<PAGE>   1


                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

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

For the fiscal year ended April 2, 2000
                                       OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

For the transition period from                    to                  
                               -----------------     -----------------

Commission file number 1-5560
                       ------


                             ALPHA INDUSTRIES, INC.
             (Exact name of registrant as specified in its charter)

                     DELAWARE                                     04-2302115
          (State or other jurisdiction of                      (I.R.S. Employer
          incorporation or organization)                     Identification No.)

       20 SYLVAN ROAD, WOBURN, MASSACHUSETTS                         01801
     (Address of principal executive offices)                     (Zip Code)
     
  Registrant's telephone number, including area code:          (781) 935-5150

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

          Securities registered pursuant to Section 12(g) of the Act:

                          Common Stock, $.25 par value

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

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

         The aggregate market value of the Registrant's Common Stock held by
non-affiliates of the Registrant at May 28, 2000 was approximately $1.746
billion.

         The number of shares of Common Stock outstanding at May 28, 2000 was
42,638,168.

                       DOCUMENTS INCORPORATED BY REFERENCE

         Portions of the Company's Proxy Statement, to be filed within 120 days
of the end of the Registrant's fiscal year are incorporated by reference into

Part III of this Report.


                    The Exhibit Index is located on page 43.
                              Page 1 of 50 pages.



<PAGE>   2
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES



                                     PART I


ITEM 1   BUSINESS

OVERVIEW

We design, develop, manufacture and market proprietary radio frequency,
microwave frequency and millimeter wave frequency integrated circuits and
discrete semiconductors for wireless voice and data and broadband
communications. The primary applications for our products include wireless voice
and data handsets. We also produce integrated circuits, discrete components,
electrical ceramics and ferrites used in wireless base station equipment, cable
television, cable modems and other broadband applications, wireless local loop,
wireless personal digital assistants and wireless local area networks.

We offer a broad range of products, including integrated circuit, or IC,
switches and controls, power amplifiers, diodes and components that comprise a
significant part of the radio frequency devices used in wireless telephone
handsets. We use a range of technologies, processes and materials to meet our
customers' performance requirements, including gallium arsenide metal
semiconductor field effect transistor, or GaAs MESFET, gallium arsenide
pseudomorphic high electron mobility transistor, or GaAs PHEMT, silicon and
electrical ceramic. Through our acquisition of Network Device, Inc. ("NDI"), we
will offer power amplifiers and other devices made with a gallium arsenide
heterojunction bipolar transistor, or GaAs HBT, process.

We divide our operations into three groups to address the distinct dynamics of
different markets:


<TABLE>
<CAPTION>
                      WIRELESS SEMICONDUCTOR                                   APPLICATION SPECIFIC
                             PRODUCTS             CERAMIC PRODUCTS                   PRODUCTS
----------------------------------------------------------------------------------------------------------
                                                                            
<S>                   <C>                       <C>                          <C>
Primary Products     GaAs Integrated Circuits   Electrical Ceramics          GaAs Integrated Circuits 
                     Discrete Semiconductors    Ferrites                     Discrete Semiconductors  
                                                                             Components               

Primary Markets      Wireless Handsets          Wireless Infrastructure      Satellite Communications 
                     Wireless Data              Broadband Data               Broadband Data           
                     Broadband Data             
</TABLE>



The Wireless Semiconductor Products Group supplies GaAs integrated circuits and
discrete semiconductors in high volume for wireless telephone handsets and
wireless data applications. These products are used in equipment incorporating
the leading digital standards, Global System for Mobile Communications, or GSM,
Code Division Multiple Access, or CDMA ("IS95"), and Time Division Multiple
Access, or TDMA ("IS136").

The Ceramic Products Group uses electrical ceramic and ferrite technologies to
supply resonators and filters, primarily for wireless base station equipment.

The Application Specific Products Group supplies radio frequency, microwave
frequency and millimeter wave frequency GaAs integrated circuits, and discrete
semiconductors and components for the broadband data and satellite
communications markets. We leverage our 30 years of experience with higher
frequency microwave and millimeter wave technologies to develop high gross
margin products and to develop new products for emerging wireless broadband data
applications.



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                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


PRODUCTS AND APPLICATIONS

We offer a broad array of radio frequency, microwave frequency and millimeter
wave frequency products to the wireless and broadband markets, including GaAs
integrated circuit switches and controls, GaAs integrated circuit power
amplifiers, silicon discrete semiconductors and ceramic resonators and filters.
A typical end product for wireless communications, such as a handset, contains
radio frequency, baseband and digital signal processing components. Radio
frequency components convert, switch, process and amplify the high frequency
signals that carry the information to be transmitted or received. Baseband
components process signals into and from their original electrical form (low
frequency voice or data). The digital components control the overall circuitry
and process the voice or other data to be transmitted and received.

The table below identifies the major product categories and markets we serve.


<TABLE>
<CAPTION>
                                                                                 
                                 POWER       SMALL SIGNAL &                                                MILLIMETER
                               AMPLIFIER     MULTIFUNCTION                     DISCRETE         CERAMIC        WAVE
          Markets                 ICS             ICS        SWITCH ICS      SEMICONDUCTORS     PRODUCTS     PRODUCTS
---------------------------------------------------------------------------------------------------------------------
<S>                            <C>            <C>             <C>            <C>                <C>         <C>
WIRELESS VOICE & DATA
     Handsets                   *                                 *               *
     PDAs                       *                                 *               *
     Infrastructure             *                  *              *               *                *             *
                                                                                                                 
BROADBAND                                                                                                        
     Wireless                                      *              *               *                *             *
     Cable TV & Modems                             *              *               *                *             *
     Fiber                                         *              *               *                *             *
</TABLE>




                                       3

<PAGE>   4

ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


WIRELESS SEMICONDUCTOR PRODUCTS

The diagram below illustrates the role of many of our Wireless Semiconductor
Products in a dual band and dual mode wireless telephone handset.


              [ai] ALPHA PRODUCTS IN A DUAL BAND/DUAL MODE HANDSET

GaAs RF IC Switches      GaAs RF Power Amplifiers        Discrete Semiconductors
--------------------------------------------------------------------------------



                             [CELL-PHONE SCHEMATIC]

There is a picture of a cellular telephone on the right side of the page. To the
left of the telephone is a diagram depicting various parts of a dual band/dual
mode handset and identifying those parts which we supply.


Power Amplifiers. Wireless communications systems require amplification in
receiving and transmitting signals. Relatively weak incoming signals must be
amplified without adding background noise. GaAs power amplifiers are used in
handsets because they use battery power more efficiently than silicon
amplifiers, and battery life is a critical system feature in these portable
applications. Alpha has been a leader in innovative GaAs power amplifier ICs.
During the fourth quarter of fiscal 2000, we became the first merchant
semiconductor company to offer a 3 volt, high-efficiency PHEMT power amplifier
IC for GSM operating at three different frequencies. We were also the first to
deliver a 3 volt MESFET GaAs power amplifier IC, which has now been in
continuous, high-volume production for more than two years. In addition, our
acquisition of NDI has provided us with GaAs HBT process technology, which we
believe will open new power amplifier opportunities and complement our existing
strength in the GaAs PHEMT and GaAs MESFET processes.

Integrated Circuit Switches and Controls. Switching and control functions route
and adjust signal levels between the receiver and transmitter and other
processing devices. The number of switching functions increases with the
complexity of the handset design. In the dual band/dual mode handset
illustrated, the switches perform three different routing functions, including:
signal routing to transmitter or receiver; signal routing to cellular or PCS
frequency; and signal routing to digital or analog mode.

Our GaAs integrated circuit switches are used in handsets to provide lower
signal loss and better signal isolation than comparable silicon products. Our
new, ultra-high-efficiency GaAs PHEMT switch ICs now



                                       4

<PAGE>   5

                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES

integrate logic elements, making their usage even easier for our OEM customers.
Our first volume order of Alpha's advanced GaAs PHEMT switch ICs that operate
with positive-only 3 volt supply is currently in production. Transistors using
the GaAs HBT process have not been suitable for switches.

Discrete Semiconductors. Discrete semiconductors, especially diodes, are used
for signal tuning and switching functions in the handset. We draw on our
microwave frequency and millimeter wave frequency experience to produce diodes
with better circuit performance. We manufacture these products in very high
volumes to several handset OEMs.

CERAMIC PRODUCTS

Our ceramic products play a critical role in the signal selection, or filtering
process, that is essential to processing communications signals. Ceramic
materials allow for improved power efficiency and miniaturization, which are
being increasingly used in wireless communications infrastructure. Ceramic
products are also critical in the frequency-determining portions of DBS
receivers, radar detectors and intrusion alarms.

APPLICATION SPECIFIC PRODUCTS

We offer customized products that address all transmit and receive functions for
radio frequency, microwave frequency and millimeter wave frequency applications,
primarily in the broadband data and satellite communications markets. The
millimeter wave applications are an emerging area of broadband, high capacity
data wireless services, such as Internet access. Systems operating in this
frequency range must use GaAs.

MARKETING AND DISTRIBUTION

We sell our products through independent manufacturers' representatives and
through a direct sales staff. We sell through 13 domestic and 23 international
independent manufacturers' representative organizations. Our field support
management staff oversees our manufacturers' representatives and provides them
with sales direction and support. Our direct sales staff manages key customer
accounts and worldwide customer support and identifies and targets sales in the
emerging wireless data markets.

We maintain an internal marketing organization that is responsible for
developing sales and advertising literature, such as product announcements,
catalogs, brochures and magazine articles in trade and other publications. Our
internal marketing organization also prepares technical presentations for
industry conferences.

We believe that the technical and complex nature of our products and markets
demands an extraordinary commitment to close ongoing relationships with our
customers. We strive to maintain close contact with our customers' design,
engineering, manufacturing, and purchasing and project management personnel. We
employ a team approach in developing close relationships by combining the
support of design and applications engineers, manufacturing personnel, sales and
marketing staff and senior management. We believe that maintaining close contact
with our customers improves their level of satisfaction, assists us in
anticipating their future product needs and enhances our opportunities for
design wins.

RESEARCH AND DEVELOPMENT

Our products and markets are subject to continued technological advances.
Recognizing this, we maintain a high level of R&D activities to remain
competitive in certain areas and to be an industry leader in other areas. We are
focusing our development efforts on new products, design tools and manufacturing
processes in our Wireless Semiconductor Products group using our core
technologies. We strive to improve existing product performance, improve design
and manufacturing processes and reduce costs. We maintain close collaborative




                                       5

<PAGE>   6

ALPHA INDUSTRIES, INC. AND SUBSIDIARIES



relationships with many of our customers to help us identify market demands and
target our development efforts to meet those demands.

GaAs HBT Capabilities. On April 24, 2000, we acquired NDI of Sunnyvale,
California. The acquisition provides a production-ready GaAs Indium Gallium
Phosphide HBT process, enabling the production of high efficiency HBT power
amplifiers for wireless telephone handsets. GaAs HBT process technology works at
higher frequencies and requires less power to transmit signals than traditional
silicon semiconductors, and it provides greater efficiency and linearity than
GaAs MESFET devices. For cellular telephones, this permits smaller handsets and
longer talk-time between battery charges. HBT power amplifiers are also
particularly well suited for use in the emerging broadband data equipment
markets. We believe that the addition of a line of GaAs HBT products will
complement our existing GaAs PHEMT and GaAs MESFET devices, enabling us to offer
our customers the full range of currently available GaAs processes for use in
wireless telephone handsets and wireless data applications.

Our R&D expenditures for fiscal 2000, 1999 and 1998 were $20.7 million, $12.9
million and $10.0 million, respectively.

RAW MATERIALS

Raw materials for our products and manufacturing processes are generally
available from several sources. It is our policy not to depend on a sole source
of supply. However, there are limited situations where we procure certain
components and services for our products from single or limited sources. We
purchase these materials and services on a purchase order basis, do not carry
significant inventories and do not have any long-term supply contracts with our
source vendors.

WORKING CAPITAL

Our business is not seasonal, and there are no special practices with respect to
working capital for us or the industry in general. We provide a limited warranty
on our products against defects in material and workmanship. Payment terms are
30 days in the domestic market and generally 60 days in foreign markets.

CUSTOMERS

During fiscal 2000, one customer, Motorola, Inc., accounted for approximately
34% of our total sales and no other single customer accounted for 10% or more of
our total sales.

COMPETITIVE CONDITIONS

We compete on the basis of price, performance, quality, reliability, size,
ability to meet delivery requirements and customer service and support. We
experience intense competition worldwide from a number of multinational
companies that offer a variety of competitive products and broader product
lines, and which have substantially greater financial resources and production,
marketing, manufacturing, engineering and other capabilities than us. We also
face competition from a number of smaller companies. In addition, our customers,
particularly our largest customers, may have or could acquire the capability to
develop or manufacture products competitive with those that have been or may be
developed or manufactured by us.




                                       6

<PAGE>   7

                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


PATENTS AND TRADEMARKS

We own a small number of patents and have other patent applications under
preparation or pending. However, we believe that our technological position
depends primarily on the ability to develop new innovative products through the
technical competence of our engineering personnel. We have applied for a U.S.
patent on an innovative GaAs switch IC design that we believe will become the
preferred technology for wireless handsets and other portable applications.

BACKLOG

Our policy is to book only the next three months of commercial orders consistent
with customer short term requirements. Many commercial orders cover
substantially more than three months of performance, but such orders can be
modified or cancelled by the customer easily and we believe it is a better
practice to limit the bookings in this manner. On this basis, we believe all
orders in our backlog to be firm. We have backlog of undelivered orders on April
2, 2000 of approximately $55.7 million compared with $36.9 million on March 28,
1999.

ENVIRONMENTAL REGULATIONS

In our opinion, compliance with federal, state, and local environmental
protection regulations does not and will not have a material effect on our
capital expenditures, earnings and competitive position.

EXECUTIVE OFFICERS

The following table sets forth certain information with respect to our executive
officers at May 31, 2000.

      NAME                        AGE     POSITION

      George S. Kariotis          77      Chairman Emeritus and Director

      Thomas C. Leonard           65      Chairman of the Board of Directors

      David J. Aldrich            43      President, Chief Executive Officer
                                          and Director

      Paul E. Vincent             52      Vice President, Treasurer,
                                          Secretary and Chief Financial Officer

      Jean-Pierre Gillard         56      Vice President

      Richard Langman             53      Vice President and President
                                          of Trans-Tech, Inc.

