SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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FORM 10-K

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(MARK ONE)
[X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2004

OR

[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM ___________ TO  _____________

Commission file number 0-25699



PLX Technology, Inc.



|Delaware                                                       | 94-3008334                             
|-------------------------------------------------------------- | ---------------------------------------
|(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number)

870 Maude Avenue
Sunnyvale, California     94085

(408) 774-9060

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:
               Common stock, $0.001 par value per share

Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. Yes
[ X ]       No  [     ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K, or any amendment to
this Form 10-K.      [     ]

Indicate by check mark whether the Registrant is an accelerated filer (as defined in
Rule 121(b)2 of the Securities Exchange Act of 1934). YES [ X ]
      NO  [     ]

The aggregate market value of the voting stock held by non-affiliates of the registrant, based
upon the closing sale price of the registrant's common stock on June 30, 2004, as reported on
The Nasdaq National Market, was approximately $301,480,368. Shares of common stock held by each
executive officer and director and by each person who to the registrant's knowledge owns 5% or
more of the outstanding voting stock have been excluded in that such persons may be deemed to
be affiliates. This determination of affiliate status is not necessarily a conclusive
determination for other purposes.

The number of shares of common stock outstanding at February 23, 2005 was 26,800,473.



DOCUMENTS INCORPORATED BY REFERENCE

PART III OF THIS REPORT ON FORM 10-K INCORPORATES INFORMATION BY REFERENCE FROM
THE REGISTRANT'S PROXY STATEMENT FOR ITS 2004 ANNUAL MEETING OF
STOCKHOLDERS --  ITEMS 10, 11, 12, 13, AND 14.







PLX Technology, Inc.

                                    INDEX TO

                           ANNUAL REPORT ON FORM 10-K

                        FOR YEAR ENDED DECEMBER 31, 2004



|Part I.    |                                                                                       | Page
|---------- | ------------------------------------------------------------------------------------- | ----
|Item 1.    | Business                                                                              | 3   
|Item 2.    | Properties                                                                            | 17  
|Item 3.    | Legal Proceedings                                                                     | 17  
|Item 4.    | Submission of Matters to a Vote of Security Holders                                   | 18  
|Part II.   |                                                                                       |     
|Item 5.    | Market for Registrant's Common Stock and Related Security Holder Matters              | 18  
|Item 6.    | Selected Financial Data                                                               | 18  
|Item 7.    | Management's Discussion and Analysis of Financial Condition and Results of Operations | 19  
|Item 7A.   | Quantitative and Qualitative Disclosures About Market Risk                            | 35  
|Item 8.    | Financial Statements and Supplementary Data                                           | 35  
|Item 9.    | Changes in and Disagreements with Accountants on Accounting and Financial Disclosures | 35  
|Item 9A.   | Controls and Procedures                                                               | 35  
|Part III.  |                                                                                       |     
|Item 10.   | Directors and Executive Officers of the Registrant                                    | 36  
|Item 11.   | Executive Compensation                                                                | 36  
|Item 12.   | Security Ownership of Certain Beneficial Owners and Management                        | 36  
|Item 13.   | Certain Relationships and Related Transactions                                        | 36  
|Item 14.   | Principal Accounting Fees and Services                                                | 36  
|Part IV.   |                                                                                       |     
|Item 15.   | Exhibits, Financial Statement Schedules and Reports on Form 8-K                       | 37  
|Signatures |                                                                                       | 62  

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS



This Annual Report on Form 10-K and certain information
incorporated herein by reference contain forward-looking statements within the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. All statements contained in this Report on Form 10-K that are not
purely historical are forward-looking statements, including, without limitation,
statements regarding our expectations, objectives, anticipations, plans, hopes,
beliefs, intentions or strategies regarding the future. Forward-looking
statements are not guarantees of future performance and are subject to risks and
uncertainties that could cause actual results to differ materially from the
results contemplated by the forward-looking statements. Forward-looking
statements include, without limitation, the statements regarding (a) the
growing demand for standards-based components such as our semiconductor devices
that connect systems together, (b) our objective to expand our advantages
in data transfer technology, under the heading "Item 1, Business -
Overview"; our expectation that we will support new I/O standards where
appropriate, under the heading "Item 1, Business - The PLX Solution"; the
statements regarding (a) our objective to continue to expand our market
position as a developer and supplier of I/O connectivity solutions for high
performance systems, (b) our plan to target those applications where we
believe we can attain a leadership position, (c) that we seek to integrate
additional I/O-related functions into our semiconductor devices, (d) our
belief that our understanding of I/O technology trends and market requirements
allows us to bring to market more quickly new products that support the latest
I/O technology, under the heading "Item 1, Business - Strategy"; that we
continue to integrate more functionality in our semiconductor devices and
continue to enhance and expand our software development kits under the heading
"Item 1, Business - Technology"; the statements regarding (a) our
belief with respect to the principal factors of competition in the business,
(b) our belief that we compete favorably with respect to each of those
factors, under the heading "Item 1, Business - Competition"; the
statements regarding (a) our expectation that revenues related to sales
through distributors will continue to account for a significant portion of total
revenues, (b) our belief that providing customers with comprehensive
product support is critical to remaining competitive in the markets we serve,
(c) our belief that our close contact with customer design engineers
provides valuable input into existing product enhancements and next generation
product specifications, under the heading "Item 1, Business - Sales,
Marketing and Technical Support"; (a) our expectation that we will continue
to make substantial investments in research and development and to participate
in the development of industry standards, (b) our expectation that we will
periodically seek to hire additional development engineers, under the heading
"Item 1, Business - Research and Development"; our belief that the
transition of our products to smaller geometries will be important for us to
remain competitive under the heading "Item 1, Business - Manufacturing";
our plan to seek patent protection when necessary, under the heading
"Item 1, Business - Intellectual Property"; our belief that our current
facility will be adequate through 2005 under the heading "Item 2,
Properties"; the statement regarding our intention to retain earnings for use in
our business and not to pay any cash dividend in the foreseeable future under
the heading "Item 5, Market for Registrant's Common Equity and Related
Stockholder Matters"; our belief that our long-term success will depend on our
ability to introduce new products under the heading "Item 7, Management's
Discussion and Analysis of Financial Condition and Results of Operations -
Overview''; the statement regarding our expectation to record amortization of
deferred compensation related to the stock grants of approximately $0.2 million,
$0.1 million, $0.1 million, and $5,000 for 2005, 2006, 2007, and 2008,
respectively, under the heading "Item 7, Management's Discussion and
Analysis of Financial Condition and Results of Operations - Results of
Operations''; our belief that our existing resources, together with cash
expected to be generated from our operations, will be sufficient to meet our
capital requirements for at least the next twelve months under the heading
"Item 7, Management's Discussion and Analysis of Financial Condition and
Results of Operations - Liquidity and Capital Resources."



All forward-looking statements included in this document are
subject to additional risks and uncertainties further discussed under
"Item 7: Management's Discussion and Analysis of Financial Condition and
Results of Operations - Certain Factors That May Affect Future Operating
Results" and are based on information available to us on the date hereof. We
assume no obligation to update any such forward-looking statements. It is
important to note that our actual results could differ materially from those
included in such forward-looking statements. The factors that could cause our
actual results to differ from those included in such forward-looking statements
are set forth under the heading "Item 7, Management's Discussion and
Analysis of Financial Condition and Results of Operations - Certain Factors That
May Affect Future Operating Results," as well as those disclosed from time to
time in our reports on Forms 10-Q and 8-K and our Annual Reports to
Stockholders.

PART I

ITEM 1: BUSINESS

Overview

PLX Technology, Inc. ("PLX" or
the "Company"), a Delaware corporation established in May 1986, develops and
supplies semiconductor devices that accelerate and manage the transfer of data
in microprocessor-based systems including networking and telecommunications,
enterprise storage, servers, personal computers (PCs), PC peripherals, consumer
electronics,  imaging and industrial products. We offer a complete solution
consisting of three related types of products: semiconductor devices, software
development kits and hardware design kits. Our semiconductor devices simplify
the development of data transfer circuits in micro-processor based systems. Our
software development kits and hardware design kits promote sales of our
semiconductor devices by lowering customers' development costs and by
accelerating their ability to bring new products to market.

In the last decade, demand for
networking, telecommunications, storage, imaging, PCs, consumer electronics and
other products that transmit, store and process information rapidly has
increased due to:

- growth of the Internet,
- deployment of high-speed networking, and
- proliferation of multimedia.

Suppliers of these products seek to reduce product
development time and to use their scarce engineering resources more efficiently.
Until the mid 90's, these suppliers typically developed their own system
components and the connections between the components. Now, however, they are
increasingly building their equipment based on industry standard connection
methods and purchasing components supplied by other companies that comply with
these standards. By doing so, they reduce the time and resources required for
product development. Consequently, there is a growing demand for standards-based
components that connect systems together, such as our semiconductor devices. The
majority of products we ship today are based on Peripheral Component
Interconnect, or PCI, an interconnect standard that is widely used in our
markets. PLX is an active member of many of the trade associations that define
current and future interconnect standards including PCITM, CompactPCI®,
PCI-X®, PCI ExpressTM, Advanced Switch Interconnect, USB and
HyperTransportTM.

Our objective is to expand our advantages in
data transfer technology by:

- focusing on high-growth markets,
- delivering comprehensive solutions, including
semiconductor devices, software development kits and hardware design kits,
- extending our technology advantages by incorporating new functions and
technologies,
- driving industry standards, and
- strengthening and expanding our industry relationships.



Our headquarters are located at
870 Maude Avenue, Sunnyvale, California 94085. The telephone number is
(408) 774-9060. Additional information about PLX is available on our
website at http://www.plxtech.com. Information contained in the website is not
part of this report.

Our Annual Report on
Form 10-K, quarterly reports on Form 10-Q, current reports on
Form 8-K and all amendments to those reports, and the Proxy Statement for
our Annual Meeting of Stockholders are made available, free of charge, on our
website, http://www.plxtech.com, as soon as reasonably practicable after the
reports have been filed with or furnished to the Securities and Exchange
Commission.

Industry Background

Microprocessor-based systems
are found in many common products and offer varying levels of performance
depending on each product's requirements. These products range from low
performance devices such as electronic toys and kitchen appliances to complex,
high-performance electronic equipment such as network routers and switches.
High-performance microprocessor-based systems offer increased data processing
capabilities and typically utilize one or more 32-bit or 64-bit microprocessors,
fast memories and peripherals, and sophisticated operating systems or control
code.

The growth of the
communications infrastructure has increased the demand for high performance
microprocessor-based systems. This demand has been fueled by the growth of the
Internet; the deployment of high-speed networking systems to transmit, store,
and process data; and the proliferation of data types in the network, including
voice traffic and multimedia.

Markets for electronic equipment that rely on
high-performance microprocessor-based systems include the following:

- Networking and Telecommunications

- Enterprise Storage

- Servers

- Imaging

- Industrial

- PC Peripherals and Consumer Electronics

Manufacturers of products that
rely on high-performance microprocessor-based systems seek to maximize the
performance and minimize the cost of their increasingly complex products. In
addition, these manufacturers must develop and bring new products to market
quickly to keep pace with technological advancements.

The I/O Subsystem

A typical computer system can
be described in terms of four primary functions: the host microprocessor, the
memory, the peripherals and the input/output, or I/O, subsystem. The host
microprocessor is the primary control center for the system. The memory acts as
a storage area for instructions to be executed and data to be processed. The
peripherals enable connections between the system and other external devices
such as network components, printers and storage systems. The I/O subsystem is
the interconnect circuitry and software that connects these three other
functions and allows for the transfer of instructions and data among these
functions. The I/O subsystem may also connect the system to the outside world.
The I/O subsystem includes the system bus or switch fabric, which is a physical
connection between these different functions.

To enable increased performance
and functionality from computer systems, semiconductor suppliers have
historically focused on improving the operation of peripherals, microprocessors
and memories. The interconnect silicon in the I/O subsystem must also improve to
keep pace with these improvements by transferring more information at faster
speeds.

In parallel with the increased
performance demands of customers and their data traffic, the reliability of
these systems is under constant pressure to improve. This is especially true as
the networking and telecommunications disciplines merge through use of the
Internet to carry all types of traffic. Highly available systems are required to
meet the expectations of customers.

As data transfer and
reliability requirements for the I/O subsystem have increased, so has the
complexity of its interface logic and related software. Until the mid 90's, most
microprocessor-based systems used simple I/O subsystems that contained limited
logic and rudimentary software, if any. Complex I/O subsystem components such as
processors, elaborate control logic and advanced software were costly, and
therefore their use was confined to very high-end equipment such as mainframe
computers. Furthermore, the lack of widely accepted I/O standards impeded the
use of complex I/O subsystems in other than high-end applications. However,
advances in semiconductor technology combined with the widespread adoption of
standards in microprocessor-based systems have enabled the development of highly
integrated semiconductor devices that can better manage I/O subsystem
performance at lower cost.

Penetration of I/O Standards in Systems

Until the mid 90's,
microprocessor-based systems manufacturers relied on a wide variety of
proprietary solutions and a fragmented set of industry standard I/O
architectures. For example, many networking, imaging, storage and industrial
applications employed proprietary architectures to meet their specific
performance and cost requirements. A mix of standard buses such as VMEbus,
Multibus and ISA was used in some industrial, telecommunications and military
applications. Software was even more fragmented with many proprietary and
application specific software architectures in use. While developers could take
advantage of many standard microprocessor, memory and peripheral components
supplied by external vendors, the lack of acceptable I/O standards forced many
to develop custom I/O subsystems internally, placing a heavy demand on
development resources.

The deployment of the PCI
standard was one of the catalysts for the widespread adoption of I/O standards
in microprocessor-based systems. In the early 1990s, PC and server manufacturers
developed PCI, a new standard hardware architecture to connect the major
components of their systems at high speed. It offered up to a one hundred times
improvement in I/O data transfer rates over the previous architectures. By the
mid-1990s, PCI became the most widely used bus architecture in the PC market.
Consequently, many suppliers of peripheral semiconductor components used in PCs
adopted PCI as the standard system interface. In addition to penetrating the PC
and server market, PCI is now established as a standard I/O architecture for
many other high-performance microprocessor-based systems because it allows the
use of low cost and state-of-the-art peripheral semiconductor components
developed for the PC market and provides a foundation for system
interoperability. PCI also offers equivalent or superior performance to the in-house
developed standards of many electronic equipment suppliers. Furthermore,
the use of PCI enables faster time to market, lower development cost and the
ability to quickly integrate new I/O components.



New standards are emerging to
meet increasing system performance needs. PCI-X, a standard now widely used in
servers, is an evolutionary improvement to PCI. PCI Express is a next-generation
PCI standard now in the early commercialization phase as it is being shipped
today in servers, desktop and notebook computers.

Although PCI and PCI Express
standards have resolved many development issues relating to I/O hardware
architectures, software remains a challenge. The lack of standards for I/O
control software and the wide use of proprietary operating systems place a
significant demand on development resources. Consequently, microprocessor-based systems developers
are increasingly adopting standard operating systems with well-defined I/O
structures as opposed to developing their own software internally. Examples
include VxWorks, Linux, pSOS, Windows CE, Windows 2000 and Windows NT.

Need for Standard I/O Interconnect Products and Comprehensive I/O
Solutions

Even with standard I/O
specifications, design teams must still create the circuitry and related
software that implement these specifications. Designers must also update their
I/O subsystems to include frequent improvements in these specifications.

Instead of developing all the
hardware and software technology internally, system developers seek to focus
their scarce engineering resources on the proprietary features of their
products. By using standard semiconductor devices in the I/O subsystem instead
of custom-designed devices they are able to implement the basic framework of the
system more easily and thereby reduce the I/O subsystem design effort resulting
in faster time-to-market and lower development cost. Standard products allow the
design teams to concentrate their efforts on differentiating hardware and
software features. In addition to standard interconnect semiconductor devices,
system designers can benefit from several other design elements, such as data
control software, hardware design kits and third-party development tools to
complete their development work in a timely manner. These additional elements
simplify development and improve time to market. They provide design teams with
proven hardware and software design examples and the tools to adapt these
examples to their needs.

Due to the availability and
adoption of I/O standards by developers of microprocessor-based systems, servers and PC's, there is
now a large demand for I/O subsystem components based on these standards.

The PLX Solution

PLX develops and supplies
interconnect semiconductor devices and supporting hardware and software
platforms that accelerate and manage the transfer of data in high-performance
microprocessor-based systems.

Our solution consists of three
related products:

- interconnect semiconductor devices,
- software development kits which assist in developing
systems that incorporate our semiconductor devices, and
- hardware design kits that allow development of a system
using our semiconductor devices and software development kits.

Development tools provided by
third parties support these three related products. Our products are designed
for use in a variety of applications including networking and
telecommunications, enterprise storage, servers, embedded control and PC
peripheral and consumer electronics. Our chips are highly integrated, cost-effective
semiconductor devices that optimize the flow of data and simplify the
development of high-performance I/O subsystems. Our software development kits
and hardware design kits promote sales of our semiconductor devices by lowering
customers' development costs and allowing them to bring new products to market
more quickly.

PLX products shipping today
provide I/O connectivity solutions mainly for the PCI, PCI-X, PCI Express, USB
and HyperTransport standards. As new I/O standards evolve, we expect to support
them where appropriate.  More than 1,000 electronic equipment manufacturers use
PLX semiconductor devices in a wide variety of applications.

Strategy

Our objective is to continue to
expand our market position as a developer and supplier of I/O connectivity
solutions for high-performance systems. Key elements of our strategy include the
following:

Focus on High-Growth
Markets.We focus on the high-growth communications, storage, server,
embedded control, PC peripheral and consumer markets. Within these markets,
there are many highly differentiated applications with different design criteria
such as product function, performance, cost, power consumption, software, size
limitations and design support. The requirements of many of these differentiated
applications are addressed by our products, and we target those applications
where we believe we can attain a leadership position.

Deliver Comprehensive
Solutions.Our products provide system developers with a comprehensive,
proven development environment to simplify I/O subsystem design, enhance
performance, reduce development costs and accelerate time-to-market. This
solution consists of semiconductor devices, software development kits and
hardware design kits. These design elements are supported by development tools
provided by third parties.

Extend I/O Subsystem
Technology.We offer our customers highly integrated semiconductor devices
and related software that incorporate many of the latest advances in I/O
interconnect technology. Our semiconductor devices and software are designed to
enable quick adoption of new I/O technologies and enhancements to existing I/O
standards. We seek to integrate additional I/O-related functions into our
semiconductor devices to provide our customers with increasing functionality at
the same or lower costs. We employ a team of engineers with expertise in system
architectures, product definition, semiconductor and software design to maintain
our I/O subsystem technology advantages.

Drive I/O Subsystem
Standards.We believe that our understanding of I/O technology trends and
market requirements allows us to bring to market more quickly new products that
support the latest I/O technologies. Through our participation in key industry
groups responsible for standards such as the PCI Special Interest Group, the PCI
Industrial Computer Manufacturer's Group (PICMG), PCI-X Manufacturers' Group,
HyperTransport Consortium, Advanced Switching Interconnect (ASI-SIG), and the
USB Implementers Forum (USB-IF), we have taken an active role in defining new
I/O standards.

Strengthen and Expand
Industry Relationships.We work with industry leaders in developing hardware
and software development tools and marketing programs that promote the use of
each company's products. Partners include AMD, Broadcom, Bustronic, Intel,
Jungo, Kaparel, Microsoft, Motorola, Pigeon Point, PMC Sierra, RamBus, Texas
Instruments and Wind River. As a result of these relationships, we enable
microprocessor-based systems designers to choose the best products for their particular
applications while still employing our product as the core of their I/O
subsystem design.

Customers

We supply our products to
customers for a wide variety of communications, storage, server, embedded
control, PC peripheral and consumer appliance applications. The typical product
life cycle of a high performance microprocessor-based system is one to two years
or more of product development and initial marketing activity followed by one to
five years or more of volume production, assuming the product is successful in
the market. The system design team typically selects the sole-source hardware
and software components early in the design cycle. Generally, the system will
incorporate these same components throughout its product life because changes
require an expensive re-engineering effort. Therefore, when our products are
designed into a system, they are likely to be used in that system throughout its
one to five year or more production life.

Our products are standard
semiconductor devices that may be incorporated into equipment used in several of
our target markets. More than 1,000 electronic equipment manufacturers
incorporate our semiconductor devices in their products.

The following table lists
representative end customers that purchased directly or through distributors
more than $100,000 of our products in 2004.



`Networking/Telecommunications    Imaging/Industrial/Medical                    
Accton Technology                ABB
Alcatel                          Comtrol Corporation
Allied Telesyn                   ESD
Artesyn Technologies             Euresys
Adlink                           Fuji Xerox
Avaya                            General Electric
Brooktrout Technologies          Geovision
Cisco Systems                    Hangzhou Hikvision Digital Technology Co., LTD
Digi International               Matrox
Eicon Technology                 Measurement Computing
Ericsson                         Moxa Technologies
Hitachi                          OKI
Huawei                           Provideo Multimedia Co., LTD
Intel                            Samsung
Marconi                          SBS Technologies
Motorola                         Siemens
NEC
Nortel Networks                  PC Peripheral & Consumer Electronics   
Performance Technology           Adaptec
Pyxis Corporation                Gemtek
Radisys                          Nvidia
Sea Level Systems                Sony
Toshiba                          Z-Com

Enterprise Storage
EMC
Fujitsu
IBM`

Our products consist of
interconnect semiconductor devices, software development kits and hardware
design kits. Development tools provided by third parties support these three
design elements. The sales of these semiconductor devices account for a majority
of our revenues. We generate less than 1% of our revenues from sales of our
software and hardware design kits. The other layers of our solution promote
sales of our semiconductor devices by lowering customers' development costs
allowing them to bring new products to market more quickly.

