FY'97 Year End Earnings

July 23, 1997

MELBOURNE, Florida -- Harris Corporation reported its sixth consecutive year of double-digit earnings growth -- with orders, sales, net income and earnings per share all reaching record levels for the year ended June 27.

Earnings per share for the year were up 15 percent to $5.27 versus $4.58 for the previous year. Net income rose to $207.5 million compared with $178.4 million, while sales increased to $3.8 billion versus $3.6 billion.

Fourth Quarter

Harris reported its sixteenth consecutive quarter of double-digit, year-to-year profit increase, as earnings per share for the fourth-quarter rose to $1.72 versus $1.55 for the year-earlier quarter. Net income rose to $68.2 million compared with $60.3 million and sales for the quarter surpassed $1 billion.

Business Sectors

Reporting on the year-end results for the company’s business sectors, Phillip W. Farmer, Harris chairman and chief executive, said, "The Communications Sector’s focus on high growth areas -- particularly in broadcasting and wireless communications -- continued to pay off this past year. Strong demand for the company’s broadcast and microwave wireless communications products pushed the sector’s sales to $948 million for the year. Net income was $45 million and included gains from the sale of investment securities. As previously reported, those gains were used to offset setbacks in the company’s digital switch business and for continuing research and development efforts.

"The Electronics Systems Sector’s strategy of refocusing on its core businesses helped boost its performance in the declining U.S. government electronic systems market. Led by increased demand for its communication, information, and aerospace products and systems, sector sales grew to $997.8 million. Net income rose substantially to $39.1 million. Sector results do not include revenues from two General Electric-Harris joint ventures, but do include the income.

"Lanier Worldwide had another strong year. Sales increased to almost $1.2 billion, reflecting growing demand for Lanier’s broad range of products, particularly the new digital multi-function devices and color copiers. Net income for the year grew to $65.6 million. The weak yen led to lower prices for Lanier products and services, which reduced revenue growth, but at the same time led to even lower costs, which increased net income for the sector.

"Harris Semiconductor Sector’s sales were slightly lower due to the weak semiconductor market and pricing pressures throughout the year. Net income for the year grew to $57.8 million, led by a significant increase in royalties and improved performance in the sector’s military and space and intelligent power businesses."

Outlook

Looking to the current year, Mr. Farmer said, "We anticipate another good year of earnings growth in fiscal 1998. Our ongoing investment in research and development, new products, and joint ventures will continue to help boost the company’s growth. In addition, we remain optimistic about the outlook for the market for Digital TV, wireless communications, digital office equipment and power semiconductors where we are focusing our efforts. This, along with the strength of our other core businesses, puts Harris in a good position for sustained growth in the years ahead."

This press release contains forward-looking statements made in reliance upon the safe harbor of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve a number of assumptions, risks and uncertainties that could cause actual results of the company to differ materially from those matters expressed in or implied by such forward-looking statements. For more information and a discussion of such risks, reference the Form 8-K filed by Harris with the SEC on July 18, 1997.

SUMMARY:

