In the fourth quarter net revenues of $27 million 500 thousand increased by 113%

Vimicro (Vimicro International) recently released as of December 31st in the 2005 fourth quarter unaudited financial statements. The report shows, Vimicro fourth quarter net revenues of $27 million 500 thousand, an increase of 113%; net profit of $5 million 700 thousand, $714 thousand for the same period last year. Fourth quarter gross margin was 40.3%, higher than the previous quarter of 40.5%, as well as the same period last year of 32.8%.

From 2005 the main overall performance point of view, in 2005 net revenues of $95 million 300 thousand, up 90% compared to $50 million 300 thousand in 2004; not in accordance with GAAP, in 2005 net profit of $17 million 800 thousand, up 130% compared to $7 million 700 thousand in 2004; in accordance with U.S. GAAP, in 2005 net profit of $16 million 400 thousand, a net loss for 2004 for $5 million 600 thousand;

Affected by seasonal factors, Vimicro expects 2006 first quarter net revenues of $25 million 500 thousand to $23 million 500 thousand, not in accordance with GAAP, Vimicro is expected in the first quarter diluted earnings per American depositary share $0.10 to $0.12