I/O Accelerators. Our
I/O accelerators are semiconductor devices that accelerate movement of data
across a PCI bus and between one or more devices or subsystems that need to
communicate across the PCI bus. These products incorporate the Data Pipe
Architecture technology, a set of circuits and features that enable an efficient
flow of data within systems with minimal supervision from the system processor.
Our I/O accelerators address a range of applications and provide flexible
interfaces that allow them to connect to a wide variety of semiconductor
devices, including processors such as Motorola's PowerPC, Intel's i960 and
Strong ARM, Hitachi's SH, and Motorola's 68K series. Customers also use these
semiconductor devices in connection with digital signal processors, or DSPs,
from Texas Instruments and others. The I/O accelerators can be connected with a
wide range of peripheral devices, including LAN, WAN, disk control and graphics.

PCI-to-PCI Bridges.  PCI-to-PCI bridges are chips that
increase the number of peripheral devices that can be included in a
microprocessor-based system. PCI-to-PCI bridges have become common in a wide
variety of systems, including servers, storage, communications, and embedded-control
applications such as imaging, industrial control, and test equipment.
PLX's bridge product line spans the entire PCI range, from 32-bit 33MHz through
64-bit 66MHz, and includes 133MHz PCI-X devices.  PLX acquired this product line
through the May 2003 acquisition of HiNT Corporation.

HyperTransport Interconnect
Bridges.The HyperTransport bridge allows a processor, typically a MIPS
processor, to generate and control two PCI-X buses. The bridge chip converts the
8 or 16 bit 800MHz HyperTransport processor interface to two 64 bit 133MHz PCI-X
buses. The bridge provides a means for the processor to communicate efficiently
with multiple I/O devices such as Ethernet controllers. This product is a result
of an agreement we entered into in May 2002 with Advanced Micro Devices.

USB Interface Chips.USB interface chips are used by computer peripherals to connect to a PC
through an external cabled connection.  The USB standard allows for
connections to be made at different speeds.  Hi-Speed USB (also known as
USB 2.0) provides 40x the bandwidth of Full-Speed USB and can be found on most
PCs sold after 2003.  However, most PC peripherals today, such as mice,
printers, and digital cameras, still utilize Full-Speed transfer rates.
 PLX's products are all USB 2.0 Hi-Speed.  The industry is moving quickly
to adopt Hi-Speed USB.  Hi-Speed connections can be found today on devices
like multi-function printers, DVD camcorders, portable media players, and hard
disks

PCI Express Switches and
Bridges.PCI Express Interconnect Chips are devices which support the
latest, standardized serial I/O interconnect protocol, known as PCI
Express.  The Switch and Bridge devices are a means of connecting PCI
Express processor and chipsets with endpoint devices supporting PCI Express such
as Graphics Controllers, High Speed Networking Devices, and Storage
Devices.  The Switch products provide the system fanout function needed in
a point-to-point protocol such as PCI Express for use in motherboards,
backplanes or even on adapter cards, while the Bridge devices enable
conventional PCI products (32-bit/33 MHz, 32-bit/66 MHz, and even 64-bit/133 MHz PCI-X) to be upgraded
for use in new PCI Express systems.

Software Development
Kits. Our software development kits, or SDKs, are designed to simplify and
accelerate the development of systems that incorporate our semiconductor
devices. Support is provided for several industry-leading operating systems,
including VxWorks from Wind River, Linux, and Microsoft Windows as well as
generic applications and other operating systems. The SDKs include an
application programming interface, or API, that enables developers to execute
complex transactions with simple commands. This programming interface allows
customers to migrate their designs, with the same software interface, from our
existing 32 bit I/O accelerators to our 64 bit I/O accelerators. This common
interface allows customers to preserve their software investment even as their
designs evolve in complexity and as new I/O architectures are deployed.

Hardware Design Kits. We
offer hardware design kits that support the development of systems incorporating
PLX semiconductor devices. We call our hardware design kits "rapid development
kits", or RDKs. Designers use the RDKs to evaluate our semiconductor devices and
to simplify and accelerate product development. Each hardware design kit
includes a development circuit board that designers can use to evaluate the PLX
products and       also design their own system. These hardware design kits also
include technical drawings, documentation and other design assistance tools.

To offer additional design
support, we work with third party companies that provide development tools for
our customers. Although we receive no revenue directly from these development
tools, they promote sales of our semiconductor devices because these tools often
make it easier to develop systems incorporating our products. Examples include
software development tools from Jungo, Microsoft, Pigeon Point, and Wind River
and software modeling tools from Synopsys.

Our principal product offerings and functions include the
following:

`Category                                 Product          Description
-----------------------------------------------------------------------------------------------------------------------------
                                               Semiconductor Devices  
-----------------------------------------------------------------------------------------------------------------------------
32-bit/33 MHz Target I/O Accelerators    PCI 9030         o Enable connection of 8-, 16- and 32-bit peripherals and personal
                                         PCI 9052         computer adapters to PCI
                                         PCI 9050
-----------------------------------------------------------------------------------------------------------------------------
32-bit/33 MHz Master I/O Accelerators    PCI 9054         o Provide the flexibility to connect with a wide range of processors,
                                         PCI 9080         peripherals and memory
                                         PCI 9060SD
                                         PCI 9060ES
                                         PCI 9060
-----------------------------------------------------------------------------------------------------------------------------
32 and 64-bit/66 MHz I/O Accelerators    PCI 9056         o Provide the flexibility to connect with a wide range of
                                         PCI 9656         microprocessors, peripherals and memory
-----------------------------------------------------------------------------------------------------------------------------
HyperTransport Bridge Chips              HT 7520          o Connect HyperTransport interface to two PCI-X buses
-----------------------------------------------------------------------------------------------------------------------------
PCI and PCI-X Bridge Chips               PCI 6140         o Increase the number of PCI peripheral devices that can be included
                                         PCI 6150         in a microprocessor-based system
                                         PCI 6152
                                         PCI 6154
                                         PCI 6156
                                         PCI 6254
                                         PCI 6350
                                         PCI 6520
                                         PCI 6540
-----------------------------------------------------------------------------------------------------------------------------
USB Bridge Chips                         NET 2270         o Connect CPUs and DSPs to a high-speed USB device port
                                         NET 2272
                                         NET 2280
                                         NET 2890
-----------------------------------------------------------------------------------------------------------------------------
PCI Express Bridges and Switches         PEX 8111         o Support the standard PCI Express serial interconnect protocol
                                         PEX 8114         o Facilitate the connection of the newest PCI Express processors
                                         PEX 8516
                                         PEX 8532         o Provide essential system fanout required by the point-to-point
                                                          Express standard
                                                          o Enable conventional PCI products to be upgraded for use in the newest
                                                          PCI Express system
-----------------------------------------------------------------------------------------------------------------------------
                                            Software Development Kits
-----------------------------------------------------------------------------------------------------------------------------
Software                                 SDK              o Provide tools for accelerating design of data transport software
                                                          o Include development and debugging utilities, sample firmware and driv
-----------------------------------------------------------------------------------------------------------------------------
                                              Hardware Design Kits
-----------------------------------------------------------------------------------------------------------------------------
Rapid Development Kits                   Kits supporting ao Include development circuit boards, SDK software, documentation and
                                         range of productsschematics to assist system development

-----------------------------------------------------------------------------------------------------------------------------`



Technology

We believe that supplying high-performance
connectivity solutions for I/O subsystems requires expertise in four
areas:

- semiconductor design,
- software technology,
- system design, and
- industry standards.

Semiconductor Design.Our engineers have substantial expertise in semiconductor design and have
developed a comprehensive library of complex functional blocks for use in
semiconductor devices for I/O connectivity. As a result of this expertise, we
offer both innovative architectures and high levels of functionality. For
example, our proprietary Data Pipe Architecture technology allows the system
developer a high degree of control over the PCI bus in order to address specific
design needs. In high-performance systems, the Data Pipe Architecture technology
enables data throughput that is faster than typical approaches. We continue to
integrate more functionality in our semiconductor devices to reduce cost,
improve performance, reduce size and simplify the customer's design effort.

Software Technology.We
devote engineering resources to the development of software technology used to
assist the system developer in debugging hardware and creating data control
software. The quality and availability of these tools are key differentiating
factors between PLX and competing alternatives. We continue to enhance and
expand our software development kits, which contain a set of programming
interfaces that simplify the development of software. Our software expertise
provides us with valuable insights into our customers' software development
issues, which aids the definition and development of future semiconductor
devices.

System Design.We employ
a team of system level design engineers that develop hardware design kits. These
kits are high-performance adapters and embedded systems that customers can use
to assist development of their products. Each of these hardware design kits is a
system or adapter similar in complexity to those built by our customers. The
system design experience provides us valuable insights which we can use to
improve future semiconductor device and software products.

Industry Standards.Through our participation in the key industry groups responsible for
interconnect standards, we take an active role in defining new I/O standards
such as PCI-X, HyperTransport, Advanced Switching Interconnect, and PCI Express.

Competition

Competition in the
semiconductor industry is intense. If our target markets continue to grow, the
number of competitors may increase significantly. In addition, new semiconductor
technologies may lead to new products that can perform similar functions as our
products.

Competition in the various
markets we serve comes from companies of various sizes, many of which are
significantly larger and have greater financial and other resources. Thus they
can better withstand adverse economic or market conditions. Our principal
products compete with standard products from companies such as Alliance
Semiconductor, Cypress Semiconductor, IDT, Intel, Kawasaki, NEC, Oxford
Semiconductor, Pericom Semiconductor, Philips, Renasas, Seiko-Epson, Texas
Instruments and Tundra Semiconductor.

In addition, two alternative
devices can perform some or all of the functions of our semiconductor devices.
The first is the Application Specific Integrated Circuit, or ASIC. With the ASIC
approach, a customer creates a custom semiconductor device for a particular
application. Because the customer buys the ASIC directly from the semiconductor
foundry, this approach may lead to lower unit production costs. However, this
approach entails a large initial time and resource investment in developing the
custom device. The second alternative device is the Field Programmable Gate
Array, or FPGA. The FPGA is a semiconductor device whose logic function can be
programmed by the system manufacturer. This requires less design effort and time
than the ASIC approach. However, because of the additional circuitry required to
enable the device to be programmed, this approach typically entails higher unit
production costs which can be prohibitive compared to ASICs or standard
semiconductor devices. Nevertheless, FPGA prices have decreased steadily and in
many cases are competitive with prices for standard semiconductor devices.
Accordingly, we also experience competition from leading ASIC suppliers,
including IBM, LSI Logic, NEC, and Toshiba as well as from FPGA suppliers,
including Actel, Altera, Atmel, Lattice, Quicklogic, and Xilinx. Many of these
competitors are large companies that have significantly greater financial,
technical, marketing and other resources than PLX.

We believe that the principal
factors of competition in our business include functionality, product
performance, price, product innovation, availability of development tools,
customer service and reliability. We believe that we compete favorably with
respect to each of these factors. We differentiate our products from those of
our competitors by incorporating innovative features that allow our customers to
build systems based on industry standards that are more efficient and higher in
performance. Furthermore, in general, our software and hardware development
tools are more comprehensive than competing solutions. However, we cannot assure
you that we will be able to compete successfully in the future against existing
or new competitors, and increased competition may adversely affect our business.

Sales, Marketing and Technical Support

Our sales and marketing
strategy is to achieve design wins at leading systems companies in high-growth
market segments. We market and sell our products in the United States through a
combination of direct regional sales managers, a network of independent
manufacturers' representatives, and a distributor. We maintain United States
direct sales offices in California, Connecticut, Massachusetts, North Carolina,
and Texas.

Outside the United States, we
have engaged a team of manufacturers' representatives, stocking representatives
and distributors to sell and market our products. Our international network
includes representatives in Australia, Austria, Belgium, Brazil, Canada,
Denmark, Finland, France, Germany, Hong Kong, India, Ireland, Israel, Italy,
Japan, Korea, Norway, People's Republic of China, Singapore, South Africa,
Spain, Sweden, Switzerland, Taiwan, The Netherlands, and the United Kingdom. We
maintain a direct sales office in the United Kingdom to service customers in
Europe and the Middle East and in Japan and Taiwan to service Japan, Southeast
Asia, and The People's Republic of China.

As of December 31, 2004,
we employed 39 individuals in sales and marketing. Sales in North America
represented 32%, 37%, and 42%, of net revenues for 2004, 2003, and 2002,
respectively. All sales to date have been denominated in U.S. dollars.

Net revenues through
distributors accounted for approximately 53%, 56%, and 54% of our net revenues
for 2004, 2003, and 2002, respectively. Revenues related to sales through
distributors are expected to continue to account for a majority of our total
revenues. See "Certain Factors That May Affect Future Operating Results - A
Large Portion of Our Revenues Is Derived from Sales to Third-Party Distributors
Who May Terminate Their Relationships with Us at Any Time."

In 2004, sales to Metatech, a
distributor, accounted for 13% of our net revenues. In 2003, sales to Metatech
and A2M, also a distributor, accounted for 11% and 10%, respectively, of our net
revenues.  In 2002, sales to A2M accounted for 13% of our revenues.  No other
distributor or direct customer accounted for more than 10% of net revenues in
any period presented.

Technical support to customers
is provided through field and factory applications engineers, technical
marketing personnel and, if necessary, product design engineers. Local field
support is provided in person or by telephone. We also use our World Wide Web
site to provide product documentation and technical support information. We
believe that providing customers with comprehensive product support is critical
to remaining competitive in the markets we serve. In addition, our close contact
with customer design engineers provides valuable input into existing product
enhancements and next generation product specifications.

Research and Development

Our future success will depend
to a large extent on our ability to rapidly develop and introduce new products
and enhancements to our existing products that meet emerging industry standards
and satisfy changing customer requirements. We have made and expect to continue
to make substantial investments in research and development and to participate
in the development of new and existing industry standards.

Our research and development
has focused on three main areas: semiconductor devices, hardware design kits and
software development kits. The majority of our engineers are involved in
semiconductor device development, with the remaining engineers working on
software and reference design hardware. Before development of a new product
commences, our marketing managers work closely with research and development
engineers and customers to develop a comprehensive requirements specification.
In addition, our marketing managers and engineers review the applicable industry
standards and incorporate desired changes into the new product specification.
After the product is designed and commercially available, our engineers continue
to work with various customers on specific design issues to understand emerging
requirements that may be incorporated into future product generations or product
upgrades.

Our research and development
expenditures totaled $17.7 million in 2004, $15.0 million in 2003, and
$14.3 million in 2002. Research and development expenses consist primarily
of salaries and related costs of employees engaged in research, design, and
development activities. In addition, expenses for outside engineering
consultants, non-recurring engineering at our independent foundries, and
deferred stock compensation are included in research and development expenses. As of
December 31, 2004, there were 68 employees engaged in research and
development. We perform our research and development activities at our
headquarters in Sunnyvale, California and in Salt Lake City, Utah. We
periodically seek to hire additional skilled development engineers who are
currently in short supply. Our business could be adversely affected if we
encounter delays in hiring additional engineers. See "Certain Factors That May
Affect Future Operating Results - We Could Lose Key Personnel Due to Competitive
Market Conditions and Attrition."

Our future performance depends
on a number of factors, including our ability to identify emerging technology
trends in our target markets, define and develop competitive new products in a
timely manner, enhance existing products to differentiate them from those of
competitors and bring products to market at competitive prices. The technical
innovations and product development required for us to remain competitive are
inherently complex and require long development cycles. We typically must incur
substantial research and development costs before the technical feasibility and
commercial viability of a product can be ascertained. We must also continue to
make significant investments in research and development in order to continually
enhance the performance and functionality of our products to keep pace with
competitive products and customer demands for improved performance. Revenues
from future products or product enhancements may not be sufficient to recover
the development costs associated with these products or enhancements. The
failure to successfully develop new products on a timely basis could have a
material adverse effect on our business. See "Certain Factors That May Affect
Future Operating Results - Rapid Technological Change Could Make Our Products
Obsolete."

Manufacturing

We have adopted a "fabless"
semiconductor manufacturing model and outsource all of our semiconductor
manufacturing, assembly and testing. This approach allows us to focus our
resources on the design, development and marketing of products and significantly
reduces our capital requirements. We subcontract substantially all of our
semiconductor manufacturing to AMD in the United States, Samsung in Korea, NEC
and Seiko-Epson Semiconductor in Japan, and Taiwan Semiconductor Manufacturing
Corporation and UMC in Taiwan. None of our products are currently manufactured
by more than one supplier, and all of our products are expected to be single-source
manufactured for the foreseeable future. We must place orders two to four
months in advance of expected delivery of finished goods. We maintain inventory
levels based on current lead times from foundries plus safety stock to account
for unanticipated fluctuations in demand. Our inventory comprises a large
portion of our working capital. As a result, we have limited ability to react to
fluctuations in demand for our products which could cause us to have an excess
or a shortage of inventory of a particular product and reduced product revenues.

In the event of a loss of, or a
decision by us to change a key supplier or foundry, qualifying a new supplier or
foundry and commencing volume production would likely involve delay and
expenses, resulting in lost revenues, reduced operating margins and possible
detriment to customer relationships. Since we place our orders on a purchase
order basis and do not have a long-term volume purchase agreement with any of
our existing suppliers, any of these suppliers may allocate capacity to the
production of other products while reducing deliveries to us on short notice.
While we believe we currently have good relationships with our foundries and
adequate capacity to support our current sales levels, there can be no assurance
that adequate foundry capacity will be available in the future on acceptable
terms, if at all. See "Certain Factors That May Affect Future Operating Results
- Our Independent Manufacturers May Not Be Able To Meet Our Manufacturing
Requirements."

Our semiconductor devices are
currently fabricated using a range of semiconductor manufacturing processes. We
must continuously develop our devices using more advanced processes to remain
competitive on a cost and performance basis. Migrating to new technologies is a
challenging task requiring new design skills, methods and tools. We believe that
the transition of our products to smaller geometries will be important for us to
remain competitive. Our business could be materially adversely affected if any
transition to new processes is delayed or inefficiently implemented. See
"Certain Factors That May Affect Future Operating Results - Defects in Our
Products Could Increase Our Costs and Delay Our Product Shipments."

Intellectual Property

Our future success and
competitive position depend upon our ability to obtain and maintain the
proprietary technology used in our principal products. Most of our current
products include implementations of the PCI, PCI Express and USB industry
standards, which are available to other companies. We currently have no patents
on any of our I/O accelerator products and rely instead on trade secret
protection. We hold two patents on switch technology that expire in December
2016. In addition, we have a patent on I/O buffer technology that expires in
September 2007. In the future, we plan to seek patent protection when we believe
it is necessary.

Our existing or future patents
may be invalidated, circumvented, challenged or licensed to others. The rights
granted may not provide competitive advantages to us. In addition, our future
patent applications may not be issued with the scope of the claims sought by us,
if at all. Furthermore, others may develop technologies that are similar or
superior to our technology, duplicate our technology or design around the
patents owned or licensed by us. In addition, effective patent, trademark,
copyright and trade secret protection may be unavailable or limited in foreign
countries where we may need this protection. We cannot be sure that steps taken
by us to protect our technology will prevent misappropriation of our technology.

The semiconductor industry is
characterized by vigorous protection and pursuit of intellectual property rights
or positions. This often results in significant and often protracted and
expensive litigation. There is no intellectual property litigation currently
pending against us. However, we may from time to time receive notifications of
claims that we may be infringing patents or other intellectual property rights
owned by other third parties. If it is necessary or desirable, we may seek
licenses under these third party patents or intellectual property rights.
However, we cannot be sure that licenses will be offered or that the terms of
any offered licenses will be acceptable to us.

The failure to obtain a license
from a third party for technology used by us could cause us to incur substantial
liabilities and to suspend the manufacture or shipment of products or our use of
processes requiring the technology. Litigation could result in significant
expenses to us, adversely affect sales of the challenged product or technology
and divert the efforts of our technical and management personnel, whether or not
the litigation is determined in our favor. In the event of an adverse result in
any litigation, we could be required to pay substantial damages, cease the
manufacture, use, sale or importation of infringing products, expend significant
resources to develop or acquire non-infringing technology, and discontinue the
use of processes requiring the infringing technology or obtain licenses to the
infringing technology. In addition, we may not be successful in developing or
acquiring the necessary licenses under reasonable terms. This could require
expenditures by us of substantial time and other resources. Any of these
developments would have a material adverse effect on our business. See "Certain
Factors That May Affect Future Operating Results - Our Limited Ability to
Protect Our Intellectual Property and Proprietary Rights Could Adversely Affect
Our Competitive Position."

Employees

As of December 31, 2004,
we employed a total of 136 full-time employees, including 68 engaged in research
and development, 39 engaged in sales and marketing, 3 engaged in manufacturing
operations and 26 engaged in general administration activities. We also from
time to time employ part-time employees and hire contractors. Our employees are
not represented by any collective bargaining agreement, and we have never
experienced a work stoppage. We believe that our employee relations are good.

Executive Officers and Directors

Our executive officers and
directors, their ages and their positions as of December 31, 2004, are as
follows:

`Name                                 Age  Position                                                

Michael J. Salameh..................  50  Chief Executive Officer and Director
Rafael Torres.......................  36  Vice President, Finance, Chief Financial Officer and Secretary
Lawrence Chisvin....................  50  Chief Operating Officer
Michael A. Hopwood..................  42  Vice President, Worldwide Sales
Hector A. Berardi...................  40  Vice President, Operations
Jack Regula.........................  56  Vice President, Chief Technology Officer
David K. Raun.......................  42  Vice President, Marketing
Alex Wong...........................  42  Vice President, Business Development
D. James Guzy.......................  68  Chairman of the Board of Directors
Wei-Ti Liu..........................  55  Director
Thomas Riordan......................  48  Director
Patrick Verderico...................  60  Director
John H. Hart........................  59  Director
Robert H. Smith.....................  67  Director`

Michael J. Salamehco-founded
PLX and has served as our Chief Executive Officer and as a member of the
Board of Directors since PLX's inception in May 1986. From 1980 through 1986,
Mr. Salameh was employed in various marketing management positions with
Hewlett-Packard Company. Mr. Salameh received a B.S. in Engineering and
Applied Science from Yale University and an M.B.A. from Harvard Business School.