HARRIS CORPORATIONFY'97 Fiscal Year End and Fourth Quarter SummaryCondensed Consolidated Statement of Income------------------------------------------(In millions except per share amounts)                               Fiscal Year Ended     Fourth Quarter Ended                                 1997       1996        1997        1996                                  ----       ----        ----        ----                       RevenueRevenue from product sales,  and rentals . . . . . . .   $3,335.7    $3,189.2    $  919.3    $  891.3 Revenue from services . . .      461.5       432.0       127.2       120.7Interest. . . . . . . . . .       37.4        38.1         9.7         9.0                               3,834.6     3,659.3     1,056.2     1,021.0Costs and ExpensesCost of product sales    and rentals . . . . . . .    2,267.4     2,151.9       620.5       596.3Cost of services. . . . . .      251.8       252.7        68.9        70.0Engineering, selling, and administrative expenses. .      963.8       911.9       262.4       248.3Interest. . . . . . . . . .       59.9        62.5        12.6        15.2Other-net . . . . . . . . .      (20.3)        5.9        (9.2)       (1.5)                               3,522.6     3,384.9       955.2       928.3Income before income  taxes . . . . . . . . . .      312.0       274.4       101.0        92.7Income taxes. . . . . . . .      104.5        96.0        32.8        32.4Net Income. . . . . . . . .   $  207.5    $  178.4    $   68.2    $   60.3Net Income Per Share. . . .      $5.27       $4.58       $1.72       $1.55Cash dividends paid  per common share. . . . .      $1.52       $1.36       $ .38       $ .34Average shares  outstanding . . . . . . .       39.4        39.0        39.8        38.9Condensed Consolidated Balance Sheet------------------------------------                   June 27     June 30(In millions)                                            1997        1996                                                       -------     -------AssetsCash, cash equivalents, and marketable  securities. . . . . . . . . . . . . . . .           $  162.0    $   99.4 Receivables . . . . . . . . . . . . . . . .              820.6       727.8 Unbilled costs and accrued earnings . . . .              324.8       397.8 Inventories . . . . . . . . . . . . . . . .              611.1       544.1 Deferred income taxes . . . . . . . . . . .              145.0       171.8 Plant and equipment . . . . . . . . . . . .              878.3       721.7 Non-current notes receivable - net. . . . .              217.7       190.7 Intangibles resulting from acquisitions . .              227.5       212.8 Other assets. . . . . . . . . . . . . . . .              250.9       140.6                                                       $3,637.9    $3,206.7 Liabilities and Shareholders' EquityShort-term debt . . . . . . . . . . . . . .           $  296.3    $  183.5 Accounts payables and accrued expenses  . .              605.4       609.1 Advance payments and unearned income. . . .              290.9       287.8 Income taxes. . . . . . . . . . . . . . . .               96.0       102.7 Non-current deferred income taxes . . . . .               84.4        62.2 Long-term debt. . . . . . . . . . . . . . .              686.7       588.5 Shareholders' equity. . . . . . . . . . . .            1,578.2     1,372.9                                                        $3,637.9    $3,206.7 Business Segment Information-----------------------------------(In millions except per share amounts)                                 Fiscal Year Ended     Fourth Quarter Ended                                  1997        1996        1997       1996                                  ----        ----        ----       ----Net SalesElectronic Systems. . . . . .   $  997.8    $  954.7   $  249.5   $  270.8    Semiconductor . . . . . . . .      679.7       707.7      187.9      185.5Communications. . . . . . . .      948.0       841.6      275.0      251.5Lanier Worldwide. . . . . . .    1,171.7     1,117.2      334.1      304.2Total . . . . . . . . . . . .   $3,797.2    $3,621.2   $1,046.5   $1,012.0Operating ProfitElectronic Systems. . . . . .  $   84.4    $   76.7    $   24.2   $   19.7Semiconductor . . . . . . . .     111.9       101.0        39.8       32.6Communications. . . . . . . .      83.5        82.4        21.0       27.4Lanier Worldwide. . . . . . .     129.3       120.7        42.6       40.2Corporate Expense . . . . . .     (37.2)      (43.9)      (14.0)     (12.0)Interest Expense. . . . . . .     (59.9)      (62.5)      (12.6)     (15.2)Total . . . . . . . . . . . .  $  312.0    $  274.4    $  101.0   $   92.7Net IncomeElectronic Systems. . . . . .  $   39.1    $   28.5    $   12.2   $    7.9Semiconductor . . . . . . . .      57.8        52.2        21.1       16.8Communications. . . . . . . .      45.0        41.7        12.6       15.4Lanier Worldwide. . . . . . .      65.6        56.0        22.3       20.2Total . . . . . . . . . . . .  $  207.5    $  178.4    $   68.2   $   60.3Net Income Per Share. . . . .     $5.27       $4.58       $1.72      $1.55

Editor's Note: For further information, contact Jim Burke at 407-727-9126 or jburke@harris.com.