      Bruce Nonnemaker            53      Vice President

All officers serve until the next Board of Directors meeting following the
Annual Meeting of Stockholders scheduled for September 11, 2000, or until their
successors are elected and qualified. No officer was elected pursuant to any
arrangement or understanding.

George S. Kariotis was elected Chairman Emeritus in April 2000. Prior to this
election, Mr. Kariotis served as Chairman of the Board and Chief Executive
Officer from our inception in 1962 to 1978, and, from 1974 to 1978, he was also
our Treasurer. From 1979 to 1983, Mr. Kariotis was the Secretary of Manpower
Development and Economic Affairs for the Commonwealth of Massachusetts. He was
re-elected Chairman of the Board in 1983 and Chief Executive Officer in 1985.
Mr. Kariotis resigned as Chief Executive Officer in July 1986 while he
campaigned for public office. He resumed his position as Chief Executive Officer
in November 1986, and served in that capacity until 1991. Mr. Kariotis served as
Chairman of the Board since his re-election in 1983 up until his election to
Chairman Emeritus in April 2000. Mr. Kariotis has been a Director since 1962 and
continues to serve in that capacity.



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<PAGE>   8

ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


Thomas C. Leonard was elected Chairman of the Board in April 2000. Prior to his
election, Mr. Leonard served as Chief Executive Officer since July 1996. Mr.
Leonard also served as our President from July 1996 to September 1999. In August
1996, Mr. Leonard was elected a Director. Mr. Leonard joined us in 1992 as a
division General Manager, and, in 1994, he was elected a Vice President. Mr.
Leonard has over 30 years experience in the microwave industry, having held a
variety of executive and senior level management and marketing positions at
M/A-COM, Inc., Varian Associates, Inc. and Sylvania.

David J. Aldrich was elected President, Chief Executive Officer and a member of
the Board of Directors in April 2000. Mr. Aldrich joined us in 1995 as Vice
President, Chief Financial Officer and Treasurer. He served as Vice President
and General Manager of the Wireless Semiconductor group and the Application
Specific Products group until his election in September 1999 to President and
Chief Operating Officer. From 1989 to 1995, Mr. Aldrich held senior management
positions at M/A-COM, Inc., including Manager Integrated Circuits Active
Products, Corporate Vice President Strategic Planning, Director of Finance and
Administration, and Director of Strategic Initiatives with the Microelectronics
Division. Mr. Aldrich is a Director of Microwave Power Devices, Inc., a
manufacturer of microwave products.

Paul E. Vincent joined us as Controller in 1979 and has been Vice President and
Chief Financial Officer since January 1997. Mr. Vincent was elected Secretary in
September 1999. Prior to joining us, Mr. Vincent worked at Applicon Incorporated
and, prior to that, Arthur Andersen & Co. Mr. Vincent is a CPA.

Richard Langman joined us in January 1997 as Vice President, and as President
and General Manager of our Trans-Tech, Inc. subsidiary. Prior to joining us, Mr.
Langman worked for Coors Ceramics Company for 23 years, holding senior executive
positions in operations and sales.

Jean-Pierre Gillard joined us in 1992 as Manager of GaAs integrated circuit
operations and has been Vice President of Business Development since June 1996.
Before 1992, he held a number of management positions at M/A-COM, Inc. in both
marketing and sales.

Bruce Nonnemaker joined us in 1997 as Director of Operations for the Wireless
Semiconductor group and Application Specific Products group. Mr. Nonnemaker
served in this capacity until his election to Vice President, Operations in
September 1999. Prior to joining us, Mr. Nonnemaker held senior operations
management positions at Digital Equipment Corporation. Before this, he held
senior operations positions at Western Digital, Commodore Computer and Solid
State Scientific.

EMPLOYEES

As of April 2, 2000, we employed approximately 1,090 persons, compared with 940
persons as of March 28, 1999.


I
TEM 2    PROPERTIES

The following information describes the major facilities we own and lease. We
believe we have adequate production capacity to meet our current business needs,
but we are adding the capacity required to better serve the wireless market as
demand continues to grow. In September 1999, we announced the completion of the
first phase of a major expansion program that enhanced and expanded the
available clean room space in our GaAs IC fabrication facility in Massachusetts.
The new clean room space is complete and in use, and additional manufacturing
equipment has been installed and brought to full productivity. As demand for our
GaAs products continues to increase, we have accelerated the second phase of
expansion in our fab. This second phase involves the installation of additional
production equipment, without the need for additional clean room construction.
We expect the total cost of this second phase to approximate $12 million and to
be complete by the end of the summer of 2000.



                                       8

<PAGE>   9

                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


a)       We own a 158,000 square foot building in Woburn, Massachusetts. This
         plant houses our primary GaAs IC fabrication facility and our corporate
         headquarters. We doubled output capacity in this facility in 1999, and
         a second doubling will be complete by the end of the summer of 2000. We
         are now implementing a conversion of a portion of this facility, which
         will allow us to manufacture product on six inch GaAs wafers, more than
         doubling its capacity again. This project is expected to be complete
         within twelve to fifteen months.

b)       We lease a 27,000 square foot building in Sunnyvale, California. This
         facility houses our second GaAs IC fabrication facility and was
         acquired in our purchase of Network Device, Inc. in April 2000. We are
         currently expanding capacity in this facility to meet demand for our IC
         products.

c)       We own a 92,000 square foot facility in Adamstown, Maryland. This plant
         is occupied by a subsidiary, and is our primary electrical ceramic
         product manufacturing facility. We are currently expanding the capacity
         of this facility to meet increased demand for its products and expect
         to significantly increase its capacity by the end of calendar year
         2000.

d)       We lease a 33,000 square foot facility in Frederick, Maryland. This
         plant is occupied by a subsidiary and is used to manufacture ceramic
         components, including filters.


ITEM 3    LEGAL PROCEEDINGS

We do not have any material pending legal proceedings other than routine
litigation incidental to our business.

We have been notified by federal and state environmental agencies of our
potential liability with respect to the Spectron, Inc. Superfund site in Elkton,
Maryland. Several hundred other companies have also been notified about their
potential liability regarding this site. We continue to deny that we have any
responsibility with respect to this site other than as a DE MINIMIS party.
Management is of the opinion that the outcome of the aforementioned
environmental matter will not have a material effect on our operations.

See also Note 7 to the Consolidated Financial Statements on page 36.


ITEM 4    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The Company's stockholders approved an increase in the authorized shares of the
Company from 30 million to 100 million during a Special Meeting of Stockholders
on March 28, 2000.


                                     PART II


ITEM 5   MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER
         MATTERS

See the section entitled "Quarterly Financial Data" appearing on page 25 for
information regarding Common Stock market prices. We have not paid cash
dividends on our common stock since fiscal 1986, and we do not anticipate paying
cash dividends in the foreseeable future. Our current policy is to retain all of
our earnings to finance future growth. We are subject to financial and operating
covenants, including restrictions on the payment of cash dividends, under our
bank financing agreement. On April 19, 2000, we distributed a two-for-one common
stock split.

See Notes 3 and 5 to the Consolidated Financial Statements beginning on pages 29
and 32, respectively, for information regarding dividend restrictions and the
stock split.



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ALPHA INDUSTRIES, INC. AND SUBSIDIARIES



ITEM 6    SELECTED FINANCIAL DATA

FIVE YEAR FINANCIAL SUMMARY
(In thousands, except per share amounts and financial ratios)


<TABLE>
<CAPTION>
                                                                              FISCAL YEAR
                                                      2000         1999          1998          1997           1996
--------------------------------------------------------------------------------------------------------------------
<S>                                                <C>           <C>           <C>           <C>            <C>     
RESULTS OF OPERATIONS
    Sales ....................................     $184,705      $126,339      $116,881      $ 85,253       $ 96,894
    Net income (loss) ........................       24,380        21,490        10,302       (15,572)         3,794
    Per share data
      Net income (loss) basic ................     $   0.64      $   0.68      $   0.34      $  (0.53)      $   0.15
      Net income (loss) diluted ..............     $   0.61      $   0.66      $   0.33      $  (0.53)      $   0.14
      Weighted average common shares basic ...       37,994        31,649        30,603        29,543         25,101
      Weighted average common shares diluted .       40,032        32,701        31,423        29,543         26,252
FINANCIAL RATIOS
    Return (based on net income-net loss)
      On sales ...............................         13.2%         17.0%          8.8%        (18.3%)          3.9%
      On average assets ......................         13.3%         23.4%         14.5%        (22.1%)          6.0%
      On average equity ......................         15.9%         31.4%         20.8%        (30.9%)          8.9%
    Current ratio ............................         7.12          3.12          2.52          2.10           3.35
    Long-term debt to equity .................          0.2%          0.9%          2.9%          8.3%           4.5%
FINANCIAL POSITION
    Working capital ..........................     $163,436      $ 42,687      $ 26,061      $ 18,409       $ 32,647
    Additions to property, plant and equipment       34,584        17,730        11,039         7,951         12,297
    Total assets .............................      259,104       106,681        76,929        65,253         75,423
    Long-term debt ...........................          345           713         1,625         3,606          2,565
    Long-term capital lease obligations ......           --            --            --             8            565
    Stockholders' equity .....................      226,554        81,014        55,822        43,386         57,533
OTHER STATISTICS
    New orders (net of cancellations) ........      203,500       126,500       121,100        81,300        103,200
    Backlog at year end .....................      $ 55,700      $ 36,900      $ 36,800      $ 32,500       $ 36,500
--------------------------------------------------------------------------------------------------------------------
</TABLE>




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                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES



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

OVERVIEW

We design, develop, manufacture and market proprietary radio frequency,
microwave frequency and millimeter wave frequency integrated circuits and
discrete semiconductors for wireless and broadband communications markets. Our
operations are currently organized into three reportable segments:

The Wireless Semiconductor Products Group supplies GaAs integrated circuits and
discrete semiconductors in high volume for wireless telephone handsets and
broadband data applications. This group represented 64.3% of our total sales in
fiscal 2000.

The Ceramic Products Group uses electrical ceramic and ferrite technologies to
supply resonators and filters, primarily for wireless base station equipment.
This group represented 19.5% of our total sales in fiscal 2000.

The Application Specific Products Group supplies radio frequency, microwave
frequency and millimeter wave frequency GaAs integrated circuits, and discrete
semiconductors and components for customized products in the broadband data and
satellite communications markets. This group represented 16.2% of our total
sales in fiscal 2000.

Our customers include leading OEMs in the wireless and broadband communications
industry and their principal suppliers. During fiscal 2000, sales to our 15
largest customers accounted for 64.8% of our total sales. During that period,
sales to Motorola accounted for 34.1% of total sales.

RESULTS OF OPERATIONS

The following table shows our statement of operations data expressed as a
percentage of sales for the periods indicated:


<TABLE>
<CAPTION>
                                                                  YEARS ENDED
                                             ------------------------------------------------------
                                             APRIL 2, 2000       MARCH 28, 1999     MARCH 29, 1998
                                             -------------       --------------     --------------
<S>                                               <C>                <C>               <C>   
Sales......................................       100.0%             100.0%            100.0%
Cost of sales..............................        55.8               56.3              62.3
                                                  -----              -----             ----- 
Gross margin...............................        44.2               43.7              37.7
Research and development expenses..........        11.3               10.2               8.6
Selling and administrative expenses........        16.2               18.0              19.1
                                                  -----              -----             ----- 
Operating income...........................        16.7               15.5              10.0
Other income (expense), net................         3.2                0.5              (0.2)
                                                  -----              -----             ----- 
Income before income taxes.................        19.9               16.0               9.8
Provision (benefit) for income taxes.......         6.7               (1.0)              1.0
                                                  -----              -----             ----- 
Net income.................................        13.2%              17.0%              8.8%
                                                  =====              =====             ===== 
</TABLE>




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<PAGE>   12

ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


FISCAL YEARS ENDED APRIL 2, 2000, MARCH 28, 1999 AND MARCH 29, 1998

Sales. Sales increased 46.2% to $184.7 million in fiscal 2000 from $126.3
million in fiscal 1999. The increase was primarily attributable to increased
demand for wireless products, as well as for products in emerging broadband data
applications. Sales increased 8.1% to $126.3 million in fiscal 1999 from $116.9
million in fiscal 1998. The increase was primarily due to increased demand for
wireless products and our penetration into additional handset platforms. Defense
sales decreased to 7.8% of total sales in fiscal 2000 from 17.2% in fiscal 1999
and 17.6% in 1998, as we exit the defense market by offering last time buys to
our customers and concluding existing contracts. Deliveries to Motorola
represented 34.1% of our total sales in fiscal 2000 compared to 28.1% in fiscal
1999 and 24.7% in fiscal 1998.

Gross Profit. Gross profit increased 47.9% to $81.6 million in fiscal 2000 from
$55.2 million in fiscal 1999. Gross margin increased to 44.2% in fiscal 2000
from 43.7% in fiscal 1999. These increases were primarily a result of improved
operating efficiencies in our Wireless Semiconductor and Ceramics Groups, as
both continued to leverage capacity and improve yields. Gross profit increased
25.2% to $55.2 million in fiscal 1999 from $44.1 million in fiscal 1998. Gross
margin increased to 43.7% in fiscal 1999 from 37.7% in fiscal 1998. These
increases were primarily due to improved operating efficiencies in all three
business segments, particularly in Wireless Semiconductors, which continued to
leverage capacity, improve yields and reduce material costs.

Research and Development Expenses. Research and development expenses increased
60.9% to $20.7 million or 11.3% of sales in fiscal 2000 from $12.9 million or
10.2% of sales in fiscal 1999. The increase in research and development expenses
was primarily attributable to the development of processes and applications in
the Wireless Semiconductor Products Group, as approximately 80% of our total
research and development spending in fiscal 2000 was within this segment.
Research and development expenses increased 28.4% to $12.9 million or 10.2% of
sales in fiscal 1999 from $10.0 million or 8.6% of sales in fiscal 1998. Over
75% of our total research and development expenses in fiscal 1999 and 1998 were
focused on the Wireless Semiconductor Products Group's efforts in developing
GaAs integrated circuits and other high volume wireless products.