Rafael Torreshas served
as our Vice President, Finance, Chief Financial Officer and Secretary since
November 2000. From May 1999 to November 2000, Mr. Torres served as our
Corporate Controller. From September 1998 to May 1999, Mr. Torres was
employed by OnCommand Corporation, an on demand video company, as Accounting
Manager. From June 1997 to September 1998, Mr. Torres was employed by
Silicon Valley Group, a semiconductor equipment company, as Manager of Financial
Reporting and Analysis. From September 1994 to June 1997, Mr. Torres was
employed with PriceWaterhouse LLP, a public accounting firm, as senior auditor.
Mr. Torres received a B.S. in Accounting from Santa Clara University. Mr.
Torres is a Certified Public Accountant.

Lawrence Chisvinhas
served as our Chief Operating Officer since August 2004.  From May 2000 to
August 2004, Mr. Chisvin served as our Vice President, Marketing. From September
1998 through May 2000, Mr. Chisvin was employed by Neomagic, a
semiconductor company, as Director of Marketing. From May 1996 through September
1998, Mr. Chisvin was employed by LSI Logic, a semiconductor company, as
Director of Marketing. Prior to LSI Logic, Mr. Chisvin was employed in a
variety of marketing and engineering positions at S3, Philips, Western Digital,
and Digital Equipment Corporation. Mr. Chisvin received a B.S. in
Electrical Engineering from Northeastern University and an M.S. in Electrical
Engineering from Worcester Polytechnic Institute.

Michael A. Hopwoodhas
served as our Vice President, Worldwide Sales since 1995. From 1995 to October
2003, Mr. Hopwood also served as our Vice President of Business Development.
From 1989 to 1995, Mr. Hopwood held a variety of other sales management
positions with our Company. From 1984 until 1989, Mr. Hopwood held various
sales positions at Intel Corporation, a semiconductor manufacturer.
Mr. Hopwood received a B.S. in Physics Engineering from Pacific Lutheran
University.

Hector A. Berardihas
served as our Vice President, Operations since August 2002. From April 1999 to
July 2002, Mr. Berardi served as the Vice President of Operations at Ubicom
Inc., a developer of wireless network processors and software platforms. From
June 1998 to April 1999, Mr. Berardi was a design and program manager for
the advanced RISC core development group at ST Microelectronics, a semiconductor
company. From July 1987 to May 1998, Mr. Berardi worked at National
Semiconductor Corporation, a semiconductor company, where his last position was
senior product engineering manager for microcontroller technologies.
Mr. Berardi received an M.B.A. and a B.S. in Electrical Engineering from
Santa Clara University.

Jack Regulahas served
as our Vice President, Chief Technology Officer since October 2001.  From May
2000 to October 2001, Mr. Regula served as our Chief Scientist.  Mr. Regula
founded Sebring Systems, a semiconductor company, in 1996 and was Sebring's
Chairman and Chief Technology Officer from 1996 until its acquisition by PLX in
May 2000.  Prior to Sebring Systems, Mr. Regula was employed in a variety of
engineering management positions at Sunscoop Corporation, Force Computers, and
Ironics, Inc.  Mr. Regula received a B.S. in Electrical Engineering and an M.S.
in Electrical Engineering, both from Rensselaer Polytechnic Institute.

David K. Raun has served
as our Vice President, Marketing since November 2004.  From January 2002 through
November 2004, he was Vice President of Marketing at Pericom
Semiconductor.  In 2001, Mr. Raun was Executive Vice President &
General Manager at Actovate, a technology-based marketing company.  From
September 1989 to November 2000, Mr. Raun worked at Waferscale Integration,
Inc., where his last position was Vice President of PSD & Memory
Products.  From 1985 to 1989, Mr. Raun held various sales, sales
management, and marketing positions at AMD.  Mr. Raun received a B.S. in
Electrical and Computer Engineering from the University of California, Santa
Barbara and has studied Strategic Marketing Management at Harvard University's
Graduate School of Business.

Alex Wong has served as our Vice President, Business
Development since October 2003. From May 2003 to October 2003, Mr. Wong served
as our Vice President.  From September 1991 to May 2003, Mr. Wong served as
President at HiNT Corporation, a fabless semiconductor company providing PCI-to-
PCI bridge products, until its acquisition by PLX in May 2003. Prior to HiNT
Corporation, Mr. Wong was the lead chipset developer for Silicon Integrated
Systems, a semiconductor company.  Mr. Wong received a B.S. in Computer
Engineering from the University of Manitoba in Canada.

D. James Guzyhas served
as our Chairman of the Board since 1986. Since 1969, Mr. Guzy has been
Chairman of Arbor Company, a limited partnership engaged in the electronics and
computer industry. Mr. Guzy is also a director of Cirrus Logic, Inc., Intel
Corporation, Micro Component Technology, Inc., Novellus Systems, Inc.,
LogicVision, Tessera Technologies, Inc., Davis Selected Group of Mutual Funds
and Alliance Capital Management Technology Fund, and a member of the board of
directors of several private technology companies. Mr. Guzy received a B.S.
from the University of Minnesota and an M.S. from Stanford University.

Wei-Ti Liuhas been a
director of PLX since May 2004.  Mr. Liu co-founded NetChip Technology, Inc., a
semi-conductor company, in June 1996, and was NetChip's President and Chief
Executive Officer until its acquisition by PLX in May 2004.  From  May 1986 to
May 1996 Mr. Liu co-founded PLX Technology, Inc. and held the position of Vice
President of Engineering.  Prior to joining PLX, Mr. Liu held various IC design,
process development and manufacturing positions at IBM, Intel and AMD.  Mr.
Liu received an M.S. in Electrical Engineering from City College, The City
University of New York and a B.S. in Electrical Engineering from National Taiwan
University.

Thomas J. Riordanhas
been a director of PLX since November 2004.  Mr. Riordan co-founded Quantum
Effect Devices, a supplier of MIPS-architecture microprocessors, and was chief
executive officer and president from August 1991 until its acquisition by PMC-
Sierra in August 2000.  Since August 2000, Mr. Riordan has served as vice
president of architecture at PMC-Sierra, a provider of communications and
storage semiconductors and MIPS based processors.  Mr. Riordan holds B.S.
and M.S. degrees in Electrical Engineering as well as a B.A. degree in
Government from the University of Central Florida and has done post-graduate
work in electrical engineering at Stanford University.

Patrick Verdericohas
been a director of PLX since November 2004.  Mr. Verderico is also a director of
OSE USA, Inc., a semiconductor-packaging foundry, and Micro Component
Technology, Inc., a semiconductor test equipment manufacturer.  From
January 2001 to January 2003, he was Chief Financial Officer of Ubicom, an
Internet processor and software company.  From April 1997 to November 2000,
he worked at OSE USA, Inc. where his last position was President and Chief
Executive Officer.  Prior to 1997, Mr. Verderico held executive positions
with Maxtor as Chief Operating Officer, Creative Technology as Chief Financial
Officer, Cypress Semiconductor as Chief Financial Officer, Philips
Semiconductors as Vice President of Assembly Operations, and National
Semiconductor as Corporate Controller.  Mr. Verderico is a Certified Public
Accountant and a former partner of PricewaterhouseCoopers.  Mr. Verderico
received a B.A. from the University of Akron and an M.B.A. from Pennsylvania
State University.

John H. Harthas been a
director of PLX since April 1999. Mr. Hart is currently a 3Com fellow and
serves on the board of directors of two other companies. In September of 2000,
he retired as Senior Vice President and Chief Technical Officer of 3Com
Corporation, a position he had held since August 1996. From the time
Mr. Hart joined 3Com in September 1990 until July 1996, he was Vice
President and Chief Technical Officer. Prior to joining 3Com, Mr. Hart worked
for Vitalink Communications Corporation for seven years, where his most recent
position was Vice President of Network Products. Mr. Hart received a B.S.
in Mathematics from the University of Georgia.

Robert H. Smithhas been
a director of PLX since November 2002. From May 1995 to August 2002,
Mr. Smith worked at Novellus Systems Inc., a semiconductor equipment
manufacturer, where his last position was Executive Vice President of
Administration in the Office of the CEO and board member. From June 1994 to
September 1994, Mr. Smith held the position of chairman of the board of
directors for Micro Component Technology, Inc., a semiconductor test-equipment
manufacturer. From 1986 through 1990, Mr. Smith served as the president of
Maxwell Graphics, Inc., a printing company. From 1982 through 1986,
Mr. Smith held chief financial officer positions with Maxwell
Communications of North America Corp. and R. R. Donnelley and Sons, printing
companies. He previously held executive positions with Honeywell, Inc., Memorex
Corp. and Control Data Corp. Mr. Smith is currently a member of the board
of directors for Cirrus Logic, Inc and Virage Logic Corporation, both
semiconductor companies, and Epicor Software Corporation, a software company.

Backlog

PLX's backlog at any particular
date is not necessarily indicative of actual sales for any succeeding period.
This results from expected changes in product delivery schedules and
cancellation of product orders. In addition, PLX's sales will often reflect
orders shipped in the same quarter that they are received.

ITEM 2: PROPERTIES

We own one facility in
Sunnyvale, California, which has approximately 55,000 square feet. This facility
comprises our headquarters and includes our research and development, sales and
marketing and administration departments. In addition, we have leases for an
engineering design center in Utah, a sales office in Florida, as well as
facilities in Fremont, California. Internationally, we lease sales offices in
Japan and Taiwan. These leases comprise approximately 16,000 square feet and
have terms expiring on or prior to January 2007. We believe that our current
facilities will be adequate through 2005.



ITEM 3: LEGAL PROCEEDINGS

None.

ITEM 4: SUBMISSION OF MATTERS TO A
VOTE OF SECURITY-HOLDERS

No matters were submitted to a
vote of security holders during the three months ended December 31, 2004.

PART II

ITEM 5: MARKET FOR REGISTRANT'S COMMON
EQUITY AND RELATED STOCKHOLDER MATTERS

Our common stock is traded on
The Nasdaq Stock Market and has been quoted on The Nasdaq National Market under
the symbol "PLXT" since its initial public offering on April 5, 1999. The
following table sets forth, for the periods indicated, the range of quarterly
high and low closing price for our common stock as reported on The Nasdaq
National Market:

`2003                                                          High Bid    Low Bid 
                                                              ---------  ---------
First Quarter.............................................. $     4.73  $    2.38
Second Quarter.............................................       4.00       2.23
Third Quarter..............................................       8.05       4.40
Fourth Quarter.............................................      10.35       6.52


2004                                                          High Bid    Low Bid 
                                                              ---------  ---------
First Quarter.............................................. $    11.20  $    8.70
Second Quarter.............................................      17.26      10.55
Third Quarter..............................................      15.77       5.71
Fourth Quarter.............................................      11.22       7.96`

As of February 23, 2005,
there were approximately 243 holders of record of our common stock. As of
February 23, 2005, the last reported sales price of our common stock was
$11.74.

We have never paid cash
dividends on our common stock. We currently intend to retain earnings, if any,
for use in our business and do not anticipate paying any cash dividends in the
foreseeable future. Any future declaration and payment of dividends will be
subject to the discretion of our Board of Directors, will be subject to
applicable law and will depend upon our results of operations, earnings,
financial condition, contractual limitations, cash requirements, future
prospects and other factors deemed relevant by our Board of Directors.

Securities Authorized For Issuance Under Equity
Compensation Plans

This information is
incorporated herein by reference to the Company's Proxy Statement for the 2005
Annual Meeting of Stockholders under the heading "Equity Compensation Plan
Information."

ITEM 6: SELECTED FINANCIAL DATA

The following selected
consolidated financial data should be read in conjunction with the consolidated
financial statements and related notes thereto and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" appearing elsewhere
in this Annual Report on Form 10-K.

`Years Ended December 31,
                                                               -----------------------------------------------------
                                                                2004(1)    2003(2)     2002       2001       2000(3)
                                                               ---------  ---------  ---------  ---------  ---------
                                                                       (in thousands, except per share data)
Consolidated Statement of Operations Data:                                                                          
Net revenues................................................. $  54,449  $  38,038  $  34,810  $  44,128  $  65,351
Gross margin.................................................    35,710     27,171     23,958     28,521     45,983
Operating loss...............................................      (831)    (2,797)    (3,264)    (9,147)    (3,108)
Net loss.....................................................      (642)    (2,259)    (2,320)    (6,537)    (7,042)
Basic and diluted loss per share............................. $   (0.03) $   (0.10) $   (0.10) $   (0.28) $   (0.31)
Shares used to compute basic and diluted loss per share......    25,422     22,755     22,785     23,258     22,560 

                                                                                     December 31,
                                                               -----------------------------------------------------
                                                                 2004       2003       2002       2001       2000
                                                               ---------  ---------  ---------  ---------  ---------
                                                                                    (in thousands)
Consolidated Balance Sheet Data:                                                                                    
Cash and cash equivalents.................................... $   9,556  $  10,955  $   5,482  $   9,631  $  16,621
Working capital..............................................    23,108     23,846     23,601     21,859     21,762
Total assets.................................................   110,473     81,803     71,975     75,229    113,479
Long-term debt...............................................        --         --         --         --     28,500
Total stockholders' equity................................... $ 102,159  $  76,021  $  67,964  $  70,553  $  73,198`

1. Results of operations for 2004 include a $1.1 million charge for in-
process research and development.
2. Results of operations for 2003 include a $0.9 million charge for in-
process research and development.
3. Results of operations for 2000 include a $14.3 million charge for in-
process research and development.

ITEM 7: MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

This Report on Form 10-K
contains forward-looking statements within the "safe harbor" provisions of the
Private Securities Litigation Reform Act of 1995, including statements regarding
our expectations, hopes, intentions, beliefs or strategies regarding the future.
Actual results could differ materially from those projected in any forward-
looking statements for the reasons noted under the sub-heading "Factors That May
Affect Future Operating Results" and in other sections of this Report on
Form 10-K. All forward-looking statements included in this Form 10-K
are based on information available to us on the date of this Report on
Form 10-K, and we assume no obligation to update the forward-looking
statements, or to update the reasons why actual results could differ from those
projected in the forward-looking statements. See "Factors That May Affect Future
Operating Results" below, as well as such other risks and uncertainties as are
detailed in our Securities and Exchange Commission reports and filings for a
discussion of the factors that could cause actual results to differ materially
from the forward-looking statements.

The following discussion should
be read in conjunction with our Consolidated Financial Statements and related
notes thereto included elsewhere in this report.

Overview

PLX was founded in 1986, and
between 1994 and 2002 we focused on development of I/O interface semiconductors
and related software and development tools that are used in systems
incorporating the PCI standard.  In 2002, we shifted the majority of our
development efforts to PCI Express.  In 1994 and 1995, a significant portion of
our revenues were derived from the sale of semiconductor devices that perform
similar functions as our current products, except they were based on a variety
of industry standards.  Our revenues since 1996 have been derived predominantly
from the sale of semiconductor devices based on the PCI standard to a large
number of customers in a variety of applications including networking and
telecommunications, enterprise storage, imaging, industrial and other embedded
applications as well as in related adapter cards.  We generate less than 1% of
our revenues from sales of our software and development tools.

In May 2003, we acquired HiNT Corp. which markets and sells
PCI Bridges and PCI-X products into a variety of applications including
networking and telecommunications, personal computer peripheral, imaging,
industrial and other embedded applications.  Beginning with the quarter ended
June 30, 2003, our operating results include results of HiNT Corp. and its
products.

In May 2004, we acquired NetChip Technology, Inc. which
markets and sells USB Device Controllers used in a range of business and
consumer applications, including printers, wireless LAN adapters, personal video
recorders, and digital camcorders. Beginning with the quarter ended June 30,
2004, our operating results include results of NetChip Technology, Inc. and its
products.  Also, in September 2004, we began shipping products based on the PCI
Express standard for next-generation systems.

We utilize a "fabless" semiconductor business model
whereby we purchase wafers and packaged and tested semiconductor devices from
independent manufacturing foundries.  This approach allows us to focus on
defining, developing, and marketing our products and eliminates the need for us
to invest large amounts of capital in manufacturing facilities and work-in-process
inventory.

We rely on a combination of direct sales personnel and
distributors and manufacturers' representatives throughout the world to sell a
significant portion of our products.  We pay manufacturers' representatives a
commission on sales while we sell products to distributors at a discount from
the selling price.  We generally recognize revenue at the time of title passage.
Recognition of sales to distributors, including international distributors, is
deferred until the product is resold by the distributors to their customers.
See "Certain Factors That May Affect Future Operating Results -- A Large
Portion of Our Revenues Is Derived From Sales to Third-Party Distributors Who
May Terminate Their Relationships with Us at Any Time."

Our gross margins have fluctuated in the past and are
expected to fluctuate in the future due to changes in product and customer mix,
write-downs and recoveries of excess or obsolete inventory, the position of our
products in their respective life cycles, and specific product manufacturing
costs.

The time period between initial customer evaluation and
design completion can range from six to twelve months or more.  Furthermore,
there is typically an additional six to twelve month or greater period after
design completion before a customer requests volume production of our products.
Due to the variability and length of these design cycles and variable demand
from customers, we may experience significant fluctuations in new orders from
month to month.  In addition, we typically make inventory purchases prior to
receiving customer orders.  Consequently, if anticipated sales and shipments in
any quarter do not occur when expected, expenses and inventory levels could be
disproportionately high, and our results for that quarter and potentially future
quarters would be materially and adversely affected.

Our long-term success will depend on our ability to introduce
new products.  While new products typically generate little or no revenues
during the first twelve months following their introduction, our revenues in
subsequent periods depend upon these new products.  Due to the lengthy sales
cycle and additional time before our customers request volume production,
significant revenues from our new products typically occur twelve to twenty-four
months after product introduction.  As a result, revenues from newly introduced
products have, in the past, produced a small percentage of our total revenues in
the year the product was introduced.  See "Certain Factors That May Affect
Future Operating Results -- Our Lengthy Sales Cycle Can Result in Uncertainty
and Delays with Regard to Our Expected Revenues."

Results of Operations

The following table summarizes
historical results of operations as a percentage of net revenues for the periods
shown.

`Years Ended December 31,
                                                                        -------------------------------
                                                                          2004       2003       2002
                                                                        ---------  ---------  ---------
Net revenues..........................................................     100.0 %    100.0 %    100.0 %
Cost of revenues......................................................      34.4       28.6       31.2
                                                                        ---------  ---------  ---------
Gross margin..........................................................      65.6       71.4       68.8
                                                                        ---------  ---------  ---------
Operating expenses:
    Research and development..........................................      32.5       39.6       41.0
    Selling, general and administrative...............................      29.4       34.5       35.7
    In-process research and development...............................       2.1        2.3         --
    Amortization of purchased intangible assets.......................       3.2        2.4        1.5
                                                                        ---------  ---------  ---------
Total operating expenses..............................................      67.2       78.8       78.2
                                                                        ---------  ---------  ---------
Operating loss........................................................      (1.6)      (7.4)      (9.4)
Interest income and other, net........................................       0.8        1.5        2.9
                                                                        ---------  ---------  ---------
Loss before provision for income taxes................................      (0.8)      (5.9)      (6.5)
Provision for income taxes............................................       0.5         --        0.2
                                                                        ---------  ---------  ---------
Net loss..............................................................      (1.3)%     (5.9)%     (6.7)%
                                                                        =========  =========  =========`

Comparison of Years Ended December 31, 2004, 2003,
and 2002

Net Revenues.Net
revenues consist of product revenues generated principally by sales of our
semiconductor devices. Net revenues for the year ended December 31, 2004 were
$54.4 million, an increase of $16.4 million or 43% from $38.0 million
for the year ended December 31, 2003. The increase was primarily due to sales of
our USB products acquired as part of the NetChip Technology, Inc. acquisition
which was completed in May 2004, as well as higher unit shipments of PCI
products. For the twelve months ended December 31, 2004 USB product sales
accounted for approximately $9.5 million or 17.5% of our total net
revenues. Our USB products are characterized by relatively fast
customer design cycles, relatively fast product ramps and relatively short
customer product life cycles. These factors may result in a greater degree of
revenue fluctuation from USB products as compared to our PCI business.

For the year ended December 31, 2004, approximately 13% of
net revenue was derived from sales to one distributor.  No other distributor or
direct customer represented greater than 10% of net revenues.

Net revenues for the year ended December 31, 2003 increased
by $3.2 million or 9% to $38.0 million from $34.8 million for the year ended
December 31, 2002.  The increase was primarily due to revenues generated from
the PCI bridge product acquired as part of the HiNT Corp. acquisition which was
completed in May 2003.  For the year ended December 31, 2003, approximately 21%
of net revenue was derived from sales to two distributors. No other distributor
or direct customer represented greater than 10% of net revenues.

Customer demand for semiconductors can change quickly and
unexpectedly.  Our revenue levels have been highly dependent on the amount
of new orders that are received for product to be delivered to the customer
within the same quarter, also called "turns fill" orders.
 Approximately 65% of our total revenues in 2004 were generated from turns
fill orders.  Because of the long cycle time to build our products, our
lack of visibility into demand when turns fill is high makes it difficult to
predict what product to build to match future demand.  We believe the
current high turns fill requirements will continue until lead times
substantially increase and order backlog grows.  However, the
sustainability of improved customer demand is uncertain and highly dependent on
economic conditions.  The high turns fill requirement together with the
uncertainty of product mix and pricing, make it difficult to predict future
levels of sales and profitability and may require us to carry higher levels of
inventory.

