UNITED
STATES





SECURITIES
AND EXCHANGE COMMISSION





WASHINGTON,
D.C. 20549





FORM
10-Q





/x/QUARTERLY
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934 FOR THE QUARTERLY PERIOD ENDED MARCH 29, 2008.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 No. 0-25662ANADIGICS,
      Inc.(Exact
      name of registrant as specified in its charter)Delaware
            22-2582106(State
      or other jurisdiction of incorporation or organization)
            (I.R.S.
      Employer Identification No.)141
      Mt. Bethel Road, Warren, New Jersey
            07059(Address
      of principal executive offices)
            (Zip
      Code)(908)
      668-5000(Registrant's
      telephone number, including area
code)








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 whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of “accelerated
filer and large accelerated filer” in Rule 12b-2 of the Exchange Act (check
one):


Large
accelerated filer [X] Accelerated filer [ ] Non-accelerated filer [
]





Indicate
by check mark whether the Registrant is a shell company (as defined in Rule
12b-2 of the Act).  Yes [ ]  No [X]





The
number of shares outstanding of the Registrant’s common stock as of March 29,
2008 was 62,584,499 (excluding 113,761 shares held in treasury).











INDEX





ANADIGICS,
Inc.








PART
      I
            Financial
      InformationItem
      1.
            Financial
      Statements (unaudited)Condensed
      consolidated balance sheets – March 29, 2008 and December 31,
      2007Condensed
      consolidated statements of operations and comprehensive income (loss) –
      Three months ended March 29, 2008 and March 31, 2007Condensed
      consolidated statements of cash flows – Three months ended March 29, 2008
      and March 31, 2007Notes
      to condensed consolidated financial statements – March 29,
      2008Item
      2.
            Management’s
      Discussion and Analysis of Financial Condition and Results of
      OperationsItem
      3.
            Quantitative
      and Qualitative Disclosures About Market RiskItem
      4.
            Controls
      and ProceduresPART
      II.
            Other
      InformationItem
      1.
            Legal
      ProceedingsItem
      6.
            ExhibitsSignatures













































































PART I -
FINANCIAL INFORMATION





ITEM
1.                      FINANCIAL
STATEMENTS





ANADIGICS,
Inc.





CONDENSED
CONSOLIDATED BALANCE SHEETS





(AMOUNTS
IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)





March
      29, 2008
            
            
            December
      31, 2007(Unaudited)
            
            
            (Note
      1)ASSETSCurrent
      assets:Cash
      and cash equivalents
            
            $
            101,028
            
            
            $
            57,786Marketable
      securities
            
            
            40,991
            
            
            
            103,778Accounts
      receivable, net
            
            
            43,037
            
            
            
            45,664Inventories
            
            
            25,495
            
            
            
            23,989Prepaid
      expenses and other current assets
            
            
            6,157
            
            
            
            3,277Total
      current assets
            
            
            216,708
            
            
            
            234,494Marketable
      securities
            
            
            24,507
            
            
            
            15,248Plant
      and equipment:Equipment
      and furniture
            
            
            178,100
            
            
            
            165,333Leasehold
      improvements
            
            
            38,653
            
            
            
            38,638Projects
      in process
            
            
            26,305
            
            
            
            23,180243,058
            
            
            
            227,151Less
      accumulated depreciation and amortization
            
            
            (153,855
            )
            
            
            (151,022
            )89,203
            
            
            
            76,129Goodwill
      and other intangibles, net of amortization
            
            
            6,459
            
            
            
            6,524Other
      assets
            
            
            958
            
            
            
            1,066Total
      assets
            
            $
            337,835
            
            
            $
            333,461LIABILITIES
      AND STOCKHOLDERS’ EQUITYCurrent
      liabilities:Accounts
      payable
            
            $
            28,870
            
            
            $
            34,184Accrued
      liabilities
            
            
            9,091
            
            
            
            7,928Total
      current liabilities
            
            
            37,961
            
            
            
            42,112Other
      long-term liabilities
            
            
            3,216
            
            
            
            3,243Long-term
      debt, less current portion
            
            
            38,000
            
            
            
            38,000Commitments
      and contingenciesStockholders’
      equity:Common
      stock, $0.01 par value, 144,000 shares authorized, 62,731 and 61,292
      issued at March 29, 2008 and December 31, 2007
            
            
            627
            
            
            
            613Additional
      paid-in capital
            
            
            546,670
            
            
            
            541,940Accumulated
      deficit
            
            
            (288,166
            )
            
            
            (292,095
            )Accumulated
      other comprehensive loss
            
            
            (215
            )
            
            
            (94
            )Treasury
      stock at cost: 114 shares
            
            
            (258
            )
            
            
            (258
            )Total
      stockholders’ equity
            
            
            258,658
            
            
            
            250,106Total
      liabilities and stockholders’ equity
            
            $
            337,835
            
            
            $
            333,461











See
      accompanying notes.











ANADIGICS,
Inc.





CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS





(AMOUNTS
IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)





Three
      months endedMarch
      29, 2008
            
            
            March
      31, 2007(unaudited)
            
            
            (unaudited)Net
      sales
            
            $
            74,369
            
            
            $
            49,573Cost
      of sales
            
            
            47,764
            
            
            
            33,287Gross
      profit
            
            
            26,605
            
            
            
            16,286Research
      and development expenses
            
            
            14,331
            
            
            
            9,738Selling
      and administrative expenses
            
            
            8,880
            
            
            
            7,359Operating
      income (loss)
            
            
            3,394
            
            
            
            (811
            )Interest
      income
            
            
            1,938
            
            
            
            1,240Interest
      expense
            
            
            (591
            )
            
            
            (625
            )Other
      expense
            
            
            (812
            )
            
            
            -Income
      (loss) from continuing operations
            
            
            3,929
            
            
            
            (196
            )Loss
      from discontinued operations
            
            
            -
            
            
            
            (965
            )Net
      income (loss)
            
            $
            3,929
            
            
            $
            (1,161
            )Basic
      earnings (loss) per shareIncome
      (loss) from continuing operations
            
            $
            0.07
            
            
            $
            (0.00
            )Loss
      from discontinued operations
            
            
            -
            
            
            
            (0.02
            )Net
      income (loss)
            
            $
            0.07
            
            
            $
            (0.02
            )Diluted
      earnings (loss) per shareIncome
      (loss) from continuing operations
            
            $
            0.07
            
            
            $
            (0.00
            )Loss
      from discontinued operations
            
            
            -
            
            
            
            (0.02
            )Net
      income (loss)
            
            $
            0.07
            
            
            $
            (0.02
            )Weighted
      average common shares outstanding used in computing earnings (loss) per
      shareBasic
            
            
            59,310
            
            
            
            48,314Diluted
            
            
            60,430
            
            
            
            48,314














CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)





(AMOUNTS
IN THOUSANDS)








Three
      months endedMarch
      29, 2008
            
            
            March
      31, 2007(unaudited)
            
            
            (unaudited)Net
      income (loss)
            
            $
            3,929
            
            
            $
            (1,161
            )Other
      comprehensive income (loss):Unrealized
      (loss) gain on marketable securities
            
            
            (957
            )
            
            
            10Foreign
      currency translation adjustment
            
            
            16
            
            
            
            (4
            )Reclassification
      adjustment:Net
      recognized loss on marketable securities previously included in other
      comprehensive income
            
            
            820
            
            
            
            -Comprehensive
      income (loss)
            
            $
            3,808
            
            
            $
            (1,155
            )


























See
      accompanying notes.