Selling and Administrative Expenses. Selling and administrative expenses
increased 31.8% to $30.0 million or 16.2% of sales in fiscal 2000 from $22.8
million or 18.0% of sales in fiscal 1999. The increase in selling and
administrative expenses was attributable to increased sales commissions and
direct selling costs resulting from higher sales volumes, as well as increased
expenses related to training, recruiting and an increased sales force. Because
we have the infrastructure in place to support our sales growth, selling and
administrative expenses as a percentage of sales declined in fiscal 2000 over
fiscal 1999. Selling and administrative expenses increased 1.8% to $22.8 million
or 18.0% of sales in fiscal 1999 from $22.4 million or 19.1% of sales in fiscal
1998. The increase in selling and administrative expenses was attributable to
increased sales commissions resulting from higher sales volumes, while the
decrease in selling and administrative expenses as a percentage of sales was
attributable to our continued efforts to control administrative costs.

Other Income (Expense), Net. Interest expense in fiscal 2000 declined $154,000
when compared to fiscal 1999 as a result of a continuing decline in outstanding
borrowings. The increase in interest income of $5.3 million in fiscal 2000 over
fiscal 1999 was due to considerably higher levels of cash, cash equivalents and
short-term investments. Other expenses increased $208,000 in fiscal 2000
compared to fiscal 1999 due to losses resulting from the disposal of equipment
in fiscal 2000. Net other income in fiscal 1999 increased $911,000 compared to
fiscal 1998 primarily due to increases in interest income as a result of higher
levels of cash, cash equivalents and short-term investments.



                                       12

<PAGE>   13

                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


Provision (Benefit) for Income Taxes. The provision for income taxes in fiscal
2000 was $12.4 million compared to an income tax benefit of $1.3 million in
fiscal 1999. The fiscal 2000 provision reflects a tax rate of 34% while the
fiscal 1999 benefit reflects a 10% tax rate offset by a $3.3 million tax
benefit. The tax benefit of $3.3 million resulted from a reduction in the
valuation allowance against deferred tax assets because of the expected use of
net operating loss carryforwards in future periods. The benefit for income taxes
in fiscal 1999 was $1.3 million compared to a provision for income taxes of $1.1
million in fiscal 1998. Our effective tax rate in fiscal 1998 was 10% due to the
utilization of net operating loss carryforwards.

BUSINESS SEGMENTS

The table below displays sales and operating income by business segment for
fiscal 2000, 1999 and 1998. See Note 9 to the consolidated financial statements.


<TABLE>
<CAPTION>
                                                                          YEARS ENDED
                                                             APRIL 2,       MARCH 28,       MARCH 29,
                                                               2000           1999            1998
                                                            ---------     -----------       ---------
                                                                          (in thousands)
<S>                                                         <C>             <C>             <C>     
SALES
Wireless Semiconductor Products...........................  $118,779        $ 65,822        $ 52,612
Ceramic Products..........................................    36,054          25,540          27,151
Application Specific Products.............................    29,872          34,977          37,118
                                                            --------        --------        --------
                                                            $184,705        $126,339        $116,881
                                                            ========        ========        ========
OPERATING INCOME                                                                            
Wireless Semiconductor Products...........................  $ 18,785        $  7,435        $  2,799
Ceramic Products..........................................     4,632           1,879           1,679
Application Specific Products.............................     7,492          10,241           7,210
                                                            --------        --------        --------
                                                            $ 30,909        $ 19,555        $ 11,688
                                                            ========        ========        ========
</TABLE>


Wireless Semiconductor Products. Sales for the Wireless Semiconductor Products
Group increased 80.5% to $118.8 million in fiscal 2000 from $65.8 million in
fiscal 1999. The increase reflects a growing wireless market to include data,
increased market penetration and gains in market share. Sales for the Wireless
Semiconductor Products Group increased 25.1% to $65.8 million in fiscal 1999
from $52.6 million in fiscal 1998. The increase was primarily attributable to
increased demand for wireless products and our penetration into additional
handset platforms.

Operating income for the Wireless Semiconductor Group increased 152.7% to $18.8
million in fiscal 2000 from $7.4 million in fiscal 1999. The increase was
primarily attributable to increased sales and improved operating efficiencies as
this group continued to leverage capacity and control material costs.
Additionally, as this group continued its development of processes and
applications for the wireless market, it was able to control administrative
costs. Operating income for the Wireless Semiconductor Products Group increased
165.6% to $7.4 million in fiscal 1999 from $2.8 million in fiscal 1998. The
increase in operating income was primarily attributable to increased sales and
improved operating efficiencies.

Ceramic Products. Sales for the Ceramics Group increased 41.2% to $36.1 million
in fiscal 2000 from $25.5 million in fiscal 1999. The increase in sales was
primarily attributable to growth in wireless infrastructure combined with added
customer penetration, as well as an increasing demand from emerging broadband
customers. Sales for the Ceramics Group decreased 5.9% to $25.5 million in
fiscal 1999 from $27.2 million in fiscal 1998. The decrease was primarily
attributable to a decreased level of sales for the first half of fiscal 1999
mainly due to lower than expected demand for wireless infrastructure and price
competition from Japanese competitors whose currency declined in value against
the U.S. dollar.



                                       13

<PAGE>   14

ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


Operating income for the Ceramics Group increased 146.5% to $4.6 million in
fiscal 2000 from $1.9 million in fiscal 1999. The increase in operating income
was primarily attributable to an increase in sales and improved operating
efficiencies, including the leveraging of capacity and increased manufacturing
automation. Operating income for the Ceramics Group increased 11.9% to $1.9
million in fiscal 1999 from $1.7 million in fiscal 1998. The increase in
operating income was primarily attributable to reduced material costs and
improved operating efficiencies.

Application Specific Products. Sales for the Application Specific Products Group
decreased 14.6% to $29.9 million in fiscal 2000 from $35.0 million in fiscal
1999. Sales continue to decline as we exit non-strategic businesses and focus
our efforts on the broadband and wireless markets. Sales for the Application
Specific Products Group decreased 5.8% to $35.0 million in fiscal 1999 from
$37.1 million in fiscal 1998. The decrease was primarily attributable to our
increasing focus on the commercial market and a continuing shift away from the
defense market.

Operating income for the Application Specific Products Group decreased 26.8% to
$7.5 million in fiscal 2000 from $10.2 million in fiscal 1999. This group
continued to realign its cost structure to current volumes, reporting a gross
margin of over 50% and operating margin of over 25% for fiscal 2000. Operating
income for the Application Specific Products Group increased 42.0% to $10.2
million in fiscal 1999 from $7.2 million in fiscal 1998. The increase in
operating income was primarily attributable to improved operating efficiencies,
including improved yields and reduced material costs. In addition, the Group's
selling and administrative activities were significantly reduced as the Group
continued to focus on controlling costs.

LIQUIDITY AND CAPITAL RESOURCES

As of April 2, 2000, we had working capital of $163.4 million, including $140.0
million in cash, cash equivalents and short-term investments. In fiscal 2000,
operations generated $38.9 million of cash primarily attributable to net income
of $24.4 million. In addition, we effectively managed working capital as
evidenced by an increase in average annual inventory turns to 9.9 in fiscal 2000
compared to 8.5 in fiscal 1999 and a decrease in average annual days sales
outstanding to 55 days in fiscal 2000 compared to 60 days in fiscal 1999. In
June 1999, we completed a public offering of our common stock that raised net
proceeds of $109.4 million. Uses of cash included $34.6 million for capital
expenditures, $109.3 million for net purchases of short-term investments and
$1.2 million for the repayment of long-term debt.

Of the $34.6 million in capital expenditures, approximately $28.3 million was
related to the Wireless Semiconductor Products Group as we continued our
investment in the semiconductor GaAs wafer fabrication operation and the
integrated circuit and discrete semiconductor assembly and test areas. In
September 1999, we announced the completion of the first phase of a major
expansion program to enhance and expand the available clean room space in our
GaAs IC facility in Massachusetts. The new clean room space is complete and in
use, and additional manufacturing equipment has been installed and brought to
full productivity. The second phase of this project has been accelerated due to
continued increase in demand for our GaAs products. The second phase, which
involves the installation of additional production equipment within the existing
facility, is expected to be complete by the end of the summer of 2000 at an
estimated total cost of $12 million. We are in the initial stages of the third
phase of this project, which involves the conversion of our Massachusetts GaAs
IC facility to allow us to manufacture product on six inch wafers. We expect to
complete this phase within twelve to fifteen months. Improvements in
manufacturing capabilities at the ceramics facility accounted for approximately
$4.2 million of capital expenditures.

In November 1999, we entered into a $10 million revolving credit agreement,
which expires on October 31, 2000. There were no borrowings under this agreement
at April 2, 2000. We expect to continue to maintain a debt facility upon
expiration of this agreement.


                                       14

<PAGE>   15
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


In June 1999, we completed a public offering of our common stock that raised net
proceeds of $109.4 million. Substantially all of the proceeds have been invested
in commercial paper and securities issued by various federal agencies and
corporations. The net proceeds may be used for the purchase of equipment, the
expansion of facilities and the acquisition of businesses, technologies or
products that complement our business.

On February 11, 2000, we announced that we had signed a definitive agreement to
acquire privately-held Network Device, Inc. of Sunnyvale, California. The
acquisition, which was completed on April 24, 2000, will be accounted for as a
pooling-of-interests.

We believe that anticipated cash from operations, available funds and borrowings
under our revolving credit agreement, together with the net proceeds from our
recent stock offering, will be adequate to fund our currently planned working
capital and capital expenditure requirements at least through fiscal 2001.

OTHER MATTERS

Inflation did not have a significant impact upon our results of operations
during the three-year period ended April 2, 2000.

Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for
Derivative Instruments and Hedging Instruments" establishes accounting and
reporting standards for derivatives and hedging activities. It requires that an
entity recognize all derivatives as either assets or liabilities in the balance
sheet and measure those instruments at fair value. SFAS No. 133 will be
effective for our fiscal year 2002. We are currently evaluating the effects of
SFAS No. 133. We do not expect this statement to have a material effect on our
consolidated financial position, results of operations or cash flow.

FORWARD-LOOKING STATEMENTS

This report and other documents we have filed with the Securities and Exchange
Commission contain forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements represent our judgment regarding future events.
Although we would not make forward-looking statements unless we believe we have
a reasonable basis for doing so, we cannot guarantee their accuracy and actual
results may differ materially from those we anticipated due to a number of
uncertainties, many of which we are not aware. We urge you to consider the risks
and uncertainties discussed below and elsewhere in this report and in the other
documents filed with the SEC in evaluating our forward-looking statements. We
have no plans to update our forward-looking statements to reflect events or
circumstances after the date of this report. We generally identify
forward-looking statements with the words "plans," "expects," "anticipates,"
"estimates," "will," "should" and similar expressions.

OUR RELIANCE ON A SMALL NUMBER OF CUSTOMERS FOR A LARGE PORTION OF OUR SALES
COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR RESULTS OF OPERATIONS. A significant
portion of our sales in each fiscal period has been concentrated among a limited
number of customers. If we lost one or more of these major customers, or if one
or more major customers decreases its orders, our business would be materially
and adversely affected. In recent periods, sales to our major customers as a
percentage of total sales have increased. In fiscal 2000, sales to our five
largest customers accounted for 50.9% of our sales, with Motorola accounting for
34.1% of sales. Our future operating results depend on the success of these
customers and our success in selling products to them.

OUR SALES VOLUME IS AFFECTED BY OUR OEM CUSTOMERS' SALES VOLUME. A substantial
portion of our sales is derived from sales of products to OEMs. These OEMs
demand highly reliable products and often require up to several months to
evaluate and test our integrated circuits and devices before deciding to design
them into their products. If our products are designed into an OEM's product,
our sales volume will depend upon the commercial success and the length of the
product cycle of the OEM's product.



                                       15

<PAGE>   16
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


DIFFICULTIES IN PRODUCTION WOULD ADVERSELY AFFECT OUR OPERATING RESULTS. Our
products are very complex, have sophisticated designs and are manufactured using
highly complex process technologies. Difficulties in production can occur which
would limit our ability to ship product and adversely affect our operating
results. In most cases, our products are customized for our customers who insist
that our products meet their exact specifications for quality, performance and
reliability. If we are unable to manufacture to our customers' specifications,
our operating results will suffer.

OUR OPERATING RESULTS ARE DEPENDENT ON THE DEVELOPMENT OF NEW PRODUCTS. Our
future success will depend on our ability to develop new products in a timely
and cost-effective manner. The development of our new products is highly
complex. We have historically experienced delays in completing the development
and introduction of new products. The successful development and introduction of
new products depends on a number of factors, including our timely completion of
product designs and development, our ability to develop manufacturing processes
for new products, and commercial acceptance of our new products and
enhancements.

OUR FAILURE TO KEEP PACE WITH RAPID TECHNOLOGICAL CHANGES IN THE WIRELESS
COMMUNICATIONS INDUSTRY WOULD IMPAIR OUR GROWTH. The wireless communications
markets are characterized by frequent introductions of new products and
services. New products and services respond to evolving product and process
technologies and consumer demand for greater functionality, lower costs, smaller
products and better performance. As a result, we have experienced, and will
continue to experience, product design obsolescence. We must continue to improve
our product designs and develop new products with new technologies to meet our
customers' demands.

WE OPERATE IN VERY COMPETITIVE INDUSTRIES AND WE MAY BE UNABLE TO COMPETE
SUCCESSFULLY. Competition in the markets for our products is intense. We compete
with several companies primarily engaged in the business of designing,
manufacturing and selling integrated circuits, discrete semiconductors and
ceramic products, as well as suppliers of other discrete products. Our
competitors could develop new process technologies that may be superior to ours.
In addition, many of our existing and potential customers manufacture or
assemble wireless communications devices and have substantial in-house
technological capabilities. If one of our large customers decided to design and
manufacture integrated circuits internally, it could have an adverse effect on
our operating results. For example, we compete with our largest customer in the
production of power amplifiers.

Many of our existing and potential competitors have strong market positions,
considerable internal manufacturing capacity, established intellectual property
rights and substantial technological capabilities. Many of our existing and
potential competitors have greater financial, technical, manufacturing and
marketing resources than we do. We cannot guarantee that we will be able to
compete successfully with our competitors.

We expect competition to increase. This could mean lower prices for our products
or reduced demand for our products. Any of these developments would have an
adverse effect on our operating results.

AVERAGE SELLING PRICES FOR OUR PRODUCTS TYPICALLY DECLINE OVER TIME. Average
selling prices for our products decline over time. Many of our manufacturing
costs are fixed. For a given level of sales, when our manufacturing costs
decline, our gross margins improve, and when our manufacturing costs increase,
our gross margins decline. Our operating results suffer when gross margins
decline. We may experience these problems in the future and we cannot predict
when they may occur or their severity.

