Exhibit 99.1


CONTACT INFORMATION:
USA:		Asia:
Phil O’Shaughnessy		Wynne Leong
(408) 546-6773		(65) 6895-4120
poshaughnessy@creative.com		wynne.leong@ctl.creative.com

Creative Announces Q2 FY09 Financial Results

SINGAPORE – Jan. 22, 2009– Creative Technology Ltd today announced financial results for the second quarter of its 2009 fiscal year, ended December 31, 2008. All financial results are stated in U.S. dollars.

Revenues for the second quarter were $155.7 million, compared to revenues of $262.5 million for the same quarter last year. Net loss for the second quarter was $32.4 million, with loss per share of $0.44. This compares to net income of $7.6 million with earnings per share of $0.09 for the same period last year.

“Based upon the continuing decline we saw in market conditions in the second quarter, we took aggressive actions to reduce our inventory position, which negatively affected our gross margins in the period. We reduced our inventory position to $57.3 million, a 45 percent reduction from last quarter. Our performance was further impacted by the downward shift in other currencies against the US dollar from the previous quarter, which reduced our revenue and gross margins in Europe and contributed to a significant currency exchange loss in the period,” said Craig McHugh, president and COO of Creative. “Looking forward, we expect that the difficult market environment will continue to deterioriate. We are evaluating the structure of our field organizations so we can significantly reduce our operating expenses.”

Share Buyback Program

During the second quarter, Creative purchased 4.65 million shares under its share buyback program at an average price of $2.44.

# # #

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About Creative

Creative is a worldwide leader in digital entertainment products. Famous for its Sound Blaster^® audio cards and for launching the multimedia revolution, Creative is now driving digital entertainment on the PC platform with products like its highly acclaimed ZEN portable audio and media players. Creative’s innovative hardware, proprietary technology, applications and services leverage the Internet, enabling consumers to experience high-quality digital entertainment — anytime, anywhere.

This announcement refers to products and pricing sold in the United States of America. Pricing and product availability are subject to change without notice. Sound Blaster and ZEN are trademarks or registered trademarks of Creative Technology Ltd. in the United States and/or other countries. All other brand and product names are trademarks of their respective holder and are hereby recognized as such.

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CREATIVE TECHNOLOGY LTD.

CONSOLIDATED BALANCE SHEETS

(In US$’ 000)


	(Unaudited) December 31, 2008		June 30, 2008
ASSETS
Current Assets:
Cash and cash equivalents	$	264,163	$	408,644
Accounts receivable, less allowances of $15,253 and $14,721		59,741		82,554
Inventory		57,303		99,788
Other assets and prepaids		25,808		39,563

Total current assets		407,015		630,549
Property and equipment, net		70,873		67,043
Investments		24,596		37,247
Other non-current assets		18,523		15,519

Total Assets	$	521,007	$	750,358

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	39,812	$	66,507
Accrued liabilities		78,515		91,164
Income taxes payable		3,188		5,288
Current portion of long term obligations and others		11		100,019

Total current liabilities		121,526		262,978
Long term obligations		29,741		29,756
Advance payments from sale of building		122,967		127,563
Minority interest in subsidiaries		378		378
Shareholders’ equity		246,395		329,683

Total Liabilities and Shareholders’ Equity	$	521,007	$	750,358

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CREATIVE TECHNOLOGY LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In US$’ 000, except per share data)

(Unaudited)


	Three months ended December 31,						Six months ended December 31,
	2008			2007			2008			2007
Sales, net	$	155,695		$	262,536		$	296,925		$	447,093
Cost of goods sold		131,489			201,883			240,018			346,646

Gross profit		24,206			60,653			56,907			100,447

Operating expenses:
Selling, general and administrative		27,155			36,947			57,028			71,401
Research and development		15,379			16,671			33,053			31,654

Total operating expenses		42,534			53,618			90,081			103,055

Operating loss		(18,328	)		7,035			(33,174	)		(2,608	)
(Loss) gain from investments, net		(3,501	)		(2,121	)		(12,305	)		2,281
Interest income		1,539			2,869			3,297			5,768
Interest expense		(1,748	)		(1,620	)		(3,671	)		(3,305	)
Others		(10,051	)		1,633			(18,111	)		7,451

(Loss) Income before income taxes and minority interest		(32,089	)		7,796			(63,964	)		9,587
Income tax expense		(351	)		(168	)		(628	)		(650	)
Minority interest in loss		1			—			1			1

Net (loss) income	$	(32,439	)	$	7,628		$	(64,591	)	$	8,938

Basic (loss) earnings per share:	$	(0.44	)	$	0.09		$	(0.86	)	$	0.11
Weighted average ordinary shares outstanding (‘000)		73,706			82,902			75,010			83,253
Diluted (loss) earnings per share:	$	(0.44	)	$	0.09		$	(0.86	)	$	0.11
Weighted average ordinary shares and equivalents outstanding (‘000)		73,706			82,953			75,010			83,303