Gross Margin.Gross
margin represents net revenues less the cost of revenues. Cost of revenues
primarily includes the cost of (1) purchasing semiconductor devices from our
independent foundries, (2) packaging, assembly and testing costs, and (3) costs
associated with the procurement, storage and shipment of products.

Gross margin for the year ended
December 31, 2004 increased by 31%, or $8.5 million, to $35.7 million
for 2004 from $27.2 million for 2003. The increase in absolute dollars was
primarily due to the shipments of USB products acquired as part of the NetChip
Technology, Inc. acquisition beginning in May 2004 as well as higher units
shipments of PCI products. The decrease in gross margin to 65.6% for 2004 from
71.4% for 2003 was primarily due to shipments of lower margin products acquired
as part of the NetChip acquisition.  Excluding the effect of selling previously
written-down inventory of $0.6 million and $0.7 million, respectively, gross
margin was 64.5% for 2004, as compared with 69.6% for 2003. The decrease in our
gross margin percentage was primarily due to an expected change in our product
and customer mix associated with the acquisition of NetChip.

Gross margin for the year ended
December 31, 2003 increased by 13%, or $3.2 million, to $27.2 million
for 2003 from $24.0 million for 2002. The increase in absolute dollars was
primarily due to the shipments of PCI bridge products acquired as part of the
HiNT Corp. acquisition beginning in May 2003 as well as the sale of previously
written-down inventory. The increase in gross margin to 71.4% for 2003 from
68.8% for 2002 was primarily related to the effect of the sale of previously
written-down inventory of approximately $0.7 million in 2003.  Excluding the
effect of selling previously written-down inventory, gross margin was 69.6% for
2003, as compared with 68.8% for 2002. The increase in our gross margin
percentage was primarily due to shifts in our product and customer mix.

Research and Development
Expenses. Research and development (R&D) expenses consist primarily of
salaries and related costs of employees engaged in research, design, and
development activities. In addition, expenses for outside engineering
consultants, non-recurring engineering at our independent foundries, and
deferred stock compensation are included in R&D expenses.

R&D as a percent of net revenues decreased to 32.5% for
the year ended December 31, 2004 as compared to 39.6% for the same period in
2003.  The percentage decrease is due primarily to an increase in net revenues.
In absolute dollars, R&D expenses increased to $17.7 million for the year
ended December 31, 2004, from $15.0 million for the same period in 2003.
Excluding deferred stock compensation of $0.1 million and $1.0 million for the years
ended December 31, 2004 and 2003, respectively, R&D increased by $3.5
million to $17.6 million for 2004 from $14.0 million for 2003.   The increase in
R&D was primarily due to an increase of approximately $1.7 million in
compensation and benefit expenses as a result of higher headcount from the
NetChip acquisition, and an increase in engineering tools expense of
approximately $1.6 million associated with the development of new products and
enhancement of existing products.

R&D as a percent of net revenues decreased to 39.6% for
2003, as compared to 41.0% for 2002.  The percentage decrease is due primarily
to an increase in net revenues.  In absolute dollars, R&D expenses increased
to $15.0 million for 2003 from $14.3 million for 2002. Excluding deferred stock
compensation of $1.0 million and $2.1 million for the years end December 31,
2003 and 2002, respectively, R&D increased by $1.8 million to $14.0 million
for 2003 from $12.2 million for 2002. The increase in R&D was primarily due
to an increase of approximately $0.4 million in compensation and benefit
expenses as a result of higher headcount associated with the acquisition of
HiNT, an increase of approximately $0.5 million in consulting expenses, and an
increase of approximately $0.5 million in engineering tools expense associated
with the development of new products and enhancement of existing products.

We believe continued spending on research and development to
develop new products is critical to our success and, consequently, expect to
increase research and development expenses in future periods.

Selling, General and Administrative Expenses. Selling,
general and administrative (SG&A) expenses consist primarily of salaries and
related costs of employees engaged in selling and administrative activities,
professional fees, trade show and other promotional expenses, as well as sales
commissions to manufacturers' representatives.

SG&A as a percent of net revenues decreased to 29.4% for
the year ended December 31, 2004, as compared to 34.5% for the year ended
December 31, 2003.  The percentage decrease is due primarily to an increase in
net revenues.  In absolute dollars, SG&A expenses increased by $2.9 million
or 22% to $16.0 million for the year ended December 31, 2004 from $13.1 million
for the same period in 2003.  The increase in SG&A was due primarily to
higher compensation and benefit expenses of approximately $1.4 million resulting
mainly from higher headcount in connection with acquisitions, higher consulting
and professional fees of $0.9 million due in part to our Sarbanes Oxley
compliance effort, and an increase of approximately $0.4 million in sales
commissions to manufacturer's representatives as a result of higher revenues.

SG&A as a percent of net revenues decreased to 34.5% for
the year ended December 31, 2003, as compared to 35.7% for the year ended
December 31, 2002.  In absolute dollars, SG&A expenses increased by $0.7
million or 5% to $13.1 million for the year ended December 31, 2003 from $12.4
million for the same period in 2002.  The increase was primarily due to an
increase of approximately $0.1 million in higher compensation and benefit
expenses as a result of higher headcount, an increase of approximately $0.1
million in professional services, an increase of approximately $0.1 million in
marketing expenses, and an increase in office lease expense of approximately
$0.2 million resulting from the assumption of the HiNT Corp. office lease and
the loss of a subtenant.

In-Process Research and
Development.  The amounts expensed to in-process research and development
for the year ended December 31, 2004 related to the acquisition of NetChip
Technology, Inc.

The acquired in-process research and development expense of
$1.1 million was determined by identifying research projects in areas for which
technological feasibility had not been established and no alternative future
uses existed.  PLX acquired technology consisting of PCI Express solutions.  The
value was determined by estimating the expected cash flows from the project once
commercially viable, discounting the net cash flows to their present value, and
then applying a percentage of completion to the calculated value as defined
below.

- Net Cash Flows.

- Discount Rate.

- Percentage of Completion

Amortization of Purchased
Intangible Assets. Amortization of purchased intangible assets increased by
$0.8 million or 85% to $1.7 million for the year ended December 31,
2004 from $0.9 million for the same period in 2003. The increase is due
primarily to additional amortization expense from developed/core technology and
customer base acquired as a result of the NetChip Technology, Inc. acquisition
in May 2004 and the HiNT Corp. acquisition in May 2003

Amortization of purchased intangible
assets increased by $0.4 million or 75% to $0.9 million for the year ended
December 31, 2003 from $0.5 million for the same period in 2002. In 2003,
the increase was due to additional amortization expense from developed/core
technology and customer base acquired as a result of the HiNT Corp. acquisition
in May 2003.

Deferred Stock Compensation. We recorded deferred
compensation of $0.9 million related to unvested stock options assumed in
connection with the acquisition of NetChip Technology, Inc. in May 2004.  We
recorded deferred compensation of $0.1 million related to unvested stock options
assumed in connection with the acquisition of HiNT Corp in May 2003.
Unamortized deferred compensation is presented as a reduction of stockholders'
equity and is amortized ratably over the vesting period of the applicable stock
grants.

Amortization of deferred compensation recorded in 2004, 2003,
and 2002, was $0.1 million, $1.0 million, and $2.1 million,
respectively. The $0.9 million decrease in deferred compensation from 2003 to
2004 is primarily the result of certain stock options becoming fully vested.
Substantially all of these amounts are included in research and development
expenses.

Based on the current level of deferred compensation, we
expect to record deferred compensation expenses of approximately $0.2 million,
$0.1 million, $0.1 million, and $5,000 for 2005, 2006, 2007, and 2008,
respectively.

Interest Income.
Interest income reflects interest earned on average cash, cash equivalents and
short-term and long-term investment balances. Interest income remained flat at
$0.4 million for 2004 and 2003. Interest income decreased to
$0.4 million in 2003 from $0.5 million for 2002. This decrease was
primarily due to lower interest rates.

Other Income, Net. Other
income, net, decreased to $12,000 for 2004 from $0.1 million for 2003. The
decrease is due primarily to the realization of income from a non-refundable
lease deposit in 2003.

Provision for Income
Taxes. Income tax expense for the period ended December 31, 2004 was
$0.3 million on a pretax loss of $0.4 million, compared to income tax expense of
$29,000 on pretax loss of $2.2 million and income tax expense of $60,000 on
pretax loss of $2.3 million for the periods ended December 31, 2003
and 2002, respectively.  Our 2004 income tax expense differs from the expected
benefit derived by applying the applicable U.S. federal statutory rate to the
loss from operations primarily due to the write off of in-process research and
development, non-deductible amortization of deferred stock compensation and the
impact of purchase accounting.  Our 2003 income tax expense differs from the
expected benefit derived by applying the applicable U.S. federal statutory rate
to the loss from operations primarily due to non-deductible amortization of
deferred compensation and the write off of in-process research and development.
Our 2002 income tax expense differs from the expected benefit derived by
applying the applicable U.S. federal statutory rate to the loss from operations
primarily due to non-deductible charges for the amortization of deferred
compensation and the recording of a valuation allowance for the deferred tax
asset partially offset by the benefit of research and development tax credits.

Liquidity and Capital Resources

Cash and cash equivalents and
short and long-term investments were $30.3 million at December 31, 2004, an
increase of $7.2 million from $23.1 million at December 31, 2003.
The increase was primarily due to the following: (1) a net loss of
$0.6 million adjusted for non-cash expenses of $5.3 million,
(2) an increase in accounts payable of $0.8 million, (3) a decrease in
accounts receivable of $1.5 million, (4) cash acquired in the acquisition of
NetChip of $2.8 million, and (5) cash received from the exercise of stock
options of $2.0 million.  This was partially offset by: (1) an increase in
inventory of $1.8 million, (2) a decrease in other accrued expenses of $0.9
million, and (3) capital expenditures of $1.9 million.

In September 2002, our
Board of Directors authorized the repurchase of up to 2,000,000 shares of
common stock.  At the discretion of the management, we can repurchase the
shares from time to time in the open market or in privately negotiated
transactions.  Approximately 774,000 shares had been repurchased for
approximately $1.9 million in cash in 2003. We did not repurchase any shares
during 2004.

We believe that our existing
resources, together with cash generated from our operations will be sufficient
to meet our capital requirements for at least the next twelve months. Our future
capital requirements will depend on many factors, including the inventory levels
we maintain, the level of investment we make in new technologies and
improvements to existing technologies and the levels of monthly expenses
required to launch new products. From time to time, we may also evaluate
potential acquisitions and equity investments complementary to our technologies
and market strategies. To the extent that existing resources and future earnings
are insufficient to fund our future activities, we may need to raise additional
funds through public or private financings. Additional funds may not be
available or, if available, we may not be able to obtain them on terms favorable
to us and our stockholders.

As of December 31, 2004,
we had the following significant contractual obligations and commercial
commitments (in thousands):

`Payments due in
                                               ----------------------------------------------  -----------
                                                                                                2008 and
                                                 Total        2005        2006        2007     thereafter
                                               ----------  ----------  ----------  ----------  -----------
Operating leases - facilities and equipment.. $      315  $      212  $       96  $        7  $        --
Software licenses............................      1,268        1268          --          --           --
Inventory purchase commitments...............      3,007       3,007          --          --           --
                                               ----------  ----------  ----------  ----------  -----------
Total cash obligations....................... $    4,590  $    4,487  $       96  $        7  $        --
                                               ==========  ==========  ==========  ==========  ===========`

See Note 12 to our Consolidated
Financial Statements for additional information on our contractual obligations
and commercial commitments.

Critical Accounting Policies

The preparation of financial statements in conformity with
accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities, revenues and expenses and related disclosures of
contingent assets and liabilities in the consolidated financial statements and
accompanying notes. The SEC has defined a company's critical accounting policies
as the ones that are most important to the portrayal of the company's financial
condition and results of operations, and which require the company to make its
most difficult and subjective judgments, often as a result of the need to make
estimates of matters that are inherently uncertain. Based on this definition, we
have identified the critical accounting policies and judgments addressed below.
We also have other key accounting policies which involve the use of estimates,
judgments and assumptions that are significant to understanding our results. For
additional information see Note 1 (Organization and Summary of Significant
Accounting Policies) of the Notes to our Consolidated Financial Statements.
Although we believe that our estimates, assumptions and judgments are
reasonable, they are based upon information presently available. Actual results
may differ significantly from these estimates under different assumptions,
judgments or conditions.

Inventory Write-downs.We evaluate the need for potential write-downs of inventory by considering a
combination of factors. Based on the life of the product, sales history,
obsolescence, and sales forecast, we may record write-downs to our inventory
ranging from 0% to 100%. Any adverse changes to our future product demand may
result in increased write-downs, resulting in decreased gross margin. In
addition, future sales on any of our previously written down inventory may
result in increased gross margin in the period of sale.

Allowance for Doubtful
Accounts.We evaluate the collectibility of our accounts receivable based on
length of time the receivables are past due. We record reserves for bad debts
against amounts due to reduce the net recognized receivable to the amount we
reasonably believe will be collected. We have certain customers with
individually large amounts due at any given balance sheet date. Any
unanticipated change in one of those customer's creditworthiness or other
matters affecting the collectibility of amounts due from such customers could
have a material affect on our results of operations in the period in which such
changes or events occur.

Goodwill. We perform goodwill impairment tests
on an annual basis and between annual tests if indicators of potential
impairment exist. Although at December 31, 2004, no impairment of goodwill has
been recognized, it is reasonably possible that assumptions upon which the
recoverability of goodwill were based could differ in the future.  In that
event, impairment charges could be required.

Taxes.We account for income taxes using the liability method.  Deferred taxes are
determined based on the differences between the financial statement and tax
bases of assets and liabilities, using enacted tax rates in effect for the year
in which the differences are expected to reverse.  Valuation allowances are
established when necessary to reduce deferred tax assets to the amounts expected
to be realized. As of December 31, 2004, we carried a valuation allowance for
the entire deferred tax asset as a result of uncertainties regarding the
realization of the asset balance (see Note 11 to the Consolidated Financial
Statements). Future taxable income and/or tax planning strategies may eliminate
all or a portion of the need for the valuation allowance. In the event we
determine we are able to realize our deferred tax asset, an adjustment to the
valuation allowance may increase income in the period such determination is
made.

Recent Accounting Pronouncements

In March 2004, the FASB issued EITF Issue No. 03-1
("EITF 03-1"), "The Meaning of Other-Than-Temporary Impairment and Its
Application to Certain Investments" which provided new guidance for assessing
impairment losses on investments. Additionally, EITF 03-1 includes new
disclosure requirements for investments that are deemed to be temporarily
impaired. In September 2004, the FASB delayed the accounting provisions of
EITF 03-1; however the disclosure requirements remain effective for annual
periods ending after June 15, 2004.  The adoption of this requirement did
not have a material impact on our  financial position or results of
operation.

In December 2004, the FASB issued SFAS 123R which
requires the measurement of all employee share-based payments to employees,
including grants of employee stock options, using a fair-value-based method and
the recording of such expense in our consolidated statements of income. The
accounting provisions of SFAS 123R are effective for reporting periods
beginning after June 15, 2005. We are required to adopt SFAS 123R in
the third quarter of fiscal 2005. The pro forma disclosures previously permitted
under SFAS 123 no longer will be an alternative to financial statement
recognition. See "Stock-Based Compensation" (Note 1 of the Consolidated Financial Statements) for the pro forma net
income and net income per share amounts, for fiscal 2002 through fiscal 2004, as
if we had used a fair-value-based method similar to the methods required under
SFAS 123R to measure compensation expense for employee stock incentive
awards. Although we have not yet determined whether the adoption of
SFAS 123R will result in amounts that are similar to the current pro forma
disclosures under SFAS 123, we are evaluating the requirements under
SFAS 123R and expect the adoption to have a material impact on our
consolidated statements of income and net income per share.



CERTAIN FACTORS THAT MAY AFFECT FUTURE OPERATING
RESULTS

The statements contained in this Report on Form 10-K
that are not purely historical are forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, including, without limitation, statements
regarding the Company's expectations, objectives, anticipations, plans, hopes,
beliefs, intentions or strategies regarding the future. Forward-looking
statements include, without limitation, the statements regarding (a) the
growing demand for standards-based components such as the Company's
semiconductor devices that connect systems together, (b) the Company's
objective to expand its advantages in data transfer technology, under the
heading "Item 1, Business - Overview"; the Company's expectation that it
will support new I/O standards where appropriate, under the heading
"Item 1, Business - The PLX Solution"; the statements regarding
(a) the Company's objective to continue to expand its market position as a
developer and supplier of I/O connectivity solutions for high performance
systems, (b) the Company's plan to target those applications where the Company
believes it can attain a leadership position, (c) that the Company seeks to
integrate additional I/O-related functions into its semiconductor devices,
(d) the Company's belief that its understanding of I/O technology trends
and market requirements allows it to bring to market more quickly new products
that support the latest I/O technology, under the heading "Item 1, Business
- Strategy"; that the Company continues to integrate more functionality in its
semiconductor devices and continues to enhance and expand its software
development kits under the heading "Item 1, Business - Technology"; the
statements regarding (a) the Company's belief with respect to the principal
factors of competition in the business, (b) the Company's belief that it
competes favorably with respect to each of those factors, under the heading
"Item 1, Business - Competition"; the statements regarding (a) the
Company's expectation that revenues related to sales through distributors will
continue to account for a significant portion of total revenues, (b) the
Company's belief that providing customers with comprehensive product support is
critical to remaining competitive in the markets it serves, (c) the
Company's belief that its close contact with customer design engineers provides
valuable input into existing product enhancements and next generation product
specifications, under the heading "Item 1, Business - Sales, Marketing and
Technical Support"; (a) the Company's expectation that it will continue to
make substantial investments in research and development and to participate in
the development of industry standards, (b) the Company's expectation that
it will periodically seek to hire additional development engineers, under the
heading "Item 1, Business - Research and Development"; the Company's belief
that the transition of its products to smaller geometries will be important for
the Company to remain competitive under the heading "Item 1, Business -
Manufacturing"; the Company's plan to seek patent protection when necessary,
under the heading "Item 1, Business - Intellectual Property"; the Company's
belief that its current facility will be adequate through 2004 under the heading
"Item 2, Properties"; the statement regarding the Company's intention to
retain earnings for use in its business and not to pay any cash dividend in the
foreseeable future under the heading "Item 5, Market for Registrant's
Common Equity and Related Stockholder Matters"; the Company's belief that its
long-term success will depend on its ability to introduce new products under the
heading "Item 7, Management's Discussion and Analysis of Financial
Condition and Results of Operations - Overview''; the statement regarding the
Company's expectation to record amortization of deferred compensation related to
stock option grants of approximately $0.2 million, $0.1 million, $0.1 million,
and $5,000 for 2005, 2006, 2007, and 2008, respectively, under the heading
"Item 7, Management's Discussion and Analysis of Financial Condition and
Results of Operations - Results of Operations''; the Company's belief that its
existing resources, together with cash expected to be generated from its
operations, will be sufficient to meet its capital requirements for at least the
next twelve months under the heading "Item 7, Management's Discussion and
Analysis of Financial Condition and Results of Operations - Liquidity and
Capital Resources."

All forward-looking statements included in this document are
based on information available to the Company on the date hereof, and the
Company assumes no obligation to update any such forward-looking statements. It
is important to note that the Company's actual results could differ materially
from those included in such forward-looking statements. The factors that could
cause our results to differ from those included in such forward-looking
statements are set forth below, as well as those disclosed from time to time in
the Company's Reports on Forms 10-Q and 8-K.

Risks and uncertainties that could cause actual results to
differ materially from those described herein include the following:

Our Operating Results May Fluctuate Significantly Due To
Factors Which Are Not Within Our Control

Our quarterly operating results have fluctuated
significantly in the past and are expected to fluctuate significantly in the
future based on a number of factors, many of which are not under our control.
Our operating expenses, which include product development costs and selling,
general and administrative expenses, are relatively fixed in the short-term.  If
our revenues are lower than we expect because we sell fewer semiconductor
devices, delay the release of new products or the announcement of new features,
or for other reasons, we may not be able to quickly reduce our spending in
response.

Other circumstances that can affect our operating results
include:

- the timing of significant orders, order cancellations and
reschedulings,
- the loss of a significant customer(s),
- our significant customers could lose market share that may affect our
business,
- integration of our product functionality into our customers' products,
- our ability to develop, introduce and market new products and technologies
on a timely basis,
- introduction of products and technologies by our competitors,
- unexpected issues that may arise with devices in production
- shifts in our product mix toward lower margin products,
- changes in our pricing policies or those of our competitors or suppliers,
including decreases in unit average selling prices of our products,
- the availability of production capacity at the fabrication facilities that
manufacture our products,
- the availability and cost of materials to our suppliers,
- general economic conditions, and
- political climate.

These factors are difficult to forecast, and these or other
factors could adversely affect our business.  Any shortfall in our revenues
would have a direct impact on our business.  In addition, fluctuations in our
quarterly results could adversely affect the market price of our common stock in
a manner unrelated to our long-term operating performance.