ANADIGICS,
      Inc.





CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS





(AMOUNTS
IN THOUSANDS)





Three
      months endedMarch
      29, 2008
            
            
            March
      31, 2007(unaudited)
            
            
            (unaudited)CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      income (loss)
            
            $
            3,929
            
            
            $
            (1,161
            )Adjustments
      to reconcile net income (loss) to net cash provided by operating
      activities:Loss
      from discontinued operations
            
            
            -
            
            
            
            965Depreciation
            
            
            3,368
            
            
            
            1,962Amortization
            
            
            181
            
            
            
            214Stock
      based compensation
            
            
            4,406
            
            
            
            3,876Amortization
      of (discount) premium on marketable securities
            
            
            (101
            )
            
            
            4Recognized
      marketable securities impairment and other
            
            
            820
            
            
            
            -Changes
      in operating assets and liabilities:Accounts
      receivable
            
            
            2,627
            
            
            
            (2,975
            )Inventories
            
            
            (1,506
            )
            
            
            2,207Prepaid
      expenses and other assets
            
            
            (2,888
            )
            
            
            (2,721
            )Accounts
      payable
            
            
            1,104
            
            
            
            1,422Accrued
      liabilities and other liabilities
            
            
            1,152
            
            
            
            (1,074
            )Net
      cash provided by operating activities
            
            
            13,092
            
            
            
            2,719CASH
      FLOWS FROM INVESTING ACTIVITIESPurchases
      of plant and equipment
            
            
            (22,861
            )
            
            
            (8,824
            )Purchases
      of marketable securities
            
            
            (15,410
            )
            
            
            (75,510
            )Proceeds
      from sale of marketable securities
            
            
            68,083
            
            
            
            31,615Net
      cash provided by (used in) investing activities
            
            
            29,812
            
            
            
            (52,719
            )CASH
      FLOWS FROM FINANCING ACTIVITIESPayment
      of capital lease obligations
            
            
            -
            
            
            
            (74
            )Issuance
      of common stock
            
            
            338
            
            
            
            101,928Net
      cash provided by financing activities
            
            
            338
            
            
            
            101,854Net
      increase in cash and cash equivalents
            
            
            43,242
            
            
            
            51,854Cash
      and cash equivalents at beginning of period
            
            
            57,786
            
            
            
            13,706Cash
      and cash equivalents at end of period
            
            $
            101,028
            
            
            $
            65,560







































































See
      accompanying notes.











ANADIGICS,
Inc.





NOTES TO
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – MARCH 29,
2008





(AMOUNTS
IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)








1.         SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES




BASIS OF
PRESENTATION




The
accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with U.S. generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
10 of Regulation S-X.  Accordingly, they do not include all of the
information and footnotes required by U.S. generally accepted accounting
principles for complete financial statements.  In the opinion of
management, all adjustments (consisting of normal recurring accruals and
adjustments) considered necessary for a fair presentation have been
included.  Operating results for the three month period ended March
29, 2008 are not necessarily indicative of the results that may be expected for
the year ending December 31, 2008.




The condensed
consolidated balance sheet at December 31, 2007 has been derived from the
audited financial statements at that date but does not include all the
information and footnotes required by U.S. generally accepted accounting
principles for complete financial statements. For further information, refer to
the consolidated financial statements and footnotes thereto included in the
Company’s Annual Report on Form 10-K for the year ended December 31,
2007.




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





IMPACT OF
RECENTLY ISSUED ACCOUNTING STANDARDS




In September
2006, the FASB issued FASB Statement No. 157, “Fair Value Measurements” (FAS
157) which defines fair value, establishes a framework for measuring fair value
in generally accepted accounting principles and expands disclosures about fair
value measurements. FAS 157 is effective for financial statements issued for
fiscal years beginning after November 15, 2007 and interim periods within those
fiscal years. In February 2008, the FASB issued FSP FAS 157-2 “Partial Deferral
of the Effective Date of Statement 157” (FSP 157-2). FSP-2 delays the effective
date of FAS 157 for non-financial assets and liabilities that are not measured
or disclosed on a recurring basis to fiscal years beginning after November 15,
2008. The adoption of this accounting pronouncement did not have a material
effect on the Company’s consolidated financial statements for financial assets
and liabilities and any other assets and liabilities carried at fair
value.  The Company is currently in the process of evaluating the
impact of adopting this pronouncement for other non-financial assets or
liabilities.





FAS 157
defines fair value as the price that would be received to sell an asset or paid
to transfer a liability in an orderly transaction between market participants at
the measurement date (exit price). FAS 157 classifies the inputs used to measure
fair value into the following hierarchy:





Level
      1
            Unadjusted
      quoted prices in active markets for identical assets or
      liabilitiesLevel
      2
            Unadjusted
      quoted prices in active markets for similar assets or liabilities, or
      unadjusted quoted prices for identical or similar assets or liabilities in
      markets that are not active, or inputs other than quoted prices that are
      observable for the asset or liabilityLevel
      3
            Unobservable
      inputs for the asset or liability




The Company
endeavors to utilize the best available information in measuring fair value.
Financial assets and liabilities are classified in their entirety based on the
lowest level of input that is significant to the fair value
measurement.




In February
2007, the FASB issued FASB Statement No. 159, “The Fair Value Option for
Financial Assets and Financial Liabilities” (FAS 159), which permits entities to
choose to measure many financial assets and financial liabilities at fair value.
Unrealized gains and losses on items for which the fair value option has been
elected are reported in earnings. FAS 159 is effective for fiscal years
beginning after November 15, 2007. As of January 1, 2008, the Company adopted
FAS 159, which did not have a material impact on its consolidated financial
statements.




In
June 2007, the FASB’s Emerging Issues Task Force reached a consensus on
EITF Issue No. 07-3, “Accounting for Nonrefundable Advance Payments for
Goods or Services to Be Used in Future Research and Development Activities”
(EITF 07-3) that would require nonrefundable advance payments made by the
Company for future R&D activities to be capitalized and recognized as an
expense as the goods or services are received by the Company. EITF 07-3 is
effective with respect to new arrangements entered into beginning
January 1, 2008. The Company adopted EITF 07-3, which did not have a
material impact on its consolidated financial statements.




