8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):  October 26, 2009

VEECO INSTRUMENTS INC.

(Exact name of registrant as specified in its charter)

Delaware	0-16244	11-2989601
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

Terminal Drive, Plainview, New York  11803

(Address of principal executive offices)

(516) 677-0200

(Registrant’s telephone number, including area code)

Not applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 2 - Financial Information

Item 2.02   Results of Operations and Financial Condition.

On October 26, 2009, Veeco Instruments Inc. (“Veeco” or the “Company”) issued a press release announcing its financial results for the quarter ended September 30, 2009.  In connection with the release and the related conference call, Veeco posted a presentation relating to its third quarter 2009 financial results on its website (www.veeco.com).  Copies of the press release and presentation are furnished as Exhibit 99.1 and Exhibit 99.2 to this report.

Section 9 - Financial Statements and Exhibits

Item 9.01   Financial Statements and Exhibits.

(d)Exhibits.

Exhibit	Description
99.1	Press release issued by Veeco Instruments Inc. dated October 26, 2009
99.2	Veeco Instruments Inc. Q3 2009 Highlights dated October 26, 2009

The information in this report, including exhibits 99.1 and 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section, nor shall this information or these exhibits be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	VEECO INSTRUMENTS INC.
October 26, 2009	By:	/s/ Gregory A. Robbins
		Gregory A. Robbins
		Senior Vice President and General Counsel

EXHIBIT INDEX

Exhibit	Description
99.1	Press release issued by Veeco Instruments Inc. dated October 26, 2009
99.2	Veeco Instruments Inc. Q3 2009 Highlights dated October 26, 2009

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EX-99.1

EXHIBIT 99.1

NEWS

Veeco Instruments Inc., Terminal Drive, Plainview, NY 11803 Tel. 516-677-0200 Fax. 516-677-0380

FOR IMMEDIATE RELEASE

Financial Contact: Debra Wasser, SVP Investor Relations & Corporate Communications, 516-677-0200 x1472

Media Contact:  Fran Brennen, Senior Director Marcom, 516-677-0200 x1222

VEECO ANNOUNCES Q3 AND FIRST NINE MONTHS 2009 FINANCIAL RESULTS

Plainview, NY, October 26, 2009 — Veeco Instruments Inc. (Nasdaq: VECO) announced its financial results for the third quarter and nine months ended September 30, 2009. Veeco will host a conference call reviewing these results at 5:00pm today at 800-790-1827 (toll-free) or 212-287-1645 using passcode VEECO. The call will also be webcast live at www.veeco.com.  A replay of the call will be available beginning at 8:00pm tonight through midnight on November 16, 2009 at 866-418-1750 (toll-free) or 203-369-0742 using passcode 9482840, or on the Veeco website. A slide presentation reviewing these results has also been posted on our website. Veeco reports its results on a generally accepted accounting principles (“GAAP”) basis, and also provides results excluding certain items. Please refer to the attached table for details of the reconciliation between GAAP operating results and Non-GAAP operating results.

GAAP Results ($M except EPS)

	Q3 ‘09		Q3 ‘08			9M ‘09			9M ‘08
Revenues	$	98.9	$	115.7		$	233.8		$	332.5
Net income (loss)	$	1.3	$	(2.4	)	$	(34.3	)	$	(1.2	)
EPS	$	0.04	$	(0.08	)	$	(1.09	)	$	(0.04	)

Non-GAAP Results ($M except EPS)

	Q3 ‘09		Q3 ‘08		9M ‘09			9M ‘08
EBITA	$	8.9	$	10.4	$	(7.2	)	$	27.9
EPS	$	0.16	$	0.19	$	(0.21	)	$	0.52

John R. Peeler, Veeco’s Chief Executive Officer, commented, “I am pleased to report that our third quarter performance exceeded guidance on every metric, and that Veeco has quickly returned to profitability. Third quarter revenue was $99 million, well above our guidance of $80-88 million, and gross margins increased over 700 basis points sequentially to 41.4%.  Veeco’s swift restructuring actions decreased operating expenses by 19% in the third quarter versus a year ago. We delivered EBITA of $9 million, positive GAAP earnings per share, and non-GAAP EPS of $0.16, significantly ahead of guidance. All three of our businesses, LED & Solar, Data Storage, and Metrology, returned to EBITA profitability in the third quarter. Veeco’s third quarter 2009 cash balance increased $12 million sequentially, resulting in a positive net cash position.  We are executing to plan and doing what we said we would do.”

