Advanced Energy Reports Third Quarter 2004 Results

Advanced Energy offers a comprehensive suite of process-centered solutions critical to the production of semiconductors, flat panel displays, data storage products, architectural glass and other advanced product applications. For the 2004 third quarter, revenues were $93.6 million, up 36 percent compared to $68.6 million for the third quarter of 2003, and down 14 percent compared to revenues of $108.9 million for the second quarter of 2004.The third quarter 2004 net loss of $1.1 million, or $0.03 per share, compares to the third quarter 2003 net loss of $27.4 million, or $0.85 per share. Net income for the second quarter of 2004 was $4.5 million, or $0.13 per dilutedshare.

Revenue for the nine months ended September 30, 2004 was $306.9 million versus $187.7 million for the first nine months of 2003. Net income for the 2004 nine-month period was $10.3 million, or $0.31 per diluted share, compared to a net loss for the 2003 nine-month period of $41.8 million, or $1.30 per share.

Doug Schatz, chairman and chief executive officer, said, "Our third quarter results reflect the downward trend in semiconductor capital equipment and data storage spending that we discussed on our second quarter 2004 conference call. We expect this weakness to continue in the near term, but depending on the shape of the industry cycle, there could be growth drivers for increased capital investment during 2005. However, this is primarily dependent on macroeconomic factors that are difficult to estimate and predict. "We are focused on what we can control, specifically, driving continued technology leadership and improved efficiencies throughout the organization.

Today, we announced a realignment of our manufacturing organization that will reduce our Fort Collins workforce by approximately 200 employees over the next nine months. Once the transition is complete, the Fort Collins facility will focus on new product design and launch programs, low volume manufacturing and advanced manufacturing processes," continued Mr. Schatz. "This is a difficult decision that affects many of our local employees.

However, it is a necessary step in our worldwide manufacturing realignment designed to enhance our ability to deliver higher quality products with shorter lead times at lower cost. We continue to provide value and innovation to our customers, while taking necessary steps to align our company with the industry environment both near and long term," continued Mr. Schatz.

For the fourth quarter of 2004, the Company expects the business environment to continue to decline based on the cautious spending outlook from major semiconductor end users and OEMs. The Company anticipates fourth quarter revenue to be $82.5 million to $85.0 million, or down approximately 9 to 12 percent relative to the third quarter, and a loss per share range of $0.15 to $0.20.