We May Fail To Adequately Integrate Acquired Businesses

In May 2004, we acquired NetChip Technology, Inc., a supplier
of high-performance semiconductors based on Universal Serial Bus (USB) and
Peripheral Component Interconnect (PCI) standards, in a transaction accounted
for as a purchase transaction.  We are continuing to integrate NetChip
Technology, Inc. and its products into our business.  This integration is
subject to risks commonly encountered in making such acquisitions, including,
among others, loss of key personnel of the acquired company, loss of key
customers and business relationships of the acquired company, the difficulty
associated with assimilating and integrating the personnel, operations and
technologies of the acquired company, the potential disruption of our ongoing
business, and the maintenance of uniform standards, controls, procedures,
employees and clients.  There can be no assurance that we will be successful in
overcoming these risks or any other problems encountered in connections with our
acquisition of NetChip.

Our Potential Future Acquisitions May Not Be
Successful Because Of Our Limited Experience With Acquisitions In The Past

As part of our business strategy, we expect to review
acquisition prospects that would complement our existing product offerings,
improve market coverage or enhance our technological capabilities.  Future
acquisitions could result in any or all of the following:

- potentially dilutive issuances of equity securities,
- large acquisition-related write-offs,
- the incurrence of debt and contingent liabilities or amortization expenses
related to other intangible assets,
- difficulties in the assimilation of operations, personnel, technologies,
products and the information systems of the acquired companies,
- diversion of management's attention from other business concerns,
- risks of entering geographic and business markets in which we have no or
limited prior experience, and
- potential loss of key employees of acquired organizations.

We have had limited experience with
acquisitions in the past and may not be able to successfully integrate any
businesses, products, technologies or personnel that may be acquired in the
future.  Our failure to do so could have a material adverse effect on our
business.

A Downturn In The Global Economy May Adversely Affect Our
Revenues, Results Of Operations And Financial Condition

Demand for semiconductor components is increasingly dependent
upon the rate of growth in the global economy.  If the rate of global economic
growth slows, or contracts, customer demand for products could be adversely
affected, which in turn could adversely affect revenues, results of operations
and financial condition.  Many factors could adversely affect regional or global
economic growth.  Some of the factors that could slow global economic growth
include:  rising interest rates in the United States, a slowdown in the rate of
growth of the Chinese economy, a significant act of terrorism which disrupts
global trade or consumer confidence, geopolitical tensions including war and
civil unrest.  Reduced levels of economic activity, or disruptions of
international transportation, could adversely affect sales on either a global
basis or in specific geographic regions.

Because A Substantial Portion Of Our Net Sales Is
Generated By A Small Number Of Large Customers, If Any Of These Customers Delays
Or Reduces Its Orders, Our Net Revenues And Earnings Will Be Harmed

Historically, a relatively small number of customers
have accounted for a significant portion of our net revenues in any particular
period.  In 2004, sales to Metatech accounted for 13% of our revenues. In 2003,
sales to Metatech and A2M, both distributors, accounted for 11% and 10%,
respectively, of our revenues.  In 2002, sales to A2M accounted for 13% of our
revenues.  No other distributor or direct customer accounted for more than 10%
of net revenues in any period presented.

We have no long-term volume
purchase commitments from any of our significant customers. We cannot be certain
that our current customers will continue to place orders with us, that orders by
existing customers will continue at the levels of previous periods or that we
will be able to obtain orders from new customers. In addition, some of our
customers supply products to end-market purchasers and any of these end-market
purchasers could choose to reduce or eliminate orders for our customers'
products. This would in turn lower our customers' orders for our products.

We anticipate that sales of our products to a relatively
small number of customers will continue to account for a significant portion of
our net sales.  Due to these factors, the following have in the past and may in
the future reduce our net sales or earnings:

- the reduction, delay or cancellation of orders from one or more of our
significant customers;
- the selection of competing products or in-house design by one or more of our
current customers;
- the loss of one or more of our current customers; or
- a failure of one or more of our current customers to pay our
invoices.

Our Lengthy Sales Cycle Can Result In Uncertainty And
Delays With Regard To Our Expected Revenues

Our customers typically perform numerous tests and
extensively evaluate our products before incorporating them into their systems.
The time required for test, evaluation and design of our products into a
customer's equipment can range from six to twelve months or more.  It can take
an additional six to twelve months or more before a customer commences volume
shipments of equipment that incorporates our products.  Because of this lengthy
sales cycle, we may experience a delay between the time when we increase
expenses for research and development and sales and marketing efforts and the
time when we generate higher revenues, if any, from these expenditures.

In addition, the delays inherent in our lengthy sales cycle
raise additional risks of customer decisions to cancel or change product plans.
When we achieve a design win, there can be no assurance that the customer will
ultimately ship products incorporating our products.  Our business could be
materially adversely affected if a significant customer curtails, reduces or
delays orders during our sales cycle or chooses not to release products
incorporating our products.

Rapid Technological Change Could Make Our Products
Obsolete

We operate in an industry that is subject to evolving
industry standards, rapid technological changes, rapid changes in customer
demands and the rapid introduction of new, higher performance products with
shorter product life cycles.  As a result, we expect to continue to make
significant investments in research and development.  However, we may not have
adequate funds from operations or otherwise to devote to research and
development, forcing us to reduce our research and development efforts.  Also,
we must manage product transitions successfully, since announcements or
introductions of new products by us or our competitors could adversely affect
sales of our existing products because these existing products can become
obsolete or unmarketable for specific purposes.  There can be no assurance that
we will be able to develop and introduce new products or enhancements to our
existing products on a timely basis or in a manner which satisfies customer
needs or achieves widespread market acceptance.  Any significant delay in
releasing new products could adversely affect our reputation, give a competitor
a first-to-market advantage or allow a competitor to achieve greater market
share.  The failure to adjust to rapid technological change could harm our
business, financial condition, results of operations and cash flows.

Failure Of Our Products To Gain Market Acceptance Would
Adversely Affect Our Financial Condition

We believe that our growth prospects depend upon our
ability to gain customer acceptance of our products and technology.  Market
acceptance of products depends upon numerous factors, including compatibility
with existing manufacturing processes and products, perceived advantages over
competing products and the level of customer service available to support such
products.  Moreover, manufacturers often rely on a limited number of equipment
vendors to meet their manufacturing equipment needs.  As a result, market
acceptance of our products may be adversely affected to the extent potential
customers utilize a competitor's manufacturing equipment.  There can be no
assurance that growth in sales of new products will continue or that we will be
successful in obtaining broad market acceptance of our products and
technology.

We expect to spend a significant amount of time and resources
to develop new products and refine existing products.  In light of the long
product development cycles inherent in our industry, these expenditures will be
made well in advance of the prospect of deriving revenues from the sale of any
new products.  Our ability to commercially introduce and successfully market any
new products is subject to a wide variety of challenges during this development
cycle, including start-up bugs, design defects and other matters that could
delay introduction of these products to the marketplace.  In addition, since our
customers are not obligated by long-term contracts to purchase our products, our
anticipated product orders may not materialize, or orders that do materialize
may be cancelled.  As a result, if we do not achieve market acceptance of new
products, we may not be able to realize sufficient sales of our products in
order to recoup research and development expenditures.  The failure of any of
our new products to achieve market acceptance would harm our business, financial
condition, results of operation and cash flows.

We Must Make Significant Research And Development
Expenditures Prior To Generating Revenues From Products

To establish market acceptance of a new semiconductor
device, we must dedicate significant resources to research and development,
production and sales and marketing.  We incur substantial costs in developing,
manufacturing and selling a new product, which often significantly precede
meaningful revenues from the sale of this product.  Consequently, new products
can require significant time and investment to achieve profitability.  Investors
should note that our efforts to introduce new semiconductor devices or other
products or services may not be successful or profitable.  In addition, products
or technologies developed by others may render our products or technologies
obsolete or noncompetitive.

We record as expenses the costs related to the development of
new semiconductor devices and other products as these expenses are incurred.  As
a result, our profitability from quarter to quarter and from year to year may be
adversely affected by the number and timing of our new product launches in any
period and the level of acceptance gained by these products.

Our Independent Manufacturers May Not Be Able To Meet Our
Manufacturing Requirements

We do not manufacture any of our semiconductor devices.
Therefore, we are referred to in the semiconductor industry as a
"fabless" producer of semiconductors.  Consequently, we depend upon
third party manufacturers to produce semiconductors that meet our
specifications.  We currently have third party manufacturers that can produce
semiconductors which meet our needs.  However, as the semiconductor industry
continues to progress towards smaller manufacturing and design geometries, the
complexities of producing semiconductors will increase.  Decreasing geometries
may introduce new problems and delays that may affect product development and
deliveries.  Due to the nature of the semiconductor industry and our status as a
"fabless" semiconductor company, we could encounter fabrication-related
problems that may affect the availability of our semiconductor devices,
delay our shipments or may increase our costs.

None of our semiconductor devices are currently manufactured
by more than one supplier.  We place our orders on a purchase order basis and do
not have a long term purchase agreement with any of our existing suppliers.  In
the event that the supplier of a semiconductor device was unable or unwilling to
continue to manufacture this product in the required volume, we would have to
identify and qualify a substitute supplier.  Introducing new products or
transferring existing products to a new third party manufacturer or process may
result in unforeseen device specification and operating problems.  These
problems may affect product shipments and may be costly to correct.  Silicon
fabrication capacity may also change, or the costs per silicon wafer may
increase.  Manufacturing-related problems may have a material adverse effect on
our business.

Intense Competition In The Markets In Which We Operate May
Reduce The Demand For Or Prices Of Our Products

Competition in the semiconductor industry is intense.  If
our main target market, the embedded systems market, continues to grow, the
number of competitors may increase significantly.  In addition, new
semiconductor technology may lead to new products that can perform similar
functions as our products.  Some of our competitors and other semiconductor
companies may develop and introduce products that integrate into a single
semiconductor device the functions performed by our semiconductor devices.  This
would eliminate the need for our products in some applications.

In addition, competition in our markets comes from companies
of various sizes, many of which are significantly larger and have greater
financial and other resources than we do and thus can better withstand adverse
economic or market conditions.  Also, we compete with established embedded
microprocessor companies and others.  Many of these indirect competitors and
microprocessor companies have significantly greater financial, technical,
marketing and other resources than PLX.  Therefore, we cannot assure you that we
will be able to compete successfully in the future against existing or new
competitors, and increased competition may adversely affect our business.  See
"Business -- Competition," and " -- Products" in Part I of
Item I of this Form 10-K.

Failure To Have Our Products Designed Into The Products Of
Electronic Equipment Manufacturers Will Result In Reduced Sales

Our future success depends on electronic equipment
manufacturers that design our semiconductor devices into their systems.  We must
anticipate market trends and the price, performance and functionality
requirements of current and potential future electronic equipment manufacturers
and must successfully develop and manufacture products that meet these
requirements.  In addition, we must meet the timing requirements of these
electronic equipment manufacturers and must make products available to them in
sufficient quantities.  These electronic equipment manufacturers could develop
products that provide the same or similar functionality as one or more of our
products and render these products obsolete in their applications.

We do not have purchase agreements with our customers that
contain minimum purchase requirements.  Instead, electronic equipment
manufacturers purchase our products pursuant to short-term purchase orders that
may be canceled without charge.  We believe that in order to obtain broad
penetration in the markets for our products, we must maintain and cultivate
relationships, directly or through our distributors, with electronic equipment
manufacturers that are leaders in the embedded systems markets.  Accordingly, we
will incur significant expenditures in order to build relationships with
electronic equipment manufacturers prior to volume sales of new products.  If we
fail to develop relationships with additional electronic equipment manufacturers
to have our products designed into new embedded systems or to develop sufficient
new products to replace products that have become obsolete, our business would
be materially adversely affected.

Lower Demand For Our Customers' Products Will Result In
Lower Demand For Our Products

Demand for our products depends in large part on the
development and expansion of the high-performance embedded systems markets
including networking and telecommunications, enterprise storage, imaging and
industrial applications.  The size and rate of growth of these embedded systems
markets may in the future fluctuate significantly based on numerous factors.
These factors include the adoption of alternative technologies, capital spending
levels and general economic conditions.  Demand for products that incorporate
high-performance embedded systems may not grow.

Defects In Our Products Could Increase Our Costs And Delay
Our Product Shipments

Our products are complex.  While we test our products, these
products may still have errors, defects or bugs that we find only after
commercial production has begun.  We have experienced errors, defects and bugs
in the past in connection with new products.

Our customers may not purchase our products if the products
have reliability, quality or compatibility problems.  This delay in acceptance
could make it more difficult to retain our existing customers and to attract new
customers.  Moreover, product errors, defects or bugs could result in additional
development costs, diversion of technical and other resources from our other
development efforts, claims by our customers or others against us, or the loss
of credibility with our current and prospective customers.  In the past, the
additional time required to correct defects has caused delays in product
shipments and resulted in lower revenues.  We may have to spend significant
amounts of capital and resources to address and fix problems in new
products.

We must continuously develop our products using new process
technology with smaller geometries to remain competitive on a cost and
performance basis.  Migrating to new technologies is a challenging task
requiring new design skills, methods and tools and is difficult to achieve.

We Could Lose Key Personnel Due To Competitive Market
Conditions And Attrition

Our success depends to a significant extent upon our
senior management and key technical and sales personnel.  The loss of one or
more of these employees could have a material adverse effect on our business.
We do not have employment contracts with any of our executive officers.

Our success also depends on our ability to attract and retain
qualified technical, sales and marketing, customer support, financial and
accounting, and managerial personnel.  Competition for such personnel in the
semiconductor industry is intense, and we may not be able to retain our key
personnel or to attract, assimilate or retain other highly qualified personnel
in the future.  In addition, we may lose key personnel due to attrition,
including health, family and other reasons.  We have experienced, and may
continue to experience, difficulty in hiring and retaining candidates with
appropriate qualifications.  If we do not succeed in hiring and retaining
candidates with appropriate qualifications, our business could be materially
adversely affected.

A Large Portion Of Our Revenues Is Derived From Sales To
Third-Party Distributors Who May Terminate Their Relationships With Us At Any
Time

We depend on distributors to sell a significant portion
of our products.  In 2004, net revenues through distributors accounted for
approximately 53% of our net revenues.  Some of our distributors also market and
sell competing products.  Distributors may terminate their relationships with us
at any time.  Our future performance will depend in part on our ability to
attract additional distributors that will be able to market and support our
products effectively, especially in markets in which we have not previously
distributed our products.  We may lose one or more of our current distributors
or may not be able to recruit additional or replacement distributors.  The loss
of one or more of our major distributors could have a material adverse effect on
our business, as we may not be successful in servicing our customers directly or
through manufacturers' representatives.

The Demand For Our Products Depends Upon Our Ability To
Support Evolving Industry Standards

A majority of our revenues are derived from sales of
products, which rely on the PCI, PCI-X, USB, and limited sales of PCI Express
standards.  If markets move away from these standards and begin using new
standards, we may not be able to successfully design and manufacture new
products that use these new standards.  There is also the risk that new products
we develop in response to new standards may not be accepted in the market.  In
addition, these standards are continuously evolving, and we may not be able to
modify our products to address new specifications.  Any of these events would
have a material adverse effect on our business.

The Successful Marketing And Sales Of Our Products Depend
Upon Our Third Party Relationships, Which Are Not Supported By Written
Agreements

When marketing and selling our semiconductor devices, we
believe we enjoy a competitive advantage based on the availability of
development tools offered by third parties.  These development tools are used
principally for the design of other parts of the embedded system but also work
with our products.  We will lose this advantage if these third party tool
vendors cease to provide these tools for existing products or do not offer them
for our future products.  This event could have a material adverse effect on our
business.  We have no written agreements with these third parties, and these
parties could choose to stop providing these tools at any time.

Our Limited Ability To Protect Our Intellectual Property
And Proprietary Rights Could Adversely Affect Our Competitive Position

Our future success and competitive position depend upon
our ability to obtain and maintain proprietary technology used in our principal
products.  Currently, we have limited protection of our intellectual property in
the form of patents and rely instead on trade secret protection.  Our existing
or future patents may be invalidated, circumvented, challenged or licensed to
others.  The rights granted thereunder may not provide competitive advantages to
us.  In addition, our future patent applications may not be issued with the
scope of the claims sought by us, if at all.  Furthermore, others may develop
technologies that are similar or superior to our technology, duplicate our
technology or design around the patents owned or licensed by us.  In addition,
effective patent, trademark, copyright and trade secret protection may be
unavailable or limited in foreign countries where we may need protection.  We
cannot be sure that steps taken by us to protect our technology will prevent
misappropriation of the technology.

We may from time to time receive notifications of claims that
we may be infringing patents or other intellectual property rights owned by
third parties.  While there is currently no intellectual property litigation
pending against us, litigation could result in significant expenses to us and
adversely affect sales of the challenged product or technology.  This litigation
could also divert the efforts of our technical and management personnel, whether
or not the litigation is determined in our favor.  In addition, we may not be
able to develop or acquire non-infringing technology or procure licenses to the
infringing technology under reasonable terms.  This could require expenditures
by us of substantial time and other resources.  Any of these developments would
have a material adverse effect on our business.

The Cyclical Nature Of The Semiconductor Industry May Lead
To Significant Variances In The Demand For Our Products

In the past, the semiconductor industry has been
characterized by significant downturns and wide fluctuations in supply and
demand.  Also, the industry has experienced significant fluctuations in
anticipation of changes in general economic conditions.  This cyclicality has
led to significant variances in product demand and production capacity.  It has
also accelerated erosion of average selling prices per unit.  We may experience
periodic fluctuations in our future financial results because of industry-wide
conditions.

Because We Sell Our Products To Customers Outside Of North
America And Because Our Products Are Incorporated With Products Of Others That
Are Sold Outside Of North America We Face Foreign Business, Political And
Economic Risks

Sales outside of North America accounted for 68%, 63%,
and 58% of our revenues in 2004, 2003, and 2002, respectively.  Sales outside of
North America may fluctuate in future periods and is expected to account for a
large portion of our revenues.  In addition, equipment manufacturers who
incorporate our products into their products sell their products outside of
North America, thereby exposing us indirectly to foreign risks.  Further, most
of our semiconductor products are manufactured outside of North America.
Accordingly, we are subject to international risks, including:

- difficulties in managing distributors,
- difficulties in staffing and managing foreign subsidiary and branch
operations,
- political and economic instability,
- foreign currency exchange fluctuations,
- difficulties in accounts receivable collections,
- potentially adverse tax consequences,
- timing and availability of export licenses,
- changes in regulatory requirements, tariffs and other barriers,
- difficulties in obtaining governmental approvals for telecommunications and
other products, and
- the burden of complying with complex foreign laws and treaties.

Because sales of our products have been denominated to date
exclusively in United States dollars, increases in the value of the United
States dollar will increase the price of our products so that they become
relatively more expensive to customers in the local currency of a particular
country, which could lead to a reduction in sales and profitability in that
country.

Our Principal Stockholders Have Significant Voting Power
And May Take Actions That May Not Be In The Best Interests Of Our Other
Stockholders

Our executive officers, directors and other principal
stockholders, in the aggregate, beneficially own a substantial amount of our
outstanding common stock.  Although these stockholders do not have majority
control, they currently have, and likely will continue to have, significant
influence with respect to the election of our directors and approval or
disapproval of our significant corporate actions.  This influence over our
affairs might be adverse to the interests of other stockholders.  In addition,
the voting power of these stockholders could have the effect of delaying or
preventing a change in control of PLX.

The Anti-Takeover Provisions In Our Certificate of
Incorporation Could Adversely Affect The Rights Of The Holders Of Our Common
Stock

Anti-takeover provisions of Delaware law and our
Certificate of Incorporation may make a change in control of PLX more difficult,
even if a change in control would be beneficial to the stockholders.  These
provisions may allow the Board of Directors to prevent changes in the management
and control of PLX.

As part of our anti-takeover devices, our Board of Directors
has the ability to determine the terms of preferred stock and issue preferred
stock without the approval of the holders of the common stock.  Our Certificate
of Incorporation allows the issuance of up to 5,000,000 shares of preferred
stock.  There are no shares of preferred stock outstanding.  However, because
the rights and preferences of any series of preferred stock may be set by the
                                                                               Board of Directors in its sole discretion without approval of the holders of the
common stock, the rights and preferences of this preferred stock may be superior
to those of the common stock.  Accordingly, the rights of the holders of common
stock may be adversely affected.  Consistent with Delaware law, our Board of
Directors may adopt additional anti-takeover measures in the future.



ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK

We have an investment portfolio
of fixed income securities, including those classified as cash equivalents,
short and long-term investments of approximately $28.5 million at
December 31, 2004. These securities are subject to interest rate
fluctuations and will decrease in market value if interest rates increase.

The primary objective of the
Company's investment activities is to preserve principal while at the same time
maximizing yields without significantly increasing risk. The Company invests
primarily in high-quality, short-term and long-term debt instruments. A
hypothetical 100 basis point increase in interest rates would result in
approximately a $0.1 million decrease (less than 1%) in the fair value of
the Company's available-for-sale securities.

ITEM 8: FINANCIAL STATEMENTS AND
SUPPLEMENTARY DATA

The information required by
this Item is contained in the financial statements and schedule set forth in
Item 15 (a) of this Form 10-K.

ITEM 9: CHANGES IN AND DISAGREEMENTS
WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE

There has been no change of
accountants nor any disagreements with accountants on any matter of accounting
principles or practices or financial statement disclosure required to be
reported under this Item.

ITEM 9A:  CONTROLS AND PROCEDURES

Controls and Procedures

(a)  Evaluation of disclosure controls and procedures.

Based on
their evaluation as of December 31, 2004, our Chief Executive Officer and
Chief Financial Officer, have concluded that our disclosure controls and
procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the
Securities Exchange Act of 1934, as amended) were sufficiently effective to
ensure that the information required to be disclosed by us in this Annual Report
on Form 10-K was recorded, processed, summarized and reported within the
time periods specified in the SEC's rules and instructions for Form 10-K.