“We completed the highest bookings quarter in Veeco’s history, with third quarter orders of approximately $226 million: $179M in LED & Solar (80% of total orders), $17M in Data Storage (7% of total) and $29M in Metrology (13% of total),” continued Mr. Peeler.  “We have seen an unprecedented demand from LED manufacturers in China, Korea and Taiwan for our TurboDisc® Metal Organic Chemical Vapor Deposition (MOCVD) systems as they ramp production for laptop and TV backlighting.  Veeco MOCVD systems were also selected by two leading U.S. LED manufacturers to ramp production for general illumination.  Momentum continued in our CIGS solar business in the third quarter, with a second key customer win for our FastFlex™ Web Coating Systems and a repeat multi-million dollar order for thermal deposition components from a leading CIGS

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manufacturer. We experienced a 27% sequential improvement in Metrology orders, driven by new product success and a modest pick-up in activity from both research and industrial customers.”

Q4’09 Guidance

Veeco’s fourth quarter 2009 revenues are currently forecasted to be between $120-$130 million, with earnings per share between $0.25 to $0.35 on a GAAP basis and $0.29 to $0.35 on a non-GAAP basis. Please refer to the attached financial tables for more details. Veeco currently anticipates a positive book-to-bill ratio for the fourth quarter. Veeco’s 2009 revenue guidance is now $353-$363 million, up from previous guidance of $310-$325 million.

Outlook

Regarding Veeco’s outlook, Mr. Peeler commented, “Veeco’s backlog at the end of September was $287 million, with $239M in LED & Solar.  We continue to experience positive business trends in our MOCVD business, with a high level of demand for our K465™ MOCVD System due to its industry-leading productivity.   We are ramping up our manufacturing capacity to satisfy customer demand. While it is challenging to predict quarterly bookings trends in this dynamic environment, it is clear to us that MOCVD quoting activity remains well above historic levels.”

Mr. Peeler added, “As we look toward the future, we believe Veeco is at the beginning of a multi-year MOCVD tool investment cycle as LEDs increase their penetration in laptop and TV backlighting and gain momentum for general illumination.  We are also seeing strong interest in our thermal deposition systems for manufacturing of CIGS solar cells, and believe that Veeco is well positioned to capture share in this market.  In addition, overall business conditions in Data Storage and Metrology appear to be improving from the trough levels we experienced earlier this year, and we remain well aligned with customers’ technology roadmaps.”

About Veeco

Veeco Instruments Inc. manufactures enabling solutions for customers in the HB-LED, solar, data storage, semiconductor, scientific research and industrial markets. We have leading technology positions in our three businesses: LED & Solar Process Equipment, Data Storage Process Equipment, and Metrology Instruments. Veeco’s manufacturing and engineering facilities are located in New York, New Jersey, California, Colorado, Arizona, Massachusetts and Minnesota. Global sales and service offices are located throughout the U.S., Europe, Japan and APAC. http://www.veeco.com/

To the extent that this news release discusses expectations or otherwise makes statements about the future, such statements are forward-looking and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These factors include the risks discussed in the Business Description and Management’s Discussion and Analysis sections of Veeco’s Annual Report on Form 10-K for the year ended December 31, 2008 and in our subsequent quarterly reports on Form 10-Q, current reports on Form 8-K and press releases.  Veeco does not undertake any obligation to update any forward-looking statements to reflect future events or circumstances after the date of such statements.

-financial tables attached-

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Veeco Instruments Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)