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CREATIVE TECHNOLOGY LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Increase (decrease) in cash and cash equivalents (in US$’000)

( Unaudited)


	Six Months Ended December 31,
	2008			2007
Cash flows from operating activities:
Net (loss) income	$	(64,591	)	$	8,938
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation of fixed assets		4,563			5,021
Amortisation of intangible assets		—			303
Deferred share compensation amortization		828			586
Minority interest in loss		(1	)		(1	)
Equity share in loss of unconsolidated investments		1,595			1,036
Loss on disposal of fixed assets		36			210
Write downs of investments and other non-current assets		12,361			6,854
Gain from investments, net		(56	)		(2,186	)
Gain on disposal of subsidiaries		—			(6,948	)
Deferred income taxes, net		(47	)		(17	)
Foreign currency exchange gain		14,131			(3,882	)
Dividend income		(96	)		(422	)
Gain on issue of treasury shares		(4	)		—
Advance payments from sale of building		3,593			—
Changes in assets and liabilities, net:
Accounts receivable		15,032			33,416
Inventory		42,640			9,932
Other assets and prepaids		18,291			(8,352	)
Accounts payable		(30,868	)		3,663
Accrued and other liabilities		(15,344	)		6,496
Income taxes		(2,100	)		860

Net cash (used in) provided by operating activities		(37	)		55,507

Cash flows from investing activities:
Capital expenditures, net		(2,233	)		(7,846	)
Proceeds from sale of fixed assets		47			75
Proceeds from sale of investments		152			4,427
Proceeds from sale of subsidiary		—			5,830
Purchase of new subsidiaries ( net of cash acquired)		(247	)		—
Purchase of investments		(202	)		(1,135	)
Increase in other non current assets, net		(602	)		—
Dividend income received		96			422

Net cash (used in) provided by investing activities		(2,989	)		1,773

Cash flows from financing activities:
Proceeds from exercise of ordinary share options		10			14
Purchase of treasury shares		(19,135	)		(8,527	)
Repayments of debt obligations		(100,000	)		(2,074	)
Repayments of capital leases		(12	)		(8	)
Dividends paid to ordinary shareholders		—			(11,528	)

Net cash used in financing activities		(119,137	)		(22,123	)

Net (decrease) increase in cash and cash equivalents		(122,163	)		35,157
Effects of exchange rate changes on cash and cash equivalents		(22,318	)		4,926
Cash and cash equivalents at beginning of year		408,644			250,480

Cash and cash equivalents at end of the period	$	264,163		$	290,563

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CREATIVE TECHNOLOGY LTD.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY


	Ordinary Shares ‘000		Treasury Shares ‘000		Ordinary Shares $’000		Treasury Shares $’000		Other Reserves $’000		Unrealised Holding Gains (Losses) on Investments $’000		(Accumulated Losses) Retained Earnings $’000		Total $’000
Q209
Balance at July 1, 2008	83,626		(6,981	)	300,100		(32,113	)	59,286		3,377		(967	)	329,683
Shares issued under employee options plans	—		—		—		—		—		—		—		—
Purchase of treasury shares	—		(6,450	)	—		(19,135	)	—		—		—		(19,135	)
Utilization of treasury shares for shares issued under employee option plans	—		3		—		10		(4	)	—		—		6
Shares cancellation	(8,626	)	8,626		(33,347	)	33,347		—		—		—		—
Amortization of deferred share compensation	—		—		—		—		828		—		—		828
Comprehensive loss	—		—		—		—		—		(396	)	(64,591	)	(64,987	)

Balance at December 31, 2008	75,000		(4,802	)	266,753		(17,891	)	60,110		2,981		(65,558	)	246,395

Q208
Balance at July 1, 2007	83,622		—		300,086		—		53,949		24,240		30,295		408,570
Shares issued under employee options plans	4		—		14		—		—		—		—		14
Purchase of treasury shares	—		(2,000	)	—		(8,527	)	—		—		—		(8,527	)
Dividends paid	—		—		—		—		—		—		(11,528	)	(11,528	)
Amortization of deferred share compensation	—		—		—		—		586		—		—		586
Comprehensive loss	—		—		—		—		—		(12,419	)	8,938		(3,481	)

Balance at December 31, 2007	83,626		(2,000	)	300,100		(8,527	)	54,535		11,821		27,705		385,634

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CREATIVE TECHNOLOGY LTD.

SUPPLEMENTAL FINANCIAL INFORMATION


	Three months ended
	Dec 31, 2008		Sept 30, 2008		Dec 31, 2007
Revenue by geographical region :
Americas	30	%	29	%	27	%
Europe	46	%	43	%	53	%
Asia and rest of the world	24	%	28	%	20	%
Revenue by product category :
Personal Digital Entertainment	54	%	47	%	56	%
Audio	12	%	14	%	12	%
Speakers and Headphones	22	%	27	%	25	%
Others	12	%	12	%	7	%

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CREATIVE TECHNOLOGY LTD 6-K