


                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                     --------------------------------------

                                    FORM 10-Q

(Mark One)

   X      QUARTERLY  REPORT  PURSUANT  TO SECTION 13 OR 15(d) OF THE  SECURITIES
          EXCHANGE ACT OF 1934

                  For the quarterly period ended April 1, 2001

                                       OR

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

Commission file number 0-21970

                     --------------------------------------

                                ACTEL CORPORATION
             (Exact name of Registrant as specified in its charter)

                California                                 77-0097724
      (State or other jurisdiction of                   (I.R.S. Employer
      incorporation or organization)                  Identification No.)

          955 East Arques Avenue
           Sunnyvale, California                           94086-4533
 (Address of principal executive offices)                  (Zip Code)

                                 (408) 739-1010
              (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.  X Yes   No

     Number of shares of Common Stock outstanding as of May 9, 2001: 23,608,348


<PAGE>


                         PART I -- FINANCIAL INFORMATION

Item 1.       Financial Statements.

                                ACTEL CORPORATION

                   CONSOLIDATED CONDENSED STATEMENTS OF INCOME
               (unaudited, in thousands except per share amounts)

<TABLE>
<CAPTION>
                                                                                        Three Months Ended
                                                                             ---------------------------------------
                                                                                Apr. 1,         Apr. 2,      Dec. 31,
                                                                                  2001           2000          2000
                                                                             -----------   -----------   -----------
<S>                                                                          <C>           <C>           <C>
Net revenues............................................................     $    45,034   $    50,666   $    60,129
Costs and expenses:
   Cost of revenues.....................................................          16,874        19,208        22,069
   Research and development.............................................           9,764         8,351        10,035
   Selling, general, and administrative.................................          11,184        11,529        12,275
   Amortization of goodwill and other acquisition related intangibles...           3,749         1,023         3,165
   Purchased in-process research and development........................              --            --         5,088
                                                                             -----------   -----------   -----------
         Total costs and expenses.......................................          41,571        40,111        52,632
                                                                             -----------   -----------   -----------
Income from operations..................................................           3,463        10,555         7,497
Interest income and other, net..........................................           2,085         1,305         2,455
                                                                             -----------   -----------   -----------
Income before tax provision and equity in net loss of equity method
   investee.............................................................           5,548        11,860         9,952
Equity in net (loss) of equity method investee..........................              --          (123)       (1,044)
Tax provision...........................................................           2,753         3,638         5,453
                                                                             -----------   -----------   -----------
Net income..............................................................     $     2,795   $     8,099   $     3,455
                                                                             ===========   ===========   ===========

Net income per share:
   Basic................................................................     $      0.12   $      0.36   $      0.14
                                                                             ===========   ===========   ===========
   Diluted..............................................................     $      0.11   $      0.32   $      0.13
                                                                             ===========   ===========   ===========

Shares used in computing net income per share:
   Basic................................................................          23,472        22,767        23,890
                                                                             ===========   ===========   ===========
   Diluted..............................................................          25,126        25,467        26,107
                                                                             ===========   ===========   ===========
</TABLE>

<PAGE>

                                ACTEL CORPORATION

                      CONSOLIDATED CONDENSED BALANCE SHEETS
                            (unaudited, in thousands)

<TABLE>
<CAPTION>
                                                                                             Apr. 1,       Dec. 31,
                                                                                               2001          2000
                                                                                           -----------   -----------
                                     ASSETS
<S>                                                                                        <C>           <C>
Current assets:
   Cash and cash equivalents...........................................................    $       529   $     9,266
   Short-term investments..............................................................        137,538       131,544
   Accounts receivable, net............................................................         20,978        29,256
   Inventories, net....................................................................         31,836        25,503
   Deferred income taxes...............................................................         26,118        26,118
   Prepaid expenses and other current assets...........................................          3,130         7,598
                                                                                            -----------   -----------
        Total current assets..........................................................         220,129       229,285
Property and equipment, net............................................................         12,965        12,137
Goodwill, net..........................................................................         44,968        47,470
Other assets, net......................................................................         26,785        23,542
                                                                                           -----------   -----------

                                                                                           $   304,847   $   312,434
                                                                                           ===========   ===========

                      LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
   Accounts payable....................................................................    $    13,849   $    14,921
   Accrued salaries and employee benefits..............................................          8,806        17,200
   Other accrued liabilities...........................................................          4,586         5,354
   Income taxes payable................................................................          1,207            --
   Deferred income.....................................................................         38,331        44,858
                                                                                           -----------   -----------
         Total current liabilities.....................................................         66,779        82,333
   Deferred compensation plan liability................................................          1,839            --
                                                                                           -----------   -----------
         Total liabilities.............................................................         68,618        82,333

