Cascade Microtech Reports First Quarter 2008 Results

Revenues of $20.8 Million With Higher Consumable Revenues From Pyramid Probe Cards and Engineering Probes; Overall EPS Is Break-Even With Solid Cash Flow Generation


PORTLAND, OR--(Marketwire - April 29, 2008) - Cascade Microtech (NASDAQ: CSCD), today reported financial results for the first quarter ended March 31, 2008.

Highlights for the First Quarter 2008 include:

--  Revenues of $20.8 million, down 6% sequentially and down 8% from Q1
    last year
--  $14.5 million Engineering Products Division revenue, down 7%
    sequentially and down 21% from Q1 last year due to lower station revenues
--  $6.3 million Production Products Division revenue, flat sequentially
    but up 54% over Q1 last year
--  Pyramid Probe card revenue was $5.4 million, up 1% sequentially
--  Other income during the first quarter includes foreign exchange
    translation gains of $428,000
--  Loss per share was $(0.00), up from a loss of $(0.01) sequentially and
    down from earnings per diluted share of $0.09 from Q1 last year
--  Cash and investment balances increased by $2.3 million during the
    quarter to $36.6 million
    

"Our Pyramid Probe cards and Engineering Probes demonstrated solid performance in the first quarter of 2008 resulting in revenue from consumables increasing to almost 50% of total revenue and improving gross margins. Engineering Products Division revenue was down from the last quarter, as expected, due to lower station sales across all geographical areas," said Geoff Wild, CEO of Cascade Microtech.

Revenue for the first quarter was $20.8 million, net loss for the quarter was approximately break even at a loss of $16,000 and loss per share was $(0.00), compared to revenue of $22.0 million, net loss of $140,000 and loss per share of $(0.01) for the fourth quarter of 2007.

Financial Outlook

Based on the current backlog and anticipated bookings, Cascade anticipates that second quarter 2008 revenues will be in the range of $18.0 million to $21.0 million and that diluted earnings per share will be in the range of a loss of $(0.06) to earnings of $0.01.

About Cascade Microtech

Cascade Microtech, Inc. (NASDAQ: CSCD) is a worldwide leader in the precise electrical measurement and test of integrated circuits (ICs) and other small structures. For technology businesses and scientific institutions that need to evaluate small structures, Cascade Microtech delivers access to, and extraction of, electrical data from wafers, integrated circuits (ICs), IC packages, circuit boards and modules, MEMs, biological structures, electro-optic devices and more. Cascade Microtech's leading-edge semiconductor production test consumables include unique probe cards and test sockets that reduce manufacturing costs of high-speed and high-density semiconductor chips. Information about Cascade Microtech can be found on the Web at www.cascademicrotech.com.

Forward-Looking Statements

The statements in this release regarding the Company's financial outlook as to revenue and earnings in the second quarter of 2008 are "forward-looking" statements within the meaning of the Securities Litigation Reform act of 1995. Such statements are based on current expectations, estimates and projections about the Company's business based in part on assumptions made by management. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including changes in demand for the Company's products, product mix, the timing of shipments and customer orders, constraints on supplies of components, excess or shortage of production capacity and other risks discussed from time to time in the Company's Securities and Exchange Commission filings and reports, including the Company's Annual Report on Form 10-K. In addition such statements could be affected by general industry and market conditions and growth rates and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made and the company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.

The company will host a conference call beginning at 5 p.m. EDT (2 p.m. PDT) on April 29, 2008 to discuss its results for the first quarter ended March 31, 2008, and its outlook for the second quarter of 2008.

A simultaneous audio cast of the conference call may be accessed online from the investor relations page of www.cascademicrotech.com. A replay will be available after 7 p.m. EDT at this same Internet address. (For a telephone replay, dial (888) 286-8010 passcode: 57642163; International: 617-801-6888.)