OUR OPERATING RESULTS WOULD SUFFER IF ONE OF OUR KEY SUPPLIERS FAILS TO DELIVER
MATERIALS OR SERVICES FOR THE FABRICATION OF OUR PRODUCTS. We currently procure
certain materials and services for our products from one or a limited number of
suppliers. For example, we procure GaAs substrates, a critical raw material,
from a small number of suppliers. In addition, we obtain some GaAs wafers from a
single external foundry. Further, we procure silicon substrates for
semiconductors and certain chemical powders for ceramic



                                       16

<PAGE>   17
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


manufacturing from single sources. We purchase these materials and services on a
purchase order basis. We do not carry significant inventories or have any
long-term supply contracts with our vendors. Our inability to obtain these
materials or services in required quantities or in acceptable quality would
result in significant delays or reductions in product shipments. This would
materially and adversely affect our operating results.

OUR OPERATING RESULTS MAY FLUCTUATE SIGNIFICANTLY. Our sales, earnings and other
operating results have fluctuated significantly in the past and may fluctuate
significantly in the future primarily as a result of the timing and receipt of
our customers' orders and the potential for delay or deferral of customer
implementation of our technology into their products.

OUR BUSINESS COULD BE ADVERSELY AFFECTED BY OUR FAILURE TO FURTHER DEVELOP GaAS
HBT TECHNOLOGY. We have acquired GaAs HBT technology through the acquisition of
NDI. We are continuing to develop this GaAs HBT process technology primarily to
manufacture power amplifiers and certain other components. We believe GaAs HBT
components will be successfully designed into wireless telephone and wireless
data handsets. While NDI provides manufacturing capacity and advanced process
capabilities, we cannot guarantee that our efforts will result in commercially
successful GaAs HBT products in the anticipated time or on budget. Certain of
our competitors are already offering this capability and our customers may
purchase their requirements for these products from our competitors. Our
business and prospects could be materially and adversely affected by our failure
to further develop and successfully manufacture this technology on schedule.

THE BENEFITS OF OUR GaAS PRODUCTS COMPARED TO SILICON ALTERNATIVES MAY NOT
CONTINUE. The production of GaAs integrated circuits is more costly than the
production of silicon circuits. As a result, we must offer GaAs products that
provide superior performance to that of silicon for specific applications to be
competitive with silicon products. If we do not continue to offer products that
provide sufficiently superior performance to offset the cost differential, our
operating results may be materially and adversely affected. We believe our costs
of producing GaAs integrated circuits will continue to exceed the costs
associated with the production of silicon circuits. The costs differ because of
higher costs of raw materials for GaAs, lower production yields in GaAs
technology and higher unit costs associated with lower production volumes.
Silicon semiconductor technologies are widely used process technologies for
certain integrated circuits and these technologies continue to improve in
performance. We cannot assure you that we will continue to identify markets that
require performance superior to that offered by silicon solutions.

WE FACE SIGNIFICANT CHALLENGES MANAGING OUR GROWTH. We are experiencing a period
of significant growth that will continue to place a strain on our resources. To
manage our growth effectively, we must continue to:

     -    improve operational systems;

     -    maintain adequate physical plant, manufacturing facilities and
          equipment to meet customer demand;

     -    add experienced senior level managers; and

     -    attract and retain qualified people with experience in engineering,
          design and manufacturing.

We will spend substantial amounts of money in connection with our growth and may
have additional unexpected costs. Our manufacturing equipment may not be
adequate to support rapid increases in orders for our products, and we may not
be able to expand quickly enough to exploit potential market opportunities. If
we cannot attract qualified people or manage growth effectively, our business,
operating results and financial condition could be adversely affected.

THERE MAY BE UNANTICIPATED COSTS ASSOCIATED WITH INCREASING OUR CAPACITY. We
anticipate that any future growth of our business will require increased
manufacturing capacity. In response to this need, we are currently expanding our
production capacity by adding manufacturing equipment, and we have begun to



                                       17

<PAGE>   18

ALPHA INDUSTRIES, INC. AND SUBSIDIARIES

implement a conversion of our Massachusetts GaAs IC fabrication facility to
six-inch wafers. We may be required to purchase significant additional equipment
or further expand our facilities if the increased demand for our products that
we experienced in fiscal 2000 continues. Expansion activities such as these are
subject to a number of risks, including:

     -    unavailability or late delivery of the advanced, and often customized,
          equipment used in the production of our products;

     -    delays in bringing new production equipment on-line;

     -    work stoppages and delays in supplying products for our existing
          customers during expansion activities; and

     -    unforeseen environmental or engineering problems relating to existing
          or new facilities.

These and other risks may affect the ultimate cost and timing of our present
expansion or any future expansion of our capacity.

OUR INTERNATIONAL SALES COULD DECLINE AS A RESULT OF CURRENCY EXCHANGE
FLUCTUATIONS AND OTHER FACTORS. Our sales outside of the United States were
approximately $84.8 million in fiscal 2000, $45.8 million in fiscal 1999 and
$39.2 million in fiscal 1998. Because most of our foreign sales are denominated
in United States dollars, our products, particularly our ceramics products,
become less price competitive with products manufactured by competitors based in
countries whose currencies decline in value against the dollar. International
sales involve a number of additional risks, including:

     -    imposition of government controls;

     -    potential insolvency of international distributors and
          representatives;

     -    fluctuation of economies outside the United States;

     -    political instability outside the United States;

     -    generally longer receivables collection periods for foreign customers;
          and

     -    tariffs and other trade barriers.

In addition, due to the technological advantage provided by GaAs in many
military applications, a portion of our sales outside of North America must be
licensed by the Bureau of Export Administration of the United States Department
of Commerce or the Office of Defense Trade Controls of the United States
Department of State. Although we have not experienced any difficulty in
obtaining these licenses, failure to obtain such licenses in the future could
have a material adverse effect on our operating results.

OUR COMPLIANCE WITH ENVIRONMENTAL REGULATIONS MAY BE COSTLY. We are subject to a
variety of federal, state and local requirements governing the protection of the
environment. These requirements relate to the use, storage, handling, discharge
and disposal of toxic or otherwise hazardous materials used in our manufacturing
processes. We may incur significant expense in complying with these
requirements, and these requirements may become more stringent in the future. In
the past, compliance with environmental regulations and our response to
environmental claims and litigation has been costly. Failure to comply with
environmental regulations could subject us to substantial liability or force us
to change our manufacturing operations. In addition, under some of these
regulations, we could be held financially responsible for remedial measures if
our properties are contaminated, even if we did not cause the contamination.

WE MAY HAVE DIFFICULTY IN PROTECTING OUR INTELLECTUAL PROPERTY. Our ability to
compete is affected by our ability to protect our intellectual property. A
significant aspect of our intellectual property is our product and process
technology. We rely primarily on trade secret laws, confidentiality procedures
and licensing arrangements to protect our intellectual property. The laws of
certain foreign countries in which our products are or may be developed,
manufactured or sold may not protect our products or intellectual property
rights to the same extent as do the laws of the United States. This may make the
possibility of piracy of our technology and products more likely. We cannot
assure you that the steps taken by us to protect our intellectual property will
be adequate to prevent misappropriation of our technology.



                                       18

<PAGE>   19

                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


OUR OPERATIONS COULD INFRINGE ON THE INTELLECTUAL PROPERTY RIGHTS OF OTHERS.
Particular aspects of our technology could be found to infringe on the
intellectual property rights or patents of others. Other companies may hold or
obtain patents on inventions or may otherwise claim proprietary rights to
technology necessary to our business. We cannot predict the extent to which we
may be required to seek licenses. We cannot guarantee that the terms of any
licenses we may be required to seek will be reasonable.

WE MAY HAVE DIFFICULTY IN MANAGING AND INTEGRATING ACQUISITIONS. From time to
time, we explore opportunities to acquire businesses to expand our production
capacity and our product offerings, such as our acquisition of NDI. Acquisitions
involve numerous risks, including:

     -    difficulties in integrating operations, products and corporate
          cultures;

     -    difficulties in completing the development of acquired technologies;

     -    the ability to manage different geographic units;

     -    entering markets or businesses in which we have limited experience;
          and

     -    the loss of key employees of the acquired businesses.

Moreover, any delay or failure to integrate an acquired company, technology or
product line could result in the additional expenditure of money and in
increased demands on our management's time. These expenditures and demands could
have a material adverse effect on our business, financial condition and results
of operations and on the price of our common stock. Acquisitions may involve
expending significant funds and the issuance of additional securities, which may
be dilutive to stockholders.


I
TEM 7A   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk represents the risk of changes in the value of short-term
investments and financial instruments caused by fluctuations in investment
prices and interest rates.

The Company handles market risks in accordance with established policies. The
Company's risk-management activities include "forward-looking statements" that
involve risk and uncertainties. Actual results could differ materially from
those projected in the forward-looking statements.

INVESTMENT PRICE RISK
The fair value of the Company's short-term investment portfolio at April 2,
2000, approximated carrying value due to its short-term duration. Market risk,
estimated as the potential decrease in fair value resulting from a hypothetical
10% decrease in interest rates for the issues contained in the investment
portfolio, is not considered to be material because of the short-term nature of
the investments.

INTEREST RATE RISK
The carrying value of the Company's long-term debt, including current
maturities, was $456,000 at April 2, 2000. Due to the nature of the debt
instruments, management has determined that the fair value was not materially
different from the year-end carrying value.



                                       19

<PAGE>   20

ALPHA INDUSTRIES, INC. AND SUBSIDIARIES



ITEM 8   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
         INDEX TO FINANCIAL STATEMENTS



                                                                            PAGE
================================================================================

Consolidated Balance Sheets - April 2, 2000 and March 28, 1999..............  21

Consolidated Statements of Operations - Years ended April 2, 2000,
March 28, 1999 and March 29, 1998...........................................  22

Consolidated Statements of Cash Flows - Years ended April 2, 2000,
March 28, 1999 and March 29, 1998...........................................  23

Consolidated Statements of Stockholders' Equity - Years ended April 2, 2000,
March 28, 1999 and March 29, 1998...........................................  24

Quarterly Financial Data (unaudited) - Fiscal 2000 and Fiscal 1999..........  25

Notes to Consolidated Financial Statements..................................  26

Independent Auditors' Report................................................  41

================================================================================



                                       20

<PAGE>   21
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)



<TABLE>
<CAPTION>
                                                                                    
                                                                     APRIL 2,    MARCH 28,
                                                                       2000        1999
==========================================================================================
<S>                                                                  <C>         <C>     
Assets
   Current assets
      Cash and cash equivalents..................................    $ 20,884    $ 14,029
      Short-term investments.....................................     119,071       9,731
      Accounts receivable, trade, less allowance
          for doubtful accounts of $796 and $741.................      32,955      22,972
      Inventories (Note 2).......................................      12,034       8,773
      Prepayments and other current assets.......................       2,399         796
      Deferred income taxes......................................       2,798       6,522
                                                                     --------    --------
               Total current assets..............................     190,141      62,823
                                                                     --------    --------
   Property, plant and equipment
      Land, building and improvements............................      31,389      26,925
      Machinery and equipment....................................     101,653      77,776
                                                                     --------    --------
                                                                      133,042     104,701
      Less-accumulated depreciation and amortization.............      65,984      62,204
                                                                     --------    --------
                                                                       67,058      42,497
                                                                     --------    --------
   Other assets..................................................       1,905       1,361
                                                                     --------    --------
               Total assets......................................    $259,104    $106,681
                                                                     ========    ========

Liabilities and Stockholders' Equity
   Current liabilities
      Current maturities of long-term debt (Note 3)..............    $    111    $    912
      Accounts payable...........................................      19,264      10,700
      Accrued liabilities
          Payroll, commissions and related expenses..............       7,132       7,292
          Other..................................................         198       1,232
                                                                     --------    --------
               Total current liabilities.........................      26,705      20,136
                                                                     --------    --------
   Long-term debt (Note 3).......................................         345         713
   Other long-term liabilities...................................       2,199       1,626
   Deferred income taxes.........................................       3,301       3,192
                                                                     --------    --------

   Commitments and contingencies (Note 7)
   Stockholders' equity (Notes 3 and 5)
      Common stock par value $0.25 per share; authorized
          100,000,000 shares; issued 39,911,514 and 32,102,622...       9,978       8,026
      Additional paid-in capital.................................     173,988      54,859
      Retained earnings..........................................      42,656      18,276
                                                                     --------    --------
                                                                      226,622      81,161
      Less - Treasury shares 64,786 and 124,758 at cost..........          68         133
      Unearned compensation-restricted stock.....................         ---          14
                                                                     --------    --------
               Total stockholders' equity........................     226,554      81,014
                                                                     --------    --------
               Total liabilities and stockholders' equity........    $259,104    $106,681
                                                                     ========    ========
==========================================================================================
</TABLE>



The accompanying notes are an integral part of these financial statements.




                                       21

<PAGE>   22
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)



<TABLE>
<CAPTION>
                                                                 YEARS ENDED
                                                   APRIL 2,       MARCH 28,      MARCH 29,
                                                     2000           1999           1998
===========================================================================================

<S>                                               <C>            <C>            <C>      
Sales .......................................     $ 184,705      $ 126,339      $ 116,881
                                                  ---------      ---------      ---------
Cost of sales ...............................       103,065         71,131         72,799
Research and development expenses ...........        20,728         12,886         10,035
Selling and administrative expenses .........        30,003         22,767         22,359
                                                  ---------      ---------      ---------
            Total operating expenses ........       153,796        106,784        105,193
                                                  ---------      ---------      ---------
Operating income ............................        30,909         19,555         11,688
Other income (expense)
    Interest expense ........................          (113)          (267)          (471)
    Interest income .........................         6,287            993            396
    Other expense, net ......................          (264)           (56)          (166)
                                                  ---------      ---------      ---------
            Total other income (expense) ....         5,910            670           (241)
                                                  ---------      ---------      ---------
Income before income taxes ..................        36,819         20,225         11,447
Provision (benefit) for income taxes (Note 4)        12,439         (1,265)         1,145
                                                  ---------      ---------      ---------
Net income ..................................     $  24,380      $  21,490      $  10,302
                                                  =========      =========      =========

Net income per share basic ..................     $    0.64      $    0.68      $    0.34
                                                  =========      =========      =========

Net income per share diluted ................     $    0.61      $    0.66      $    0.33
                                                  =========      =========      =========

Weighted average common shares basic ........        37,994         31,649         30,603
                                                  =========      =========      =========

Weighted average common shares diluted ......        40,032         32,701         31,423
                                                  =========      =========      =========

===========================================================================================
</TABLE>



The accompanying notes are an integral part of these financial statements.