In
December 2007, the FASB issued FASB Statement No. 141R, “Business
Combinations” (FAS 141R), which changes how business acquisitions are
accounted.  FAS 141R requires the acquiring entity in a business
combination to recognize all (and only) the assets acquired and liabilities
assumed in the transaction and establishes the acquisition-date fair value as
the measurement objective for all assets acquired and liabilities assumed in a
business combination.  Certain provisions of this standard will, among
other things, impact the determination of acquisition-date fair value of
consideration paid in a business combination (including contingent
consideration); exclude transaction costs from acquisition accounting; and
change accounting practices for acquired contingencies, acquisition-related
restructuring costs, in-process research and development, indemnification
assets, and tax benefits.  FAS 141R is effective for financial statements
issued for fiscal years beginning after December 15, 2008.  The
Company has not yet determined the impact FAS 141R may have on its results of
operations or financial position.




In
December 2007, the FASB issued FASB Statement No. 160, “Noncontrolling
Interests in Consolidated Financial Statements, an amendment of ARB No. 51”
(FAS 160), which establishes new standards governing the accounting for and
reporting of noncontrolling interests (NCIs) in partially owned consolidated
subsidiaries and the loss of control of subsidiaries.  Certain provisions
of this standard indicate, among other things, that NCIs (previously referred to
as minority interests) be treated as a separate component of equity, not as a
liability; that increases and decrease in the parent’s ownership interest that
leave control intact be treated as equity transactions, rather than as step
acquisitions or dilution gains or losses; and that losses of a partially owned
consolidated subsidiary be allocated to the NCI even when such allocation might
result in a deficit balance. This standard also requires changes to certain
presentation and disclosure requirements. FAS 160 is effective for
financial statements issued for fiscal years beginning after December 15, 2008.
The provisions of the standard are to be applied to all NCIs prospectively,
except for the presentation and disclosure requirements, which are to be applied
retrospectively to all periods presented. The Company has not yet determined the
impact FAS 160 may have on its results of operations or financial
position.




INCOME
TAXES




The Company
maintains a full valuation allowance on its deferred tax
assets.  Accordingly, the Company has not recorded a benefit or
provision for income taxes. We recognize interest and penalties related to the
underpayment of income taxes in income tax expense. At January 2, 2007, we had
no unrecognized tax benefits. No unrecognized tax benefits, interest or
penalties were accrued at March 29, 2008. The Company’s U.S. federal net
operating losses have occurred since 1998 and as such, tax years subject to
potential tax examination could apply from that date because carrying-back net
operating loss opens the relevant year to audit.





WARRANTY




Based on the
examination of historical returns and other information it deems critical, the
Company estimates that a current charge to income will need to be provided in
order to cover future warranty obligations for products sold during the year.
The accrued liability for warranty costs is included in Accrued liabilities in
the condensed consolidated balance sheets.Warranty
reserve movements in the three months ended March 29, 2008 included $176 in
actual charges and $395 in provisions resulting in the balance of $546 at March
29, 2008.  Warranty reserve movements in the three months ended March
31, 2007 included $127 in actual charges and a $115 increase in the
provision.





RECLASSIFICATIONS




Certain prior
period amounts have been reclassified to conform to the current
presentation.





2. DISCONTINUED
OPERATIONS
  On April 2,
2007, the Company sold the majority of the operating assets of Telcom Devices
Inc. (Telcom, a wholly-owned subsidiary of the Company) to GTRAN Camarillo, Inc.
in exchange for $500 and effectively ceased Telcom’s operations. Accordingly,
the financial results, position and cashflow of Telcom have been classified as
discontinued operations in the accompanying financial statements for the
applicable period presented.
  Summarized
operating results and loss on sale of discontinued operations through March 31,
2007 were as follows:


Three
      months endedMarch
      31, 2007Revenue
            
            $
            559Operating
      loss
            
            
            (479
            )Interest
      income
            
            
            4Loss
      on sale of discontinued operations
            
            
            (490
            )Loss
      from discontinued operations
            
            $
            (965
            )








3. INVENTORIES




Inventories
are stated at the lower of cost (first-in, first-out method) or
market.  Inventories consist of the following:





March
      29, 2008
            
            
            December
      31, 2007Raw
      materials
            
            $
            9,602
            
            
            $
            8,915Work
      in process
            
            
            16,556
            
            
            
            15,256Finished
      goods
            
            
            3,560
            
            
            
            4,05529,718
            
            
            
            28,226Reserves
            
            
            (4,223
            )
            
            
            (4,237
            )Total
            
            $
            25,495
            
            
            $
            23,989





4. EARNINGS
(LOSS) PER SHARE




The
reconciliation of shares used to calculate basic and diluted earnings (loss) per
share consists of the following:





Three
      months endedMarch
      29, 2008
            
            
            March
      31, 2007Weighted
      average common shares outstanding used to calculate basic earnings (loss)
      per share
            
            
            59,310
            
            
            
            48,314Net
      effect of dilutive securities based upon the treasury stock method using
      an average market price
            
            
            1,120
            
            
            
            -Weighted
      average common and dilutive securities outstanding used to calculate
      diluted earnings (loss) per share
            
            
            60,430
            
            
            
            48,314




Dilution
arising from the Company's outstanding stock options, unvested restricted shares
or shares potentially issuable upon conversion of the Convertible notes was not
included in the three months ended March 31, 2007 as their effect was
anti-dilutive.




For the three
month periods ended March 29, 2008 and March 31, 2007, potential additional
dilution arising from any of the Company's outstanding stock options, unvested
restricted shares or shares potentially issuable upon conversion of the
Convertible notes are detailed below. Such potential dilution was excluded as
their effect was anti-dilutive.





Three
      months ended,March
      29, 2008
            
            
            March
      31, 2007Convertible
      notes
            
            
            7,600
            
            
            
            7,600Stock
      options
            
            
            1,972
            
            
            
            5,117Unvested
      restricted shares
            
            
            362
            
            
            
            2,678








The Company
classifies its revenues based upon the end application of the product in which
its integrated circuits are used.  Net sales by end application are
regularly reviewed by the chief operating decision maker and are as
follows:





Three
      months endedMarch
      29, 2008
            
            
            March
      31, 2007Broadband
            
            $
            23,139
            
            
            $
            24,554Wireless
            
            
            51,230
            
            
            
            25,019Total
            
            $
            74,369
            
            
            $
            49,573




The Company
primarily sells to three geographic regions: Asia, USA and Canada, and Other.
The geographic region is determined by the destination of the shipped product.
Net sales to each of the three geographic regions are as follows:





Three
      months endedMarch
      29, 2008
            
            
            March
      31, 2007Asia
            
            $
            47,866
            
            
            $
            32,987U.S.A.
      and Canada
            
            
            21,965
            
            
            
            14,355Other
            
            
            4,538
            
            
            
            2,231Total
            
            $
            74,369
            
            
            $
            49,573





6. LONG-TERM
DEBT




On September
24, 2004, the Company issued $38,000 aggregate principal amount of 5%
Convertible Senior Notes (“2009 Notes”) due October 15, 2009. The 2009 Notes are
convertible into shares of the Company’s common stock at any time prior to their
maturity, at an initial conversion rate, subject to adjustment, of 200 shares
for each $1,000 principal amount, which is equivalent to a conversion price of
$5.00 per share (7,600 shares contingently issuable). Interest on the 2009 Notes
is payable semi-annually in arrears on April 15 and October 15 of each
year.