Commitments and contingencies

Shareholders' equity:
   Common stock........................................................................             24            23
   Additional paid-in capital..........................................................        153,431       150,709
   Retained Earnings...................................................................         82,703        79,908
   Note receivable from officer........................................................           (368)         (368)
   Unearned compensation cost..........................................................           (587)         (922)
   Accumulated other comprehensive income..............................................          1,026           751
                                                                                           -----------   -----------
         Total shareholders' equity....................................................        236,229       230,101
                                                                                           -----------   -----------
                                                                                           $   304,847   $   312,434
                                                                                           ===========   ===========

</TABLE>


<PAGE>


                                ACTEL CORPORATION

                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                            (unaudited, in thousands)

<TABLE>
<CAPTION>
                                                                                               Three Months Ended
                                                                                           -------------------------
                                                                                              Apr. 1,        Apr. 2,
                                                                                               2001          2000
                                                                                           -----------   -----------
<S>                                                                                        <C>           <C>
Operating activities:
   Net income..........................................................................    $     2,795   $     8,099
   Adjustments to reconcile net income to net cash (used in) provided by operating
     activities:
     Depreciation and amortization.....................................................          5,478         3,117
     Equity in net loss of equity method investee......................................             --           123
     Changes in operating assets and liabilities:
       Accounts receivable.............................................................          8,278        (3,000)
       Inventories.....................................................................         (6,333)       (1,468)
       Other current assets............................................................          1,968          (356)
       Accounts payable, accrued salaries and employee benefits, and other accrued
         liabilities...................................................................         (9,027)       (3,806)
       Deferred income.................................................................         (6,527)        3,183
       Deferred income taxes...........................................................             24          (801)
                                                                                           -----------   -----------
   Net cash (used in) provided by operating activities.................................         (3,344)        5,091
                                                                                           -----------   -----------
Investing activities:
   Purchases of property and equipment.................................................         (2,558)       (1,191)
   Purchases of available-for-sale securities..........................................        (57,295)      (41,773)
   Sales of available-for-sale securities..............................................         51,245        29,538
   Other assets........................................................................             75            76
                                                                                           -----------   -----------
   Net cash (used in) investing activities.............................................         (8,533)      (13,350)
                                                                                           -----------   -----------

Financing activities:
   Issuance of note receivable from officer............................................             --          (368)
   Sale of common stock................................................................          3,140         6,479
                                                                                           -----------   -----------
   Net cash provided by financing activities...........................................          3,140         6,111
                                                                                           -----------   -----------

Net decrease in cash and cash equivalents..............................................         (8,737)       (2,148)
Cash and cash equivalents, beginning of period.........................................          9,266         4,939
                                                                                           -----------   -----------
Cash and cash equivalents, end of period...............................................    $       529   $     2,791
                                                                                           ===========   ===========

Supplemental disclosures of cash flow information:
   Cash paid for taxes.................................................................    $         6   $     2,098

</TABLE>


<PAGE>


1.     Basis of Presentation and Summary of Significant Accounting Policies

       The accompanying  unaudited  consolidated  financial  statements of Actel
Corporation  (Actel) have been prepared in accordance  with  generally  accepted
accounting   principles  for  interim   financial   information   and  with  the
instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly,  these
financial  statements  do  not  include  all of the  information  and  footnotes
required by generally  accepted  accounting  principles  for complete  financial
statements. In the opinion of management,  all adjustments (consisting of normal
recurring  accruals)  considered  necessary  for a fair  presentation  have been
included.

       The consolidated  financial  statements include the accounts of Actel and
its  wholly  owned  subsidiaries.  All  significant  intercompany  accounts  and
transactions  have been  eliminated  in  consolidation.  The  interim  financial
statements should be read in conjunction with the audited  financial  statements
included in Actel's  Annual Report on Form 10-K for the year ended  December 31,
2000.  The results of operations  for the three months ended April 1, 2001,  are
not necessarily indicative of results that may be expected for the entire fiscal
year, which ends January 6, 2002.

2.     Derivatives and Hedging

       On January 1, 2001,  Actel  adopted  Statement  of  Financial  Accounting
Standards  (SFAS) No. 133,  "Accounting  for Derivative  Instruments and Hedging
Activities." SFAS 133 requires that all derivatives be recognized on the balance
sheet at fair market value.  Derivatives that are not hedges must be adjusted to
fair value through  earnings.  If the  derivative  is a hedge,  depending on the
nature of the  hedge,  changes in the fair  value of the  derivative  are either
offset against the change in the fair value of the hedged item through  earnings
or recognized in other comprehensive  income until the hedged item is recognized
in earnings.  The ineffective  portion of a derivative's change in fair value is
immediately  recognized  in  earnings.  The  adoption of SFAS 133 did not have a
material impact on Actel's consolidated financial position or operating results.