                                       22

<PAGE>   23
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

<TABLE>
<CAPTION>
                                                                                              YEARS ENDED
                                                                                 APRIL 2,       MARCH 28,    MARCH 29,
                                                                                   2000           1999         1998
======================================================================================================================
<S>                                                                             <C>            <C>           <C>     
CASH PROVIDED BY OPERATIONS:
      Net income ..........................................................     $  24,380      $ 21,490      $ 10,302
      Adjustments to reconcile net income to net cash provided
         by operations:
         Depreciation and amortization of property, plant and equipment ...         9,891         7,851         6,742
         Deferred income taxes ............................................        10,860        (2,627)           --
         Amortization of unearned compensation - restricted stock .........            14            90            31
         Loss on sales and retirements of property, plant and equipment ...           132            12           132
         (Increase) decrease in other assets ..............................          (572)         (285)          375
         Increase (decrease) in other liabilities and long-term benefits ..           573          (744)          884
         Issuance of treasury stock to 401(k) plan ........................         1,120           960           833
         Changes in operating assets and liabilities:
             Accounts receivable ..........................................        (9,983)       (4,472)       (1,481)
             Inventories ..................................................        (3,261)         (832)        2,326
             Prepayments and other current assets .........................        (1,603)           87           (26)
             Accounts payable .............................................         8,564         4,975           105
             Accrued liabilities ..........................................        (1,194)         (979)        2,631
             Repositioning reserve ........................................            --            --        (1,106)
                                                                                ---------      --------      --------
         Net cash provided by operations ..................................        38,921        25,526        21,748
                                                                                ---------      --------      --------
CASH USED IN INVESTING:
      Additions to property, plant and equipment excluding capital leases .       (34,584)      (17,730)      (11,039)
      Purchases of short-term investments .................................      (220,181)      (17,943)       (2,335)
      Maturities of short-term investments ................................       110,841         9,705         2,060
      Proceeds from sale of property, plant and equipment .................            --            34           109
                                                                                ---------      --------      --------
         Net cash used in investing .......................................      (143,924)      (25,934)      (11,205)
                                                                                ---------      --------      --------
CASH PROVIDED BY (USED IN) FINANCING:
      Payments on notes payable ...........................................        (1,169)       (1,876)       (3,044)
      Payments on capital lease obligations ...............................            --            (8)         (230)
      Deferred charges related to long-term debt ..........................            28            16             2
      Exercise of stock options and warrants ..............................         3,393         1,724         1,400
      Proceeds from sale of stock .........................................       109,606           225           138
      Repurchase of treasury shares .......................................            --            --          (268)
                                                                                ---------      --------      --------
         Net cash provided by (used in) financing .........................       111,858            81        (2,002)
                                                                                ---------      --------      --------
      Net increase (decrease) in cash and cash equivalents ................         6,855          (327)        8,541
      Cash and cash equivalents, beginning of year ........................        14,029        14,356         5,815
                                                                                ---------      --------      --------
      Cash and cash equivalents, end of year ..............................     $  20,884      $ 14,029      $ 14,356
                                                                                =========      ========      ========

======================================================================================================================

Supplemental disclosure of non-cash operating activity:
      Tax benefit from the exercise of stock options.......................     $   7,027      $    703      $     --
                                                                                =========      ========      ========
</TABLE>


The accompanying notes are an integral part of these financial statements.



                                       23

<PAGE>   24
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(In thousands)


<TABLE>
<CAPTION>
                                                                              RETAINED                UNEARNED
                                                                ADDITIONAL    EARNINGS              COMPENSATION
                                              COMMON STOCK       PAID-IN    (ACCUMULATED  TREASURY   RESTRICTED
                                          SHARES    PAR VALUE    CAPITAL      DEFICIT)      STOCK      STOCK
================================================================================================================
<S>                                       <C>        <C>        <C>          <C>           <C>        <C>  
Balance at March 30, 1997 ...........     30,380     $7,593     $ 49,578     $(13,516)     $(195)     $(74)
Net income ..........................         --         --           --       10,302         --        --
Employee Stock Purchase Plan ........         59         15          123           --         --        --
Amortization of unearned compensation
  restricted stock ..................         --         --           --           --         --        31
Issuance of 248,340 treasury shares
  to 401(k) plan ....................         --         --          685           --        148        --
Repurchase of 65,508 shares .........         --         --           --           --       (268)       --
Exercise of stock options ...........      1,046        262          950           --         --        --
Exercise of stock warrants ..........        150         38          150           --         --        --
                                          ------     ------     --------     --------      -----      ----
Balance at March 29, 1998 ...........     31,635      7,908       51,486       (3,214)      (315)      (43)

Net income ..........................         --         --           --       21,490         --        --
Employee Stock Purchase Plan ........         52         13          212           --         --        --
Issuance of restricted stock ........         12          3           58           --         --       (61)
Amortization of unearned compensation
  restricted stock ..................         --         --           --           --         --        90
Issuance of 175,828 treasury shares
  to 401(k) plan ....................         --         --          778           --        182        --
Exercise of stock options ...........        404        102        1,622           --         --        --
Tax benefit from the exercise of
  stock options .....................         --         --          703           --         --        --
                                          ------     ------     --------     --------      -----      ----
Balance at March 28, 1999 ...........     32,103      8,026       54,859       18,276       (133)      (14)

Net income ..........................         --         --           --       24,380         --        --
Employee Stock Purchase Plan ........         21          5          283           --         --        --
Amortization of unearned compensation
  restricted stock ..................         --         --           --           --         --        14
Issuance of 59,972 treasury shares to
  401(k) plan .......................         --         --        1,055           --         65        --
Exercise of stock options ...........      1,159        290        3,103           --         --        --
Proceeds from stock offering ........      6,629      1,657      107,661           --         --        --
Tax benefit from the exercise of
  stock options .....................         --         --        7,027           --         --        --
                                          ------     ------     --------     --------      -----      ----
Balance at April 2, 2000 ............     39,912     $9,978     $173,988     $ 42,656      $ (68)     $ --
                                          ======     ======     ========     ========      =====      ====

================================================================================================================
</TABLE>


The accompanying notes are an integral part of these financial statements.



                                       24

<PAGE>   25
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


QUARTERLY FINANCIAL DATA
(unaudited)
(In thousands, except per share data)

<TABLE>
<CAPTION>

                                     FIRST       SECOND        THIRD       FOURTH
                                    QUARTER      QUARTER      QUARTER      QUARTER        YEAR
================================================================================================
<S>                                 <C>          <C>          <C>          <C>          <C>
FISCAL 2000
  Sales..........................   $38,605      $41,769      $47,463      $56,868      $184,705
  Gross profit...................    17,105       18,413       20,979       25,143        81,640
  Net income ....................     4,389        5,384        6,297        8,310        24,380
  Per share data                                                                      
      Net income basic...........       .13          .14          .16          .21           .64
      Net income diluted.........       .12          .13          .15          .20           .61
  Market price range                                                                  
     High........................    23.125       28.906       33.125       74.734        74.734
     Low.........................     8.938       21.500       23.875       27.016         8.938
                                                                                      
FISCAL 1999                                                                           
  Sales..........................   $29,955      $29,626      $32,489      $34,269      $126,339
  Gross profit...................    12,823       12,863       14,338       15,184        55,208
  Net income ....................     3,974        4,216        4,772        8,528        21,490
  Per share data                                                                      
      Net income basic...........       .13          .13          .15          .27           .68
      Net income diluted.........       .12          .13          .15          .25           .66
  Market price range                                                                  
     High........................     6.167         5.50       11.208       13.375        13.375
     Low.........................     4.125        3.167        3.167        7.125         3.167
                                                                                   
================================================================================================
</TABLE>


The Company's common stock is traded on the NASDAQ Stock Market under the symbol
AHAA. The number of stockholders of record as of May 31, 2000 was approximately
800.

(1)  Earnings per share calculations for each of the quarters are based on the
     weighted average number of shares outstanding and included common stock
     equivalents in each period. Therefore, the sums of the quarters do not
     necessarily equal the full year earnings per share.



                                       25

<PAGE>   26
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation:
      The financial statements include the accounts of the Company and its
      subsidiaries. All significant intercompany accounts and transactions have
      been eliminated in consolidation.

Fiscal Year:
      The Company's fiscal year ends on the Sunday closest to March 31. There
      were 53 weeks in fiscal 2000 and 52 weeks in fiscal 1999 and 1998.

Use of Estimates:
      The preparation of consolidated financial statements in conformity with
      generally accepted accounting principles requires management to make
      estimates and assumptions that affect the reported amounts of assets and
      liabilities and disclosure of contingent assets and liabilities at the
      date of the financial statements and the reported amounts of revenues and
      expenses. Actual results could differ from those estimates.

Revenue Recognition:
      Revenue is recognized when a product is shipped.

Foreign Currency Translation:
      The accounts of foreign subsidiaries are translated in accordance with
      Statement of Financial Accounting Standards ("SFAS") No. 52. Foreign
      operations are remeasured as if the functional currency were the U.S.
      dollar. Monetary assets and liabilities are translated at the year end
      rates of exchange. Revenues and expenses (except cost of sales and
      depreciation) are translated at the average rate for the period.
      Non-monetary assets, equity, cost of sales and depreciation are remeasured
      at historical rates. Remeasurement gains and losses are reflected
      currently in operations and are not material.

Research and Development Expenditures:
      Research and development expenditures are charged to income as incurred.

Cash, Cash Equivalents and Short-Term Investments:
      Cash and cash equivalents include cash deposited in demand deposits at
      banks and highly liquid investments with original maturities of 90 days or
      less.

      The Company's short-term investments are classified as held-to-maturity.
      These investments consist primarily of commercial paper and securities
      issued by various federal agencies and corporations with original
      maturities of more than 90 days. Such short-term investments are carried
      at amortized cost, which approximates fair value, due to the short period
      of time to maturity. Gains and losses are included in investment income in
      the period they are realized.

Inventories:
      Inventories are stated at the lower of cost, determined on a first-in,
      first-out basis, or market.



                                       26

<PAGE>   27
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 1    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Property, Plant and Equipment:
      Property, plant and equipment are carried at cost. Depreciation is
      calculated using the straight-line method for financial reporting and
      accelerated methods for tax purposes.

      Estimated useful lives used for depreciation purposes are 5 to 30 years
      for buildings and improvements and 3 to 10 years for machinery and
      equipment.

      During fiscal 2000 and 1999, the Company removed $6.0 million and $6.5
      million, respectively, of fully depreciated fixed assets from the related
      property, plant and equipment and accumulated depreciation accounts.

Fair Value of Financial Instruments:
      Financial instruments of the Company consist of cash, cash equivalents,
      accounts receivable, accounts payable and accrued liabilities. The
      carrying value of these financial instruments approximates their fair
      value because of the short maturity of these instruments. Based upon
      borrowing rates currently available to the Company for issuance of similar
      debt with similar terms and remaining maturities, the estimated fair value
      of long-term debt approximates its carrying amount. The Company does not
      currently use derivative instruments.

Income Taxes:
      The Company uses the asset and liability method of accounting for income
      taxes. Under the asset and liability method, deferred tax assets and
      liabilities are recognized for the estimated future tax consequences
      attributable to differences between the financial statement carrying
      amounts of existing assets and liabilities and their respective tax bases.
      This method also requires the recognition of future tax benefits such as
      net operating loss carryforwards, to the extent that realization of such
      benefits is more likely than not. Deferred tax assets and liabilities are
      measured using enacted tax rates expected to apply to taxable income in
      the years in which those temporary differences are expected to be
      recovered or settled. The effect on deferred tax assets and liabilities of
      a change in tax rates is recognized in income in the period that includes
      the enactment date.

Net Income Per Common Share:
      Basic earnings per share is calculated by dividing net income by the
      weighted average number of common shares outstanding. Diluted earnings per
      share includes the dilutive effect of stock options, if their effect is
      dilutive, using the treasury stock method.

      A reconciliation of the weighted average number of shares outstanding used
      in the computation of the basic and diluted earnings per share for each of
      the following years:

                                                        YEARS ENDED
                                               -------------------------------
                                               APRIL 2,   MARCH 28,   MARCH 29,
                                                 2000        1999       1998
                                               --------   --------    ---------
                                                      (in thousands)
      Weighted average shares (basic)......    37,994      31,649      30,603
      Effect of dilutive stock options.....     2,038       1,052         820
                                               ------      ------      ------
      Weighted average shares (diluted)....    40,032      32,701      31,423
                                               ======      ======      ======


                                       27

<PAGE>   28
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 1    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed of:
      The Company accounts for impairment of long-lived assets in accordance
      with SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and
      for Long-Lived Assets to be Disposed of." This statement requires that
      long-lived assets and certain identifiable intangibles be reviewed for
      impairment whenever events or changes in circumstances indicate that the
      carrying amount of an asset may not be recoverable. Recoverability of
      assets to be held and used is measured by a comparison of the carrying
      amount of an asset to undiscounted future net cash flows expected to be
      generated by the asset. If such assets are considered to be impaired, the
      impairment to be recognized is measured by the amount by which the
      carrying amount of the assets exceeds the fair value of the assets. Assets
      to be disposed of are reported at the lower of the carrying amount or fair
      value less costs to sell. This Statement has not had a material impact on
      the Company's financial position, results of operations, or liquidity.

Stock Option Plans:
      The Company accounts for its stock-based compensation under the provisions
      of Accounting Principles Board Opinion No. 25, "Accounting for Stock
      Issued to Employees" and related interpretations and provides disclosure
      related to its stock-based compensation under the provisions of SFAS No.
      123, "Accounting for Stock-Based Compensation."

Comprehensive Income:
      During fiscal 1999, the Company adopted the provisions of SFAS No. 130,
      "Reporting Comprehensive Income." SFAS No. 130 is a financial statement
      presentation standard, which requires the Company to disclose non-owner
      changes included in equity but not included in net income or loss. There
      were no differences between net income and comprehensive income for fiscal
      2000, 1999 and 1998.