(b) Changes in internal controls.

There has been no significant change in our internal
control over financial reporting that occurred during our most recent fiscal
quarter that has materially affected or is reasonably likely to materially
affect our internal control over financial reporting.

Management's Report on Internal Control over Financial
Reporting

Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting (as defined in Rule 13a-15(f) under the
Securities Exchange Act of 1934, as amended). Our management assessed the
effectiveness of our internal control over financial reporting as of
December 31, 2004. In making this assessment, our management used the
criteria set forth by the Committee of Sponsoring Organizations of the Treadway
Commission ("COSO") in Internal Control-Integrated Framework. Our management has
concluded that, as of December 31, 2004, our internal control over
financial reporting is effective based on these criteria. Our independent
registered public accounting firm, Ernst & Young LLP, have issued an audit
report on our assessment of our internal control over financial reporting, which
is included herein.

PART III

ITEM 10: DIRECTORS AND EXECUTIVE
OFFICERS OF THE REGISTRANT

The information required by
this Item is incorporated herein by reference to the Company's Proxy Statement
for the 2005 Annual Meeting of Stockholders.



ITEM 11: EXECUTIVE COMPENSATION

The information required by
this Item is incorporated herein by reference to the Company's Proxy Statement
for the 2005 Annual Meeting of Stockholders.

ITEM 12: SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information required by
this Item is incorporated herein by reference to the Company's Proxy Statement
for the 2005 Annual Meeting of Stockholders.

ITEM 13: CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS

The information required by
this Item is incorporated herein by reference to the Company's Proxy Statement
for the 2005 Annual Meeting of Stockholders.

ITEM 14: PRINCIPAL ACCOUNTANT FEES
AND SERVICES

The information required by
this Item is incorporated herein by reference to the Company's Proxy Statement
for the 2005 Annual Meeting of Stockholders.

PART IV

ITEM 15: EXHIBITS, FINANCIAL
STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)     
   1.      Consolidated Financial
Statements

For the following
financial information included herein, see Index on page 38:

Reports of Ernst & Young LLP, Independent
Auditors.

Consolidated Balance Sheets as of December 31, 2004 and
2003.

Consolidated Statements of Operations for each of the three years in the
period ended December 31, 2004.

Consolidated Statements of Stockholders' Equity for each of the three years
in the period ended December 31, 2004.

Consolidated Statements of Cash Flows for each of the three years in the
period ended December 31, 2004.

Notes to Consolidated Financial Statements.

1. Financial Statement Schedule
2. Exhibit Index

See Exhibit Index immediately following the signature
page for a list of exhibits filed or incorporated by reference as a part of this
report.

(b)     
    Exhibits

The Company hereby files, as exhibits to this Form 10-K,
those exhibits listed on the Exhibit Index referenced in Item 15 (a)
(3) above.





PLX TECHNOLOGY, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS



|                                                                                                                  | Page
|----------------------------------------------------------------------------------------------------------------- | ----
|Reports of Ernst & Young LLP, Independent
Registered Public Accounting Firm                                       | 39  
|Consolidated Balance Sheets as of December 31, 2004 and
2003                                                      | 41  
|Consolidated Statements of Operations for each of the three
years in the period ended December 31,
2004           | 42  
|Consolidated Statements of Stockholders' Equity for each of the
three years in the period ended December 31,
2004 | 43  
|Consolidated Statements of Cash Flows for each of the three
years in the period ended December 31,
2004           | 44  
|Notes to Consolidated Financial
Statements                                                                        | 45  

---



Report of Ernst & Young LLP,
Independent Registered Public Accounting Firm, on Financial Statements

The Board of Directors and Stockholders
PLX Technology, Inc.

We have audited the
accompanying consolidated balance sheets of PLX Technology, Inc. as of
December 31, 2004 and 2003, and the related consolidated statements of
operations, stockholders' equity and cash flows for each of the three years in
the period ended December 31, 2004. Our audits also included the financial
statement schedule listed in the Index at Item 15(a). These consolidated
financial statements and schedule are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements and schedule based on our audits.

We conducted our audits in
accordance with the standards of the Public Company Accounting Oversight Board
(United States). 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
consolidated financial statements referred to above present fairly, in all
material respects, the consolidated financial position of PLX Technology, Inc.
at December 31, 2004 and 2003, and the consolidated results of its
operations and its cash flows for each of the three years in the period ended
December 31, 2004, in conformity with U.S. generally accepted accounting
principles.  Also, in our opinion, the related financial statement schedule,
when considered in relation to the basic financial statements taken as a whole,
presents fairly in all material respects the information set forth therein.

We also have audited, in accordance with the standards
of the Public Company Accounting Oversight Board (United States), the
effectiveness of PLX Technology, Inc.'s internal control over financial
reporting as of December 31, 2004, based on the criteria established in
Internal Control-Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission, and our report dated February 24,
2005 expressed an unqualified opinion thereon.



/s/ Ernst & Young LLP

San Jose, California
February 24, 2005



---



Report of Ernst & Young LLP,
Independent Registered Public Accounting Firm, on Internal Control Over
Financial Reporting

The Board of Directors and Stockholders
PLX Technology, Inc.

We have
audited management's assessment, included in the accompanying Management's
Report on Internal Control over Financial Reporting appearing in Item 9A,
that PLX Technology, Inc. maintained effective internal control over financial
reporting as of December 31, 2004, based on criteria established in
Internal Control-Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (the COSO criteria). PLX Technology,
Inc.'s management is responsible for maintaining effective internal control over
financial reporting and for its assessment of the effectiveness of internal
control over financial reporting. Our responsibility is to express an opinion on
management's assessment and an opinion on the effectiveness of the company's
internal control over financial reporting based on our audit.

We conducted
our audit in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control over
financial reporting, evaluating management's assessment, testing and evaluating
the design and operating effectiveness of internal control, and performing such
other procedures as we considered necessary in the circumstances. We believe
that our audit provides a reasonable basis for our opinion.

A company's
internal control over financial reporting is a process designed to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. A company's internal control over
financial reporting includes those policies and procedures that (1) pertain
to the maintenance of records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of
the company are being made only in accordance with authorizations of management
and directors of the company; and (3) provide reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company's assets that could have a material effect on the
financial statements.

Because of
its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.

In our
opinion, management's assessment that PLX Technology, Inc. maintained effective
internal control over financial reporting as of December 31, 2004, is
fairly stated, in all material respects, based on the COSO criteria.  Also, in
our opinion, PLX Technology, Inc. maintained, in all material respects,
effective internal control over financial reporting as of December 31,
2004, based on the COSO criteria.

We also have audited, in accordance with the standards of the
Public Company Accounting Oversight Board (United States), the consolidated
balance sheets of PLX Technology, Inc. as of December 31, 2004 and 2003,
and the related consolidated statements of operations, stockholders' equity, and
cash flows for each of the three years in the period ended December 31,
2004 of PLX Technology, Inc. and our report dated February 24, 2005 expressed an
unqualified opinion thereon.

/s/ Ernst & Young LLP

San Jose, California
February 24, 2005



---





PLX TECHNOLOGY, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)

``

`December 31,
                                                                              ----------------------
                                                                                 2004        2003
                                                                              ----------  ----------
                                   ASSETS
Current assets:
  Cash and cash equivalents................................................. $    9,556  $   10,955
  Short-term investments....................................................     10,565      10,052
  Accounts receivable, less allowance for doubtful accounts of $127
    in 2004 and $161 in 2003................................................      5,084       4,998
  Inventories...............................................................      4,159       1,893
  Other current assets......................................................      2,058       1,730
                                                                              ----------  ----------
Total current assets........................................................     31,422      29,628
Goodwill....................................................................     30,965      15,998
Other intangible assets, net of accumulated amortization of $4,164
    in 2004 and $2,447 in 2003..............................................      6,991       2,730
Property and equipment, net.................................................     30,860      31,068
Long-term investments.......................................................     10,155       2,049
Other assets................................................................         80         330
                                                                              ----------  ----------
Total assets................................................................ $  110,473  $   81,803
                                                                              ==========  ==========

                    LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable.......................................................... $    3,627  $    1,768
  Accrued compensation and benefits.........................................      1,813       1,427
  Deferred revenues.........................................................      1,310         991
  Accrued commissions.......................................................        300         368
  Other accrued expenses....................................................      1,264       1,228
                                                                              ----------  ----------
Total current liabilities...................................................      8,314       5,782
                                                                              ----------  ----------
Commitments
Stockholders' equity:
  Preferred stock, $.001 par value:
      Authorized -- 5,000,000 shares: none issued and outstanding...........         --          --
  Common stock, $.001 par value: authorized -- 50,000,000 shares:
      issued and outstanding -- 26,706,763 in 2004 and 23,848,168 in 2003...         27          24
  Additional paid-in capital................................................    111,739      84,508
  Deferred stock compensation...............................................       (406)        (44)
  Notes receivable for employee stock purchases.............................         --         (70)
  Accumulated other comprehensive loss......................................       (211)        (49)
  Accumulated deficit.......................................................     (8,990)     (8,348)
                                                                              ----------  ----------
Total stockholders' equity..................................................    102,159      76,021
                                                                              ----------  ----------
Total liabilities and stockholders' equity.................................. $  110,473  $   81,803
                                                                              ==========  ==========`

See accompanying notes to consolidated financial statements.
statements.

---



PLX TECHNOLOGY, INC.
                     CONSOLIDATED STATEMENTS OF OPERATIONS 
                (in thousands, except per share data)

`Years Ended December 31,
                                                                        -------------------------------
                                                                          2004       2003       2002
                                                                        ---------  ---------  ---------
Net revenues.......................................................... $  54,449  $  38,038  $  34,810
Cost of revenues......................................................    18,739     10,867     10,852
                                                                        ---------  ---------  ---------
Gross margin..........................................................    35,710     27,171     23,958
                                                                        ---------  ---------  ---------
Operating expenses:
    Research and development..........................................    17,686     15,048     14,256
    Selling, general and administrative...............................    16,014     13,114     12,433
    In-process research and development...............................     1,123        875         --
    Amortization of purchased intangible assets.......................     1,718        931        533
                                                                        ---------  ---------  ---------
Total operating expenses..............................................    36,541     29,968     27,222
                                                                        ---------  ---------  ---------
Operating loss........................................................      (831)    (2,797)    (3,264)
Interest income.......................................................       435        437        527
Other income, net.....................................................        12        130        477
                                                                        ---------  ---------  ---------
Loss before provision for income taxes................................      (384)    (2,230)    (2,260)
Provision for income taxes............................................       258         29         60
                                                                        ---------  ---------  ---------
Net loss.............................................................. $    (642) $  (2,259) $  (2,320)
                                                                        =========  =========  =========

Basic and diluted net loss per share.................................. $   (0.03) $   (0.10) $   (0.10)
                                                                        =========  =========  =========

Shares used to compute basic and diluted per share amounts............    25,422     22,755     22,785
                                                                        =========  =========  =========`

See accompanying notes to consolidated financial statements.

---



PLX TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(in thousands, except share amounts)



`Notes      Accumulated
                                                                                             Deferred    Receivable      Other
                                                           Common Stock        Additional     Stock     for Employee  Comprehensive                Total
                                                       ----------------------    Paid-in     Compen-       Stock        Income     Accumulated  Stockholders'
                                                          Shares      Amount     Capital      sation     Purchases      (Loss)       Deficit       Equity
                                                       ------------  --------  -----------  ----------  ------------  -----------  -----------  ------------
                                                       ------------  --------  -----------  ----------  ------------  -----------  -----------  ------------
Balance at December 31, 2001..........................  23,345,994  $     23  $    78,328  $   (3,929) $        (63) $       (37) $    (3,769) $     70,553
Issuance of stock pursuant
  to exercise of stock options........................     199,850        --        1,287          --            --           --           --         1,287
Stockholder notes receivable interest.................          --        --           --          --            (4)          --           --            (4)
Tax benefit from employee stock option plans..........          --        --          944          --            --           --           --           944
Repurchase of common stock............................  (2,421,652)       (2)      (4,698)         --            --           --           --        (4,700)
Reversal of deferred compensation on options
  associated with employee terminations...............          --        --         (908)        908            --           --           --            --
Amortization of deferred stock compensation...........          --        --           --       2,121            --           --           --         2,121
Comprehensive loss:
    Change in unrealized loss on investments..........          --        --           --          --            --           95           --            95
    Translation adjustments...........................          --        --           --          --            --          (12)          --           (12)
Net loss..............................................          --        --           --          --            --           --       (2,320)       (2,320)
                                                                                                                                                ------------
Total comprehensive loss..............................                                                                                               (2,237)
                                                       ------------  --------  -----------  ----------  ------------  -----------  -----------  ------------
Balance at December 31, 2002..........................  21,124,192        21       74,953        (900)          (67)          46       (6,089)       67,964
Issuance of common stock and options related to
   the acquisition of HiNT Corporation................   2,996,589         3       10,160          --            --           --           --        10,163
Deferred compensation on options issued
   related to acquisition of HiNT Corporation.........          --        --           --        (110)           --           --           --          (110)
Issuance of stock pursuant
  to exercise of stock options........................      69,687        --          317          --            --           --           --           317
Stockholder notes receivable interest.................          --        --           --          --            (3)          --           --            (3)
Repurchase of common stock............................    (342,300)       --         (922)         --            --           --           --          (922)
Amortization of deferred stock compensation...........          --        --           --         966            --           --           --           966
Comprehensive loss:
    Change in unrealized loss on investments..........          --        --           --          --            --          (91)          --           (91)
    Translation adjustments...........................          --        --           --          --            --           (4)          --            (4)
Net loss..............................................          --        --           --          --            --           --       (2,259)       (2,259)
                                                                                                                                                ------------
Total comprehensive loss..............................                                                                                               (2,354)
                                                       ------------  --------  -----------  ----------  ------------  -----------  -----------  ------------
Balance at December 31, 2003..........................  23,848,168  $     24  $    84,508  $      (44) $        (70) $       (49) $    (8,348) $     76,021
Issuance of common stock related
   to the acquisition of Hint Corporation.............     337,162        --        2,994          --            --           --           --         2,994
Issuance of common stock and options related to
   the acquisition of NetChip Technology, Inc.........   2,035,077         2       22,588          --            --           --           --        22,590
Deferred compensation on options issued
   related to acquisition of NetChip Technology, Inc..          --        --           --        (869)           --           --           --          (869)
Issuance of stock pursuant
  to exercise of stock options........................     486,356         1        2,026          --            --           --           --         2,027
Repayment of stockholder notes receivable.............          --        --           --          --            70           --           --            70
Reversal of deferred compensation on options
  associated with employee terminations...............          --        --         (377)        377            --           --           --            --
Amortization of deferred stock compensation...........          --        --           --         130            --           --           --           130
Comprehensive loss:
    Change in unrealized loss on investments..........          --        --           --          --            --         (163)          --          (163)
    Translation adjustments...........................          --        --           --          --            --            1           --             1
Net loss..............................................          --        --           --          --            --           --         (642)         (642)
                                                                                                                                                ------------
Total comprehensive loss..............................                                                                                                 (804)
                                                       ------------  --------  -----------  ----------  ------------  -----------  -----------  ------------
Balance at December 31, 2004..........................  26,706,763  $     27  $   111,739  $     (406) $         --  $      (211) $    (8,990) $    102,159
                                                       ============  ========  ===========  ==========  ============  ===========  ===========  ============`

See accompanying notes to consolidated financial
statements.

---



PLX TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

`Years Ended December 31,
                                                                          -------------------------------
                                                                            2004       2003       2002
                                                                          ---------  ---------  ---------
Cash flows from operating activities:                                                                    
    Net loss............................................................ $    (642) $  (2,259) $  (2,320)
    Adjustments required to reconcile net loss to cash
       flows provided by operating activities:
        Depreciation and amortization...................................     2,197      2,335      2,401
        Amortization of deferred stock compensation.....................       130        966      2,121
        Amortization of purchased intangible assets.....................     1,718        929        533
        In-process research and development.............................     1,123        875         --
        Tax benefit from employee stock option plans....................        --         --        944
        Other non-cash items............................................       135        104        172
        Changes in operating assets and liabilities:
            Accounts receivable.........................................     1,480     (1,840)     1,505
            Inventories.................................................    (1,772)      (423)     3,583
            Deferred tax assets.........................................        --         --      3,194
            Income tax receivable.......................................        --      3,635     (2,912)
            Other current assets........................................      (313)       225     (1,288)
            Other assets................................................       253        (20)       (15)
            Accounts payable............................................       766       (413)      (271)
            Accrued compensation and benefits...........................       360        380        124
            Deferred revenues...........................................       319        378        332
            Deferred tax liability......................................        --         --       (830)
            Accrued commissions.........................................      (233)       167       (109)
            Other accrued expenses......................................      (873)      (714)        68
                                                                          ---------  ---------  ---------
Net cash provided by operating activities...............................     4,648      4,325      7,232
                                                                          ---------  ---------  ---------
Cash flows provided by (used in) investing activities:                                                   
    Cash used in acquisition of HiNT, net of cash acquired..............      (137)      (704)        --
    Cash acquired in acquisition of NetChip Technologies................     2,821         --         --
    Purchases of investments............................................   (22,815)    (6,094)   (14,200)
    Sales and maturities of investments.................................    13,902     10,000      7,020
    Purchase of property and equipment..................................    (1,919)    (1,441)      (782)
                                                                          ---------  ---------  ---------
Net cash provided by (used in) investing activities                         (8,148)     1,761     (7,962)
                                                                          ---------  ---------  ---------
Cash flows provided by (used in) financing activities:                                                   
    Proceeds from exercise of common stock options......................     2,027        317      1,287
    Repurchases of common stock.........................................        --       (922)    (4,700)
    Proceeds from stockholder notes receivable..........................        70         --         --
                                                                          ---------  ---------  ---------
Net cash provided by (used in) financing activities.....................     2,097       (605)    (3,413)
                                                                          ---------  ---------  ---------

Effect of exchange rate fluctuations on cash and cash equivalents.......         4         (8)        (6)
                                                                          ---------  ---------  ---------
Increase (decrease) in cash and cash equivalents........................    (1,399)     5,473     (4,149)
Cash and cash equivalents at beginning of year..........................    10,955      5,482      9,631
                                                                          ---------  ---------  ---------
Cash and cash equivalents at end of year................................ $   9,556  $  10,955  $   5,482
                                                                          =========  =========  =========
                                                                                                         
Supplemental disclosure of cash flow information:                                                        
    Cash received for income taxes...................................... $      16  $   4,028  $     650
    Cash paid for income taxes.......................................... $      74  $      49  $       8`

See accompanying notes to consolidated financial statements.

---



PLX TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  Organization and Summary of Significant Accounting Policies

Description of Business

PLX Technology, Inc. (the
"Company") develops and markets I/O interconnectivity solutions that speed the
transfer of data in high-performance microprocessor-based systems. The Company's
principal products are high performance semiconductor devices, as well as
related software development kits and hardware design kits.  The Company
utilizes a "fabless" semiconductor business model whereby it purchases
wafers and packaged and tested semiconductor devices from independent
manufacturing foundries.  Semiconductor devices account for substantially all of
the Company's net revenues.

Basis of Presentation

The consolidated financial
statements include the accounts of the Company and its wholly-owned
subsidiaries. All intercompany transactions and balances have been eliminated.

Cash and Cash Equivalents

The Company considers all
highly liquid investments purchased with an original maturity of three months or
less to be cash equivalents.

The Company accounts for its
investments in accordance with Statement of Financial Accounting Standards
No. 115, "Accounting for Certain Investments in Debt and Equity Securities"
(FAS 115). Under FAS 115, management determines the appropriate classification
of debt securities at the time of purchase and reevaluates such designation as
of each balance sheet date. At December 31, 2004 and 2003, all debt
securities were designated as available-for-sale. Available-for-sale securities
are carried at fair value with unrealized gains and losses reported in a
separate component of stockholders' equity. The fair value of securities is
based on quoted market prices. The amortized cost of debt securities in this
category is adjusted for the amortization of premiums and the accretion of
discounts to maturity. Such amortization, as well as any interest earned on the
securities, is included in interest income. Realized gains and losses and
declines in value judged to be other-than-temporary on available-for-sale
securities are included in interest income. The cost of securities sold is based
on the specific identification method.

Allowance for Doubtful Accounts

Credit limits are established
by reviewing the financial history and stability of each customer.  Where
appropriate, the Company obtains credit rating reports and financial statements
of the customer to initiate and modify their credit limits.  On certain foreign
sales, letters of credit are required.  The collectibility of trade receivable
balances is regularly evaluated based on a combination of factors.  If it is
determined that a customer will be unable to fully meet its financial
obligation, such as in the case of a bankruptcy filing or other material events
impacting its business, a specific reserve for bad debt is recorded to reduce
the carrying value of the receivable to the amount expected to be recovered.

Inventories

Inventories are valued at the
lower of cost (first-in, first-out method) or market.  Inventories were as
follows:

`December 31,
                                                                -----------------------
                                                                   2004        2003
                                                                ----------  -----------
                                                                     (in thousands)    
Work-in-process............................................... $    1,083  $       356
Finished goods................................................      3,076        1,537
                                                                ----------  -----------
   Total...................................................... $    4,159  $     1,893
                                                                ==========  ===========`

Inventory Write-downs

The Company evaluates the need
for potential write-downs of inventory by considering a combination of factors.
Based on the life of the product, sales history, obsolescence and sales
forecast, the Company may record write-downs to inventory ranging from 0% to
100%.