       Actel  purchases  a  portion  of its  wafers  used in  production  from a
Japanese supplier denominated in Japanese Yen. The amount of US Dollars that are
necessary  to purchase  wafers is subject to  fluctuations  in foreign  currency
exchange rates between the US Dollar and Yen. Actel enters into foreign exchange
forward  contracts  to reduce the  variability  in the amount of US Dollars that
will be required to settle forecasted wafer purchases denominated in Yen.

       Actel's  accounting  policies for these  forward  contracts  are based on
Actel's  designation of the yen forward  contracts as foreign currency cash flow
hedges.  The  criteria  Actel  uses for  designating  an  instrument  as a hedge
includes its effectiveness in exposure reduction and one-to-one  matching of the
derivative  financial  instrument with the underlying  transaction being hedged.
Hedge  effectiveness  is assessed by  comparing  the change in fair value of the
forward contract with the change in fair value of the forecasted payments. Gains
and losses on these contracts are recognized upon usage of the contracts and are
included  in  cost  of  sales  along  with  the  offsetting  gain or loss on the
underlying  transactions  being hedged. If the criteria for designation of these
instruments as hedging  transactions are not met, then the instruments  would be
marked to market,  with gains and losses  recognized in that period. At April 1,
2001, and December 31, 2000,  Actel had no forward  foreign  exchange  contracts
outstanding  and  no  amounts  related  to  valuation  of  derivative  financial
instruments were included in other comprehensive income at either date.

       Actel  limits the  amount of forward  foreign  exchange  contract  to the
amount  sufficient to hedge a maximum three months worth of forecasted yen based
payments.  Actel does not use forward foreign exchange contracts for speculative
or trading purposes.  During the first quarter of 2001, Actel recognized $15,000
in loss on the income statement  related to forward foreign exchange  contracts.
The forward  contracts  were  perfectly  effective as hedges and offset gains of
$15,000 on payments for yen denominated wafer purchases during the period.

3.     Equity Accounting

       During 1998, Actel entered into a product marketing rights agreement with
GateField Corporation (GateField) and made investments in GateField common stock
and GateField  convertible  preferred stock,  which were valued at cost.  During
1999,  Actel made additional  investments in GateField,  which resulted in Actel
accounting for its investments in GateField  under the equity method  commencing
July 1, 1999.

       On  May  31,  2000,  GateField  and  Actel  announced  the  signing  of a
definitive  agreement  to merge.  On November  15,  2000,  the  acquisition  was
completed and Actel paid cash consideration of $5.25 for each share of GateField
common stock not already owned by Actel. Equity accounting was discontinued as a
result of the acquisition on November 15, 2000.

4.     Inventories

         Inventories consist of the following:

                                                    Apr. 2,       Dec. 31,
                                                      2001          2000
                                                  -----------   -----------
                                                        (in thousands)
Inventories:
   Purchased parts and raw materials..........    $     7,597   $     5,334
   Work-in-process............................         16,674        11,443
   Finished goods.............................          7,565         8,726
                                                  -----------   -----------
                                                  $    31,836   $    25,503
                                                  ===========   ===========

       Inventories  are  stated at the lower of cost  (first-in,  first-out)  or
market  (net  realizable  value).  Given the  volatility  of the  market for its
products,  Actel makes inventory  provisions for potentially excess and obsolete
inventory based on backlog and forecast demand.  However, such backlog demand is
subject to  revisions,  cancellations,  and  rescheduling.  Actual  demand  will
inevitably  differ from such backlog and forecast  demand,  and such differences
may be material to the financial statements. Excess inventory increases handling
costs  and  the  risk  of  obsolescence,  is a  non-productive  use  of  capital
resources,  and  delays  realization  of  the  price  and  performance  benefits
associated with more advanced manufacturing processes.


5.     Earnings Per Share

       The  following  table sets  forth the  computation  of basic and  diluted
earnings per share in accordance with SFAS No. 128, "Earnings per Share":


<TABLE>
<CAPTION>
                                                                                        Three Months Ended
                                                                             ---------------------------------------
                                                                               Apr. 1,       Apr. 2,       Dec. 31,
                                                                                2001          2000           2000
                                                                             ===========   ===========   ===========
                                                                             (in thousands, except per share amounts)
<S>                                                                          <C>           <C>           <C>
Basic:
Average common shares outstanding.......................................          23,472        22,767        23,890
Shares used in computing net income per share...........................          23,472        22,767        23,890
                                                                             ===========   ===========   ===========
Net income..............................................................     $     2,795   $     8,099   $     3,455
                                                                             ===========   ===========   ===========
Net income per share....................................................     $      0.12   $      0.36   $      0.14
                                                                             ===========   ===========   ===========


Diluted:
Average common shares outstanding.......................................          23,472        22,767        23,890
Net effect of dilutive stock options - based on the treasury stock method          1,654         2,700         2,217
                                                                             -----------   -----------   -----------
Shares used in computing net income per share...........................          25,126        25,467        26,107
                                                                             ===========   ===========   ===========
Net income..............................................................     $     2,795   $     8,099   $     3,455
                                                                             ===========   ===========   ===========
Net income per share....................................................     $      0.11   $      0.32   $      0.13
                                                                             ===========   ===========   ===========
</TABLE>


