obligation for    )        (3,376  )        )        )       7)
services                   )
rendered to date
Plans assets at   12,049   1,474   9,826    1,486    7,059   1,406
fair value
Excess
(shortfall) of
plan assets over  2,610    (1,902  618      (1,518)  (714)   (1,341
(under)                    )                                 )
projected
benefit
obligation
Unrecognized net  (2,634)  330     (1,500)  28       (1,248) 190
loss (gain)
Unrecognized
prior service     1,094            1,333             1,550
cost
Unrecognized net
transition                 171              (50)             (47)
obligation
Net pension       $ 1,070  $       $451     $(1,540  $       $(1,19
asset                      (1,401           )        (412)   8)
(liability)                )
</TABLE>
U.S. plan assets consist of investments in equities, bonds, and
cash equivalents. Foreign plans' assets consist of securities,
real estate, loans, and cash equivalents.

Report of Independent Auditors
Board of Directors
Burr-Brown Corporation
We have audited the accompanying consolidated balance sheets of
Burr-Brown Corporation and Subsidiaries as of December 31, 1996,
1995, and 1994, and the related consolidated statements of
income, changes in stockholders' equity, and cash flows for each
of the three years in the period ended December 31, 1996. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above
present fairly, in all material respects, the consolidated
financial position of Burr-Brown Corporation and Subsidiaries at
December 31, 1996, 1995, and 1994, and the consolidated results
of their operations and their cash flows for each of the three
years in the period ended December 31, 1996, in conformity with
generally accepted accounting principles.

Tucson, Arizona
January 22, 1997

Summarized Quarterly Data (Unaudited)
The following is a summary of quarterly financial data for 1996,
1995, and 1994:
<TABLE>
<CAPTION>
               Quarter Ended 1996
               March 30   June 29    Sept.    Dec. 31
                                    28
<S>            <C>       <C>        <C>       <C>
Net revenue    $61,174   $58,181    $50,109   $50,533
Gross margin   30,677    29,754     25,092    25,246
Net income     11,598    6,607      5,700     5,779
Earnings per   .69       .40        .35       .35
share

               Quarter Ended 1995
               April 1   July 1     Sept. 30  Dec. 31
Net revenue    $59,547   $69,594    $70,218   $69,803
Gross margin   28,186    33,798     34,411    34,510
Net income     4,657     6,845      8,287     9,423
Earnings per   .31       .45        .54       .55
share

               Quarter Ended 1994
               April 2   July 2     Oct. 1    Dec. 31
Net revenue    $47,355   $47,607    $49,217   $50,017
Gross margin   22,874    22,810     21,177    21,093
Net income     1,737     1,964      1,704     1,060
Earnings per   .12       .14        .12       .07
share
</TABLE>

Quarterly Market & Dividend Information
<TABLE>
<CAPTION>
               1996      1996       1995      1995
               High      Low        High      Low
<S>            <C>       <C>        <C>       <C>
First Quarter  $29 7/8   $15 3/4    $12 1/8   $7 5/8
Second Quarter  24 1/2   15 1/4     27 1/4    11 1/8
Third Quarter  21 1/4    15 1/4     40 3/4    25 1/4
Fourth Quarter 27 1/2    19 1/2     36 3/4    19 1/4
</TABLE>
The Company's common stock has been traded on the National Market
System under the symbol BBRC since March 1984. As of December 31,
1996, there were approximately 5,500 stockholders of record,
which include those listed in company records and stockholders
who hold their shares in a broker's name.

The Company has never paid any cash dividends on its common
stock. It is the present policy of the Board of Directors to
retain earnings to finance expansion of the Company's operations,
and the Company does not expect to pay dividends in the
foreseeable future.


Management's Discussion and
Analysis of Financial
Condition and Results of Operations
1996 Compared to 1995
Net income for 1996 was the highest in the Company's history.
Annual revenue was second only to the prior year despite the
first industry contraction since 1985 and the divestiture of
Power Convertibles Corporation (PCC) in the first quarter of the
year. In addition, substantial gains were realized across a broad
front in the Company's operations.

For the year ended December 31, 1996, revenue was $220 million
compared to revenue of $269.2 million in 1995. When excluding
revenue of PCC, a subsidiary divested in the first quarter of
1996, revenues from ongoing operations were 10.6% lower than
1995. This decline was the result of industry conditions which
prevailed for most of the year. The magnitude of this decline was
consistent with that reported for the industry as a whole for
1996. Customer inventories and supply in the distribution channel
remained high throughout the year, due largely to very strong
1995 demand and shortened lead times. Revenue declined in the
third quarter and remained stable for the remainder of the year.
A recovery appears to be starting as fourth quarter new order
bookings exceeded revenue for the first time all year.