The following
is a summary of available-for-sale securities presented in accordance with FAS
157:





Fair
      Value Measurements at Reporting Date UsingSecurity
      Type
            
            March
      29, 2008
            
            
            Quoted
      Prices in Active Markets for Identical Assets
              (Level
      1)
            
            
            Significant
      Other Observable Inputs
              (Level
      2)
            
            
            Significant
      Unobservable Inputs
              (Level
      3)Non-auction
      Corporate Debt securities
            
            $
            13,812
            
            
            $
            13,812
            
            
            $
            -
            
            
            $
            -Government
      sponsored enterprise debt securities
            
            
            28,037
            
            
            
            28,037
            
            
            
            -
            
            
            
            -Auction
      Rate SecuritiesCorporate
      Debt
            
            
            6,041
            
            
            
            -
            
            
            
            3,760
            
            
            
            2,281Preferred
      Equity
            
            
            11,225
            
            
            
            -
            
            
            
            -
            
            
            
            11,225State
      and Municipal
            
            
            6,383
            
            
            
            -
            
            
            
            200
            
            
            
            6,183Total
            
            $
            65,498
            
            
            $
            41,849
            
            
            $
            3,960
            
            
            $
            19,689




Auction rate
securities (ARS) are generally long-term debt instruments that provide liquidity
through a Dutch auction process that resets the applicable interest rate at
pre-determined calendar intervals, generally every 28 days. This mechanism
generally allows existing investors to rollover their holdings and continue to
own their respective securities or liquidate their holdings by selling their
securities at par value. The Company generally invests in these securities for
short periods of time as part of its cash management program. During the second
half of 2007, certain auction rate debt and preferred securities failed to
auction due to sell orders exceeding buy orders. In February 2008, liquidity
issues in the global credit markets resulted in failures of the auction process
for a broader range of ARS, including substantially all of the auction rate
corporate, state and municipal debt and preferred equity securities the Company
holds. The funds associated with failed auctions will not be accessible until a
successful auction occurs or a buyer is found outside of the auction
process.




At March 29,
2008, there was insufficient observable ARS market information available to
determine the fair value of the Company’s investments in ARS. Therefore, the
Company estimated Level 3 fair values for these securities by incorporating
assumptions that market participants would use in their estimates of fair value.
Some of these assumptions included credit quality, final stated maturity,
estimates of the probability of the issue being called or becoming liquid prior
to the final maturity, impact due to extended periods of maximum auction rates
and valuation estimates from independent evaluators. Based upon this analysis,
the Company adjusted the March 29, 2008 carrying value of these securities
downward to fair value by the amount of $1,194. Of the adjustment amount, $823
was determined to be other-than-temporary and was recorded in other expense for
the three months ended March 29, 2008 whilst the remaining $371 was considered
temporary, resulting primarily due to the limited liquidity of those
investments. The related ARS underlying these temporary and other-than-temporary
adjustment amounts were classified as current and non-current, respectively as
of March 29, 2008.




Classification of
marketable securities as current or non-current is dependent upon management’s
intended holding period, the security’s maturity date and liquidity
considerations based on market conditions. If management intends to hold the
securities for longer than one year as of the balance sheet date, they are
classified as non-current. Since these marketable securities are classified as
available-for-sale securities, changes in fair value will flow through other
comprehensive income, with amounts reclassified out of other comprehensive
income into earnings upon sale or other-than-temporary impairment.




Management
has the ability and intent, if necessary, to liquidate certain of its marketable
securities in order to meet the Company’s liquidity needs in the next 12 months.
Accordingly, certain securities with contractual maturities greater than one
year from year-end have been classified as short-term. Expected maturities may
differ from contractual maturities because the issuers of the securities may
have the right to prepay obligations without prepayment penalties.




As further
required by FAS 157, provided below is a reconciliation of the beginning and
ending balances for each type of security valued using a Level 3 valuation at
March 29, 2008.





($
      in 000’s)
            
            Fair
      Value Measurements Using Significant Unobservable Inputs
              (Level
      3)State
      & Municipal Securities
            
            
            Corporate
      Debt Securities
            
            
            Preferred
      Equity Securities
            
            
            TotalBeginning
      balance
            
            $
            -
            
            
            $
            2,324
            
            
            $
            2,344
            
            
            $
            4,668Total gains or losses
      realized/unrealizedIncluded in
    earnings
            
            
            
            
            
            
            (43
            )
            
            
            (175
            )
            
            
            (218
            )Included in other comprehensive
      incomePurchases, issuances, and
      settlementsTransfers in and/or out of Level
      3
            
            
            6,183
            
            
            
            -
            
            
            
            9,056
            
            
            
            15,239Ending
      Balance
            
            $
            6,183
            
            
            $
            2,281
            
            
            $
            11,225
            
            
            $
            19,689The
      amount of total gains or losses for the period included in earnings
      attributable to the change in unrealized gains or losses relating to
      assets still held at the reporting date
            
            $
            (186
            )
            
            $
            (43
            )
            
            $
            (594
            )
            
            $
            (823
            )







Equity
Compensation Plans





The
Company had 4 equity compensation plans under which equity securities are
authorized for issuance to employees and/or directors:


§
            The
      1995 Long-Term Incentive and Share Award Plan for Officers and Directors
      (terminated February 28, 2005)  (1995
  Plan);


§
            The
      1997 Long Term Incentive and Share Award Plan (1997
  Plan);


§
            The
      2005 Long Term Incentive and Share Award Plan (2005 Plan, collectively
      with the 1995 Plan and the 1997 Plan, the Plans);
  and


§
            The
      Employee Stock Purchase Plan (ESP
Plan).




Employees and
outside directors have been granted restricted stock and options to purchase
shares of common stock under stock option plans adopted in 1995, 1997 and 2005.
An aggregate of 4,913, 5,100 and 6,450 shares of common stock were reserved for
issuance under the 1995 Plan, the 1997 Plan and the 2005 Plan, respectively. The
Plans provide for the granting of stock options, stock appreciation rights,
restricted shares and other share based awards to eligible employees and
directors, as defined in the Plans. Option grants have terms of ten years and
become exercisable in varying amounts over periods of up to three years. To
date, no stock appreciation rights have been granted under the
Plans.