	Three months ended						Nine months ended
	September 30,						September 30,
	2009			2008			2009			2008
Net sales	$	98,913		$	115,709		$	233,782		$	332,465
Cost of sales	58,005			69,626			148,108			196,026
Gross profit	40,908			46,083			85,674			136,439
Operating expenses:
Selling, general and administrative expense	21,042			23,589			59,471			70,528
Research and development expense	13,721			15,302			39,770			45,173
Amortization expense	1,777			3,148			5,437			7,530
Restructuring expense	1,192			4,120			7,567			6,995
Asset impairment charge	—			—			304			285
Other (income) expense, net	(312		)	(213		)	1,097			(591		)
Total operating expenses	37,420			45,946			113,646			129,920
Operating income (loss)	3,488			137			(27,972		)	6,519
Interest expense, net	1,656			1,792			5,063			5,097
Income (loss) before income taxes	1,832			(1,655		)	(33,035		)	1,422
Income tax provision	562			812			1,342			2,860
Net income (loss) including noncontrolling interest	1,270			(2,467		)	(34,377		)	(1,438		)
Net loss attributable to noncontrolling interest	—			(54		)	(65		)	(200		)
Net income (loss) attributable to Veeco	$	1,270		$	(2,413	)	$	(34,312	)	$	(1,238	)
Income (loss) per common share:
Net income (loss) attributable to Veeco	$	0.04		$	(0.08	)	$	(1.09	)	$	(0.04	)
Diluted net income (loss) attributable to Veeco	$	0.04		$	(0.08	)	$	(1.09	)	$	(0.04	)
Weighted average shares outstanding	31,608			31,458			31,540			31,293
Diluted weighted average shares outstanding	32,375			31,458			31,540			31,293

Veeco Instruments Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands)

	September 30,		December 31,
	2009		2008
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	109,441	$	103,799
Accounts receivable, net	64,260		59,659
Inventories, net	74,999		94,930
Prepaid expenses and other current assets	8,059		6,425
Deferred income taxes	2,226		2,185
Total current assets	258,985		266,998
Property, plant and equipment, net	59,294		64,372
Goodwill	59,422		59,160
Other assets, net	32,124		39,011
Total assets	$	409,825	$	429,541
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	28,521	$	29,610
Accrued expenses	73,445		66,964
Deferred profit	2,337		1,346
Current portion of long-term debt	208		196
Income taxes payable	23		354
Total current liabilities	104,534		98,470
Deferred income taxes	5,233		4,540
Long-term debt	100,286		98,330
Other non-current liabilities	1,652		2,391
Total non-current liabilities	107,171		105,261
Shareholders’ equity attributable to Veeco	198,120		225,026
Noncontrolling interest	—		784
Total shareholders’ equity	198,120		225,810
Total liabilities and shareholders’ equity	$	409,825	$	429,541

Veeco Instruments Inc. and Subsidiaries

Reconciliation of operating income (loss) to earnings (loss) excluding certain items

(In thousands, except per share data)

(Unaudited)

	Three months ended						Nine months ended
	September 30,						September 30,
	2009			2008			2009			2008
Operating income (loss)	$	3,488		$	137		$	(27,972	)	$	6,519
Adjustments:
Amortization expense	1,777			3,148			5,437			7,530
Equity-based compensation expense	2,400			2,048			5,953			5,671
Restructuring expense	1,192		(1)	4,120		(2)	7,567		(1)	6,995		(2)
Asset impairment charge	—			—			304		(3)	285		(4)
Purchase accounting adjustment	—			927		(5)	—			927		(5)
Inventory write-off	—			—			1,526		(6)	—
Earnings (loss) before interest, income taxes and amortization excluding certain items (“EBITA”)	8,857			10,380			(7,185		)	27,927
Interest expense, net	1,656			1,792			5,063			5,097
Adjustment to add back non-cash portion of interest expense	(714		)(7)	(740		)(7)	(2,114		)(7)	(2,184		)(7)
Earnings (loss) excluding certain items before income taxes	7,915			9,328			(10,134		)	25,014
Income tax provision (benefit) at 35%	2,770			3,265			(3,547		)	8,755
Earnings (loss) excluding certain items	5,145			6,063			(6,587		)	16,259
Loss attributable to noncontrolling interest, net of income tax benefit at 35%	—			(35		)	(42		)	(130		)
Earnings (loss) excluding certain items attributable to Veeco	$	5,145		$	6,098		$	(6,545	)	$	16,389
Earnings (loss) excluding certain items per diluted share attributable to Veeco	$	0.16		$	0.19		$	(0.21	)	$	0.52
Diluted weighted average shares outstanding	32,375			31,598			31,540			31,498

(1) During the nine months ended September 30, 2009, the Company recorded a restructuring charge of $7.6 million, which consisted principally of $6.3 million of personnel severance costs ($1.2M was incurred in the third quarter), $0.9 million of lease-related charges and $0.4 million of moving and consolidation costs associated with vacating two facilities in our Data Storage Process Equipment segment.