The Company's core analog and mixed signal integrated circuit
(IC) products accounted for 91% of total revenue, up from 85%
last year.  Much of this increase was the result of the PCC
divestiture and represented further progress in the strategy to
become a pure analog IC company. Over 50% of sales were derived
from the markets for industrial process control and test and
instrumentation equipment. The Company maintains a very strong
position in these markets by virtue of long standing
relationships with customers and the high performance
applications requirements in terms of precision, speed, and cost.
Sales into these markets exhibited the most stability year-to-
year, the result of a very broad customer, product, and
application base. 20% of sales were into digital audio and video
applications. Given the high consumer product content, sales into
this market were most affected by industry conditions. Further,
as a high proportion of these sales were to Japanese customers,
the significant devaluation of the Yen as compared to 1995 had
some adverse impact on dollar revenues. The telecommunications
market was the source of 15% of sales and represents an area of
significant growth opportunity for the Company. The overall
growth rate of this market is among the highest addressed by Burr-
Brown, and requirements are particularly well suited to the
Company's core competency of high performance analog and mixed
signal ICs. Revenue from this sector was relatively even with the
prior year but increased as a percent of total sales. Sales into
the personal computer and multimedia market, which accounted for
only 6% of revenue, declined from 1995 levels, again due to
overall semiconductor market conditions. The remainder of the
Company's sales were realized from a broad range of sources
including military applications and were, in total, roughly
consistent with prior year levels.

Geographically, all regions, with the notable exception of
Southeast Asia (SEA), contributed to the overall revenue decline.
The U.S. sales decline included only a slight decrease in the
domestic third-party distribution channel. Japan sales declined
as a result of conditions in the consumer audio market and
devaluation of the Yen. The European sales decline was reflective
of overall business conditions in that region. SEA sales grew
year over year as the Company increased its penetration in the
developing, faster growing markets within the People's Republic
of China and the Four Tigers countries.

1996 gross margin as a percent of sales improved to 50.4% from
48.6% in 1995. Some of this improvement was due to the
divestiture of PCC, a relatively low gross margin business unit.
As is characteristic for analog ICs, exclusive of currency
impacts, like product pricing remained stable, and product mix
was somewhat more favorable. More significantly, manufacturing
cost reductions and gains in efficiency contributed to gross
margin expansion despite lower revenue levels. Product yield
increased by over 10%, and manufacturing headcount was reduced by
21%, exclusive of the PCC divestiture. Much of this improvement
was driven by capital investment in factory automation. The first
phase of a new manufacturing execution system was completed with
installation in the Tucson wafer fabrication facility occurring
at mid-year. Progress was made in the standardization of test
systems employed in final test operations. The benefits of this
strategy include both an overall lower cost of ownership, due to
the reduction of support costs required, and improved yields.
Throughput yields have also benefited from process equipment
upgrades in the Tucson wafer fab. An excess of industry capacity
resulted in favorable pricing on externally sourced wafers and
assembly services. Further gross margin expansion was precluded
by the loss of operating leverage due to lower sales volume. With
the expansion of several discrete manufacturing bottlenecks,
sufficient internal capacity and contractual source of supply
arrangements are in place to support nearly three times the
current revenue level without a major wafer fab addition.

Total operating expenses were reduced by $9.7 million or 10.8%.
Research and Development (R&D) spending was increased by $2.7
million or 10.6%. Sales, Marketing, and General, and
Administrative (SMG&A) spending was reduced by $12.4 million or
19.2% as compared to 1995. This reflects continued progress of
the strategy to increase R&D investments as the primary driver of
revenue growth while reducing SMG&A expenses in order to expand
profit margins.

As a percent of revenue, R&D investments increased to 12.9% in
1996 from 9.6% last year. This increase was consistent with the
conviction that effective R&D spending is the critical success
factor in revenue growth and increased market penetration. This
increased spending has been in the form of expanding the design
and technical staff, acquiring improved development tools, and in
the development of proprietary, next generation analog wafer fab
processes. The benefits of increased R&D investment have already
become apparent in the introduction of 65 new products during
1996, nearly twice the previous record. Among these products are
a number of highly innovative application specific standard
products (ASSPs) which target the large and rapidly growing
telecommunication and computer and multimedia markets. Several of
these products have already resulted in volume orders and should
begin to contribute significantly to revenue in 1997. The
Company's near term operating model for R&D spending is in the
range of 13-15% of revenue.