In 1995, the
Company adopted the ESP Plan under Section 423 of the Internal Revenue Code. All
full-time employees of ANADIGICS, Inc. and part-time employees, as defined in
the ESP Plan, are eligible to participate in the ESP Plan. An aggregate of 2,694
shares of common stock were reserved for offering under the ESP Plan. Offerings
are made at the commencement of each calendar year and must be purchased by the
end of that calendar year. Pursuant to the terms of the ESP Plan, shares
purchased and the applicable per share price were 236 and $7.95, respectively
for the year ended December 31, 2007.




The table
below summarizes stock based compensation by source and by financial statement
line item for the three month periods:




March
      29, 2008
            
            
            March
      31, 2007Amortization
      of restricted stock awards
            
            $
            (3,887
            )
            
            $
            (3,149
            )Amortization
      of ESP Plan
            
            
            (200
            )
            
            
            (200
            )Amortization
      of stock option awards
            
            
            (319
            )
            
            
            (572
            )Total
      stock based compensation
            
            $
            (4,406
            )
            
            $
            (3,921
            )By
      Financial Statement line itemCost
      of sales
            
            $
            726
            
            
            $
            900Research
      and development expenses
            
            
            1,896
            
            
            
            1,500Selling
      and administrative expenses
            
            
            1,784
            
            
            
            1,476Loss
      from discontinued operations
            
            
            -
            
            
            
            45





No tax
benefits have been recorded due to the Company’s full valuation allowance
position.





Restricted
Stock and Stock Option Awards




Commencing in
August 2004, the Company began granting restricted shares under the Plans. The
value of the restricted stock awards are fixed upon the date of grant and
amortized over the related vesting period of one to three
years.  Restricted stock awards are subject to forfeiture if
employment terminates prior to vesting.  The Company estimates that
approximately 2.5% of its restricted stock awards are forfeited
annually.  The restricted stock awards carry voting and dividend
rights commencing upon grant but may not be traded or transferred prior to
vesting.  Grant, vest and forfeit activity and related weighted
average price per share for restricted stock and for stock options during the
period from January 1, 2007 to March 29, 2008 is presented in tabular form
below:





Restricted
      Shares
            
            
            Stock
      OptionsShares
            
            
            Weighted
      average price per share
            
            
            Issuable
      upon exercise
            
            
            Weighted
      average exercise priceGrants
      outstanding at January 1, 2007
            
            
            3,138
            
            
            $
            6.23
            
            
            
            5,669
            
            
            $
            8.36Granted
            
            
            1,185
            
            
            
            12.40
            
            
            
            182
            
            
            
            11.48Shares
      vested/options exercised
            
            
            (1,916
            )
            
            
            6.07
            
            
            
            (2,135
            )
            
            
            5.73Forfeited/expired
            
            
            (195
            )
            
            
            7.21
            
            
            
            (225
            )
            
            
            15.29Balance
      at December 31, 2007
            
            
            2,212
            
            
            
            9.61
            
            
            
            3,491
            
            
            
            9.68Granted
            
            
            1,412
            
            
            
            8.53
            
            
            
            -
            
            
            
            -Shares
      vested/options exercised
            
            
            (934
            )
            
            
            7.23
            
            
            
            (83
            )
            
            
            4.09Forfeited/expired
            
            
            (4
            )
            
            
            9.04
            
            
            
            (38
            )
            
            
            19.21Balance
      at March 29, 2008
            
            
            2,686
            
            
            $
            9.87
            
            
            
            3,370
            
            
            $
            9.70







As
      of March 29, 2008Unrecognized
      stock based compensation costOption plans
            
            $
            3,664Restricted stock
            
            $
            20,693Weighted
      average remaining recognition periodOption plans
            
            1.8
      yearsRestricted stock
            
            1.8
      years





Stock
options outstanding at March 29, 2008 are summarized as follows:





Range
      of exercise prices
            
            
            Outstanding
      Options at March 29, 2008
            
            
            Weighted
      average remaining contractual life
            
            
            Weighted
      average exercise price
            
            
            Exercisable
      at March 29, 2008
            
            
            Weighted
      average exercise price$
            1.39
      - 7.27
            
            
            
            1,380
            
            
            
            4.9
            
            
            $
            5.63
            
            
            
            1,372
            
            
            $
            5.63$
            7.65
      - 8.84
            
            
            
            968
            
            
            
            8.6
            
            
            $
            8.82
            
            
            
            441
            
            
            $
            8.79$
            9.00
      - 15.94
            
            
            
            879
            
            
            
            3.2
            
            
            $
            13.65
            
            
            
            784
            
            
            $
            13.85$
            16.00
      - 53.48
            
            
            
            143
            
            
            
            2.6
            
            
            $
            30.84
            
            
            
            128
            
            
            $
            32.25





Valuation
Method for ESP Plan and Stock Option Awards




The fair
value of these equity awards was estimated at the date of grant using a
Black-Scholes option pricing model. The weighted average assumptions for stock
based compensation grants used for the three month periods ended March 29, 2008
and March 31, 2007 were:





Three
      months endedMarch
      29, 2008
            
            
            March
      31, 2007Stock
      option awards:Risk-free
      interest rate
            
            
            N/A
            
            
            
            4.57
            %Expected
      volatility
            
            
            N/A
            
            
            
            76
            %Average
      expected term (in years)
            
            
            N/A
            
            
            
            4.75Expected
      dividend yield
            
            
            N/A
            
            
            
            0.0
            %Weighted
      average fair value of options granted
            
            
            N/A
            
            
            $
            5.79ESP
      Plan:Risk-free
      interest rate
            
            
            1.56
            %
            
            
            4.90
            %Expected
      volatility
            
            
            66
            %
            
            
            62
            %Average
      expected term (in years)
            
            
            1.00
            
            
            
            1.00Expected
      dividend yield
            
            
            0.0
            %
            
            
            0.0
            %Weighted
      average fair value of purchase option
            
            $
            4.14
            
            
            $
            3.16




For equity
awards with expected terms of one year or less, the assumption for expected
volatility is solely based on the Company’s historical volatility.





9. STOCKHOLDERS’
EQUITY




In March,
2007, The Company completed an underwritten public offering of 8,625 shares of
common stock, generating net proceeds to the Company of
$98,955.





ANADIGICS,
Inc.





ITEM 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS





OVERVIEW




ANADIGICS,
Inc. (“we” or the “Company”) is a leading provider of semiconductor solutions in
the rapidly growing broadband wireless and wireline communications
markets.  Our products include power amplifiers (PAs), tuner
integrated circuits, active splitters, line amplifiers and other components,
which can be sold individually or packaged as integrated radio frequency (RF)
and front end modules.  We believe that we are uniquely positioned to
capitalize on the rapidly-growing voice, data and video segments of the
broadband wireless and wireline communications markets.  We offer
third generation (3G) products that use the Wideband Code-Division Multiple
Access (W-CDMA) and Enhanced Data Rates for Global System for Mobile
Communication Evolution (EDGE) standards and combinations of W-CDMA and EDGE
platforms (WEDGE), beyond third generation (3.5G) products that use the High
Speed Packet Access (inclusive of downlink and uplink) and Evolution Data
Optimized standards, fourth generation (4G) products for Worldwide
Interoperability for Microwave Access (WiMAX) inclusive of WiBRO systems,
Wireless Fidelity (WiFi) products that use the 802.11 a/b/g and 802.11 n
(Multiple Input Multiple Output) standards, cable television (CATV) cable modem
and set-top box products, CATV infrastructure products and Fiber-To-The-Premises
products.




