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Flush-to-zero mode replaces denormalized numbers with zero. This does not comply with IEEE 754 arithmetic, but in some circumstances can improve performance considerably.
Some implementations of VFP use support code to handle denormalized numbers. The performance of such systems, in calculations involving denormalized numbers, is much less than it is in normal calculations.
In VFPv2, flush-to-zero mode can either preserve the sign bit or flush to +0, depending on the implementation. Flush-to-zero mode in VFPv3 and VFPv4 always preserves the sign bit.