1996 SMG&A expenses of $52.2 million were 23.7% of revenue as
compared to 24.0% of revenue in 1995, despite an overall decline
in revenue. SMG&A expenses decreased by $12.4 million or 19.2% of
revenue as compared to an overall revenue decline of 18.3%.
Throughout 1996, opportunities to reduce cost in this area were
aggressively pursued. SMG&A headcount declined by 8% from 1995
levels, exclusive of the effect of the PCC sale. Critical to the
further progress of this effort is expanded use of third party
distribution and the consolidation and increased efficiency of
administrative functions. Although the primary reason for
increased use of external distributors is revenue growth through
expanded market coverage, it also allows for significant
reductions in worldwide selling costs. During 1996, this channel
accounted for 40% of worldwide revenue, up from 35% last year. A
new worldwide management information system is the enabling
technology which will drive increased administrative efficiency.
Implementation of this system in the Company's domestic
operations was completed during 1996, and a regional service
center was established in Europe to consolidate all
administrative and logistic functions for that region. Reducing
SMG&A spending as a percent of sales is an ongoing objective, and
a model of 20% of sales has been set to be achieved over the next
several years.

Despite lower revenue, operating profit was $30.1 million or
13.7% of revenue, second only to 1995 in the Company's recent
history both in terms of absolute amount and as a percent of
sales. A pre-tax gain of $7.2 million was realized from the sale
of PCC and included in other income. Net interest income on
invested funds was the primary source of the remaining $2.5
million of other income.

The effective tax rate for 1996 was 25.5% compared to 27% in
1995. Several discrete events contributed to this tax rate
reduction, including the reinstatement of the federal R&D tax
credit, a tax benefit from an investment previously written off
for book purposes, and increased use of tax advantaged
instruments for invested cash. The 1996 tax rate was less than
the U.S. federal statutory rate of 35% due mainly to the
reduction in deferred tax asset valuation allowances against net
deductible temporary book to tax differences. Deferred tax
valuation allowances were recorded by the Company to offset
deferred tax assets which could only be realized by earning
taxable income in future years. Management established the
valuation allowances because it could not be assured that such
income would be earned. There were no changes in 1996 to the
assumptions and methodology used in determining the valuation
allowances.

Net income for the year was $29.7 million or 13.5% of sales as
compared to $29.2 million or 10.9% of revenue in 1995. Excluding
the effect of the one time gain from the sale of PCC of $5.3
million, net income for the year was $24.3 million or 11.1% of
revenue, a level slightly higher than the profitability of the
prior year. Earnings per share (EPS) was $1.78 for the year as
compared to $1.86 for the prior year, a decline of 4.3% on a 6.2%
increase in the number of shares used. Excluding the effect of
the one-time gain on the PCC sale, EPS of $1.46 is lower only
than 1995 in Company history.

1995 Compared to 1994
1995 was a year of unprecedented revenue growth and profitability
for the Company.
Total 1995 revenue of $269.2 million was 39% higher than the
$194.2 million of 1994. All business units and geographic areas
participated in this growth. Growth in the core business, analog
and mixed signal integrated circuits, was the greatest at 42%
bringing revenue for the core analog and mixed signal component
business to $228.1 million or 85% of total. Benefiting greatly
from the computer and multimedia sector, Asia exhibited the
highest regional growth with a 42.9% increase over 1994.
Penetration into third party distribution increased substantially
during the year with approximately 35% of 1995 revenue being
realized through this channel as compared to 26% in the previous
year. To a limited extent, further revenue growth was restricted
by certain manufacturing capacity bottlenecks, primarily in the
product test area.

Annual gross margin, at $130.9 million, increased by $43 million
or 49% over 1994. As a percentage of revenue, gross margin
improved 3.3 percentage points to 48.6% from 45.3% in 1994, with
fourth quarter gross margin achieving 49.4%. Manufacturing cost
reduction efforts drove margin improvements. Higher output levels
increased capacity utilization which resulted in increased
operating leverage. Manufacturing yields improved continuously
throughout the year. Pricing throughout all product lines
remained essentially stable. The impact of foreign currency
exchange rate changes, particularly involving the yen, was highly
favorable in the first half of 1995 and unfavorable in the second
half.