Recent Accounting Pronouncements:
      SFAS No. 133, "Accounting for Derivative Instruments and Hedging
      Instruments" establishes accounting and reporting standards for
      derivatives and hedging activities. It requires that an entity recognize
      all derivatives as either assets or liabilities in the balance sheet and
      measure those instruments at fair value. SFAS No. 133 will be effective
      for the Company's fiscal year 2002. The Company is currently evaluating
      the effects of SFAS No. 133. The Company does not expect this new
      statement to have a material effect on its consolidated financial
      position, results of operations or cash flow.

NOTE 2    INVENTORIES

                                               APRIL 2,     MARCH 28,
Inventories consisted of the following:          2000         1999
                                               --------     ---------
                                                   (in thousands)
Raw materials...........................       $ 3,591        $3,852
Work-in-process.........................         7,397         3,034
Finished goods..........................         1,046         1,887
                                               -------        ------
                                               $12,034        $8,773
                                               =======        ======



                                       28

<PAGE>   29
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 3     BORROWING ARRANGEMENTS AND COMMITMENTS

LINES OF CREDIT

In November 1999, the Company entered into a $10.0 million unsecured Revolving
Credit Agreement which expires on October 31, 2000. A commitment fee of 1/4% per
year is due quarterly under the Agreement. The agreement includes various
covenants that require maintenance of certain financial ratios and balances and
restrict creation of funded debt and payment of dividends. There were no
borrowings under this Agreement at April 2, 2000.


LONG-TERM DEBT
                                                 APRIL 2,     MARCH 28,
Long-term debt consisted of the following:         2000         1999
                                                 --------     ---------
                                                    (in thousands)
    Equipment Term Note (a)..................     $ --         $  689
    Industrial Revenue Bond (b)..............       --            334
    CDBG Grant (c)...........................      456            602
                                                  ----         ------
                                                   456          1,625
    Less - current maturities................      111            912
                                                  ----         ------
                                                  $345         $  713
                                                  ====         ======


a.   The equipment term note was at LIBOR (4.963% at March 28, 1999) plus 1.5%.
     This note was collateralized by the assets of the Company, excluding real
     property, not otherwise collateralized. Principal payments of approximately
     $138,000 plus interest were due monthly until August 1999.

b.   An industrial revenue bond was held by the Farmers and Mechanics National
     Bank. The interest rate on this bond was prime (7.75% at March 28, 1999).
     This bond was repaid in full during fiscal 2000.

c.   The Company obtained a ten year $960,000 loan from the State of Maryland
     under the Community Development Block Grant program. Quarterly payments are
     due through December 2003 and represent principal plus interest at 5% of
     the unamortized balance.

Aggregate annual maturities of long-term debt are as follows:

           FISCAL YEAR
           -----------                     (in thousands)
           2002............................    $ 120
           2003............................      126
           2004............................       99
                                               -----
                                               $ 345


Cash payments for interest were $151,000, $253,000 and $492,000, in fiscal 2000,
1999 and 1998, respectively.



                                       29

<PAGE>   30


ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 4     INCOME TAXES

Income before income taxes consisted of:

                                                 YEARS ENDED
                                   ------------------------------------------
                                   APRIL 2,       MARCH 28,         MARCH 29,
                                     2000            1999             1998
                                   --------       ---------         ---------
                                                (in thousands)
    Domestic.....................  $ 36,501       $ 19,443          $ 11,027
    Foreign......................       318            782               420
                                   --------       --------          --------
    Total........................  $ 36,819       $ 20,225          $ 11,447
                                   ========       ========          ========

The income tax provision (benefit) consisted of the following:

    FISCAL 2000                     CURRENT       DEFERRED           TOTAL
    -----------                    --------       --------          --------
                                               (in thousands)
    Federal......................  $  8,202       $  3,934          $ 12,136
    State........................       305           (101)              204
    Foreign......................        99             --                99
                                   --------       --------          --------
    Total........................  $  8,606       $  3,833          $ 12,439
                                   ========       ========          ========

    FISCAL 1999                     CURRENT       DEFERRED           TOTAL
    -----------                    --------       --------          --------
                                               (in thousands)
    Federal......................  $    447       $ (2,530)         $ (2,083)
    State........................       670            (97)              573
    Foreign......................       245             --               245
                                   --------       --------          --------
    Total........................  $  1,362       $ (2,627)         $ (1,265)
                                   ========       ========          ========

    FISCAL 1998                     CURRENT       DEFERRED           TOTAL
    -----------                    --------       --------          --------
                                               (in thousands)
    Federal......................  $    221       $     --          $    221
    State........................       683             --               683
    Foreign......................       241             --               241
                                   --------       --------          --------
    Total........................  $  1,145       $     --          $  1,145
                                   ========       ========          ========





                                       30

<PAGE>   31
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 4     INCOME TAXES (CONTINUED)

Income tax expense (benefit) for income taxes is different from that which would
be obtained by applying the statutory federal income tax rates of 35% to pretax
income in fiscal years 2000 and 1999 and 34% in fiscal year 1998 as a result of
the following:


<TABLE>
<CAPTION>
                                                                  YEARS ENDED
                                                      ------------------------------------
                                                      APRIL 2,     MARCH 28,     MARCH 29,
                                                       2000          1999         1998
                                                      --------     --------      ---------
                                                                (in thousands)

<S>                                                  <C>           <C>          <C>    
Tax expense at U.S. statutory rate .............     $ 12,887      $ 7,079      $ 3,892
Alternative minimum tax ........................           --           --          221
Foreign sales corporation ......................         (416)          --           --
Foreign tax rate difference ....................          (12)         (29)          --
State income taxes, net of federal benefit .....          133          372          451
Change in valuation allowance ..................           40       (9,298)      (3,375)
Net U.S. tax on distribution of foreign earnings          216           --           --
Other, net .....................................         (409)         611          (44)
                                                     --------      -------      -------
Total ..........................................     $ 12,439      $(1,265)     $ 1,145
                                                     ========      =======      =======
</TABLE>



The tax effects of temporary differences that give rise to significant portions
of the deferred tax assets and deferred tax liabilities are as follows:


<TABLE>
<CAPTION>
                                                               APRIL 2,     MARCH 28,
                                                                2000          1999
                                                               -------      -------
                                                                   (in thousands)
<S>                                                            <C>          <C>    
Deferred tax assets:
  Accounts receivable due to bad debts ...................     $   234      $   242
  Inventories due to reserves and inventory capitalization         981        1,377
  Accrued liabilities ....................................         965          892
  Deferred compensation ..................................         777          670
  Net operating loss carryforward ........................          --        3,687
  Minimum tax credit and state tax credit carryforwards ..       1,819        1,007
                                                               -------      -------
    Total gross deferred tax assets ......................       4,776        7,875
    Less valuation allowance .............................        (870)        (830)
                                                               -------      -------
    Net deferred tax assets ..............................       3,906        7,045
                                                               -------      -------
Deferred tax liabilities:
  Property, plant and equipment due to depreciation ......      (4,193)      (3,715)
  Net U.S. tax on distribution of foreign earnings .......        (216)          --
                                                               -------      -------
    Total gross deferred tax liability ...................      (4,409)      (3,715)
                                                               -------      -------
Net deferred tax assets (liabilities) ....................     $  (503)     $ 3,330
                                                               =======      =======
</TABLE>





                                       31

<PAGE>   32
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 4     INCOME TAXES (CONTINUED)

Deferred income taxes are presented in the accompanying consolidated balance
sheets as follows:

                                            APRIL 2,     MARCH 28,
                                              2000         1999
                                            --------     ---------
                                                (in thousands)

Current deferred tax assets                  $2,798       $6,522
Non-current deferred tax liabilities          3,301        3,192
                                             ------       ------
    Net deferred tax assets (liabilities)    $ (503)      $3,330
                                             ======       =======

The valuation allowance for deferred tax assets as of April 2, 2000 and March
28, 1999 was $870,000 and $830,000, respectively. The net change in the total
valuation allowance for the years ended April 2, 2000 and March 28, 1999 was an
increase of $40,000 and a decrease of $9.3 million, respectively. During fiscal
1999, the valuation allowance was reduced to reflect the deferred tax assets
utilized in fiscal 1999 to reduce current income taxes and to recognize
additional net deferred tax asset. The Company has minimum tax credit
carryforwards of approximately $646,000, which are available to reduce future
federal regular income taxes over an indefinite period. In addition, the Company
has state tax credit carryforwards of $870,000, which are available to reduce
state income taxes over an indefinite period.

Cash payments for income taxes were $3.3 million, $915,000 and $342,000 in
fiscal 2000, 1999 and 1998, respectively.

During fiscal 2000, the Company recognized a deferred tax liability of
approximately $216,000 for the planned repatriation of undistributed earnings of
its 100 percent owned foreign subsidiaries. The $216,000 provides for the tax on
the foreign retained earnings, net of U.S. tax credits for non-U.S. taxes.

NOTE 5     COMMON STOCK

COMMON STOCK SPLIT

On January 27, 2000, the Board of Directors approved a two-for-one split of the
Company's common stock, subject to stockholder approval of an increase in the
Company's authorized shares from 30 million to 100 million. On March 28, 2000,
the increase in authorized shares was approved at a Special Meeting of
Stockholders. The two-for-one split was effected in the form of a stock dividend
paid on April 19, 2000 to shareholders of record as of March 29, 2000. All
agreements concerning stock options and other commitments payable in shares of
the Company's common stock provide for the issuance of additional shares due to
the declaration of the stock split. An amount equal to the par value of the
common shares issued was transferred from additional paid-in capital to the
common stock account. All share and per share data in these consolidated
financial statements and related footnotes has been restated to reflect the
stock split on a retroactive basis for all periods presented.

LONG-TERM INCENTIVE PLANS

The Company adopted a long-term incentive plan in 1999 pursuant to which
non-qualified stock options may be granted. The Company also adopted long-term
incentive plans in 1986 and 1996 pursuant to which stock options, with or
without stock appreciation rights, may be granted and restricted stock awards
and book value awards may be made.



                                       32

<PAGE>   33
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 5     COMMON STOCK (CONTINUED)

         Common Stock Options
         These options may be granted in the form of incentive stock options or
         non-qualified stock options. The option price may vary at the
         discretion of the Compensation Committee but shall not be less than the
         greater of fair market value or par value. The option term may not
         exceed ten years. The options may be exercised in cumulative annual
         increments commencing one year after the date of grant. A total of
         9,750,000 shares are authorized for grant under the Company's long-term
         incentive plans. The number of common shares reserved for granting of
         future awards was 1,818,588 at April 2, 2000.

         Restricted Stock Awards
         No restricted shares of the Company's common stock were issued during
         fiscal 2000 and 1998. During fiscal 1999, a total of 12,132 restricted
         shares of the Company's common stock were granted to certain employees.
         The market value of these shares was $61,000 and the vesting period was
         one year. This amount was recorded as unearned compensation -
         restricted stock and is shown as a separate component of stockholders'
         equity. Unearned compensation was being amortized to expense over the
         vesting period and such expense amounted to $14,000, $90,000, and
         $31,000 in fiscal 2000, 1999 and 1998, respectively.

LONG-TERM COMPENSATION PLAN

On October 1, 1990, the Company adopted a Supplemental Executive Retirement Plan
for certain key executives. There was no compensation expense in fiscal 2000 and
compensation expense was $27,000 and $127,000 in fiscal 1999 and 1998,
respectively.

A summary of stock option and restricted stock award transactions follows:

                                                            WEIGHTED AVERAGE
                                                            EXERCISE PRICE OF
                                                SHARES      SHARES UNDER PLAN
                                              ----------    -----------------

Balance outstanding at March 30, 1997.....     3,166,410        $ 2.07
                                              ----------
                                              
    Granted...............................       780,000          3.79
    Exercised.............................    (1,037,982)         1.15
    Restricted............................       (34,998)          ---
    Cancelled.............................       (87,098)         3.06
                                              ----------
                                              
Balance outstanding at March 29, 1998.....     2,786,332          2.83
                                              ----------
                                              
    Granted...............................       976,132          4.03
    Exercised.............................      (358,910)         2.53
    Restricted............................       (32,008)          ---
    Cancelled.............................       (85,500)         3.26
                                              ----------
                                              
Balance outstanding at March 28, 1999.....     3,286,046          3.23
                                              ----------
                                              
    Granted...............................     1,340,458         18.49
    Exercised.............................    (1,075,106)         2.79
    Restricted............................       (32,134)          ---
    Cancelled.............................      (168,620)         6.57
                                              ----------
                                              
Balance outstanding at April 2, 2000......     3,350,644        $ 9.34
                                              ==========


                                       33

<PAGE>   34
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 5     COMMON STOCK (CONTINUED)

Options exercisable at the end of each fiscal year:

                                                  WEIGHTED AVERAGE
                                  SHARES           EXERCISE PRICE
                                 -------          ----------------
2000........................     837,864               $ 5.91
1999........................     827,920               $ 2.40
1998........................     688,066               $ 1.98


The following table summarizes information concerning currently outstanding and
exercisable options as of April 2, 2000:


<TABLE>
<CAPTION>
                                     WEIGHTED
                                     AVERAGE       WEIGHTED
                                    REMAINING      AVERAGE                        WEIGHTED
RANGE OF EXERCISE     NUMBER       CONTRACTUAL    OUTSTANDING      OPTIONS        AVERAGE
    PRICES          OUTSTANDING    LIFE (YEARS)   OPTION PRICE    EXERCISABLE   EXERCISE PRICE
-----------------   -----------    -----------    ------------    -----------   --------------
<C>                 <C>              <C>           <C>            <C>              <C>   
$ 0.92 - $10.00      2,199,194        7.44          $ 3.87         687,264          $ 3.62
$10.01 - $20.00        874,750        9.09          $16.71         150,600          $16.34
$20.01 - $30.00        214,000        9.52          $26.43             ---             ---
$30.01 - $40.00         36,500        9.66          $30.28             ---             ---
$40.01 - $50.00         12,000        9.83          $44.34             ---             ---
$50.01 - $60.00          5,200        9.86          $55.68             ---             ---
$60.01 - $67.00          9,000        9.93          $66.02             ---             ---
                     ---------                                     -------
                     3,350,644                                     837,864                
                     =========                                     =======                
</TABLE>

                        


The Company applies Accounting Principles Board Opinion No. 25, "Accounting for
Stock Issued to Employees" and related interpretations in accounting for its
stock option and employee stock purchase plans. Accordingly, no compensation
expense has been recognized in the consolidated financial statements for such
plans. Had compensation cost for the Company's stock option plans been
determined based upon the fair value at the grant date for awards under these
plans consistent with the methodology prescribed under SFAS No. 123, "Accounting
for Stock-based Compensation," the Company's net income would have been as
follows:


<TABLE>
<CAPTION>
                                                                    YEARS ENDED
                                                      --------------------------------------
                                                      APRIL 2,       MARCH 28,     MARCH 29,
                                                        2000           1999          1998
                                                      --------       ---------     ----------
                                                                 (in thousands)

<S>                                                   <C>            <C>           <C>    
  Net income ...................... As reported       $24,380        $21,490       $10,302
                                                      =======        =======       =======
                                    Pro forma         $21,526        $20,433       $ 9,650
                                                      =======        =======       =======

  Net income per share diluted..... As reported       $  0.61        $  0.66       $  0.33
                                                      =======        =======       =======
                                    Pro forma         $  0.54        $  0.62       $  0.31
                                                      =======        =======       =======
</TABLE>



                                       34

<PAGE>   35
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 5     COMMON STOCK (CONTINUED)

The effect of applying SFAS No. 123 as shown in the above pro forma disclosure
is not representative of the pro forma effect on net income in future years
because it does not take into consideration pro forma compensation expense
related to grants made prior to fiscal year 1996.