Goodwill

Goodwill represents the excess
of cost over the value of net assets of businesses acquired pursuant to
Statement of Financial Accounting Standards (SFAS) No. 141, "Business
Combinations" and is carried at cost unless write-downs for impairment are
required. The Company evaluates the carrying value of goodwill on an annual
basis (November 1st) and whenever events and changes in circumstances indicate
that the carrying amount may not be recoverable. Such indicators would include a
significant reduction in the Company's market capitalization, a decrease in
operating results or a deterioration in the Company's financial position. To
date, no such impairment has been recorded.

Changes in the carrying amount of goodwill for the years
ended December 31, 2004 and 2003 are as follows (in thousands):

`Balance as of December 31, 2002............................... $    8,054
  HiNT acquisition............................................      7,944
Balance as of December 31, 2003...............................     15,998
  NetChip acquisition.........................................     11,998
  HiNT acquisition - additional consideration (see note 3)....      3,131
  Other.......................................................       (162)
                                                                ----------
Balance as of December 31, 2004............................... $   30,965
                                                                ==========`

Long-lived Asset Impairment

Long-lived assets, principally property and equipment and
identifiable intangibles held and used by the Company are reviewed for
impairment whenever events or circumstances indicate that the carrying amount of
assets may not be recoverable in accordance with SFAS No. 144.  The Company
evaluates recoverability of assets to be held and used by comparing the carrying
amount of an asset to estimated future net undiscounted cash flows generated by
the asset.  If such assets are considered to be impaired, the impairment
recognized is measured as the amount by which the carrying amount of the assets
exceeds the fair value of the assets.  Also see Note 8.

Property and Equipment

Property and equipment are
stated at cost, less accumulated depreciation. Depreciation is computed using
the straight-line method over the estimated useful lives of 39 years for
buildings and three to five years for equipment, furniture and purchased
software. Leasehold improvements are amortized using the straight-line method
over the shorter of the useful lives of the assets or the terms of the leases.

Property and equipment are as follows:

`December 31,
                                                                -----------------------
                                                                   2004        2003
                                                                ----------  -----------
                                                                     (in thousands)       
Land.......................................................... $    8,550  $     8,550
Building......................................................     19,333       19,333
Equipment and furniture.......................................     11,168       10,275
Purchased software............................................      4,878        4,826
                                                                ----------  -----------
                                                                   43,929       42,984
Accumulated depreciation and amortization.....................    (13,069)     (11,916)
                                                                ----------  -----------
Net property and equipment.................................... $   30,860  $    31,068
                                                                ==========  ===========`

Stock-Based Compensation

The Company has employee stock
plans, which are more fully described in Note 6. The Company has elected to
account for its stock option and stock grant plans in accordance with the
intrinsic value method under Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" (APB Opinion No. 25).

The Company has elected to
follow APB Opinion No. 25 and related interpretations in accounting for its
stock options and grants since the alternative fair market value accounting
provided for under Statement of Financial Accounting Standards
(SFAS) No. 123 requires use of valuation models that were not
developed for use in valuing employee stock options and grants. Under APB
Opinion No. 25, if the exercise price of the Company's stock grants and
options equals the deemed fair value of the underlying stock on the date of
grant, no compensation expense is recognized.

If compensation cost for the
Company's stock-based compensation plans had been determined based on the fair
value at the grant dates for awards under those plans consistent with the method
of SFAS No. 123, then the Company's net loss per share would have been
adjusted to the pro forma amounts indicated below:

`Years Ended December 31,
                                                                -----------------------------------
                                                                   2004        2003         2002
                                                                ----------  -----------  ----------         
                                                                (in thousands, except per share data)
Net loss as reported.......................................... $     (642) $    (2,259) $   (2,320)
Add: Stock-based compensation included in reported net loss...        130          966       2,121
Deduct: Stock-based compensation cost under SFAS 123..........     (5,257)      (6,348)     (9,721)
                                                                ----------  -----------  ----------
Pro forma net loss............................................ $   (5,769) $    (7,641) $   (9,920)
                                                                ==========  ===========  ==========
Pro forma basic and diluted net loss per common share:
Pro forma shares used in the calculation of pro forma
   net loss per common share - basic and diluted..............     25,422       22,755      22,785
                                                                ==========  ===========  ==========
Pro forma net loss per common share - basic and diluted....... $    (0.23) $     (0.34) $    (0.44)
                                                                ==========  ===========  ==========
Reported net loss per common share - basic and diluted........ $    (0.03) $     (0.10) $    (0.10)
                                                                ==========  ===========  ==========`

See Note 7 for a discussion on the
assumptions used in the option-pricing model and estimated fair value of
employee stock options.

Revenue Recognition

Sales to original equipment
manufacturers are generally recognized at the time of title passage, which
typically occurs at the time of shipment. Recognition of sales to distributors,
including international distributors, is deferred until the product is resold by
the distributors to their customers. Net revenues from the sale of software
development kits is insignificant for all years presented. Our products are
warranted to be free from defect for a period of one year. The Company records a
warranty provision for defective products at the time of sale. To date, the
Company has experienced an immaterial amount of defective product returns. In
addition, the Company generally indemnifies, under predetermined conditions, its
customers for infringement of third party intellectual property rights by its
products or services.  The Company has not recorded a liability associated with
these guarantees, as the Company has little or no history of costs associated
with such indemnification requirements.

Advertising

The Company accounts for
advertising costs as expenses in the period in which they are incurred.
Advertising expenses for 2004, 2003, and 2002, were $5,000, $4,000, and $19,000,
respectively.

Software Development Costs

In accordance with Statement of
Financial Accounting Standards No. 86, "Accounting for the Costs of
Computer Software to Be Sold, Leased, or Otherwise Marketed," the Company is
required to capitalize eligible computer software costs upon achievement of
technological feasibility subject to net realizable value considerations. The
Company has defined technological feasibility as completion of a working model.
The period between the achievement of technological feasibility and release of
the Company's software products has been of short duration. As of
December 31, 2004, 2003, and 2002 such costs were insignificant.
Accordingly, the Company has charged all such costs to research and development
expenses in the accompanying consolidated statements of operations.

Use of Estimates

The preparation of financial
statements in conformity with accounting principles generally accepted in the
United States requires management to make estimates and assumptions that affect
the amounts reported in the financial statements and accompanying notes. The
accounting estimates that require management's most difficult and subjective
judgments include the evaluation on the collectibility of the Company's accounts
receivable, the assessment of recoverability of property, plant, and equipment
and goodwill; the valuation of inventory; and the recognition and measurement of
income tax assets and liabilities. The actual results experienced by the Company
may differ from management's estimates.

Comprehensive Income (Loss)

At December 31, 2004, the
components of accumulated other comprehensive income (loss), reflected in the
Consolidated Statements of Stockholders' Equity, consisted of the following:

`Years Ended December 31,
                                                                -----------------------------------
                                                                   2004        2003         2002
                                                                ----------  -----------  ----------       
                                                                            (in thousands)
Unrealized gain (loss) on investments, net.................... $     (157) $         6  $       97
Cumulative translation adjustments............................        (54)         (55)        (51)
                                                                ----------  -----------  ----------
Accumulated other comprehensive income (loss)................. $     (211) $       (49) $       46
                                                                ==========  ===========  ==========`

Recent Accounting Pronouncements

In March 2004, the FASB issued EITF Issue No. 03-1
("EITF 03-1"), "The Meaning of Other-Than-Temporary Impairment and Its
Application to Certain Investments" which provided new guidance for assessing
impairment losses on investments. Additionally, EITF 03-1 includes new
disclosure requirements for investments that are deemed to be temporarily
impaired. In September 2004, the FASB delayed the accounting provisions of
EITF 03-1; however the disclosure requirements remain effective for annual
periods ending after June 15, 2004.  The adoption of this requirement did
not have a material impact on the Company's financial position or results of
operation.

In December 2004, the FASB issued SFAS 123R which
requires the measurement of all employee share-based payments to employees,
including grants of employee stock options, using a fair-value-based method and
the recording of such expense in our consolidated statements of income. The
accounting provisions of SFAS 123R are effective for reporting periods
beginning after June 15, 2005. The Company is required to adopt
SFAS 123R in the third quarter of fiscal 2005. The pro forma disclosures
previously permitted under SFAS 123 no longer will be an alternative to
financial statement recognition. See "Stock-Based Compensation" (Note 1) for the
pro forma net income and net income per share amounts, for fiscal 2002 through
fiscal 2004, as if the Company had used a fair-value-based method similar to the
methods required under SFAS 123R to measure compensation expense for
employee stock incentive awards. Although the Company has not yet determined
whether the adoption of SFAS 123R will result in amounts that are similar
to the current pro forma disclosures under SFAS 123, the Company is
evaluating the requirements under SFAS 123R and expect the adoption to have
a material impact on its consolidated statements of income and net income per
share.

2.  Net Loss Per Share

Basic and diluted net loss per
share is computed by dividing the net loss by the weighted average number of
common shares outstanding during the period.

As the Company incurred a loss for each of the years
ended December 31, 2004, 2003 and 2002, the effect of dilutive securities,
totaling 4.4 million, 4.2 million, and 3.4 million, equivalent shares,
respectively, have been excluded from the computation of diluted loss per share,
as their impact would be anti-dilutive.  Dilutive securities are comprised of
stock options to purchase common stock.

3.
Business Combination

On May 24, 2004, the Company
purchased NetChip Technology, Inc., a fabless supplier of high-performance
semiconductors based on Universal Serial Bus (USB) and Peripheral Component
Interconnect (PCI) standards, for an aggregate purchase price, including
acquisition costs, of $22.2 million. The Company acquired NetChip Technology,
Inc. in order to expand its position of strength in the market for PCI, PCI-X
and PCI Express interconnect chips to include the USB product line, where
NetChip offers an industry-leading product line offering high-performance and
low-power products for the USB 2.0 market. NetChip also has PCI Express products
in development that complement the Company's PCI Express chips. The combined
company provides a wide selection of interconnect chips based on these
standards. The transaction was accounted for using purchase accounting.

The financial results for the year ended December 31, 2004
reflect the acquisition from the date the transaction was closed.

The purchase price of the NetChip Technology, Inc.
acquisition is summarized below (in thousands):

`Fair value of common stock issued......... $  21,405
Fair value of options assumed.............       315
Acquisition costs.........................       524
                                            ---------
Total consideration....................... $  22,244
                                            =========`

The Company issued an aggregate of 2,035,077 shares of its
common stock valued at $21.4 million.  The Company also assumed 126,419 stock
options with a total value of approximately $0.3 million.  The stock options
were valued using the Black-Scholes valuation model.  Additionally, the Company
incurred approximately $0.5 million in professional fees, including legal,
valuation and accounting fees related to the acquisition, which were included as
part of the purchase price consideration for this transaction.  Assumed
liabilities consisted primarily of accounts payable and other accrued
expenses.

PLX recorded $0.9 million in deferred compensation on the
unvested options assumed in connection with the acquisition of NetChip
Technology, Inc.  Deferred compensation is being amortized over the remaining
vesting period of these assumed options, generally three years.

Additional consideration of PLX's common stock with a maximum
aggregate value of approximately $10 million may be paid to the former
shareholders of NetChip Technology, Inc. in the event USB gross profits meet
certain milestones in the period ending approximately one year following the
close of the transaction.  Any additional consideration will become goodwill in
the period such additional consideration becomes payable.

The allocation of the Company's purchase price to the
tangible and identifiable intangible assets acquired and liabilities assumed is
summarized below (in thousands).  The allocation was based on a number of
factors including a valuation and a fair value appraisal.

`Net tangible assets....................... $    3,144
In-process technology.....................      1,123
Goodwill and other intangible assets:
    Goodwill..............................     11,998
    Developed/Core Technology.............      3,594
    Customer Base.........................      2,385
                                             ---------
                                               17,977
                                             ---------
Net assets acquired....................... $   22,244
                                             =========`

Net tangible assets acquired were comprised primarily of
cash, inventory, accounts receivables, accounts payables, and other accrued
liabilities. The acquired in-process technology was written-off in the second
quarter of 2004. The estimated weighted average useful lives of the intangible
assets for the developed/core technology and customer base acquired in
connection with the acquisition of NetChip Technology, Inc. are approximately
six and three years, respectively.  Amortization of developed/core technology
and customer base was $0.4 million and $0.5 million, respectively, for the year
ended December 31, 2004.

The $1.1 million allocation of the purchase price to the
acquired in-process technology was determined by identifying research projects
in areas for which technological feasibility had not been established and no
alternative future uses existed. PLX acquired technology consisting of PCI
Express solutions. The value was determined by
estimating the expected cash flows from the project once
commercially viable, discounting the net cash flows to their present value, and
then applying a percentage of completion to the calculated value as defined
below.

Net Cash Flows.  The net cash flows from the identified
project utilized were based on estimates of revenues, cost of sales, research
and development costs, selling, general and administrative costs, and income
taxes from the project.  These estimates were based on assumptions mentioned
below.  The research and development costs excluded costs to bring the acquired
in-process project to technological feasibility.  The estimated revenues were
based on management projections of the acquired in-process project.

Discount Rate.  Discounting the net cash flows back to
their present value was based on the cost of capital for well-managed venture
capital funds which typically have similar risks and returns on investments.
The cost of capital used in discounting the net cash flows from acquired in-
process technology was 30%.

Percentage of Completion.  Percentage of completion
was determined using costs incurred by NetChip Technology, Inc. prior to the
acquisition date compared to the remaining research and development costs to be
incurred to bring the project to technological feasibility. As of the
acquisition date, the Company estimated that the project was approximately 60%
complete.  As of February 2005, the project was substantially complete.

Unaudited Pro Forma Financial Results

On May 22, 2003, the Company
purchased HiNT Corp., a fabless semiconductor supplier of Peripheral Component
Interconnect (PCI) and PCI-X bridge chips, for an aggregate purchase price, of
$15.6 million.  In addition, the Company issued 337,162 shares of common
stock valued at approximately $3.0 million and paid approximately $137,000 to
former employees and warrant holders of HiNT because certain product sales
milestones were met as of June 30, 2004.  This additional consideration was
recorded as goodwill during the three months ended September 30, 2004.

The unaudited pro forma financial information combines the
historical statements of operations of the Company, NetChip Technology, Inc. and
Hint Corp. for the years ended December 31, 2004 and 2003 and gives effect to
the transactions, including the amortization of other intangible assets and the
recognition of deferred compensation, as if they occurred at the beginning of
fiscal 2003.  The amount of the aggregate purchase price allocated to purchased
in-process research and development has been excluded from the pro forma
information, as it is a non-recurring item.

The unaudited pro forma information is presented for
illustrative purposes only and is not necessarily indicative of the operating
results that would have occurred if the transactions had been consummated at the
dates indicated, nor is it necessarily indicative of future operating results of
the combined companies and should not be construed as representative of these
amounts for any future periods.  The following table is in thousands, except per
share data:

`December 31,
                                                           --------------------------
                                                               2004          2003
                                                           ------------   -----------  

Net revenues............................................. $     64,003   $    50,127
Net income (loss)........................................ $        731   $    (2,236)

Net income (loss) per share - basic...................... $       0.03   $     (0.09)
                                                           ============   ============
Net income (loss) per share - diluted.................... $       0.03   $     (0.09)
                                                           ============   ============

Shares used to compute basic per share amounts...........       26,417        26,285
                                                           ============   ============
Shares used to compute diluted per share amounts.........       27,468        26,285
                                                           ============   ============`

4.  Cash, Cash Equivalents, Short-Term Investments and
Long-Term Investments

The Company invests its excess
cash in high quality, short-term and long-term debt and equity instruments. The
following is a summary of the Company's investments by major security type at
December 31, 2004 and December 31, 2003 (in thousands):

`Carrying   Unrealized Unrealized Estimated
                                                                        Value      Gains     Losses    Fair Value
                                                                      ---------  ---------  ---------  ---------
2004                                                                                                            
Cash................................................................ $   1,896  $      --  $      --  $   1,896
Cash equivalents:
  Money market mutual funds.........................................     6,360         --         --      6,360
  Commercial paper..................................................     1,300         --         --      1,300
                                                                      ---------  ---------  ---------  ---------
Total cash equivalents..............................................     7,660         --         --      7,660
                                                                      ---------  ---------  ---------  ---------
Total cash and cash equivalents.....................................     9,556         --         --      9,556
                                                                      ---------  ---------  ---------  ---------
Short-term investments:
  Commercial paper..................................................     2,298         --         --      2,298
  Corporate bonds...................................................     1,306         --        (16)     1,290
  Munipal auction rate securities...................................     3,975         --         --      3,975
  U.S government & agency securities................................     3,016         --        (14)     3,002
                                                                      ---------  ---------  ---------  ---------
Total short-term investments........................................    10,595         --        (30)    10,565
                                                                      ---------  ---------  ---------  ---------
Long-term investments:
  Corporate bonds...................................................     1,197         --         (7)     1,190
  U.S government & agency securities................................     9,085         --       (120)     8,965
                                                                      ---------  ---------  ---------  ---------
Total long-term investments.........................................    10,282         --       (127)    10,155
                                                                      ---------  ---------  ---------  ---------
Total cash, cash equivalents, short-term and long-term investments.. $  30,433  $      --  $    (157) $  30,276
                                                                      =========  =========  =========  =========

2003                                                                                                            
Cash................................................................ $   1,919  $      --  $      --  $   1,919
Cash equivalents:
  Money market mutual funds.........................................     5,990         --         --      5,990
  Commercial paper..................................................     3,049         --         (3)     3,046
                                                                      ---------  ---------  ---------  ---------
Total cash equivalents..............................................     9,039         --         (3)     9,036
                                                                      ---------  ---------  ---------  ---------
Total cash and cash equivalents.....................................    10,958         --         (3)    10,955
                                                                      ---------  ---------  ---------  ---------
Short-term investments:
  U.S government & agency securities................................     1,000          1         --      1,001
  Munipal auction rate preferred stock..............................     1,000         --         --      1,000
  Munipal auction rate securities...................................     7,050         --         --      7,050
  Sovereign debt securities.........................................     1,000          1         --      1,001
                                                                      ---------  ---------  ---------  ---------
Total short-term investments........................................    10,050          2         --     10,052
                                                                      ---------  ---------  ---------  ---------
Long-term investments:
  U.S government & agency securities................................     2,042          7         --      2,049
                                                                      ---------  ---------  ---------  ---------
Total long-term investments.........................................     2,042          7         --      2,049
                                                                      ---------  ---------  ---------  ---------
Total cash, cash equivalents, short-term and long-term investments.. $  23,050  $       9  $      (3) $  23,056
                                                                      =========  =========  =========  =========`

At December 31, 2004, the amortized cost and estimated
fair values of short-term and long-term investments (including cash equivalents)
by contractual maturity were as follows:

`Amortized
                                                                   Cost     Fair Value
                                                                ----------  -----------
                                                                     (in thousands)     
Less than one year............................................ $   18,255  $    18,225
Mature in 1-2 years...........................................     10,282       10,155
                                                                ----------  -----------
   Total...................................................... $   28,537  $    28,380
                                                                ==========  ===========`

5.  Concentrations of Credit, Customer and Supplier Risk

Financial instruments that
potentially subject the Company to concentrations of credit risk consist
primarily of cash equivalents, short-term investments, long-term investments and
trade receivables. The Company generally invests its excess cash in money market
funds, commercial paper of corporations with high credit ratings, municipal
bonds, and treasury bills. The Company has not experienced any significant
losses on its cash equivalents or short and long-term investments. The Company
performs ongoing credit evaluations of its customers and generally requires no
collateral. At December 31, 2004, the Company's largest receivable balance
accounted for approximately 20% of net accounts receivable. Through fiscal 2004,
a relatively small number of direct customers and distributors accounted for a
significant percentage of the Company's revenues. The Company analyzes the need
for reserves for potential credit losses and records reserves when necessary.

Currently, the Company relies
on single source suppliers of materials for the significant majority of its
product inventory. As a result, should the Company's current suppliers not
produce and deliver inventory for the Company to sell on a timely basis,
operating results may be adversely impacted.

6.  Employee Stock Plans

At December 31, 2004,
5,930,166 shares of the Company's common stock were reserved for future
issuance.

The Company's 1998 Stock
Incentive Plan (the "1998 Plan") was approved by the Board of Directors on
January 15, 1998. The 1998 Plan provides for the grant of both incentive
and nonqualified stock options. The Company's 1999 Stock Incentive Plan was
approved by the Board of Directors on January 25, 1999 and amended on
May 24, 2000, May 22, 2001 and May 22, 2002 (as so amended, the
"1999 Plan"). The 1999 Plan provides for the grant of both incentive and
nonqualified stock options. The maximum term of any stock option granted under
the 1998 and 1999 Plans is ten years, except that with respect to incentive
stock options granted to a person possessing more than 10% of the combined
voting power of the Company (a 10% stockholder), the term of such stock options
shall be for no more than five years. The exercise price of incentive stock
options granted under the 1998 and 1999 Plan must be at least 100% of the fair
market value of the common stock on the grant date except that the exercise
price of incentive stock options granted to a 10% stockholder must be at least
110% of such fair market value on the date of grant. The options generally vest
over a period of four years.