(2) During the nine months ended September 30, 2008, the Company recorded restructuring charges of $7.0 million, consisting primarily of $3.7 million in the third quarter associated with the mutually agreed upon termination of the employment agreement of the Company’s former CEO, $0.5 million for severance costs ($0.2 million in the third quarter) and $2.8 million for lease-related charges principally associated with the consolidation and relocation of our Corporate headquarters ($0.2 million in the third quarter).

(3) During the nine months ended September 30, 2009, the Company recorded a $0.3 million asset impairment charge in our Data Storage Process Equipment segment for assets no longer being utilized.

(4) During the nine months ended September 30, 2008, the Company recorded a $0.3 million asset impairment charge related to fixed asset write-offs associated with the consolidation and relocation of our Corporate headquarters.

(5) During the nine months ended September 30, 2008, the Company recorded $0.9 million in cost of sales related to the acquisition of Mill Lane Engineering.  This charge was the result of purchase accounting, which requires adjustments to capitalize inventory at fair value.

(6) During the nine months ended September 30, 2009, the Company recorded a $1.5 million inventory write-off in our Data Storage Process Equipment segment associated with the discontinuance of certain products.  This charge was included in cost of sales in the GAAP income statement.

(7) Adjustment to exclude non-cash interest expense on convertible subordinated notes.

NOTE - The above reconciliation is intended to present Veeco’s operating results, excluding certain items and providing income taxes at a 35% statutory rate. This reconciliation is not in accordance with, or an alternative method for, generally accepted accounting principles in the United States, and may be different from similar measures presented by other companies. Management of the Company evaluates performance of its business units based on EBITA, which is the primary indicator used to plan and forecast future periods. The presentation of this financial measure facilitates meaningful comparison with prior periods, as management of the Company believes EBITA reports baseline performance and thus provides useful information.

Veeco Instruments Inc. and Subsidiaries

Segment Bookings, Revenues, and Reconciliation

of Operating Income (Loss) to EBITA (Loss)

(In thousands)

(Unaudited)

	Three months ended						Nine months ended
	September 30,			September 30,			September 30,			September 30,
	2009			2008			2009			2008
LED & Solar Process Equipment
Bookings	$	179,229		$	25,775		$	264,092		$	116,513
Revenues	$	52,966		$	40,983		$	107,050		$	128,205
Operating income	$	8,357		$	2,970		$	1,321		$	18,840
Amortization expense	792			1,587			2,341			3,040
Equity-based compensation expense	245			146			619			323
Restructuring expense	200			—			1,129			—
Purchase accounting adjustment	—			927			—			927
EBITA **	$	9,594		$	5,630		$	5,410		$	23,130
Data Storage Process Equipment
Bookings	$	17,243		$	32,359		$	44,379		$	124,685
Revenues	$	21,721		$	43,256		$	56,219		$	104,096
Operating income (loss)	$	565		$	5,788		$	(8,133	)	$	7,466
Amortization expense	405			952			1,213			2,856
Equity-based compensation expense	303			304			892			693
Restructuring expense	225			—			3,055			124
Inventory write-off	—			—			1,526			—
Asset impairment charge	—			—			304			—
EBITA (Loss) **	$	1,498		$	7,044		$	(1,143	)	$	11,139
Metrology
Bookings	$	29,165		$	32,031		$	68,886		$	94,738
Revenues	$	24,226		$	31,470		$	70,513		$	100,164
Operating loss	$	(800	)	$	(886	)	$	(10,615	)	$	(1,304	)
Amortization expense	507			495			1,662			1,295
Equity-based compensation expense	290			251			847			597
Restructuring expense	411			437			2,797			627
EBITA (Loss) **	$	408		$	297		$	(5,309	)	$	1,215
Unallocated Corporate
Operating loss	$	(4,634	)	$	(7,735	)	$	(10,545	)	$	(18,483	)
Amortization expense	73			114			221			339
Equity-based compensation expense	1,562			1,347			3,595			4,058
Restructuring expense	356			3,683			586			6,244
Asset impairment charge	—			—			—			285
Loss **	$	(2,643	)	$	(2,591	)	$	(6,143	)	$	(7,557	)
Total
Bookings	$	225,637		$	90,165		$	377,357		$	335,936
Revenues	$	98,913		$	115,709		$	233,782		$	332,465
Operating income (loss)	$	3,488		$	137		$	(27,972	)	$	6,519
Amortization expense	1,777			3,148			5,437			7,530
Equity-based compensation expense	2,400			2,048			5,953			5,671
Restructuring expense	1,192			4,120			7,567			6,995
Purchase accounting adjustment	—			927			—			927
Inventory write-off	—			—			1,526			—
Asset impairment charge	—			—			304			285
EBITA (Loss) **	$	8,857		$	10,380		$	(7,185	)	$	27,927

** Refer to footnotes on “Reconciliation of operating income (loss) to earnings (loss) excluding certain items” for further details.