Operating expenses at $90.4 million increased over the prior year
by $13 million or 17% as compared to a 39% increase in revenue.
As a percentage of revenue, operating expenses were reduced to
34% from 40% in 1994. SMG&A expenses were reduced to 24% in 1995
from 29% in 1994 with fourth quarter SMG&A expenses declining to
23% of revenue. Reducing the ratio of SMG&A expenses to revenue
is an ongoing objective of the Company. Part of the 1995
reduction was the result of the consolidation of certain
administrative activities in Europe and more extensive use of
third party distribution in all regions. SMG&A expense growth in
all areas was by design strictly constrained, with the most
significant increases coming from revenue driven commission and
incentive expenses.

Spending on R&D increased by approximately $4 million or 18% over
the previous year. As a percentage of revenue, R&D spending
decreased to 9.6% from 11.3% in 1994. Although it has been
successful in increasing spending, dramatic revenue growth and
high demand for scarce, qualified human resources have combined
to limit the rate at which this ratio could be raised. During
1995, the number of product introductions increased substantially
over the prior year; a new technology development group was
established, and several new wafer fab foundry relationships were
developed, which widened the scope of process technology
available to the Company.

Revenue growth combined with manufacturing cost reductions and
constrained expense increases resulted in new record levels of
both profit and profitability being set for the Company in 1995.
Income from operations was $40.5 million or 15% of revenue, an
increase of 285% over 1994. Net income was $29.2 million or 11%
of revenue, an increase of 352% over 1994. The effective tax rate
for 1995 was 27% compared to 22% in 1994. The 1995 tax rate was
less than the U.S. federal statutory rate of 35% due mainly to
the utilization of tax credit carry forwards which were
previously reserved. The valuation allowances decreased by $4
million in 1995 due mainly to the utilization of tax credit
carryforwards. There were no changes in 1995 to the assumptions
and methodology used in determining the valuation allowances.

Liquidity and Capital Resources
At 1996 year end; the Company's cash, cash equivalents, and
investments totaled $89.4 million; an increase of $3.2 million
over year end 1995. The net cash generated from operations and
from the sale of a subsidiary was mainly used in the investment
of capital equipment and repurchasing the Company's stock.

At 1996 year end, total debt was $17.5 million of which $2.9
million was term debt. This represented a $3.4 million decrease
in total debt over 1995. Most of this debt was held
internationally and represented an interest rate arbitrage
situation for the Company. In addition to term debt, credit
facilities of approximately $48.5 million with both domestic and
international banks were available to the Company, of which
approximately $14.5 million or 30% was utilized. The current
ratio declined to 2.76 in 1996 from 2.96 in 1995. The decline was
mainly due to the classification of $36.5 million of investments
as long-term in 1996. The longer term investments were purchased
to take advantage of higher rates of return. On a consistent
basis, the current ratio would be 3.42 in 1996 compared to 2.96
in 1995. The debt to equity ratio improved year over year from
 .12 to .09. The Company's balance sheet continues to be strong
and management believes that it possesses more than sufficient
capital resources to meet the anticipated requirements of the
next twelve months.

Accounts receivable declined by 29% from $55.7 million at the end
of 1995 to $39.5 million at the end of 1996 as a result of lower
revenue. Days sales outstanding increased period to period due to
a higher international component of receivables.

Excluding the PCC inventory change, inventories increased in
preparation for growth in 1997. Inventory valuation reserves
remained relatively flat. Management believes that adequate
reserves have been provided for potentially unsalable and excess
inventories.

Capital spending totaled $31.9 million for 1996 which is an
increase of 81.6% from the prior year. About half of this total
was for wafer fabrication equipment required for the development
and production of a next generation, proprietary process for high
performance analog circuits. Other expenditures were concentrated
in the standardization of product test equipment and the
continuation of an enterprise-wide program to replace the
Company's business information systems. This last initiative will
allow for more efficient management of the Company on a worldwide
basis, thus supporting the strategy of SMG&A expense reduction.
Capital investment plans for 1997 are in excess of $24 million
and will fund the continued modernization of test, design, and
manufacturing machinery as well as further implementation of new
worldwide information systems.

