Cascade Microtech Reports Third Quarter 2007 Results.

Revenues of $21.3 Million and EPS Loss of 2 Cents in Line with Preliminary Results Announced October 3, 2007

PORTLAND, Ore. -- Cascade Microtech (NASDAQ:CSCD) (News), today reported financial results for the third quarter ended September 30, 2007.

Highlights for the Third Quarter 2007 include:

* Revenues of $21.3 million, down 11% sequentially and down 7% from Q3 last year;

* $15.7 million Engineering Products Division revenue, down 18% sequentially and 13% over Q3 last year;

* $5.6 million Production Products Division revenue, up 11% sequentially and up 16% over Q3 last year; Q3 results this year include $1.4 million in revenue from the Gryphics acquisition;

* EPS loss of $0.02 per share includes amortization of purchased intangibles of $668,000;

* During the third quarter, we acquired certain assets of our German distributor for approximately $1.8 million.

"As previously reported, our Engineering Products Division experienced some system order delays and push outs in the third quarter. Our overall systems bookings were lower than expected for the third quarter and our systems book to bill ratio was below one. In our Production Products Division, however, both Pyramid Probe Card revenues and bookings were in line with our plan and the book to bill ratio was above one as we continue to build a more diversified customer base," said Eric Strid, CEO of Cascade Microtech. "We were disappointed with our operating performance in the quarter and have taken steps during and after the end of the quarter to reduce our expenses in order to return to GAAP profitability in the near term," added Strid.

Revenue for the third quarter was $21.3 million, net loss for the quarter was $0.2 million and loss per share was $0.02 compared to revenue of $24.1 million, net income of $0.2 million and diluted earnings per share of $0.02 for the second quarter of 2007.

For the third quarter, there was a tax charge of $194,000 due to additional tax contingency provisions compared to a tax benefit of $248,000 in the second quarter of 2007.

Financial Outlook

Based on the current backlog and anticipated bookings, Cascade anticipates that fourth quarter 2007 revenues will be in the range of $20 million to $22 million and that diluted earnings per share will be in the range of a loss of $0.02 to earnings of $0.02.

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 fourth quarter of 2007 and any acquisition-related charges 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 October 23, 2007 to discuss its results for the third quarter ended September 30, 2007 and its outlook for the fourth quarter of 2007.

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: 39602458; International: 617-801-6888.)

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