Veeco Instruments Inc. and Subsidiaries

Reconciliation of operating income to income excluding certain items

(In thousands, except per share data)

(Unaudited)

	Guidance for the three
	months ended December 31, 2009
	LOW			HIGH
Operating income	$	10,900		$	14,200
Adjustments:
Amortization expense	1,900			1,900
Restructuring expense	300		(1)	300		(1)
Equity-based compensation expense	2,900			2,900
Income before interest, income taxes and amortization excluding certain items (“EBITA”)	16,000			19,300
Interest expense, net	1,800			1,800
Adjustment to add back non-cash portion of interest expense	(800		)(2)	(800		)(2)
Income excluding certain items before income taxes	15,000			18,300
Income tax expense at 35%	5,250			6,405
Income excluding certain items	$	9,750		$	11,895
Income per diluted share excluding certain items	$	0.29		$	0.35
Diluted weighted average shares outstanding	33,500			33,500

(1) During the fourth quarter of 2009, the Company expects to record a restructuring charge of approximately $0.3 million.

(2) Adjustment to exclude non-cash interest expense on convertible subordinated notes.

NOTE - The above reconciliation is intended to present Veeco’s operating results, excluding certain items and providing income taxes at a 35% statutory rate. This reconciliation is not in accordance with, or an alternative method for, generally accepted accounting principles in the United States, and may be different from similar measures presented by other companies. Management of the Company evaluates performance of its business units based on earnings before interest, income taxes and amortization excluding certain items (“EBITA”), which is the primary indicator used to plan and forecast future periods. The presentation of this financial measure facilitates meaningful comparison with prior periods, as management of the Company believes EBITA reports baseline performance and thus provides useful information.

EX-99.2

Exhibit 99.2

Q3 2009 Highlights October 26, 2009

Delivering What We Said We Would Do GOAL: To Emerge From Downturn in a Position Strength New product traction in all businesses Aligned to customers technology roadmaps Winning business – best order quarter in our history Excellent customer connectivity and relationships Generated cash through the down cycle A solid balance sheet Achieved $80M breakeven level Q3’09 Simplify organizational structure and lower company breakeven point Executed factory consolidation ahead of plan Increase variable cost percentage for better performance through cycles

Third Quarter 2009 Highlights: Exceeded Guidance in all Areas Revenue was $98.9 million, down 15% compared to $115.7 million in Q3’08. Revenue increased 37% sequentially Bookings were $225.6 million, a record level for the company; Sept 30 backlog $286.5M Net income was $1.3 million, or $0.04 per share, compared to net loss of ($2.4) million, or ($0.08) per share, last year Veeco’s earnings per share, excluding certain items, was $0.16 compared to earnings per share of $0.19 last year All three businesses return to profitability Q3‘09 operating spending declined 19% versus Q3‘08 Q3‘09 gross margins were 41.4%, ahead of guidance Cash balance increased $12 million to $109.4 million, resulting in a positive net debt/cash balance

Q3 2009 Financial Highlights $0.19 ($0.15) $0.16 EPS (Loss) (Non-GAAP)** $10.4 ($6.4) $8.9 EBITA (Loss)** $0.1 ($12.6) $3.5 Operating Income (Loss) 40.6% 33.9% 41.4% Gross Margin* $115.7 $72.0 $98.9 Revenues $90.2 $98.7 $225.6 Orders Q3’08 Q2’09 Q3’09 ($M except EPS) *Excludes certain charges **See reconciliation to GAAP at end of presentation Significant sequential improvement $80M breakeven model achieved

Q3 2009 Segment Performance EBITA* Revenue Bookings $10.4 $8.9 -15% $115.7 $98.9 +150% $90.2 $225.6 Veeco Total 29.2 17.2 $179.2 Q3 ‘09 32.0 32.4 $25.8 Q3 ‘08 -8% -47% +595% (2.7) 0.4 1.6 $9.6 Q3 ‘09 (2.6) Unallocated Corporate 0.3 -23% 31.5 24.2 Metrology 7.0 -50% 43.3 21.7 Data Storage $5.7 30% $40.9 $53.0 LED & Solar Q3 ‘08 Q3 ‘08 Q3 ‘09 $M *See reconciliation to GAAP at end of presentation