International markets constitute a majority of the Company's
revenue. The resulting transactions have exchange rate
fluctuation risk associated with them. To reduce the cash
exchange rate risk the Company purchases forward currency
contracts to hedge its foreign currency net accounts receivable
due from international subsidiaries. The forward contracts are in
three primary currencies: Japanese Yen, British Pounds and German
Marks. Exchange rate fluctuations can also affect the Company's
reported revenue as the international subsidiaries' sales are
primarily in foreign currencies but reported in the consolidated
financial statements in U.S. dollars using weighted average
exchange rates.

The impact of inflation on the Company's financial position and
results of operations has not been significant during the three
year period ended December 31, 1996.

In the first quarter of 1996, the Company sold all of its
interest in PCC. PCC products include battery chargers used in
cellular telephone applications and modular DC to DC converters
which are used in a great variety of applications. In 1995, PCC
was responsible for about 9.5% of the Company's total revenues
and approximately 3% of the profits. The decision to sell PCC was
consistent with a continuing strategy to more clearly focus the
Company's efforts and resources on the opportunities available in
its core analog and mixed signal integrated circuit business.

Litigation
At the end of 1995, the Company was involved in one ground water
toxic tort lawsuit. On August 7, 1996, the Company was dismissed
from this lawsuit without prejudice due to the absence of
evidence that the ground water beneath the Company's site
commingled with other contaminated ground water.

In the semiconductor industry, it is not uncommon for companies
to prosecute and defend against intellectual property related
claims such as those involving patents, proprietary information,
and trade secret information. Currently, the Company is involved
in one such matter, a patent infringement lawsuit filed against
the Company by Unitrode Corporation, in the U.S. District Court,
State of Massachusetts, and involving certain Small Computer
System Interface (SCSI) terminator devices. The Company is
vigorously contesting the lawsuit and believes that the claim is
not supportable. However, the case is still in its early stages,
and patent litigation is inherently uncertain. Therefore, there
can be no assurances as to the ultimate outcome of the case.
Regardless of the outcome of the litigation, the SCSI terminator
devices that are at issue in the lawsuit constituted an
immaterial portion of the Company's annual revenue and cessation
of sales of these devices would not result in any material change
in the Company's financial position, results of operations or
cash flows.

Business Outlook
In order to provide our shareholders with better insight to our
future plans, directions, and objectives, the following forward
looking statements are provided.

Markets: The Company will continue to emphasize the industrial
and process control and test and instrumentation markets in which
it holds a leadership position in order to protect and enhance
market penetration. The Company expects to hold a steady market
position in the digital audio market. In addition, it will
endeavor to improve its market position in the relatively larger
and faster growth communications, computing, and digital
video/imaging markets.

Products: The Company possesses very strong core competencies in
the development, manufacture, and marketing of high performance
analog and mixed signal integrated circuits. It also maintains a
strong presence in digital audio applications. It believes that,
by using these capabilities to address the requirements of its
target markets, it can sustain substantial growth over the next
five years. To capitalize on these rapid growth opportunities,
the Company is seeking to increase its number of product
offerings and reduce the time required to bring new products to
market. The Company is also seeking to design products for a wide
customer base. Product offerings will include both standard
linear products which will serve a wide range of market
applications and, on a selective basis, products which target
specific needs of very high growth market segments.

Gross Margin: The Company's plans call for a continually
expanding gross margin over the next five years. Product pricing
is expected to remain stable and continue to reflect the high
value-added content of these products. Accordingly, the Company's
ability to increase revenues will depend in part upon its ability
to increase unit sales volumes of existing products and to
introduce and sell new products. Increased volume and improved
manufacturing efficiency will continue to reduce product costs.
Some products targeting very high volume, rapid growth
applications will be characterized by relatively lower gross
margins but will require lower levels of operating costs in
contrast to products serving more traditional markets.

Operating Expenses: In order to support acceleration of new
product development, the Company will increase its R&D expense.
Growth in SMG&A expenses will be constrained to a rate
substantially lower than that of revenue growth. The goal is
continual expansion of operating margins with sales growth while
allowing for increased research and development investment as the
primary engine of that growth.

Investments: The Company believes the growth opportunities
inherent in this strategy will require significant additions to
manufacturing capacity and technological capabilities over the
next five years. This will be met in the form of internal capital
investments and development of source of supply arrangements with
third party vendors as well as timely and synergistic business
acquisitions.

