CyberOptics Reports Strong Sales and Earnings Growth For First Quarter of 1998.

MINNEAPOLIS--(BUSINESS WIRE)--April 20, 1998--

Japanese and European SMT Sensor Customers Are Maintaining Robust Order Forecasts

CyberOptics Corporation (Nasdaq National Market: CYBE) today reported record revenues of $10,630,000 for the first quarter of 1998 ended March 31, an increase of 50% from $7,080,000 in the year-earlier period. Net income also came to a first quarter record of $1,568,000 or $.28 per diluted share, up 166% from $589,000 or $.11 per diluted share in the first quarter of 1997.

Dr. Steven K. Case, chairman, said the Company's first quarter results were driven by strong demand for the LaserAlign family of process control sensors, which are incorporated into high-speed SMT assembly equipment of Japanese and European original equipment manufacturers (OEMs). He said the continuation of robust LaserAlign sales reflects the strength of the high-end consumer electronics market and the ongoing drive to further miniaturize these products, which is necessitating sophisticated new production equipment. Earlier this month, Case added, the Company's OEM customers reconfirmed their strong sensor order forecasts, which now extend through the October-December time frame.

First quarter sales of SMT process control sensors increased 79% in comparison to the same period of 1997. Sales of SMT solder paste inspection systems, including the Sentry 2000, were virtually unchanged from the prior year's level, reflecting the normal seasonal sales cycle of this product family. Sales of general industrial measurement products declined in the first quarter, due to the planned changeover in this product line. The phased introduction of a new general industrial sensor was completed in the first quarter, while a new family of measurement systems will be rolled out in the second quarter. These new products are expected to generate growing general industrial sales as the year progresses.

The gross margin increased to 58% in this year's first quarter, from 57% in the fourth quarter of 1997 and 52% in the first quarter of 1997. In addition to the higher sales volume, this margin improvement was attributable to enhanced manufacturing efficiencies and operating leverage. Although selling, general and administrative expense declined to 25% of sales from 27% in the year-earlier period, first quarter earnings growth was restrained somewhat by the impact of expenses related to participating in major electronics trade shows as well as the settlement of the Company's patent infringement litigation against Yamaha Motor Co., Ltd. of Japan. Expenses associated with this issue are expected to have no material impact on the Company's future operating results.

Reflecting the Company's strong current backlog, the second quarter of 1998 is expected to be another period of solid sales and earnings growth. Order bookings for SMT sensors are continuing at strong levels, while the outlook for the Company's systems business is positive.

CyberOptics Corporation is a worldwide leader in the field of three-dimensional, non-contact optical process management for the surface mount technology (SMT) electronics and general industrial markets. The Company's inspection, alignment and measurement products strengthen the yields, operating efficiencies and quality control of manufacturing that involves miniaturized, high-precision, wet or fragile components as well as high-speed processes. -0-

CyberOptics Corporation

Statements of Income
(In thousands, except per share amounts)  Three Months Ended March 31,
                                                1998             1997
Revenue                                      $10,630           $7,080
Cost of revenue                                4,447            3,374
        Gross margin                           6,183            3,706
Research and development expenses              1,845            1,426
Selling, general and administrative
 expenses                                      2,633            1,909
        Income from operations                 1,705              371
Interest income                                  593              493
        Income before income taxes             2,298              864
Provisions for income taxes                      730              275
        Net income                            $1,568             $589
Net income per share - Basic                   $0.29            $0.11
Net income per share - Diluted                 $0.28            $0.11
Weighted average shares outstanding - Basic    5,372            5,183
Weighted average shares outstanding - Dilute   5,640            5,415


Balance Sheets                         March 31, 1998    Dec. 31, 1997

Assets
Cash and cash equivalents                 $9,775           $6,160
Marketable securities                     21,523           20,577
Accounts receivable, net                   7,416            7,697
Inventories                                5,781            4,611
Other current assets                       1,491            1,343
      Total current assets                45,986           40,388

Marketable securities                     11,112           14,290
Equipment and furnishings, net             2,858            2,661
Capitalized patent cost, net                  99              106
      Total assets                       $60,055          $57,445

Liabilities and Stockholders' Equity
Accounts payable                          $1,644           $1,205
Income taxes payable                       1,261              661
Accrued expenses                           1,884            2,286
      Total current liabilities            4,789            4,152

Stockholders' equity:
    Common stock, no par value,
     25,000 shares authorized, 5,409
      and 5,341 shares issued and
       outstanding, respectively          38,842           38,437
    Retained earnings                     16,424           14,856
      Total stockholders' equity          55,266           53,293
      Total liabilities and
       stockholders' equity              $60,055          $57,445

Backlog Shipment Schedule:
      2nd Quarter 1998                    $6,542
      3rd Quarter 1998                       254
      After 3rd Quarter 1998                  23
        Total backlog                     $6,819
-0-

    Statements regarding the Company's anticipated performance in
1998 are forward-looking and therefore involve risks and
uncertainties, including but not limited to: market conditions in the
global electronics industry, competitive products and technologies,
and other factors set forth in the Company's filings with the
Securities and Exchange Commission.

CONTACT: CyberOptics, Minneapolis

Jack Beagan, 612/542-5000

or

Scott Larson, 612/542-5000