Our business
strategy focuses on developing RF front end solutions and partnering with
industry-leading wireless chipset providers to incorporate our solutions into
their reference designs.  Our integrated solutions enable our
customers to improve RF performance, power efficiency, reliability,
time-to-market and the integration of chip components into single packages,
while reducing the size, weight and cost of their products.  We have
established longstanding relationships with several of the industry-leading
chipset suppliers and tier-one customers.  For example, our
relationships with Qualcomm Inc., Intel Corporation, Cisco Systems, Inc. and
Motorola, Inc. have enabled us to develop RF products used in 3G, 3.5G, 4G
WiMAX, WiFi and CATV products and to be the primary supplier with respect to
such partners and customers.  Other leading chipset suppliers and
tier-one customers with whom we are engaged include Beceem Communications, Inc,
Broadcom Corporation, High Tech Computer Corp., Huawei Technologies Co., Ltd.,
KYOCERA Corporation, LG Electronics Inc., Marvell Technology Group Ltd., Murata
Manufacturing Co., Ltd., Novatel Wireless, Inc., NXP Semiconductors, Palm, Inc.,
Research In Motion Limited, Samsung Electronics Co., Ltd., Sierra Wireless,
Inc., Texas Instruments Incorporated and ZTE Corporation.




We continue
to focus on leveraging our technological and manufacturing advantages to remain
a leading supplier of semiconductor solutions for broadband wireless and
wireline communications. We believe our patented InGaP-plustechnology, which
combines the bipolar technology of a PA (HBT PA) with the surface device
technology of an RF active switch on the same die, provides us with a
competitive advantage in the marketplace. Additionally, we believe our
InGaP-plus process and
design technologies such as High Efficiency at Low Power provide a competitive
advantage by enabling us to provide PAs that consume less battery power and
extend talk time for products in the 3G, 3.5G and 4G markets.




On April 2,
2007, we sold the majority of the operating assets of Telcom Devices Inc.
(Telcom, a wholly-owned subsidiary of the Company) to GTRAN Camarillo, Inc. in
exchange for $0.5 million and effectively ceased Telcom’s operations.
Accordingly, the financial results, position and cashflow of Telcom have been
classified as discontinued operations in the accompanying financial statements
for the applicable period presented.




We were
incorporated in Delaware in 1984. Our corporate headquarters are located at 141
Mt. Bethel Road, Warren, New Jersey 07059, and our telephone number at that
address is 908-668-5000.




RESULTS OF
OPERATIONS




The following
table sets forth unaudited consolidated statements of operations data as a
percent of net sales for the periods presented:





Three
      months endedMarch
      29, 2008
            
            
            March
      31, 2007Net
      sales
            
            
            100.0
            %
            
            
            100.0
            %Cost
      of sales
            
            
            64.2
            %
            
            
            67.1
            %Gross
      margin
            
            
            35.8
            %
            
            
            32.9
            %Research
      and development expenses
            
            
            19.3
            %
            
            
            19.6
            %Selling
      and administrative expenses
            
            
            11.9
            %
            
            
            14.9
            %Operating
      income (loss)
            
            
            4.6
            %
            
            
            (1.6
            %)Interest
      income
            
            
            2.6
            %
            
            
            2.5
            %Interest
      expense
            
            
            (0.8
            %)
            
            
            (1.3
            %)Other
      expense
            
            
            (1.1
            %)
            
            
            -Income
      (loss) from continuing operations
            
            
            5.3
            %
            
            
            (0.4
            %)Loss
      from discontinued operations
            
            
            -
            
            
            
            (1.9
            %)Net
      income (loss)
            
            
            5.3
            %
            
            
            (2.3
            %)





FIRST
QUARTER 2008 (ENDED MARCH 29, 2008) COMPARED TO FIRST QUARTER 2007 (ENDED MARCH
31, 2007)




NET
SALES.Net
sales increased 50.0% during the first quarter of 2008 to $74.4 million from
$49.6 million in the first quarter of 2007.




Sales of
integrated circuits for wireless applications increased 104.8% during the first
quarter of 2008 to $51.3 million from $25.0 million in the first quarter of
2007.  This increase in sales was primarily due to increased demand
for our 3G PAs shipped into the EDGE/WEDGE and WCDMA cellular device market,
where revenue rose by $26.2 million.




Sales of
integrated circuits for broadband applications decreased 5.8% during the first
quarter of 2008 to $23.1 million from $24.6 million in the first quarter of
2007. This decrease in sales was primarily due to lower seasonal demand for
infrastructure products (sales of which were lower by $4.8 million), partially
offset by increased demand for WLAN PAs shipped into the PC Notebook
market.




GROSS MARGIN.
Gross margin during the first quarter of 2008 increased to 35.8% of net sales
from 32.9% of net sales in the first quarter of 2007.  The increase in
gross margin was primarily due to the favorable product mix of 3G
PAs.




RESEARCH AND
DEVELOPMENT. Company-sponsored research and development (R&D) expenses
increased 47.2% during the first quarter of 2008 to $14.3 million from $9.7
million during the first quarter of 2007. The increase was primarily due to
increased headcount and support of our R&D product and process development
efforts as well as increased R&D product material costs.




SELLING AND
ADMINISTRATIVE. Selling and administrative expenses increased 20.7% to $8.9
million during the first quarter of 2008 from $7.4 million during the first
quarter of 2007.  The increase was primarily driven by increased
headcount and marketing support of our sales programs.




INTEREST
INCOME.Interest
income increased 56.3% to $1.9 million during the first quarter of 2008 from
$1.2 million during the first quarter of 2007.  The increase was
primarily due to higher average funds invested, slightly offset by lower
interest rates.




INTEREST
EXPENSE.  Interest expense was consistent at $0.6 million during the
first quarters of 2008 and 2007.




OTHER
EXPENSE. Other expense of $0.8 million was recorded during the first quarter of
2008 for an other-than-temporary decline in value on certain auction rate
securities held by the Company.




LOSS FROM
DISCONTINUED OPERATIONS. Loss from discontinued operations relating to Telcom
was $1.0 million during the first quarter of 2007 and included the $0.5 million
loss on sale of discontinued operations.





LIQUIDITY
AND CAPITAL RESOURCES




As of March
29, 2008, we had $101.0 million in cash and cash equivalents and $65.5 million
in marketable securities.  As of March 29, 2008, we had outstanding
$38.0 million aggregate principal amount of our 2009 Notes.