The foregoing plans are subject to a number of risks and
uncertainties, including the following: Factors that could
materially and adversely affect net revenue, gross margin, and
profitability include the volume and timing of orders, changes in
product mix, market acceptance of the Company's and its
customers' products, competitive pricing pressures, fluctuations
in foreign currency exchange rates, the timing of new product
introductions, and fluctuations in manufacturing yields. Average
selling prices typically decrease over the life of particular
products. If the Company is unable to introduce new products with
higher average selling prices or reduce manufacturing costs to
offset decreases in the prices of its existing products, the
Company's operating results will be adversely affected. In
addition, the Company is limited in its ability to reduce costs
quickly in response to any revenue shortfalls. To meet
anticipated future demand and to utilize a broader range of
fabrication processes, the Company intends to increase its
manufacturing capacity. Given the complexity and expense of
designing and constructing a significant expansion of a
semiconductor fabrication plant, during the construction of the
additions, the Company's manufacturing yields could be materially
and adversely impacted. The Company is subject to several risks
associated with its international operations; including
unexpected changes in regulatory requirements, delays resulting
from difficulty in obtaining export licenses for certain
technology, foreign exchange fluctuations, tariffs and other
barriers and restrictions, and the burdens of complying with a
variety of foreign laws. The semiconductor industry is intensely
competitive. Many of the Company's competitors have substantially
greater financial, technical, marketing, distribution, and other
resources than the Company. In the event of a downturn in the
market for analog circuits, companies that have broader product
lines may be in a stronger competitive position than the Company.
Other risks potentially affecting future operating results are
set forth in the Company's filings with the Securities and
Exchange Commission.


Five Year Financial Summary
Burr-Brown Corporation and Subsidiaries_In thousands, except per
share amounts
<TABLE>
<CAPTION>
                     1996     1995    1994     1993     1992
<S>                  <C>      <C>     <C>      <C>      <C>
Net revenue          $219,99  $269,16 $194,19  $168,57  $162,9
                     7        2       6        7        49
Revenue by
geographic area:
Foreign              66%      64%     62%      64%      61%
Domestic             34%      36%     38%      36%      39%
Increase (decrease)
in revenue over      (18%)    39%     15%      3%       (9%)
prior years
Gross margin % of    50%      49%     45%      48%      47%
revenue
Operating expenses
% of revenue         37%      34%     40%      44%      43%
Operating income %   14%      15%     5%       5%       4%
of revenue
Interest expense %   0%       0%      1%       1%       2%
of revenue
Other income % of    5%       0%      0%       1%       1%
revenue
Net income           $29,684  $29,212 $6,465   $2,817   $998
Per share amount     $1.78    $1.86   $0.45    $0.20    $0.07
Income tax rate      25%      27%     22%      38%      42%
Return on revenue    13%      11%     3%       2%       1%
Return on average    12%      15%     5%       2%       1%
assets
Return on average
capital employed     14%      19%     6%       3%       1%
Return on equity     15%      16%     7%       4%       1%
Total capital        $220,26  $202,34 $110,05  $108,49  $106,6
employed             0        9       5        5        18
% of revenue         100%     75%     57%      64%      65%
Total equity         $199,40  $179,14 $87,622  $79,551  $77,44
                     6        5                         3
% of revenue         91%      67%     45%      47%      48%
Per share amount     $11.96   $11.41  $6.04    $5.53    $5.38
Long-term debt,
less current         $1,830   $1,808  $1,839   $8,802   $11,71
portion                                                 8
Total debt           $17,450  $20,862 $19,900  $26,725  $27,10
                                                        0
% of revenue         8%       8%      10%      16%      17%
Debt-to-equity       0.09     0.12    0.23     0.34     0.35
ratio
Total assets         $261,58  $252,24 $143,00  $142,06  $136,4
                     8        9       8        2        07
% of revenue         119%     94%     73%      84%      84%
Working capital      $97,914  $129,90 $45,623  $49,456  $47,
                              8                         705
% of revenue         45%      48%     23%      29%      29%
Current ratio        2.76     2.96    1.98     2.08     2.28
Capital              $31,919  $17,574 $12,055  $7,117   $5,356
expenditures
Depreciation and     $13,272  $12,712 $10,615  $10,072  $11,04
amortization                                            2
Land, building and
equipment, net       $67,530  $51,424 $45,896  $42,427  $45,66
                                                        5
% of revenue         31%      19%     24%      25%      28%
Average number of
employees during     1,540    1,926   1,825    1,547    1,566
the year
Revenue per          $142.86  $139.75 $106.40  $108.97  $104.0
employee                                                5
Shares used to
compute earnings     16,671   15,696  14,498   14,376   14,390
per share
</TABLE>