Record Q3’09 Bookings Q3’09 bookings $225.6M, up 129% sequentially LED & Solar: Record orders $179.2M – included multi-unit MOCVD orders from key LED manufacturers in Korea, China, Taiwan and U.S. Manufacturers ramp production for TV, laptop backlighting and general illumination applications $15M order for FastFlex CIGS deposition tools Multi-million dollar repeat order for CIGS components Data Storage: Orders still weak at $17.2M Metrology: Orders $29.2M, up 27% sequentially due to new product traction and modest improvement in scientific research and industrial spending

LED & Solar Grows As Percentage of Veeco – Q3 Results LED & Solar Process Equipment Data Storage Process Equipment LED & Solar Process Equipment Data Storage Process Equipment (54%) (24%) (80%) (7%) (13%) Q3 Revenues ($M) $99 Million Q3 Bookings ($M) ~$226 Million Metrology Metrology (22%) $29 $179 $17 $22 $53 $24

LED & Solar Grows As Percentage of Veeco – 9 Month Results LED & Solar Process Equipment Data Storage Process Equipment LED & Solar Process Equipment Data Storage Process Equipment (46%) (30%) (70%) (12%) (18%) 9 Month Revenues ($M) $234 Million 9 Month Bookings ($M) $377 Million Metrology Metrology (24%) $69 $264 $44 $56 $107 $71

Q4 2009 and Full Year Guidance Revenues $120-130 million GAAP EPS $0.25 to $0.35 per share Non-GAAP EPS $0.29 to $0.35 (utilizing 35% tax rate) [Note: Share Count 33.5M Diluted] Order Outlook Currently forecast positive book-to-bill in Q409 Full Year ‘09 Outlook Revenue between $353 – $363 Million

Favorable Business Outlook Heading into 2010 Backlog at end of September $287M, $239M in LED & Solar Continue to experience positive business trends in MOCVD High level of demand for K465 MOCVD systems due to industry-leading productivity Executing our manufacturing ramp up to satisfy customer demand Challenging to predict quarterly bookings trends – clear that MOCVD quoting activity remains well above historic levels Believe this is the beginning of a multi-year MOCVD investment cycle Strong interest in thermal deposition systems for CIGS solar cell manufacturing Overall business conditions in Data Storage and Metrology appear to be improving from trough levels and we remain well aligned with customers’ technology roadmaps

Restructuring Activities & Top Line Recovery Drive Significant EBITA Improvement 13-15% $38-$40M** 43-44% $120-130M Q4’09 Forecast (9%) $33M 34% $72M Q2 ‘09A 9% (15%) 8% EBITA%* $35M $33M $38M Operating Spending 41% 35% 40% GM $99M $63M $110M Revenue Q3 ’09A Q1 ‘09A Q4 ‘08A *See reconciliation tables **Normalized Veeco Operating Spending Forecast at $120M-$130M Revs = $37-$38M. Unusual items impact Q409. Achieving Target Model

2009 Restructuring and Top Line Recovery Impact All Key Metrics Total Sales ($M) - 20.0 40.0 60.0 80.0 100.0 120.0 140.0 Q1'08 Q2'08 Q3'08 Q4'08 Q1'09 Q2'09 Q3'09 Q4'09F Gross Margin % 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0% Q1'08 Q2'08 Q3'08 Q4'08 Q1'09 Q2'09 Q3'09 Q4'09F OPEX % 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% Q1'08 Q2'08 Q3'08 Q4'08 Q1'09 Q2'09 Q3'09 Q4'09F EBITA % -20.0% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% Q1'08 Q2'08 Q3'08 Q4'08 Q1'09 Q2'09 Q3'09 Q4'09F

$198.1 $100.5 $409.8 $59.3 $154.5 $109.4 09/30/2009 12/31/2008 06/30/2009 $225.8 $190.8 Shareholder’s Equity $98.5 $99.8 Long-Term Debt (including current portion) $429.5 $371.0 Total Assets $64.4 $60.5 Fixed Assets, Net $168.5 $143.0 Working Capital $103.8 $97.5 Cash Equivalents Veeco Balance Sheet (in millions)