6.     Comprehensive Income


       The components of comprehensive income, net of tax, are as follows:

<TABLE>
<CAPTION>
                                                                                        Three Months Ended
                                                                             ---------------------------------------
                                                                               Apr. 1,       Apr. 2,       Dec. 31,
                                                                                 2001          2000          2000
                                                                             -----------   -----------   -----------
                                                                                          (in thousands)
<S>                                                                          <C>           <C>           <C>
Net Income..............................................................     $     2,795   $     8,099   $     3,455
Unrealized gain/(loss) on available for sale securities, net of tax.....             275         6,515           585
Less reclassification adjustment for (gains) losses included in net income            --            11            --
                                                                             -----------   -----------   -----------
Other Comprehensive Income..............................................             275         6,526           585
                                                                             -----------   -----------   -----------
Total Comprehensive Income..............................................     $     3,070   $    14,625   $     4,040
                                                                             ===========   ===========   ===========
</TABLE>

Accumulated   other   comprehensive   income   presented  in  the   accompanying
consolidated condensed balance sheets consists of the accumulated net unrealized
gain (loss) on available-for-sale securities.

7.     Infringement Claims

       On March 29, 2000, Unisys Corporation (Unisys) brought suit in the United
States District Court for the Northern District of California, San Jose Division
(Court),  against Actel seeking  monetary  damages and  injunctive  relief.  The
summons and  complaint  were served on Actel on April 10,  2000.  The  complaint
alleges that Actel has infringed and is currently  infringing four United States
patents that belong to plaintiff:  U.S. Patent No.  4,442,507,  issued April 10,
1984;  U.S.  Patent  No.  5,296,722,  issued  March 22,  1994;  U.S.  Patent No.
5,407,851, issued April 18, 1995; and U.S. Patent No. 5,496,763, issued March 5,
1996. On May 15, 2000, Unisys served its Initial  Disclosure of Asserted Claims,
identifying  the SX and SX-A  family of field  programmable  gate  arrays as the
specific Actel  products  being accused of  infringement,  and  identifying  the
specific  claims of each of the patents in suit alleged to be infringed by those
products.  On September 25, 2000,  Actel filed its First  Amended  Answer to the
Complaint,  denying that it has infringed or is infringing any of the patents in
suit,  and alleging,  among other things,  that each of those patents is invalid
for  failure to meet the  statutory  requirements  for  patentability.  With its
amended  answer,  Actel  also  filed a  counterclaim  against  Unisys  seeking a
judicial  declaration  that  each of the  Unisys  patents  in  suit is  invalid,
unenforceable,  and not  infringed  by Actel.  On October  26,  2000,  the Court
entered its Order for Pretrial Preparation,  which established various deadlines
in the case and set the case for trial on March  25,  2002.  On April 25,  2001,
Actel and Unisys orally agreed to settle the case. Such settlement is subject to
the negotiation  and execution of a definitive  written  agreement.  The pending
settlement is immaterial to Actel's business,  financial condition, or operating
results.

       As is typical in the semiconductor  industry,  Actel has been and expects
to be  notified  from time to time of claims that it may be  infringing  patents
owned by others.  During 2000,  Actel continued to hold discussions with several
third parties  regarding  potential patent  infringement  issues,  including two
semiconductor   manufacturers   with   significantly   greater   financial   and
intellectual  property  resources than Actel.  As it has in the past,  Actel may
obtain licenses under patents that it is alleged to infringe.  When probable and
reasonably  estimable,  Actel has made  provision for the  estimated  settlement
costs of claims for alleged  infringement prior to the balance sheet date. While
Actel believes that reasonable  resolution will occur, there can be no assurance
that these claims will be resolved or that the  resolution  of these claims will
not have a materially adverse effect on Actel's business,  financial  condition,
or results of operations. In addition, Actel's evaluation of the probable impact
of these pending  disputes  could change based upon new  information  learned by
Actel.  Subject  to the  foregoing,  Actel  does not  believe  that any  pending
disputes,  including  those  described  above,  are likely to have a  materially
adverse  effect on  Actel's  financial  condition,  results  of  operations,  or
liquidity.  The foregoing is a  forward-looking  statement subject to all of the
risks and  uncertainties  of  patent  claims,  including  the  discovery  of new
information and unpredictability as to the outcome of any proceeding.


<PAGE>


Item 2.    Management's  Discussion  and  Analysis of  Financial  Condition  and
           Results of Operations.