Operating
activities provided $13.1 million in cash during the three month period ended
March 29, 2008, primarily as a result of our improved operating results adjusted
for non-cash expenses.  Investing activities, consisting principally
of net proceeds received from the sale of marketable securities of $52.7
million, partly offset by purchases of fixed assets of $22.9 million, provided
$29.8 million of cash during the three month period ended March 29,
2008.  Financing activities provided $0.3 million of cash, consisting
of proceeds received from stock option exercises.




We had
unconditional purchase obligations at March 29, 2008 of approximately $13.9
million, of which $11.5 million relates to capital equipment purchase
requirements primarily over the next three to six months. Such capital purchase
requirements will serve to increase the installed equipment capacity of our
manufacturing operations in response to increases in customer demand for our
products. In early 2007, the Company signed an agreement with the Kunshan New
and Hi-Tech Industrial Development Zone (KSND) in China to jointly construct a
wafer fabrication facility. The agreement requires the Company to invest
approximately $50.0 million over a ten-year period, inclusive of $16.7 million
required by January 31, 2010, of which approximately $4.1 million has been
funded as of March 29, 2008. In the event we decide unilaterally not to proceed
with the agreement with KSND, our maximum obligation under the agreement with
KSND is to pay KSND $16.7 million, reduced by payments made to the date of
cancellation.




We held a
total of $23.6 million of auction rate securities (ARS) within our $65.5 million
in marketable securities at March 29, 2008.  ARS are generally
long-term debt instruments that provide liquidity through a Dutch auction
process that resets the applicable interest rate at pre-determined calendar
intervals, generally every 28 days. This mechanism generally allows existing
investors to rollover their holdings and continue to own their respective
securities or liquidate their holdings by selling their securities at par value.
We generally invest in these securities for short periods of time as part of our
cash management program. During the second half of 2007, certain auction rate
debt and preferred securities failed to auction due to sell orders exceeding buy
orders. In February 2008, liquidity issues in the global credit markets resulted
in failures of the auction process for a broader range of ARS, including
substantially all of the auction rate corporate, state and municipal debt and
preferred equity securities we hold. The funds associated with failed auctions
will not be accessible until a successful auction occurs or a buyer is found
outside of the auction process.




At March 29,
2008, there was insufficient observable ARS market information available to
determine the fair value of our investments in ARS. Therefore, we estimated
Level 3 fair values for these securities by incorporating assumptions that
market participants would use in their estimates of fair value. Some of these
assumptions included credit quality, final stated maturity, estimates of the
probability of the issue being called or becoming liquid prior to the final
maturity, impact due to extended periods of maximum auction rates and valuation
estimates from independent evaluators. Based upon this analysis, we adjusted the
March 29, 2008 carrying value of these securities downward to fair value by the
amount of $1,194. Of the adjustment amount, $823 was determined to be
other-than-temporary and was recorded in other expense for the three months
ended March 29, 2008 whilst the remaining $371 was considered temporary,
resulting primarily due to the limited liquidity of those investments. The
related ARS underlying these temporary and other-than-temporary adjustment
amounts were classified as current and non-current, respectively as of March 29,
2008. While we believe these securities will again become liquid, the timing is
uncertain.  We currently have the ability and intent to hold these
auction rate securities until a recovery of the auction process or until
maturity.




We believe
that our existing sources of capital, including our existing cash and marketable
securities, will be adequate to satisfy both operational and capital needs for
the next twelve months. We may elect to finance all or part of our anticipated
operational and capital needs, which may include acquisitions of complimentary
businesses or technologies, investments in other companies or repurchases of our
outstanding debt or equity, through additional equity or debt financing. Our
ability to pay principal and interest on our outstanding 2009 Notes due in
October 2009, our other debt and to fund our planned capital expenditures
depends on our future operating performance and the liquidity of our
ARS.





IMPACT OF
RECENTLY ISSUED ACCOUNTING STANDARDS




In September
2006, the FASB issued FASB Statement No. 157, “Fair Value Measurements” (FAS
157) which defines fair value, establishes a framework for measuring fair value
in generally accepted accounting principles and expands disclosures about fair
value measurements. FAS 157 is effective for financial statements issued for
fiscal years beginning after November 15, 2007 and interim periods within those
fiscal years. In February 2008, the FASB issued FSP FAS 157-2 “Partial Deferral
of the Effective Date of Statement 157” (FSP 157-2). FSP-2 delays the effective
date of FAS 157 for non-financial assets and liabilities that are not measured
or disclosed on a recurring basis to fiscal years beginning after November 15,
2008. The adoption of this accounting pronouncement did not have a material
effect on the Company’s consolidated financial statements for financial assets
and liabilities and any other assets and liabilities carried at fair
value.  The Company is currently in the process of evaluating the
impact of adopting this pronouncement for other non-financial assets or
liabilities.





FAS 157
defines fair value as the price that would be received to sell an asset or paid
to transfer a liability in an orderly transaction between market participants at
the measurement date (exit price). FAS 157 classifies the inputs used to measure
fair value into the following hierarchy:





Level
      1
            Unadjusted
      quoted prices in active markets for identical assets or
      liabilitiesLevel
      2
            Unadjusted
      quoted prices in active markets for similar assets or liabilities, or
      unadjusted quoted prices for identical or similar assets or liabilities in
      markets that are not active, or inputs other than quoted prices that are
      observable for the asset or liabilityLevel
      3
            Unobservable
      inputs for the asset or liability




The Company
endeavors to utilize the best available information in measuring fair value.
Financial assets and liabilities are classified in their entirety based on the
lowest level of input that is significant to the fair value
measurement.




In February
2007, the FASB issued FASB Statement No. 159, “The Fair Value Option for
Financial Assets and Financial Liabilities” (FAS 159), which permits entities to
choose to measure many financial assets and financial liabilities at fair value.
Unrealized gains and losses on items for which the fair value option has been
elected are reported in earnings. FAS 159 is effective for fiscal years
beginning after November 15, 2007. As of January 1, 2008, the Company adopted
FAS 159, which did not have a material impact on its consolidated financial
statements.




In
June 2007, the FASB’s Emerging Issues Task Force reached a consensus on
EITF Issue No. 07-3, “Accounting for Nonrefundable Advance Payments for
Goods or Services to Be Used in Future Research and Development Activities”
(EITF 07-3) that would require nonrefundable advance payments made by the
Company for future R&D activities to be capitalized and recognized as an
expense as the goods or services are received by the Company. EITF 07-3 is
effective with respect to new arrangements entered into beginning
January 1, 2008. The Company adopted EITF 07-3, which did not have a
material impact on its consolidated financial statements.