The fair value of each option grant was estimated on the grant date using the
Black Scholes Option Pricing Model with the following weighted average
assumptions:

                                               2000     1999      1998
                                               ----     ----      ----
                                               
Expected volatility......................       69%      85%       71%
Risk free interest rate..................        6%       5%        6%
Dividend yield...........................       ---      ---       ---
Expected option life (years).............       3.0      4.0       4.4
                                           

Weighted average fair value of options granted during the year:

2000.....................................                    $ 6.18
1999.....................................                    $ 1.88
1998.....................................                    $ 2.33


STOCK PURCHASE WARRANTS

In April 1994, the Company issued 150,000 stock purchase warrants. During fiscal
1998, all 150,000 stock purchase warrants were exercised.

STOCK OPTION PLANS FOR NON-EMPLOYEE DIRECTORS

The Company has two stock option plans for non-employee directors -- the 1994
Non-Qualified Stock Option Plan and the 1997 Non-Qualified Stock Option Plan.
Under the two plans, a total of 450,000 shares have been authorized for option
grants. The two plans have substantially similar terms and conditions and are
structured to provide options to non-employee directors as follows: a new
Director receives a total of 45,000 options upon becoming a member of the Board;
and continuing Directors receive 15,000 options after each Annual Meeting of
Shareholders. Under both of these plans the option price is the fair market
value at the time the option is granted. Options become exercisable 20% per year
beginning one year from the date of grant. During fiscal 2000, 105,000 options
were granted with 45,000 granted at a price of $16.36 and 60,000 granted at a
price of $27.28. During fiscal 1999 and 1998, 60,000 and 225,000 shares were
granted at prices of $6.59 and $5.17, respectively. At April 2, 2000, a total of
450,000 options have been granted under these two plans. During fiscal 2000,
84,000 options were exercised at a weighted average exercise price of $4.70. At
April 2, 2000, 36,000 shares were exercisable.



                                       35


<PAGE>   36
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 5     COMMON STOCK (CONTINUED)

STOCK PURCHASE PLAN

The Company maintains an employee stock purchase plan. Under the plan, eligible
employees may purchase common stock through payroll deductions of up to 10% of
compensation. The price per share is the lower of 85% of the market price at the
beginning or end of each six-month offering period. The plan provides for
purchases by employees of up to an aggregate of 900,000 shares through December
31, 2001. Shares of 21,086, 51,506 and 59,280 were purchased under this plan in
fiscal 2000, 1999 and 1998, respectively.

NOTE 6     EMPLOYMENT BENEFIT PLAN

The Company maintains a 401(k) plan covering substantially all of its employees.
All of the Company's employees who are at least 21 years old and have completed
six months of service (1,000 hours in a 12 month period) with the Company are
eligible to receive a Company contribution. Discretionary Company contributions
are determined by the Board of Directors and may be in the form of cash or the
Company's stock. The Company contributes a match of 100% of the first 1% and a
50% match on the next 4% of an employee's salary for employees with 5 years or
less of service. For employees with more than 5 years of service, the Company
contributes a 100% match on the first 1% and a 75% match on the next 5% of an
employee's salary. For fiscal 2000, 1999 and 1998, the Company contributed
39,374, 161,336 and 185,242 shares, respectively, of the Company's common stock
valued at $1.2 million, $995,000 and $833,000, to fund the Company's obligation
under the 401(k) plan.

NOTE 7   COMMITMENTS AND CONTINGENCIES

The Company has various operating leases primarily for computer equipment and
buildings. Rent expense amounted to $1.4 million, $1.3 million and $1.8 million
in fiscal 2000, 1999 and 1998, respectively. Purchase options may be exercised
at various times for some of these leases. Future minimum payments under these
leases are as follows:


     FISCAL YEAR                                    (in thousands)
     -----------                                    --------------
     2001  .......................................    $   741
     2002  .......................................        524
     2003  .......................................        323
     2004  .......................................         21
     Thereafter...................................         --
                                                      -------
                                                      $ 1,609
                                                      =======

 
The Company has been notified by federal and state environmental agencies of its
potential liability with respect to the Spectron, Inc. Superfund site in Elkton,
Maryland. Several hundred other companies have also been notified about their
potential liability regarding this site. The Company continues to deny that it
has any responsibility with respect to this site other than as a DE MINIMIS
party. Management is of the opinion that the outcome of the aforementioned
environmental matter will not have a material effect on the Company's operations
or financial position.

The Company is party to suits and claims arising in the normal course of
business. Management believes these are adequately provided for or will result
in no significant additional liability to the Company.



                                       36

<PAGE>   37
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 8      RELATED PARTY TRANSACTIONS

The Company has had transactions in the normal course of business with various
related parties. Scientific Components Corporation, a beneficial owner of the
Company's common stock, purchased approximately $7.4 million of products during
fiscal 2000 and 1999 and $8.9 million of products during fiscal 1998.

NOTE 9   SEGMENT INFORMATION

The Company is engaged in the design and manufacture of discrete semiconductors,
integrated circuits and electrical ceramic components for a wide range of
applications in the wireless communications industry.

The Company has adopted SFAS No. 131, "Disclosures About Segments of an
Enterprise and Related Information." SFAS No. 131 establishes standards for the
way public business enterprises report information about operating segments in
annual financial statements and in interim reports to shareholders. The method
for determining what information to report is based on the way that management
organizes the segments within the Company for making operating decisions and
assessing financial performance. In evaluating financial performance, management
uses sales and operating profit as the measure of the segments' profit or loss.

The Company is organized into three reportable segments as follows:

Wireless Semiconductor Products:
      The Wireless Semiconductor segment designs and manufactures gallium
      arsenide integrated circuits and other discrete semiconductors to the
      global market for wireless telephone handsets and broadband data
      applications.

Ceramic Products:
      The Ceramics segment designs and manufactures technical ceramic and
      magnetic products for wireless telephony infrastructure and other wireless
      markets.

Application Specific Products:
      The Application Specific segment designs and manufactures a broad range of
      gallium arsenide and silicon devices and components to broadband data and
      satellite communications markets.



                                       37

<PAGE>   38

ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 9   SEGMENT INFORMATION (CONTINUED)

The table below presents selected financial data by business segment for fiscal
2000, 1999 and 1998. The accounting policies of the segments are the same as
those described in the "Summary of Significant Accounting Policies."



                                               YEARS ENDED
                                    -----------------------------------
                                    APRIL 2,     MARCH 28,    MARCH 29,
                                     2000          1999         1998
                                    --------     ---------    ---------
SALES                                          (in thousands)

Wireless Semiconductor Products     $118,779     $ 65,822     $ 52,612
Ceramic Products ..............       36,054       25,540       27,151
Application Specific Products .       29,872       34,977       37,118
                                    --------     --------     --------
                                    $184,705     $126,339     $116,881
                                    ========     ========     ========
OPERATING INCOME

Wireless Semiconductor Products     $ 18,785     $  7,435     $  2,799
Ceramic Products ..............        4,632        1,879        1,679
Application Specific Products .        7,492       10,241        7,210
                                    --------     --------     --------
                                    $ 30,909     $ 19,555     $ 11,688
                                    ========     ========     ========


                                               YEARS ENDED
                                          ----------------------
                                           APRIL 2,     MARCH 28,
                                             2000         1999
                                           --------     --------
NET LONG-LIVED ASSETS                          (in thousands)

Wireless Semiconductor Products            $ 49,094     $ 27,646
Ceramic Products ..............              13,061       11,128
Application Specific Products .               4,903        3,657
Corporate .....................                  --           66
                                           --------     --------
                                           $ 67,058     $ 42,497
                                           ========     ========
TOTAL ASSETS

Wireless Semiconductor Products            $ 74,841     $ 41,508
Ceramic Products ..............              25,892       20,119
Application Specific Products .              11,682       10,751
Corporate .....................             146,689       34,303
                                           --------     --------
                                           $259,104     $106,681
                                           ========     ========

Customer Concentration:
      During fiscal year 2000, 1999 and 1998, one customer accounted for 34%,
      28% and 25%, respectively, of the Company's total sales. In fiscal 2000,
      sales to the Company's 15 largest customers accounted for 65% of total
      sales. In fiscal 1999 and 1998, sales to these customers accounted for 64%
      and 63% respectively.



                                       38

<PAGE>   39
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 9   SEGMENT INFORMATION (CONTINUED)

Geographic Information:
      Sales include export sales primarily to Europe and Asia of $84.8 million,
      $45.8 million and $39.2 million, in fiscal 2000, 1999 and 1998,
      respectively. During fiscal 2000, 1999 and 1998, the Company operated a
      sales subsidiary in the United Kingdom. The following table shows certain
      financial information relating to the Company's operations in various
      geographic areas:

                                     YEARS ENDED
                        ---------------------------------------
                        APRIL 2,       MARCH 28,      MARCH 29,
                          2000           1999           1998  
                        ---------      ---------      ---------
                                    (in thousands)
Sales
  United States
     Customers ....     $ 178,879      $ 118,460      $ 110,108
     Intercompany .         4,698          6,497          5,665
  Europe
     Customers ....         5,826          7,879          6,773
  Eliminations ....        (4,698)        (6,497)        (5,665)
                        ---------      ---------      ---------
Net sales .........     $ 184,705      $ 126,339      $ 116,881
                        =========      =========      =========

Income before taxes
  United States ...     $  36,501      $  19,443      $  11,027
  Europe ..........           318            782            420
                        ---------      ---------      ---------
Income before taxes     $  36,819      $  20,225      $  11,447
                        =========      =========      =========

Assets
  United States ...     $ 254,620      $ 101,212      $  72,165
  Europe ..........         4,484          5,469          4,764
                        ---------      ---------      ---------
Total assets ......     $ 259,104      $ 106,681      $  76,929
                        =========      =========      =========


Substantially all of the Company's long-lived assets are located in the United
States. Transfers between geographic areas are made at terms that allow for a
reasonable profit to the seller.



                                       39

<PAGE>   40
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 10   SUBSEQUENT EVENT (UNAUDITED)

On April 24, 2000, the Company completed its acquisition of privately-held
Network Device, Inc. of Sunnyvale, California. Approximately 2.67 million shares
of common stock were exchanged for all outstanding shares and options of NDI.
Approximately 185,000 shares of Company stock were issued for the conversion of
NDI stock options into Company options.

In connection with the acquisition of NDI, which will be accounted for as a
pooling-of-interests, the consolidated financial statements of the Company will
be restated for all prior periods. Total pro forma revenue, net income, net
income per share and weighted average common shares outstanding of the Company,
as presently reported and as will be restated, are summarized below (in
thousands, except per share amounts):


                                                               YEARS ENDED
                                                          ---------------------
                                                          APRIL 2,    MARCH 28,
                                                            2000        1999
                                                          --------    --------
                                                             
Revenue................................... As reported    $184,705    $126,339
                                                          ========    ========
                                   As will be restated    $186,402    $126,413
                                                          ========    ========

Net income ............................... As reported    $ 24,380    $ 21,490
                                                          ========    ========
                                   As will be restated    $ 17,982    $ 19,263
                                                          ========    ========

Net income per share diluted.............. As reported    $   0.61    $   0.66
                                                          ========    ========
                                   As will be restated    $   0.42    $   0.54
                                                          ========    ========

Weighted average common shares diluted.... As reported      40,032      32,701
                                                          ========    ========
                                   As will be restated      42,827      35,411
                                                          ========    ========


                                       40

<PAGE>   41




                          INDEPENDENT AUDITORS' REPORT



The Board of Directors and Stockholders
Alpha Industries, Inc.:

We have audited the consolidated financial statements of Alpha Industries, Inc.
and subsidiaries as listed in the accompanying index under Item 8. In connection
with our audits of the consolidated financial statements, we have also audited
the financial statement schedule as listed in the accompanying index under Item
14. These consolidated financial statements and financial statement schedule are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements and financial statement
schedule based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Alpha Industries,
Inc. and subsidiaries at April 2, 2000 and March 28, 1999, and the results of
their operations and their cash flows for each of the years in the three-year
period ended April 2, 2000 in conformity with generally accepted accounting
principles. Also, in our opinion, the related financial statement schedule, when
considered in relation to the basic consolidated financial statements taken as a
whole, presents fairly, in all material respects, the information set forth
therein.



/s/KPMG LLP
KPMG LLP
Boston, Massachusetts
April 28, 2000




                                       41

<PAGE>   42
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES



I
TEM 9   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

None.


                                    PART III


ITEM 10  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

See the section entitled "Election of Directors" appearing in the Company's
Proxy Statement for the Annual Meeting of Stockholders to be held on September
11, 2000, to be filed within 120 days of the end of the Company's fiscal year,
which section is incorporated herein by reference, and the section entitled
"Executive Officers" under Item 1 of this Annual Report on Form 10-K.


ITEM 11  EXECUTIVE COMPENSATION

See the section entitled "Executive Compensation" appearing in the Company's
Proxy Statement for the Annual Meeting of Stockholders to be held on September
11, 2000, which section is incorporated herein by reference.


ITEM 12  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

See the section entitled "Securities Beneficially Owned by Certain Persons"
appearing in the Company's Proxy Statement for the Annual Meeting of
Stockholders to be held on September 11, 2000, which section is incorporated
herein by reference.


ITEM 13  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

See the section entitled "Certain Relationships and Related Transactions"
appearing in the Company's Proxy Statement for the Annual Meeting of
Stockholders to be held on September 11, 2000, which section is incorporated
herein by reference.