       All forward-looking statements contained in this Quarterly Report on Form
10-Q,  including  all  forward-looking  statements  contained  in  any  document
incorporated  herein  by  reference,  are  made  pursuant  to  the  safe  harbor
provisions of the Public Securities Litigation Reform Act of 1995. Words such as
"anticipates,"  "believes,"  "estimates," "expects," intends," "plans," "seeks,"
and  variations of such words and similar  expressions  are intended to identify
the forward-looking  statements. In addition, all forward-looking statements are
based on current  expectations and projections about the semiconductor  industry
and programmable  logic market,  and assumptions made by Actel's management that
reflect its best judgment based on other factors  currently known by management,
but they are not guarantees of future  performance.  Accordingly,  actual events
and  results  may differ  materially  from those  expressed  or  forecast in the
forward-looking  statements  due to the risk  factors  identified  herein or for
other reasons. Actel undertakes no obligation to update any statement, including
any  forward-looking  statement,  contained or incorporated by reference in this
Quarterly Report on Form 10-Q.

Results of Operations

       Net Revenues

       Net revenues for the first quarter of 2001 were $45.0  million,  which is
25% less than Actel's net  revenues for the fourth  quarter of 2000 and 11% less
than Actel's net revenues for the first quarter of 2000.  Quarterly net revenues
declined sequentially due to a 13% decrease in the overall average selling price
(ASP) and a 14% decrease in overall unit  shipments of field  programmable  gate
arrays  (FPGAs).  Quarterly  net revenues  declined from a year ago due to a 16%
decrease in unit shipments, which was partially offset by a 6% increase in ASP.

       Gross Margin

       Gross  margin for the first  quarter  of 2001 was 62.5% of net  revenues,
compared  with  63.3%  for the  fourth  quarter  of 2000 and 62.1% for the first
quarter of 2000.  Gross margin  declined  sequentially  primarily as a result of
reduced  manufacturing  and  operating  efficiencies  associated  with lower net
revenues.

       Actel  seeks to  improve  gross  margin by  reducing  costs.  These  cost
reduction   activities   include  improving  wafer  yields,   negotiating  price
reductions  with  suppliers,  increasing the level and efficiency of its testing
and  packaging  operations,  achieving  economies  of scale  by means of  higher
production  levels,  and  increasing  the  number of die  produced  per wafer by
shrinking  the die size of its  products.  There can be no assurance  that these
efforts will be  successful.  The ability of Actel to shrink the die size of its
FPGAs is dependent on the availability of more advanced manufacturing processes.
Due to the custom steps involved in manufacturing  antifuse-based  FPGAs,  Actel
typically  obtains  access  to  new  manufacturing   processes  later  than  its
competitors using standard manufacturing processes.

       Research and Development (R&D)

       R&D expenditures for the first quarter of 2001 were $9.8 million,  or 22%
of net revenues,  compared with $10.0 million,  or 17% of net revenues,  for the
fourth  quarter  of 2000 and $8.4  million,  or 16% of  revenues,  for the first
quarter of 2000. Quarterly R&D spending increased from a year ago primarily as a
result of Actel's acquisitions of Prosys Technology  (Prosys),  an embedded FPGA
intellectual property (IP) developer,  in June 2000 and of GateField Corporation
(GateField), a developer of flash-based FPGA products, in November 2000.

       Selling, General, and Administrative (SG&A)

       SG&A expenses for the first quarter of 2001 were $11.2 million, or 25% of
net revenues,  compared  with $12.3  million,  or 20% of net  revenues,  for the
fourth quarter of 2000 and $11.5 million, or 23% of net revenues,  for the first
quarter of 2000. Quarterly SG&A expenses declined primarily as a result of lower
sales costs associated with lower net revenues.

       Amortization  of Goodwill and Other  Acquisition-Related  Intangibles and
Expenses

       Amortization  of goodwill and other  acquisition-related  intangibles and
expenses  for the first  quarter of 2001 was $3.7  million,  compared  with $3.2
million for the fourth quarter of 2000 and $1.0 million for the first quarter of
2000. The sequential  increase was due to a full quarter of amortization for the
GateField acquisition, which occurred in November 2000. The increase from a year
ago  was  due  to  amortization  charges  of  $2.3  million  for  the  GateField
acquisition  and $0.9 million for the Prosys  acquisition,  which were offset in
part by the  elimination of a charge for Actel's equity  investment in GateField
(which was $0.5 million for the first quarter of 2000).

       Interest Income and Other Income and Expenses

       Interest  income and other  income and  expenses was $2.1 million for the
first quarter of 2001, compared with $1.4 million for the fourth quarter of 2000
and $1.2 million for the first quarter of 2000. The sequential increase resulted
primarily  from the  elimination  of losses booked on account of Actel's  equity
investment in GateField,  which were $1.0 million for the fourth quarter of 2000
and $0.1 million for the first quarter of 2000. The increase from a year ago was
due primarily to increased cash, cash  equivalents,  and short-term  investments
available for investing by Actel.