                          CASCADE MICROTECH, INC.
                             AND SUBSIDIARIES

              Condensed Consolidated Statements of Operations
                  (in thousands, except per share data)
                                (Unaudited)



                                                 Three Months Ended
                                         ---------------------------------
                                          March 31  December 31   March 31
                                            2008       2007         2007
                                         ---------  -----------  ---------
Sales                                    $  20,759  $    21,992  $  22,471

Cost of sales                               10,867       11,741     12,087
Stock-based compensation                       109           83        122
                                         ---------  -----------  ---------

    Gross profit                             9,783       10,168     10,262
                                         ---------  -----------  ---------

Operating expenses:
  Research and development (includes
   $116, $107, $79, respectively, of
   stock-based compensation)                 2,906        2,759      2,639
  Selling, general and administrative
   (includes $414, $399, $361,
   respectively, of stock-based
   compensation)                             6,879        6,872      6,664
  Amortization of purchased intangibles        648          649        106
                                         ---------  -----------  ---------

    Total operating expenses                10,433       10,280      9,409
                                         ---------  -----------  ---------

    Income (loss) from operations             (650)        (112)       853
                                         ---------  -----------  ---------

Other income (expense):
  Interest income                              264          306        455
  Interest expense                              (1)          (1)        (1)
  Other, net                                   439          (63)       110
                                         ---------  -----------  ---------

    Total other income                         702          242        564
                                         ---------  -----------  ---------

    Income before income taxes                  52          130      1,417

Provision for income taxes                      68          270        369
                                         ---------  -----------  ---------

    Net income (loss)                    $     (16) $      (140) $   1,048
                                         =========  ===========  =========

    Net income (Loss)  per share-Basic
     and Diluted
      Basic                              $    0.00  $     (0.01) $    0.09
      Diluted                            $    0.00  $     (0.01) $    0.09

    Shares used in computing net income
     per share:
      Basic                                 12,985       12,855     11,808
      Diluted                               12,985       12,855     12,207






                          CASCADE MICROTECH, INC.
                             AND SUBSIDIARIES

                  Condensed Consolidated Balance Sheets
                        (Unaudited - in thousands)


                                                    March 31,  December 31,
                      Assets                          2008         2007
                                                  ------------ ------------

Current assets:
  Cash and cash equivalents                       $      5,359 $      4,900
  Marketable securities                                 27,522       24,521
  Accounts receivable, net                              17,265       18,195
  Inventories                                           18,972       18,608
  Prepaid expenses and other                             1,533        1,874
  Deferred income taxes                                  2,731        2,729
                                                  ------------ ------------

    Total current assets                                73,382       70,827

Long-term investments                                    3,717        4,836
Fixed assets, net                                       14,509       14,575
Goodwill                                                17,310       17,310
Purchased intangible assets, net                        14,393       15,042
Other assets                                             2,720        2,691
                                                  ------------ ------------

Total Assets                                      $    126,031 $    125,281
                                                  ============ ============


       Liabilities and Stockholders' Equity

Current liabilities:
  Current portion of long-term debt and capital
   leases                                         $         14 $         13
  Accounts payable                                       4,657        5,158
  Deferred revenue                                         974        1,102
  Accrued liabilities                                    5,316        5,589
                                                  ------------ ------------

    Total current liabilities                           10,961       11,862

Long-term debt and capital leases                           55           51
Deferred income tax                                      3,037        3,114
Deferred revenue                                           423          481
Other long-term liabilities                              2,253        2,168
                                                  ------------ ------------

    Total liabilities                                   16,729       17,676
                                                  ------------ ------------

Stockholders' equity:
  Common stock                                          81,315       79,697
  Unrealized holding gain on investments                   140           45
  Retained earnings                                     27,847       27,863
                                                  ------------ ------------

    Total stockholders' equity                         109,302      107,605
                                                  ------------ ------------

Total Liabilities and Stockholders' Equity        $    126,031 $    125,281
                                                  ============ ============

Contact Information: Contact: Cascade Microtech, Inc. Steven Sipowicz Chief Financial Officer 503 601-1000