                                     PART IV


ITEM 14  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)   1. Index to Financial Statements

         The financial statements filed as part of this report are listed on the
         index appearing on page 20.

      2. Index to Financial Statement Schedules

         The following financial statement schedule is filed as part of this
         report (page references are to this report):

                  Schedule II    Valuation and Qualifying Accounts (page 46)

         Other schedules are omitted because of the absence of conditions under
         which they are required or because the required information is
         presented in the financial statements or notes thereto.


                                       42

<PAGE>   43
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


      3. Exhibits

        (3)     Certificate of Incorporation and By-laws.

                (a)  Restated Certificate of Incorporation (Filed as Exhibit 3
                     (a) to Registration Statement on Form S-3 (Registration No.
                     33-63857))*.

                (b)  Amended and restated By-laws of the Corporation dated April
                     30, 1992 (Filed as Exhibit 3(b) to the Annual Report on
                     Form 10-K for the year ended March 29, 1992)*.

        (4)     Instruments defining rights of security holders, including
                indentures.

                (a)  Specimen Certificate of Common Stock (Filed as Exhibit 4(a)
                     to Registration Statement on Form S-3 (Registration No.
                     33-63857))*.

                (b)  Loan and Security Agreement dated December 15, 1993 between
                     Trans-Tech, Inc., and County Commissioners of Frederick
                     County (Filed as Exhibit 4(h) to the Quarterly Report on
                     Form 10-Q for the quarter ended July 3, 1994)*.

                (c)  Revolving credit agreement dated November 1, 1999 between
                     Alpha Industries, Inc., and Trans-Tech, Inc. and Fleet Bank
                     of Massachusetts and Silicon Valley Bank (Filed as Exhibit
                     4(c) to the Quarterly Report on Form 10-Q for the quarter
                     ended December 26, 1999)*.

        (10)    Material Contracts.

                (a)  Alpha Industries, Inc., 1986 Long-Term Incentive Plan as
                     amended (Filed as Exhibit 10(a) to the Quarterly Report on
                     Form 10-Q for the quarter ended October 2, 1994)*. (1)

                (b)  Alpha Industries, Inc., Employee Stock Purchase Plan as
                     amended October 22, 1992 (Filed as Exhibit 10(b) to the
                     Annual Report on Form 10-K for the fiscal year ended March
                     28, 1993)* and amended August 22, 1995 (Filed as Exhibit
                     10(b) to the Annual Report on Form 10-K for the fiscal year
                     ended March 31, 1996)*. (1)

                (c)  SERP Trust Agreement between the Registrant and the First
                     National Bank of Boston as Trustee dated April 8, 1991
                     (Filed as Exhibit 10(c) to the Annual Report on Form 10-K
                     for the fiscal year ended March 31, 1991)*. (1)

                (d)  Alpha Industries, Inc., Long-Term Compensation Plan dated
                     September 24, 1990 (Filed as Exhibit 10(i) to the Annual
                     Report on Form 10-K for the fiscal year ended March 29,
                     1992)*; amended March 28, 1991 (Filed as Exhibit 10(a) to
                     the Quarterly Report on Form 10-Q for the quarter ended
                     June 27, 1993)* and as further amended October 27, 1994
                     (Filed as Exhibit 10(f) to the Annual Report on Form 10-K
                     for the fiscal year ended April 2, 1995)*. (1)

                (e)  Severance Agreement dated May 20, 1997 between the
                     Registrant and David J. Aldrich (Filed as Exhibit 10(g) to
                     the Annual Report on Form 10-K for the fiscal year ended
                     March 30, 1997)*. (1)

                (f)  Severance Agreement dated January 14, 1997 between the
                     Registrant and Richard Langman (Filed as Exhibit 10(h) to
                     the Annual Report on Form 10-K for the fiscal year ended
                     March 30, 1997)*. (1)

                (g)  Consulting Agreement dated August 13, 1992 between the
                     Registrant and Sidney Topol (Filed as Exhibit 10(p) to the
                     Annual Report on Form 10-K for the fiscal year ended April
                     3, 1994)*.(1)

                (h)  Alpha Industries, Inc., 1994 Non-Qualified Stock Option
                     Plan for Non-Employee Directors (Filed as Exhibit 10(r) to
                     the Quarterly Report on Form 10-Q for the quarter ended
                     October 2, 1994)*. (1)



                                       43

<PAGE>   44

ALPHA INDUSTRIES, INC. AND SUBSIDIARIES


                (i)  Alpha Industries Executive Compensation Plan dated January
                     1, 1995 and Trust for the Alpha Industries Executive
                     Compensation Plan dated January 3, 1995 (Filed as Exhibit
                     10(p) to the Annual Report on Form 10-K for the fiscal year
                     ended April 2, 1995)*.(1)

                (j)  Alpha Industries, Inc. Savings and Retirement 401(k) Plan
                     dated July 1, 1996 (Filed as Exhibit 10(n) to the Annual
                     Report on Form 10-K for the fiscal year ended March 30,
                     1997)*.

                (k)  Severance Agreement dated September 4, 1998 between the
                     Registrant and Paul E. Vincent (Filed as Exhibit 10(n) to
                     the Quarterly Report on Form 10-Q for the fiscal quarter
                     ended September 27, 1998)*. (1)

                (l)  Severance Agreement dated December 11, 1998 between the
                     Registrant and Jean-Pierre Gillard (Filed as Exhibit 10(r)
                     to the Quarterly Report on Form 10-Q for the fiscal quarter
                     ended December 27, 1998)*. (1)

                (m)  Alpha Industries, Inc., 1997 Non-Qualified Stock Option
                     Plan for Non-Employee Directors. (Filed as Exhibit 10(r)
                     to the Annual Report on Form 10-K for the fiscal year ended
                     March 29, 1998)*.(1)

                (n)  Alpha Industries, Inc. 1996 Long-Term Incentive Plan (Filed
                     as Exhibit 99 to Registration Statement on Form S-8 filed
                     January 22, 1999)*.(1)

                (o)  Alpha Industries, Inc. 1999 Employee Long-Term Incentive
                     Plan dated April 27, 1999 (Filed as Exhibit 10(q) to the
                     Quarterly Report on Form 10-Q for the fiscal quarter ended
                     June 27, 1999)*.(1)

                (p)  Severance Agreement dated September 13, 1999 between the
                     Registrant and Thomas C. Leonard (Filed as Exhibit 10(p) to
                     the Quarterly Report on Form 10-Q for the fiscal quarter
                     ended September 26, 1999)*.(1)

        (11)    Statement re computation of per share earnings. See Note 1 to
                the Consolidated Financial Statements.

        (21)    Subsidiaries of the Registrant.

        (23)    Consent of Independent Auditors.

        (27)    Financial Data Schedules.

                (b)  Reports on Form 8-K

                     On February 16, 2000, Form 8-K was filed with the
                     Securities and Exchange Commission ("SEC") stating that the
                     Company had entered into a definitive agreement to acquire
                     privately-held Network Device, Inc.

                     On May 8, 2000, Form 8-K was filed with the SEC stating
                     that the Company had completed its acquisition of Network
                     Device, Inc. on April 24, 2000.

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

*Not filed herewith. In accordance with Rule 12b-32 promulgated pursuant to the
Securities Exchange Act of 1934, as amended, reference is hereby made to
documents previously filed with the Commission, which are incorporated by
reference herein.

(1)     Management Contracts.



                                       44

<PAGE>   45
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES




                                   SIGNATURES


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

                             ALPHA INDUSTRIES, INC.
                                  (REGISTRANT)

                            BY: /s/ DAVID J. ALDRICH 
                                ---------------------------
                                DAVID J. ALDRICH, PRESIDENT


Date:  June 27, 2000

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities indicated on June 27, 2000.

           Signature and Title                            Signature and Title

/s/ THOMAS C. LEONARD                           /s/TIMOTHY R. FUREY
--------------------------------                ----------------------------
Thomas C. Leonard                               Timothy R. Furey
Chairman of the Board                           Director

/s/DAVID J. ALDRICH                             /s/JAMES W. HENDERSON
--------------------------------                ----------------------------
David J. Aldrich                                James W. Henderson
Chief Executive Officer                         Director
President and Director                          

/s/ PAUL E. VINCENT                             /s/ GEORGE S. KARIOTIS       
--------------------------------                ----------------------------
Paul E. Vincent                                 George S. Kariotis           
Chief Financial Officer                         Director                     
Principal Financial Officer                     
Principal Accounting Officer                    /s/ARTHUR PAPPAS
Secretary                                       ----------------------------
                                                Arthur Pappas
                                                Director

                                                /s/SIDNEY TOPOL
                                                ----------------------------
                                                Sidney Topol
                                                Director
                                                  
                                                  
                                                  
                                                


                                       45

<PAGE>   46
ALPHA INDUSTRIES, INC. AND SUBSIDIARIES



                                   SCHEDULE II

VALUATION AND QUALIFYING ACCOUNTS
(In thousands)


<TABLE>
<CAPTION>
                                                          CHARGED
                                             BALANCE AT   TO COSTS               BALANCE AT
                                             BEGINNING      AND                    END OF
   DESCRIPTION                               OF YEAR      EXPENSES   DEDUCTIONS     YEAR
============================================================================================

<S>                                             <C>        <C>         <C>          <C> 
Year Ended April 2, 2000
 Allowance for doubtful accounts ...........    $741       $418        $363         $796
                                                                                    
Year Ended March 28, 1999                                                           
 Allowance for doubtful accounts ...........    $634       $295        $188         $741
 Allowance for estimated losses on contracts    $ 36         --        $ 36         $ --
                                                                                    
Year Ended March 29, 1998                                                           
 Allowance for doubtful accounts ...........    $521       $257        $144         $634
 Allowance for estimated losses on contracts    $  3       $ 33        $ --         $ 36
</TABLE>




                                       46





<PAGE>   1
                                         ALPHA INDUSTRIES, INC. AND SUBSIDIARIES



                                   EXHIBIT 21

                         SUBSIDIARIES OF THE REGISTRANT



Name                                         Jurisdiction Of Incorporation
----                                         -----------------------------

Alpha Industries Limited                                England

Alpha Industries GmbH                                   Germany

Alpha Securities Corporation                            Massachusetts

CFP Holding Company, Inc.                               Washington

Trans-Tech, Inc.                                        Maryland

Trans-Tech Europe SARL                                  France

Alpha FSC, Inc.                                         Barbados





<PAGE>   1

                                   EXHIBIT 23



                         CONSENT OF INDEPENDENT AUDITORS




The Board of Directors
Alpha Industries, Inc.:

We hereby consent to incorporation by reference in the registration statements
(No. 33-63541, No. 33-63543, No. 33-71013 and No. 33-71015) on Form S-8 of Alpha
Industries, Inc. of our report dated April 28, 2000 relating to the consolidated
balance sheets of Alpha Industries, Inc. and subsidiaries as of April 2, 2000
and March 28, 1999 and the related consolidated statements of operations,
stockholders' equity, and cash flows and related schedule for each of the years
in the three-year period ended April 2, 2000, which report appears in the April
2, 2000 annual report on Form 10-K of Alpha Industries, Inc.




/s/KPMG LLP
KPMG LLP
Boston, Massachusetts
June 27, 2000





<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of Alpha Industries, Inc. and Subsidiaries as of and for
the twelve months ended April 2, 2000 and is qualified in its entirety by
reference to such financial statements. 

This schedule has been updated to reflect the two-for-one common stock split
distributed on April 19, 2000.
</LEGEND>
<MULTIPLIER> 1,000
       
<S>                             <C>
<PERIOD-TYPE>                   12-MOS
<FISCAL-YEAR-END>                          APR-02-2000
<PERIOD-END>                               APR-02-2000
<CASH>                                         $20,884
<SECURITIES>                                   119,071
<RECEIVABLES>                                   33,751
<ALLOWANCES>                                       796
<INVENTORY>                                     12,034
<CURRENT-ASSETS>                               190,141
<PP&E>                                         133,042
<DEPRECIATION>                                  65,984
<TOTAL-ASSETS>                                 259,104
<CURRENT-LIABILITIES>                           26,705
<BONDS>                                            345
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                         9,978
<OTHER-SE>                                     216,576
<TOTAL-LIABILITY-AND-EQUITY>                   259,104
<SALES>                                        184,705
<TOTAL-REVENUES>                               184,705
<CGS>                                          103,065
<TOTAL-COSTS>                                  153,796
<OTHER-EXPENSES>                                   264
<LOSS-PROVISION>                                   418
<INTEREST-EXPENSE>                             (6,174)
<INCOME-PRETAX>                                 36,819
<INCOME-TAX>                                    12,439
<INCOME-CONTINUING>                             24,380
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                    24,380
<EPS-BASIC>                                       0.64
<EPS-DILUTED>                                     0.61
        

</TABLE>






<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of Alpha Industries, Inc. and Subsidiaries as of and for
the twelve months ended March 28, 1999 and is qualified in its entirety by
reference to such financial statements. 

This schedule has been updated to reflect the two-for-one common stock split
distributed on April 19, 2000.
</LEGEND>
<MULTIPLIER> 1,000
       
<S>                             <C>
<PERIOD-TYPE>                   12-MOS
<FISCAL-YEAR-END>                          MAR-28-1999
<PERIOD-END>                               MAR-28-1999
<CASH>                                          14,029
<SECURITIES>                                     9,731
<RECEIVABLES>                                   23,713
<ALLOWANCES>                                       741
<INVENTORY>                                      8,773
<CURRENT-ASSETS>                                62,823
<PP&E>                                         104,701
<DEPRECIATION>                                  62,204
<TOTAL-ASSETS>                                 106,681
<CURRENT-LIABILITIES>                           20,136
<BONDS>                                            713
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                         8,026
<OTHER-SE>                                      72,988
<TOTAL-LIABILITY-AND-EQUITY>                   106,681
<SALES>                                        126,339
<TOTAL-REVENUES>                               126,339
<CGS>                                           71,131
<TOTAL-COSTS>                                  106,784
<OTHER-EXPENSES>                                    56
<LOSS-PROVISION>                                   295
<INTEREST-EXPENSE>                               (726)
<INCOME-PRETAX>                                 20,225
<INCOME-TAX>                                   (1,265)
<INCOME-CONTINUING>                             21,490
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                    21,490
<EPS-BASIC>                                       0.68
<EPS-DILUTED>                                     0.66
        

</TABLE>