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Lexar Expands Sales Channels in China -- Forms Partnership with Leading Distributor, Laser Computer Limited


WEBWIRE

FREMONT, CA -- December 28, 2004 -- Lexar Media, Inc. (Nasdaq:LEXR), a world leader in advanced digital media technologies, and Laser Computer Limited, a leading distributor of IT products, will commence broad distribution of Lexar digital media and accessories in the People’s Republic of China. As a leading distributor in the region, Laser can leverage the strong product line of Lexar, in a region where digital media is growing at a record pace.

“Laser is eager to begin distributing Lexar’s JumpDrive(R) products, one of the best selling brands of USB flash drives in the world, as well as its award-winning flash memory cards,” said Nicky Lo, Managing Director, Laser Computer Ltd. “To meet China’s hearty demand for digital media products, Laser will be working closely with Lexar in establishing a significant presence for Lexar products in this vast country.”

“To further expand our sales channels and regional coverage, Lexar is pleased to partner with Laser -- one of the most cost-effective and efficient distributors in this region,” said Stella Chan, Country Manager, Lexar China. “With a strong management team, numerous regional sales offices, and its robust pan-China network providing direct transaction relationships with customers in 182 cities, Laser is capable of reaching millions of potential customers and providing prompt delivery and superior after-sales support for Lexar products.”

China’s 2003 gross domestic product (GDP) exceeded US $1.4 trillion, up 9.1 percent over the previous year, according to China’s National Bureau of Statistics. With an ever-growing retail sector worth over US $550 billion in 2003, China is an attractive market for consumer electronics and digital media, including digital cameras and flash memory cards.

“Laser represents a core component of our channel strategy in China where we see significant potential to jointly build market share,” said Tim Sullivan, Vice President, Worldwide Sales, Lexar. “As one of the largest and fastest-growing IT products distributors, Laser offers additional benefits such as advanced logistics and inventory systems, as well as key account relationships such as Gome stores.”

“As a key partner, we intend to support Lexar’s marketing and sales efforts through product launches at Laser’s various branch offices and promotion centers,” said Dickson Lui, Assistant General Manager, Laser. “Our goal is to broadly introduce Lexar products and its brand to our diverse customer base, including computer businesses and government entities, as well as our established sales outlets in consumer IT products.”

To drive sales of Lexar branded memory cards and JumpDrive USB flash drives, Laser is rolling out a marketing campaign in major cities, and will be featuring Lexar products prominently in all of Laser’s image shops across ten provinces in China. Laser will also incorporate its successful “Rainbow Nationwide” anti-counterfeit labels and warranty cards into the Lexar products it distributes, thus allowing customers to quickly and easily identify genuine Lexar products. This new packaging from Laser will effectively assure customer protection and satisfaction while protecting the rights and interests of vendors like Lexar.

About Laser Computer Limited

With over 20 years of experience as a computer and IT distributor, Laser Computer Limited has 24 offices in Hong Kong and Mainland China and a workforce of over 750 staff. Laser has developed a large and diverse customer base in China, serving hypermarkets such as Metro, electronics chain stores such as Gome, as well as other computer and government entities. Ranked as one of China’s top two IT distributors by sales turnover, Laser is the largest distributor of Hewlett-Packard’s consumer products and the largest PC components distributor in China. Through its efficient logistics and distribution hubs, Laser broadly and directly distributes PC components from Intel, Seagate, Logitech, BenQ; printers and printing accessories from HP, ENCAD, Lexmark, and Quantum; networking, storage, backup and other IT systems from HP, IBM, Quantum, Avaya, Adaptec, QLogic, and Sanyo, and software products from Microsoft OEM, Autodesk, Computer Associates, Veritas, Legato, and IBM Lotus. Laser has received numerous awards from such vendors as Intel, Seagate, HP and IBM for its excellence in distribution and marketing services for the IT industry. Headquartered in Hong Kong, Laser Computer Ltd. is a member of the Synnex Technology Group. For more information, please visit www.laser.com.hk.

About Lexar Media, Inc.

Lexar is a leading marketer and manufacturer of flash memory cards, USB flash drives, card readers and ATA controller technology for the digital photography, consumer electronics, industrial and communications markets. The company holds over 78 controller and system patents, and licenses its technology to companies including Olympus, Samsung Electronics, SanDisk and Sony. For more information, please call 800-789-9418 or visit www.lexar.com.

Cautionary Note Regarding Forward-Looking Statements

This release contains forward-looking statements which are subject to the safe harbor provisions of the Private Litigation Reform Act of 1995. These statements include statements related to the benefits and availability of, and consumer demand for, Lexar products and the growth opportunities available to Lexar. These forward-looking statements involve risks and uncertainties that could cause our actual results to differ materially from those anticipated by these forward-looking statements. These risks include that the growth and success of our business depends on our ability to achieve and maintain technology leadership, and develop, sell and market products that are commercially accepted. Readers should also refer to the risk factors described in our filings with the SEC, including our most recently filed Form 10-K and Form 10-Q. We assume no obligation to update the information in this release.

Lexar, JumpDrive and the Lexar logo are trademarks of Lexar Media, Inc. All other brand or product names are trademarks or registered trademarks of their respective holders.



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