       Tax Provision

       Actel's  effective  rate for the first quarter of 2001 was 30%,  compared
with 32% for the fourth  quarter of 2000. The decrease in the effective rate was
due primarily to increased R&D credits and tax-exempt  income as a percentage of
projected  pre-tax  book  income.  The  effective  tax  rates  are  based on the
estimated  annual tax rate in compliance with Statement of Financial  Accounting
Standards  No. 109,  "Accounting  for Income  Taxes." This rate differs from the
federal  statutory  rate due  primarily  to state  income  taxes (net of federal
benefit), the benefits of R&D credits and tax exempt income, and the recognition
of certain  deferred tax assets  subject to valuation  allowances as of December
31, 2000.

Liquidity and Capital Resources

       At the end of the first quarter of 2001,  Actel's cash, cash equivalents,
and short-term investments were $138.1 million,  compared with $140.8 million at
the  beginning  of 2001.  The  amount  of cash and  cash  equivalents  decreased
principally  because of the payout of management  and sales  bonuses  related to
year 2000 performance.

       During  the  first  quarter  of 2001,  $3.3  million  of cash was used in
operating activities and $8.5 million of cash was used in investing  activities,
including  $6.1 million of net purchases of  available-for-sale  securities  and
$2.6 million purchases of property and equipment.  Financing activities provided
cash of $3.1  million,  which was  generated  from sales of common  stock  under
employee option and stock purchase plans.

       Actel has a line of credit with a bank that provides for  borrowings  not
to exceed $5 million.  The agreement  contains  covenants  that require Actel to
maintain certain  financial ratios and levels of net worth. As of April 1, 2001,
Actel was in compliance  with the  covenants for the line of credit.  Borrowings
against the line of credit bear interest at the bank's prime rate. There were no
borrowings  against  the line of credit at April 1,  2001.  The line of  credit,
which expires in May 2001,  may be terminated by either party upon not less than
thirty days' prior written notice.

       Actel  believes that existing  cash,  cash  equivalents,  and  short-term
investments,  together with cash from operations, will be sufficient to meet its
cash requirements for the next four quarters. A portion of available cash may be
used for investment in or acquisition of complementary businesses,  products, or
technologies.  Wafer manufacturers are increasingly  demanding financial support
from  customers in the form of equity  investments  and advance  purchase  price
deposits,  which can be substantial.  If Actel requires additional capacity,  it
may be required to incur significant expenditures to secure such capacity.

       Actel believes that the availability of adequate financial resources is a
substantial  competitive  factor.  To take  advantage of  opportunities  as they
arise,  or to withstand  adverse  business  conditions  when they occur,  it may
become prudent or necessary for Actel to raise additional capital. Actel intends
to continue monitoring the availability and cost of potential capital resources,
including equity,  debt, and off-balance sheet financing  arrangements,  and may
consider raising additional capital on terms that are acceptable to Actel. There
can be no assurance that additional  capital will become available on acceptable
terms.

Other Factors Affecting Future Operating Results

       Actel's operating results are subject to general economic  conditions and
a variety  of risks  characteristic  of the  semiconductor  industry  (including
booking  and  shipment  uncertainties,  wafer  supply  fluctuations,  and  price
erosion)  or  specific to Actel,  any of which  could  cause  Actel's  operating
results to differ materially from past results.  For a discussion of such risks,
see "Risk  Factors"  in Part I of Actel's  Annual  Report on Form 10-K for 2000,
which is incorporated herein by this reference.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

       As of April 1, 2001, Actel's investment  portfolio consisted primarily of
corporate bonds, floating rate notes, and federal and municipal obligations. The
principal objectives of Actel's investment activities are to preserve principal,
meet liquidity  needs,  and maximize  yields.  To meet these  objectives,  Actel
invests only in high credit quality debt securities  with average  maturities of
less than two years.  Actel also limits the percentage of total investments that
may be  invested in any one issuer.  Corporate  investments  as a group are also
limited to a maximum percentage of Actel's investment portfolio.

       Actel is exposed to financial market risks, including changes in interest
rates,  foreign currency  exchange rates, and marketable equity security prices.
All of the  potential  changes noted below are based upon  sensitivity  analysis
performed on Actel's financial  position and expected  operating levels at April
1, 2001. Actual results may differ materially.

       Actel's  investments  are subject to interest  rate risk.  An increase in
interest  rates  could  subject  Actel to a decline in the  market  value of its
investments.  These  risks are  mitigated  by the ability of Actel to hold these
investments  to maturity.  A  hypothetical  100 basis point increase in interest
rates would  result in a reduction  of  approximately  $1.7  million in the fair
value of Actel's available-for-sale securities held at April 1, 2001.