Back-up and Reconciliation Data

Income Statement (in Thousands, except for share data) (unaudited) 2009 2008 2009 2008 Net sales $98,913 $115,709 $233,782 $332,465 Cost of sales 58,005 69,626 148,108 196,026 Gross profit 40,908 46,083 85,674 136,439 Operating expenses: Selling, general and administrative expense 21,042 23,589 59,471 70,528 Research and development expense 13,721 15,302 39,770 45,173 Amortization expense 1,777 3,148 5,437 7,530 Restructuring expense 1,192 4,120 7,567 6,995 Asset impairment charge - - 304 285 Other (income) expense, net (312) (213) 1,097 (591) Total operating expenses 37,420 45,946 113,646 129,920 Operating income (loss) 3,488 137 (27,972) 6,519 Interest expense, net 1,656 1,792 5,063 5,097 Income (loss) before income taxes 1,832 (1,655) (33,035) 1,422 Income tax provision 562 812 1,342 2,860 Net income (loss) including noncontrolling interest 1,270 (2,467) (34,377) (1,438) Net loss attributable to noncontrolling interest - (54) (65) (200) Net income (loss) attributable to Veeco $1,270 ($2,413) ($34,312) ($1,238) Income (loss) per common share: Net income (loss) attributable to Veeco $0.04 ($0.08) ($1.09) ($0.04) Diluted net income (loss) attributable to Veeco $0.04 ($0.08) ($1.09) ($0.04) Weighted average shares outstanding 31,608 31,458 31,540 31,293 Diluted weighted average shares outstanding 32,375 31,458 31,540 31,293 September 30, Three months ended Nine months ended September 30,

Balance Sheet (In thousands) September 30, December 31, 2009 2008 ASSETS (Unaudited) Current assets: Cash and cash equivalents 109,441 $ 103,799 $ Accounts receivable, net 64,260 59,659 Inventories, net 74,999 94,930 Prepaid expenses and other current assets 8,059 6,425 Deferred income taxes 2,226 2,185 Total current assets 258,985 266,998 Property, plant and equipment, net 59,294 64,372 Goodwill 59,422 59,160 Other assets, net 32,124 39,011 Total assets 409,825 $ 429,541 $ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable 28,521 $ 29,610 $ Accrued expenses 73,445 66,964 Deferred profit 2,337 1,346 Current portion of long-term debt 208 196 Income taxes payable 23 354 Total current liabilities 104,534 98,470 Deferred income taxes 5,233 4,540 Long-term debt 100,286 98,330 Other non-current liabilities 1,652 2,391 Total non-current liabilities 107,171 105,261 Shareholders' equity attributable to Veeco 198,120 225,026 Noncontrolling interest - 784 Total shareholders' equity 198,120 225,810 Total liabilities and shareholders' equity 409,825 $ 429,541 $ 