In
December 2007, the FASB issued FASB Statement No. 141R, “Business
Combinations” (FAS 141R), which changes how business acquisitions are
accounted.  FAS 141R requires the acquiring entity in a business
combination to recognize all (and only) the assets acquired and liabilities
assumed in the transaction and establishes the acquisition-date fair value as
the measurement objective for all assets acquired and liabilities assumed in a
business combination.  Certain provisions of this standard will, among
other things, impact the determination of acquisition-date fair value of
consideration paid in a business combination (including contingent
consideration); exclude transaction costs from acquisition accounting; and
change accounting practices for acquired contingencies, acquisition-related
restructuring costs, in-process research and development, indemnification
assets, and tax benefits.  FAS 141R is effective for financial statements
issued for fiscal years beginning after December 15, 2008.  The
Company has not yet determined the impact FAS 141R may have on its results of
operations or financial position.




In
December 2007, the FASB issued FASB Statement No. 160, “Noncontrolling
Interests in Consolidated Financial Statements, an amendment of ARB No. 51”
(FAS 160), which establishes new standards governing the accounting for and
reporting of noncontrolling interests (NCIs) in partially owned consolidated
subsidiaries and the loss of control of subsidiaries.  Certain provisions
of this standard indicate, among other things, that NCIs (previously referred to
as minority interests) be treated as a separate component of equity, not as a
liability; that increases and decrease in the parent’s ownership interest that
leave control intact be treated as equity transactions, rather than as step
acquisitions or dilution gains or losses; and that losses of a partially owned
consolidated subsidiary be allocated to the NCI even when such allocation might
result in a deficit balance. This standard also requires changes to certain
presentation and disclosure requirements. FAS 160 is effective for
financial statements issued for fiscal years beginning after December 15, 2008.
The provisions of the standard are to be applied to all NCIs prospectively,
except for the presentation and disclosure requirements, which are to be applied
retrospectively to all periods presented. The Company has not yet determined the
impact FAS 160 may have on its results of operations or financial
position.




FORWARD-LOOKING
STATEMENTS




This
quarterly report on Form 10-Q contains projections and other forward-looking
statements (as that term is defined in the Securities Exchange Act of 1934, as
amended).  These projections and forward-looking statements reflect
the Company’s current views with respect to future events and financial
performance and can generally be identified as such because the context of the
statement will include words such as “believe”, “anticipate”, “expect”, or words
of similar import. Similarly, statements that describe our future plans,
objectives, estimates or goals are forward-looking statements.  No
assurances can be given, however, that these events will occur or that these
projections will be achieved, and actual results and developments could differ
materially from those projected as a result of certain
factors.  Important factors that could cause actual results and
developments to be materially different from those expressed or implied by such
projections and forward-looking statements include, but are not limited to, the
following risks which are described in greater detail in the Company’s Annual
Report on Form 10-K referred to below: (i) our ability to respond to a
significant increase in demand from our customers; (ii) our history of recent
losses and the possibility that we may continue to incur losses; (iii) our
dependence on a small number of customers; (iv) sources for certain components,
materials and equipment are limited, which could result in delays or reductions
in product shipments; (v) we may face interruptions in our manufacturing
processes; (vi) the variability of our manufacturing yields may affect our gross
margins; (vii) our dependence on foreign semiconductor assembly and test
operations contractors could lead to delays in product shipments; (viii) the
existence of intense competition in the markets for our products, which could
result in a decrease in our products’ prices and sales; (ix) our need to keep
pace with rapid product and process development and technological changes as
well as product cost reductions to be competitive; (x) our gallium arsenide
semiconductors may cease to be competitive with silicon alternatives; (xi) our
operating results may be harmed if we fail to sell a high volume of products;
(xii) the short life cycles of some of our products may leave us with obsolete
or excess inventories; (xiii) our results of operations can vary significantly
due to the cyclical nature of the semiconductor industry and our end markets;
(xiv) our products have experienced rapidly declining unit prices; (xv) our
marketable securities’ liquidity and valuation could be affected by disruption
in financial markets; (xvi) capital required for our business may not be
available when we need it; (xvii) our success depends on our ability to attract
and retain qualified personnel; (xviii) risks due to our international customer
base and our subcontracting operations; (xix) stringent environmental laws and
regulations both domestically and abroad; (xx) any failure to protect our
intellectual property rights or avoid claims that we have infringed on the
intellectual property rights of others; (xxi) any pursuit of selective
acquisitions and alliances which dilute the ownership of our current
shareholders and the management and integration of additional operations which
may be expensive and divert management time; (xxii) we have had significant
volatility in our stock price and it may fluctuate in the future; (xxiii)
certain provisions in our governing documents, our shareholders’ rights
agreement and of Delaware law could deter, delay or prevent a third party from
acquiring us and prevent shareholders from realizing a takeover premium. The
foregoing review of important factors should not be construed as exhaustive and
should be read in conjunction with the other cautionary statements that are
included herein or detailed from time to time in our reports filed with the
Securities and Exchange Commission, including the Company’s Annual Report on
Form 10-K for the year ended December 31, 2007. The Company undertakes no
obligation to update publicly or revise any forward-looking statement, whether
as a result of new information, future developments or otherwise.





ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK




The Company's
market risk has not changed significantly for the risks disclosed in Item 7A of
the Company's Annual Report on Form 10-K for the fiscal year ended December 31,
2007.





ITEM 4. CONTROLS AND
PROCEDURES




Under the
supervision and with the participation of our management, including our Chief
Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), we conducted an
evaluation of the effectiveness of our disclosure controls and procedures as of
March 29, 2008. Based on that evaluation, our management, including our CEO and
CFO, concluded that our disclosure controls and procedures were effective to
ensure that information required to be disclosed by us in reports that we file
or submit under the Exchange Act is recorded, processed, summarized and reported
as specified within the SEC’s rules and forms.





There was no
change in the Company’s internal control over financial reporting during the
Company’s last fiscal quarter that has materially affected, or is reasonably
likely to materially affect, the Company’s internal control over financial
reporting.





Because of
their inherent limitations, disclosure controls and procedures and 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.











ANADIGICS,
Inc.





PART II -
OTHER INFORMATION





ITEM          1.      LEGAL
PROCEEDINGS





We are a
party to litigation arising in the ordinary course out of the operation of our
business.  We believe that the ultimate resolution of such litigation
should not have a material adverse effect on our financial condition, results of
operations or liquidity.





ITEM          6.      EXHIBITS





31.1
      Rule 13a-14(a)/15d-14(a) Certification of Bami Bastani, President and
      Chief Executive Officer of ANADIGICS,
Inc.





31.2
      Rule 13a-14(a)/15d-14(a) Certification of Thomas C. Shields, Executive
      Vice President and Chief Financial Officer of ANADIGICS,
    Inc.





32.1
      Section 1350 Certification of Bami Bastani, President and Chief Executive
      Officer of ANADIGICS, Inc.





32.2
      Section 1350 Certification of Thomas C. Shields, Executive Vice President
      and Chief Financial Officer of ANADIGICS,
Inc.





SIGNATURES








Pursuant to the requirements 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.





ANADIGICS,
INC.




By:
            /s/
      Thomas C. ShieldsThomas
      C. ShieldsExecutive
      Vice President and
      Chief Financial Officer








Dated:
April 28, 2008