       Actel  purchases  a  portion  of the  wafers it uses in  production  from
Japanese suppliers,  which are denominated in Japanese yen. An adverse change in
the foreign exchange rate would affect the price Actel pays for a portion of the
wafers used in  production  over the long term.  Actel  attempts to mitigate its
exposure to risks from  foreign  currency  fluctuations  by  purchasing  forward
foreign  exchange  contracts to hedge firm purchase  commitments  denominated in
foreign  currencies.  Forward exchange contracts are short term and do not hedge
purchases that will be made for anticipated  longer-term wafer needs. An adverse
change of 10% in exchange  rates would  result in a reduction  in income  before
taxes of  approximately  $0.7 million based on projected yen  denominated  wafer
purchases for the next year.

       Actel's strategic investments in marketable equity securities are subject
to equity price risks.  Actel  typically does not attempt to reduce or eliminate
market  exposure  on  these  securities.  Assuming  a 10%  adverse  change,  our
marketable  strategic equity securities would decrease in value by approximately
$0.5 million, based on the value of the portfolio as of April 1, 2001.

Additional Quarterly Information

       The following table presents certain unaudited quarterly results for each
of the eight  quarters  in the period  ended  April 1, 2001.  In the  opinion of
management,  all  necessary  adjustments  (consisting  only of normal  recurring
accruals)  have been included in the amounts  stated below to present fairly the
unaudited   quarterly   results  when  read  in  conjunction  with  the  audited
consolidated financial statements of Actel and notes thereto included in Actel's
Annual Report on Form 10-K for the year ended December 31, 2001. These quarterly
operating  results are not necessarily  indicative of the results for any future
period.



<PAGE>

<TABLE>
<CAPTION>
                                                                              Three Months Ended
                                                 -----------------------------------------------------------------------------
                                                 Apr. 1,   Dec. 31,  Oct. 1,   Jul. 2,   Apr. 2,   Jan. 2,   Oct. 3,   Jul. 4,
                                                   2001      2000      2000      2000      2000      2000      1999      1999
                                                 -------   -------   -------   -------   -------   -------   -------   -------
                                                                         (in thousands, except per share amounts)
<S>                                              <C>       <C>       <C>       <C>       <C>       <C>       <C>       <C>
Statements of Income Data:
Net revenues .................................   $45,034   $60,129   $60,080   $55,544   $50,666   $46,042   $43,162   $41,619
Gross profit .................................    28,160    38,060    37,626    34,595    31,458    28,546    26,503    25,381
Income from operations .......................     3,463     7,497    13,648     6,778    10,555     7,175     7,492     2,111
Net income ...................................   $ 2,795   $ 3,455   $ 9,779   $20,112   $ 8,099   $ 5,823   $ 5,668   $ 1,926
Net income per share:
   Basic .....................................   $  0.12   $  0.14   $  0.41   $  0.86   $  0.36   $  0.26   $  0.26   $  0.09
                                                 =======   =======   =======   =======   =======   =======   =======   =======
   Diluted ...................................   $  0.11   $  0.13   $  0.36   $  0.77   $  0.32   $  0.24   $  0.25   $  0.09
                                                 =======   =======   =======   =======   =======   =======   =======   =======
Shares used in computing net income per share:
   Basic .....................................    23,472    23,890    23,869    23,263    22,767    22,048    21,748    21,511
                                                 =======   =======   =======   =======   =======   =======   =======   =======
   Diluted ...................................    25,126    26,107    26,999    26,186    25,467    24,015    23,003    22,454
                                                 =======   =======   =======   =======   =======   =======   =======   =======
</TABLE>


<TABLE>
<CAPTION>
                                                                              Three Months Ended
                                                 -----------------------------------------------------------------------------
                                                 Apr. 1,   Dec. 31,  Oct. 1,   Jul. 2,   Apr. 2,   Jan. 2,   Oct. 3,   Jul. 4,
                                                   2001      2000      2000      2000      2000      2000      1999      1999
                                                 -------   -------   -------   -------   -------   -------   -------   -------
<S>                                              <C>       <C>       <C>       <C>       <C>       <C>       <C>       <C>
As a Percentage of Net Revenues:
Net revenues .................................    100.0%    100.0%    100.0%    100.0%    100.0%    100.0%    100.0%    100.0%
Gross profit .................................     62.5      63.3      62.6      62.3      62.1      62.0      61.4      61.0
Income from operations .......................      7.7      12.5      22.7      12.2      20.8      15.6      17.4       5.1
Net income ...................................      6.2       5.7      16.3      36.2      16.0      12.6      13.1       4.6
</TABLE>


<PAGE>

                          PART II -- OTHER INFORMATION

Item 1.   Legal Proceedings

       Periodically,  Actel is made  aware  that  technology  used by Actel  may
infringe  intellectual  property  rights  held by  others.  During  2000,  Actel
continued in negotiations with several first parties regarding  potential patent
infringement  issues.  Actel  has  made  adequate  provision  for the  estimated
settlement costs of claims for alleged  infringement  prior to the balance sheet
date. While management believes that reasonable resolution will occur, there can
be no  assurance  that these claims will be resolved or that the  resolution  of
these  claims will not have a  materially  adverse  effect on future  results of
operations or require  changes in Actel's  products or  processes.  In addition,
management's  evaluation of the likely impact of these  pending  disputes  could
change  based  upon  new  information  learned  by  management.  Subject  to the
foregoing,  management does not believe any pending dispute, including the legal
proceeding  described below,  are likely to have a materially  adverse effect on
Actel's financial condition,  results of operations, or liquidity. The foregoing
is a forward-looking  statement subject to all of the risks and uncertainties of
intellectual property disputes and legal proceedings, including the discovery of
new information and unpredictability as to the ultimate outcome.