Activity under the 1998 and 1999 Plans is summarized as
follows:

`Options Outstanding
                                                   -----------------------------------------
                                         Options                                Weighted
                                        Available                  Aggregate    Average
                                           for       Number of     Exercise     Exercise
                                          Grant       Options       Price        Price
                                       ----------- ------------  -----------  ----------
Balance at December 31, 2001..........  1,673,911    3,090,183  $38,995,401  $    12.62
    Options authorized................    900,000           --
    Options granted................... (1,073,300)   1,073,300   14,386,905       13.40
    Options exercised.................         --     (199,850)  (1,286,976)       6.44
    Options canceled..................    525,396     (560,325)  (7,559,407)      13.49
                                       ----------- ------------  -----------
Balance at December 31, 2002..........  2,026,007    3,403,308   44,535,923       13.09
    Options authorized................         --           --
    Options assumed...................         --      267,920      415,645        1.55
    Options granted...................   (942,500)     942,500    3,303,040        3.50
    Options exercised.................         --      (69,687)    (317,338)       4.55
    Options canceled..................    306,021     (307,627)  (4,152,600)      13.50
                                       ----------- ------------  -----------
Balance at December 31, 2003..........  1,389,528    4,236,414   43,784,670       10.34
    Options authorized................    700,000           --
    Options assumed...................         --      126,419      232,219        1.84
    Options granted...................   (969,850)     969,850   10,093,811       10.41
    Options exercised.................         --     (486,356)  (2,026,986)       4.17
    Options canceled..................    444,453     (480,292)  (5,533,876)      11.52
                                       ----------- ------------  -----------
Balance at December 31, 2004..........  1,564,131    4,366,035  $46,549,838  $    10.66
                                       =========== ============  ===========`

Options assumed in 2004 of 126,419 represent options related
to the May 2004 acquisition of NetChip Technology, Inc.  Options assumed in 2003
of 267,920 represent options related to the May 2003 acquisition of HiNT Corp.
Options assumed from both NetChip Technology, Inc. and HiNT Corp. are no longer
available for grant once canceled.

The following table summarizes the information
about options outstanding at December 31, 2004:

`Options Outstanding           Options Exercisable
                     ---------------------------------- ---------------------
                                   Weighted
                                    Average   Weighted               Weighted
                                   Remaining  Average                Average
      Range of          Number    Contractual Exercise    Number     Exercise
   Exercise Price    Outstanding     Life       Price   Exercisable    Price
-------------------- -----------  ----------  --------- ----------  ---------
$0.88 - $3.22.......    809,538   7.21 years $    2.67    458,810  $    2.48
$3.28 - $7.75.......    907,241   6.12 years      5.59    720,467       5.98
$7.95 - $9.12.......    989,799   7.24 years      8.72    488,449       8.55
$9.21 - $16.65......    947,982   7.97 years     14.64    438,532      15.59
$19.38 - $27.44.....    706,475   5.31 years     23.57    706,475      23.57
$31.63 - $31.63.....      5,000   5.67 years     31.63      5,000      31.63
                     -----------                        ----------
Total...............  4,366,035   6.85 years $   10.66  2,817,733  $   11.81
                     ===========                        ==========`

As of December 31, 2004, 2003, and 2002, there were
2,769,349, 2,500,572 and 1,686,558 stock options vested at weighted average
exercise prices of $11.88 per share, $12.04 per share, and $12.20 per share,
respectively.

During the year ended
December 31, 2004, the Company recorded aggregate deferred compensation of
$0.9 million, representing the difference between the grant price and the
deemed fair value of the Company's common stock options granted during this
period. The Company recorded $0.1 million of deferred compensation in 2003.  The
Company recorded no deferred compensation in 2002. The amortization of deferred
compensation is charged to operations and is amortized on a straight-line basis
over the vesting period of the options, which is typically three years. For the
years ended December 31, 2004, 2003, and 2002, amortization expense was
$0.1 million, $1.0 million, and $2.1 million, respectively. In
addition, for the years ended December 31, 2004, 2003, and 2002, the
Company reversed aggregate deferred compensation of $0.4 million, $0, and
$0.9 million, respectively, on options associated with employee
terminations.

7.  FAS 123 Assumptions

Pro forma information regarding
net income (loss) is required by FAS 123, which also requires that the
information be determined as if the Company had accounted for grants subsequent
to December 31, 1994 under a method specified by FAS 123. Options granted
were estimated using the Black-Scholes valuation model. The following weighted
average assumptions were used for 2004, 2003, and 2002:

`Years Ended December 31,
                                                         -------------------------------
                                                           2004       2003       2002
                                                         ---------  ---------  ---------
Volatility.............................................      1.13       1.16       1.00
Expected life of options (in years)....................      5.10       5.15       4.05
Dividend yield.........................................        -- %       -- %       -- %
Risk-free interest rate................................      3.55 %     3.23 %     4.05 %`

The weighted average grant date
fair value of options granted during 2004, 2003, and 2002 was $9.15, $2.98, and
$10.93, respectively.

8.  Other Intangible Assets

Information regarding the
Company's other identified intangible assets subject to amortization is as
follows (in thousands):

`2004
                                               -------------------------------------------------
                                               Gross Carrying     Accumulated          Net
                                                   Amounts        Amortization        Value
                                               ---------------  ---------------  ---------------   
Patents...................................... $         2,132  $        (2,132) $            --
Developed Core Technology....................           5,422             (950)           4,472
Customer Base................................           3,246             (942)           2,304
                                               ---------------  ---------------  ---------------
Total........................................ $        10,800  $        (4,024) $         6,776
                                               ===============  ===============  ===============

                                                                  2003
                                               -------------------------------------------------
                                               Gross Carrying     Accumulated          Net
                                                   Amounts        Amortization        Value
                                               ---------------  ---------------  ---------------   
Patents...................................... $         2,132  $        (1,909) $           223
Developed Core Technology....................           1,828             (222)           1,606
Customer Base................................             861             (175)             686
                                               ---------------  ---------------  ---------------
Total........................................ $         4,821  $        (2,306) $         2,515
                                               ===============  ===============  ===============`

The estimated weighted average amortization periods of the
intangible assets for patents, developed/core technology and customer base are
approximately four, six and three years, respectively.  Estimated amortization
expenses for the fiscal years ending December 31 are as follows:

`2005.................... $2.0 million
2006.................... $1.9 million
2007.................... $1.3 million
2008.................... $0.8 million
2009 and thereafter..... $0.8 million`

The carrying amount of
indefinite lived intangibles (Tradename) as of December 31, 2004 and 2003
remained unchanged at approximately $0.2 million.

9.  Stock Repurchase

In September 2002, the
Company's Board of Directors approved a repurchase of up to 2,000,000 shares of
common stock.  The Company, at the discretion of management, can repurchase the
shares from time to time in the open market or in privately negotiated
transactions.  In fiscal 2003, approximately 774,000 shares were repurchased for
approximately $1.9 million.  No shares were repurchased in 2004.

10.  Retirement Savings Plan

The Company has a retirement
savings plan, commonly known as a 401(k) plan, that allows all full-time
employees to contribute up to 100% of their annual compensation.  Employee
contributions are limited to a maximum annual amount as set up by the Internal
Revenue Service. Beginning in 1996, the Company made a matching contribution
calculated at 50 cents on each dollar of the first 6% of participant
contributions. The Company's expenses to the total plan were $0.3 million,
$0.3 million, and $0.2 million for 2004, 2003, and 2002, respectively.

11.  Income Taxes

The provision for income taxes
consists of the following:

`Years Ended December 31,
                                                         -------------------------------
                                                           2004       2003       2002
                                                         ---------  ---------  ---------
                                                                  (in thousands)        
Federal:
    Current............................................ $      34  $      --  $  (2,842)
    Deferred...........................................       130         --      2,764
                                                         ---------  ---------  ---------
                                                              164         --        (78)
                                                         ---------  ---------  ---------
State:
    Current............................................         8          6         --
    Deferred...........................................        32         --        138
                                                         ---------  ---------  ---------
                                                               40          6        138
                                                         ---------  ---------  ---------
Foreign:
    Current............................................        54         23         --
    Deferred...........................................        --         --         --
                                                         ---------  ---------  ---------
                                                               54         23         --
                                                         ---------  ---------  ---------
Total.................................................. $     258  $      29  $      60
                                                         =========  =========  =========`

The provision for income taxes differs from the
amount of income taxes determined by applying the U.S. statutory federal income
tax rate as follows:

`Years Ended December 31,
                                                         -------------------------------
                                                           2004       2003       2002
                                                         ---------  ---------  ---------
                                                                  (in thousands)        
Tax benefit at the U.S. statutory rate................. $    (134) $    (780) $    (791)
State taxes (net of federal benefit)...................       (25)       (97)       (99)
Tax exempt interest income.............................        --         --       (379)
Non-deductible in-process R&D write off................       382        345         --
Non-deductible amortization of deferred compensation...        --        380        835
Research and development credit........................      (576)        --     (1,786)
Change in valuation allowance..........................       553         98      2,242
Other individually immaterial items....................        58         83         38
                                                         ---------  ---------  ---------
                                                        $     258  $      29  $      60
                                                         =========  =========  =========`

During the years ended December 31, 2004, 2003, and 2002, the
Company's deferred tax asset valuation allowance increased by $4.7 million, $0.6
million, and $4.7 million, respectively.   The increase in the valuation
allowance relates to acquired tax benefits associated with the Company's
acquisitions of NetChip Technology, Inc., HiNT Corporation and Sebring Systems,
Inc.

Significant components of the Company's deferred tax assets and liabilities
are as follows:

`December 31,
                                                         --------------------
                                                           2004       2003
                                                         ---------  ---------
                                                            (in thousands)              
Deferred tax assets:
    Accrued expenses and reserves...................... $   1,493  $   1,100
    Net operating loss carryforwards...................     7,608      3,920
    Research and development credit carryforwards......     4,824      2,286
    Costs capitalized for tax purposes.................        78        284
                                                         ---------  ---------
Gross deferred tax assets..............................    14,003      7,590
Valuation allowance....................................   (10,649)    (5,967)
                                                         ---------  ---------
                                                            3,354      1,623
                                                         ---------  ---------
Deferred tax liabilities:
    Acquisition related intangibles....................    (3,034)    (1,323)
    Other..............................................      (320)      (300)
                                                         ---------  ---------
                                                           (3,354)    (1,623)
                                                         ---------  ---------
Total net deferred tax assets.......................... $      --  $      --
                                                         =========  =========`

At December 31, 2004, the
Company had federal and state net operating loss carryforwards of
$20.6 million and $6.6 million, respectively. These carryforwards will
expire at various dates beginning in 2007 through 2024, if not utilized. In
addition, as of December 31, 2004, the Company had federal and state tax
credit carryforwards of approximately $2.4 million and $2.5 million,
respectively, which expire at various dates beginning in 2012. Approximately
$2.3 million of the federal and $1.5 million of the state net operating loss
carryforward represents the stock option deduction arising from activity under
the Company's stock option plan, the benefit of which will increase additional
paid in capital when realized.

Utilization of the net
operating loss and credit carryforwards may be subject to a substantial annual
limitation due to the ownership change limitations provided by the Internal
Revenue Code of 1986, as amended, and similar state provisions. The annual
limitation may result in the expiration of net operating loss carryforwards
before utilization.

A valuation allowance has been
recorded for the entire deferred tax asset as a result of uncertainties
regarding the realization of the asset balance due to the history of losses and
the variability of operating results.

Approximately $7.5 million of the valuation allowance
related to acquired tax benefits, which will result in an adjustment to goodwill
recorded when such benefits are realized.  During 2004, $162,000 was released
from the deferred tax valuation allowance and credited to goodwill.

The Company has made no provision for U.S. income taxes on
approximately $230,000 of cumulative undistributed earnings of certain foreign
subsidiaries because it is the Company's intention to permanently reinvest such
earnings.  If such earnings were distributed, the Company would accrue
additional taxes of approximately $80,500.

Pre-tax income from foreign operations was $79,000 in 2004
and $56,000 in 2003.

12.  Commitments

In November 2003, the Company
entered into a software license agreement with an unrelated party totaling
$3.9 million. As of December 31, 2004, the Company had paid approximately
$2.6 million, and is obligated to pay the remaining $1.3 million balance in
October 2005.

The Company uses several
contract manufacturers and suppliers to provide manufacturing services for its
products. As of December 31, 2004, the Company has purchase commitments for
inventory with these contract manufacturers and suppliers of approximately
$3.0 million. These inventory purchase commitments are placed on a sales
order basis with lead times ranging from 8 to 13 weeks to meet estimated
customer demand requirements.

The Company leases facilities
and equipment under non-cancelable operating lease agreements. Future minimum
payments under facility and equipment leases at December 31, 2004 are as
follows:

`(in thousands)
                                                         ---------                      
2005................................................... $     212
2006...................................................        96
2007...................................................         7
                                                         ---------
Total minimum lease payments........................... $     315
                                                         =========`

Rental expense for all facility
leases aggregated approximately $0.8 million, $0.7 million, and
$0.1 million, net of sublease income of $38,000, $8,000, and $0.4 million
for the years ended December 31, 2004, 2003, and 2002, respectively.

13.  Segments of an Enterprise and Related Information

The Company has one operating
segment, the sale of semiconductor devices. The President has been identified as
the Chief Operating Decision Maker (CODM) because he has final authority over
resource allocation decisions and performance assessment. The CODM does not
receive discrete financial information about individual components of the
Company's business.

Revenues by geographic region based on
customer location were as follows:

`Years Ended December 31,
                                                         -------------------------------
                                                           2004       2003       2002
                                                         ---------  ---------  ---------
                                                                  (in thousands)        
Revenues:
    United States...................................... $  15,708  $  12,155  $  13,312
    Asia - excluding Taiwan............................    18,675     10,691      9,135
    Europe - excluding France..........................     7,201      5,280      4,955
    Taiwan.............................................     8,571      4,097      1,614
    France.............................................     2,310      3,845      4,609
    North America - excluding United States............     1,984      1,970      1,185
                                                         ---------  ---------  ---------
        Total.......................................... $  54,449  $  38,038  $  34,810
                                                         =========  =========  =========`

There were no direct end customer sales that
accounted for more than 10% of net revenues.  Sales to the following
distributors accounted for 10% or more of net revenues:

`Years Ended December 31,
                                                         -------------------------------
                                                           2004       2003       2002
                                                         ---------  ---------  ---------
Metatech...............................................        13 %       11 %        9 %
A2M....................................................         4 %       10 %       13 %`

14.  Quarterly Summaries (unaudited)

(In thousands, except per share amounts)

`Three Months Ended
                                       --------------------------------------------------
                                         March 31,    June 30,   September 30, December 31,
                                           2004        2004(1)       2004         2004
                                       -----------  -----------  -----------  -----------
Net revenues......................... $    11,642  $    14,016  $    15,457  $    13,334
Gross profit......................... $     8,413  $     9,091  $     9,818  $     8,388
Net income (loss).................... $       277  $      (537) $       327  $      (709)
Net income (loss) per basic share.... $      0.01  $     (0.02) $      0.01  $     (0.03)
Net income (loss) per diluted share.. $      0.01  $     (0.02) $      0.01  $     (0.03)
                                       --------------------------------------------------
                                                    Three Months Ended
                                         March 31,    June 30,   September 30, December 31,
                                           2003         2003(2)      2003         2003
                                       -----------  -----------  -----------  -----------
Net revenues......................... $     8,503  $     8,660  $    10,283  $    10,592
Gross profit......................... $     5,988  $     6,142  $     7,437  $     7,604
Net income (loss).................... $      (816) $    (1,897) $       129  $       325
Net income (loss) per basic share.... $     (0.04) $     (0.09) $      0.01  $      0.01
Net income (loss) per diluted share.. $     (0.04) $     (0.09) $      0.01  $      0.01`

(1) Net loss includes a $1.1 million charge for in-process research and
development.

SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS

(IN THOUSANDS)

`Additions    Deductions
                                        Balance at   Charged to     Amounts     Balance at
                                       Beginning of   Costs and    Recovered      End of
             Description                  Period      Expenses    (Written off)   Period
-------------------------------------  ------------  -----------  ------------  ----------
Year ended December 31, 2004
Allowance for doubtful accounts...... $        161  $        45  $        (79) $      127
Year ended December 31, 2003
Allowance for doubtful accounts...... $        127  $        39  $         (5) $      161
Year ended December 31, 2002
Allowance for doubtful accounts...... $        202  $       103  $       (178) $      127`

---

SIGNATURES

Pursuant to the requirements of Section 13
or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

|February 25, 2005 | PLX Technology, Inc.
by:     /s/     Michael J. Salameh

Name: Michael J. Salameh
Title: Chief Executive Officer
|----------------- | ----------------------------------------------------------------------------------------------------------------

---

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE
PRESENTS, that each person whose signature appears below constitutes and
appoints Michael J. Salameh and Rafael Torres, and each of them, his attorneys-in-fact,
 each with the power of substitution, for him in any and all capacities,
to sign any amendments to this Report on Form 10-K and to file the same,
with exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming all that
each of said attorneys-in- fact, or his substitute or substitutes, may do or
cause to be done by virtue hereof.

Pursuant to the requirements of
the Securities Exchange Act of 1934, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.

|Name and Signature                           | Title(s)                                                                                                    | Date             
|-------------------------------------------- | ----------------------------------------------------------------------------------------------------------- | -----------------
|/s/	Michael J. Salameh	
		Michael J. Salameh | Chief Executive Officer and Director
(Principal Executive Officer)                                          | February 25, 2005
|/s/	Rafael Torres
		Rafael Torres            | Vice President, Finance, Chief Financial Officer
and Secretary
(Principal Financial and Accounting Officer) | February 25, 2005
|/s/	D. James Guzy
		D. James Guzy            | Director and Chairman of the Board of
Directors                                                             | February 25, 2005
|/s/	Timothy Draper
		Timothy Draper          | Director                                                                                                    | February 25, 2005
|/s/	Robert H. Smith
		Robert H. Smith        | Director                                                                                                    | February 25, 2005
|/s/	John H. Hart
		John H. Hart              | Director                                                                                                    | February 25, 2005
|/s/	Wei-Ti Lu
		Wei-Ti Lu                    | Director                                                                                                    | February 25, 2005
|/s/	Thomas Riordan
		Thomas Riordan          | Director                                                                                                    | February 25, 2005
|/s/	Patrick Verderico
		Patrick Verderico    | Director                                                                                                    | February 25, 2005



EXHIBIT INDEX



|Exhibit       |  |                                                                                                                                                                                                                             
|------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number        |  | Description                                                                                                                                                                                                                 
|2.1 (3)       |  | Agreement and Plan of Reorganization dated May 6, 2003 by and
among PLX Technology, Inc., HT Acquisition Sub, LLC, HiNT Corporation and
Herbert Chang as Shareholders' Agent.                                               
|3.1 (1)       |  | Amended and Restated Certificate of Incorporation of the
Registrant.                                                                                                                                                        
|3.2 (1)       |  | Registrant's Amended and Restated Bylaws.                                                                                                                                                                                   
|3.3 (1)       |  | Certificate of Amendment to Amended and Restated Certificate of Incorporation, filed as Exhibit 3.1 to the
Company's quarterly report on Form 10-Q for the quarter ended June 30, 2004 and incorporated herein by reference.
|4.1           |  | Reference is made to Exhibits 3.1 and 3.3.                                                                                                                                                                                  
|4.2           |  | Registration Rights Agreement, filed as Exhibit 4.2 to the Company's Registration Statement on Form S-3,
filed on June 21, 2004 and incorporated herein by reference.                                                       
|10.1 (1)*     |  | Form of Indemnification Agreement between PLX and each of its
Officers and Directors.                                                                                                                                       
|10.2 (1)*     |  | 1998 Stock Incentive Plan.                                                                                                                                                                                                  
|10.3 (1) (2)* |  | 1999 Stock Incentive Plan, As Amended.                                                                                                                                                                                      
|10.4 (1)      |  | Lease Agreement dated October 17, 1997 between The
Arrillaga Foundation and The Perry Foundation as Landlords and PLX as Tenant, as
amended.                                                                                
|10.10 (6)*    |  | HiNT Corp. 2000 Stock Plan.                                                                                                                                                                                                 
|10.11 (5)*    |  | Sebring Systems, Inc. 1997 Stock Otion/Stock/Issuance
Plan.                                                                                                                                                                 
|10.12 (7)*    |  | NetChip Technology, Inc. 1996 Flexible Stock Incentive
Plan.                                                                                                                                                                
|10.13*        |  | PLX Technology, Inc. 2004 Bonus and Deferred Compansation Plan, filed as Exhibit 10.2 to the Company's
 quarterly report on Form S-3 for the quarter ended June 30, 2004, and incorporated herein by reference.             
|21.1          |  | Subsidiaries of the Company.                                                                                                                                                                                                
|23.1          |  | Consent of Ernst & Young LLP, Independent
Auditors.                                                                                                                                                                         
|31.1          |  | Certification of Chief Executive Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.                                                                                                                         
|31.2          |  | Certification of Chief Financial Officer Pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.                                                                                                                         
|32.1          |  | Certification of Chief Executive Officer Pursuant to 18
U.S.C.Section 1350, Chapter 63 of Title 18, United States Code, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.                               
|32.2          |  | Certification of Chief Financial Officer Pursuant to
Section 1350, Chapter 63 of Title 18, United States Code, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.                                        

|(1) |  | Incorporated by reference to the same numbered exhibit
previously filed with the Company's Registration Statement on Form S-1
(Registration No. 333-71795).
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) |  | Incorporated by reference to Exhibit 10.1 to the Company's
quarterly report on Form 10-Q for the quarter ended June 30,
2002.                              
|(3) |  | Incorporated by reference to Exhibit 2.1 to Form 8-K as filed on
May 27, 2003.                                                                             
|(4) |  | Incorporated by reference to the same numbered exhibit
previously filed with the Company's Form 10-K as filed on March 13,
2003.                           
|(5) |  | Incorporated by reference to Exhibit 2.1 to Form 8-K as filed on
June 2, 2000.                                                                             
|(6) |  | Incorporated by reference to Exhibit 10.1 to the Company's
quarterly report on Form 10-Q for the quarter ended September 30,
2003.                         
|(7) |  | Incorporated by reference to Exhibit 10.2 to the Company's
quarterly report on Form 10-Q for the quarter ended June 30,
2004.                              
|(*) |  | Management contract or compensatory plan or
arrangement.                                                                                                   

---