       Except as described  below,  there are no pending legal  proceedings of a
material nature to which Actel is a party or of which any of its property is the
subject.  There are no such legal  proceedings known by Actel to be contemplated
by any governmental authority.

       Unisys v. Actel and QuickLogic (CV C-00 01114 WDB)

       On March 29, 2000, Unisys Corporation (Unisys) brought suit in the United
States District Court for the Northern District of California, San Jose Division
(Court),  against Actel seeking  monetary  damages and  injunctive  relief.  The
summons and  complaint  were served on Actel on April 10,  2000.  The  complaint
alleges that Actel has infringed and is currently  infringing four United States
patents that belong to plaintiff:  U.S. Patent No.  4,442,507,  issued April 10,
1984;  U.S.  Patent  No.  5,296,722,  issued  March 22,  1994;  U.S.  Patent No.
5,407,851, issued April 18, 1995; and U.S. Patent No. 5,496,763, issued March 5,
1996. On May 15, 2000, Unisys served its Initial  Disclosure of Asserted Claims,
identifying  the SX and SX-A  family of field  programmable  gate  arrays as the
specific Actel  products  being accused of  infringement,  and  identifying  the
specific  claims of each of the patents in suit alleged to be infringed by those
products.  On September 25, 2000,  Actel filed its First  Amended  Answer to the
Complaint,  denying that it has infringed or is infringing any of the patents in
suit,  and alleging,  among other things,  that each of those patents is invalid
for  failure to meet the  statutory  requirements  for  patentability.  With its
amended  answer,  Actel  also  filed a  counterclaim  against  Unisys  seeking a
judicial  declaration  that  each of the  Unisys  patents  in  suit is  invalid,
unenforceable,  and not  infringed  by Actel.  On October  26,  2000,  the Court
entered its Order for Pretrial Preparation,  which established various deadlines
in the case and set the case for trial on March  25,  2002.  On April 25,  2001,
Actel and Unisys orally agreed to settle the case. Such settlement is subject to
the negotiation  and execution of a definitive  written  agreement.  The pending
settlement is immaterial to Actel's business,  financial condition, or operating
results.

       As is typical in the semiconductor  industry,  Actel has been and expects
to be  notified  from time to time of claims that it may be  infringing  patents
owned by others.  During 2000,  Actel continued to hold discussions with several
third parties  regarding  potential patent  infringement  issues,  including two
semiconductor   manufacturers   with   significantly   greater   financial   and
intellectual  property  resources than Actel.  As it has in the past,  Actel may
obtain licenses under patents that it is alleged to infringe.  When probable and
reasonably  estimable,  Actel has made  provision for the  estimated  settlement
costs of claims for alleged  infringement prior to the balance sheet date. While
Actel believes that reasonable  resolution will occur, there can be no assurance
that these claims will be resolved or that the  resolution  of these claims will
not have a materially adverse effect on Actel's business,  financial  condition,
or results of operations. In addition, Actel's evaluation of the probable impact
of these pending  disputes  could change based upon new  information  learned by
Actel.  Subject  to the  foregoing,  Actel  does not  believe  that any  pending
disputes,  including  those  described  above,  are likely to have a  materially
adverse  effect on  Actel's  financial  condition,  results  of  operations,  or
liquidity.  The foregoing is a  forward-looking  statement subject to all of the
risks and  uncertainties  of  patent  claims,  including  the  discovery  of new
information and unpredictability as to the outcome of any proceeding.

Item 6.  Exhibits and Reports on Form 8-K

(a)    Exhibits

       None

(b)    Reports on Form 8-K

       On November 30, 2000,  Actel filed a Current Report on Form 8-K regarding
the  completion  of Actel's  acquisition  of GateField on November 15, 2000.  On
January 29, 2001, Actel filed Amendment No. 1 to the Current Report on Form 8-K,
which included the required  financial  statements of the business  acquired and
the required pro forma financial information.


                                    SIGNATURE

       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.



                                                ACTEL CORPORATION




       Date: May 10, 2001                      /s/ Henry L. Perret
                                 -----------------------------------------------
                                                   Henry L. Perret
                                              Vice President of Finance
                                             and Chief Financial Officer
                                           (as principal financial officer
                                            and on behalf of Registrant)