Reconciliation (In thousands, except share data) NOTE - The above reconciliation is intended to present Veeco's operating results, excluding certain items and providing income taxes at a 35% statutory rate. This reconciliation is not in accordance with, or an alternative method for, generally accepted accounting principles in the United States, and may be different from similar measures presented by other companies. Management of the Company evaluates performance of its business units based on EBITA, which is the primary indicator used to plan and forecast future periods. The presentation of this financial measure facilitates meaningful comparison with prior periods, as management of the Company believes EBITA reports baseline performance and thus provides useful information. (Unaudited) 2009 2008 2009 2008 Operating income (loss) $3,488 $137 ($27,972) $6,519 Adjustments: Amortization expense 1,777 3,148 5,437 7,530 Equity-based compensation expense 2,400 2,048 5,953 5,671 Restructuring expense 1,192 (1) 4,120 (2) 7,567 (1) 6,995 (2) Asset impairment charge - - 304 (3) 285 (4) Purchase accounting adjustment - 927 (5) - 927 (5) Inventory write-off - - 1,526 (6) - Earnings (loss) before interest, income taxes and amortization excluding certain items ("EBITA") 8,857 10,380 (7,185) 27,927 Interest expense, net 1,656 1,792 5,063 5,097 Adjustment to add back non-cash portion of interest expense (714) (7) (740) (7) (2,114) (7) (2,184) (7) Earnings (loss) excluding certain items before income taxes 7,915 9,328 (10,134) 25,014 Income tax provision (benefit) at 35% 2,770 3,265 (3,547) 8,755 Earnings (loss) excluding certain items 5,145 6,063 (6,587) 16,259 Loss attributable to noncontrolling interest, net of income tax benefit at 35% - (35) (42) (130) Earnings (loss) excluding certain items attributable to Veeco $5,145 $6,098 ($6,545) $16,389 Earnings (loss) excluding certain items per diluted share attributable to Veeco $0.16 $0.19 ($0.21) $0.52 Diluted weighted average shares outstanding 32,375 31,598 31,540 31,498 Three months ended September 30, (6) During the nine months ended September 30, 2009, the Company recorded a $1.5 million inventory write-off in our Data Storage Process Equipment segment associated with the discontinuance of certain products. This charge was included in cost of sales in the GAAP income statement. Nine months ended September 30, (5) During the nine months ended September 30, 2008, the Company recorded $0.9 million in cost of sales related to the acquisition of Mill Lane Engineering. This charge was the result of purchase accounting, which requires adjustments to capitalize inventory at fair value. (7) Adjustment to exclude non-cash interest expense on convertible subordinated notes. (1) During the nine months ended September 30, 2009, the Company recorded a restructuring charge of $7.6 million, which consisted principally of $6.3 million of personnel severance costs, $0.9 milion of lease-related charges and $0.4 million of moving and consolidation costs associated with vacating two facilities in our Data Storage Process Equipment segment. (2) During the nine months ended September 30, 2008, the Company recorded restructuring charges of $7.0 million, consisting primarily of $3.7 million associated with the mutually agreed upon termination of the employment agreement of the Company's former CEO, $0.5 million for severance costs and $2.8 million for lease-related charges principally associated with the consolidation and relocation of our Corporate headquarters. (3) During the nine months ended September 30, 2009, the Company recorded a $0.3 million asset impairment charge in our Data Storage Process Equipment segment for assets no longer being utilized. (4) During the nine months ended September 30, 2008, the Company recorded a $0.3 million asset impairment charge related to fixed asset write-offs associated with the consolidation and relocation of our Corporate headquarters.

Segment Bookings, Revenue & Reconciliation (in thousands) (Unaudited) **Refers to footnotes on “Reconciliation of operating income (loss) to earnings (loss) excluding certain items” for further details. $ 27,927 $ (7,185) $ 10,380 $ 8,857 EBITA (Loss) ** 285 304 - - Asset impairment charge - 1,526 - - Inventory write-off 927 - 927 - Purchase accounting adjustment 6,995 7,567 4,120 1,192 Restructuring expense 5,671 5,953 2,048 2,400 Equity-based compensation expense 7,530 5,437 3,148 1,777 Amortization expense $ 6,519 $ (27,972) $ 137 $ 3,488 Operating income (loss) $ 332,465 $ 233,782 $ 115,709 $ 98,913 Revenues $ 335,936 $ 377,357 $ 90,165 $ 225,637 Bookings Total $ (7,557) $ (6,143) $ (2,591) $ (2,643) Loss ** 285 - - - Asset impairment charge 6,244 586 3,683 356 Restructuring expense 4,058 3,595 1,347 1,562 Equity-based compensation expense 339 221 114 73 Amortization expense $ (18,483) $ (10,545) $ (7,735) $ (4,634) Operating loss Unallocated Corporate $ 1,215 $ (5,309) $ 297 $ 408 EBITA (Loss) ** 627 2,797 437 411 Restructuring expense 597 847 251 290 Equity-based compensation expense 1,295 1,662 495 507 Amortization expense $ (1,304) $ (10,615) $ (886) $ (800) Operating loss $ 100,164 $ 70,513 $ 31,470 $ 24,226 Revenues $ 94,738 $ 68,886 $ 32,031 $ 29,165 Bookings Metrology $ 11,139 $ (1,143) $ 7,044 $ 1,498 EBITA (Loss) ** - 304 - - Asset impairment charge - 1,526 - - Inventory write-off 124 3,055 - 225 Restructuring expense 693 892 304 303 Equity-based compensation expense 2,856 1,213 952 405 Amortization expense $ 7,466 $ (8,133) $ 5,788 $ 565 Operating income (loss) $ 104,096 $ 56,219 $ 43,256 $ 21,721 Revenues $ 124,685 $ 44,379 $ 32,359 $ 17,243 Bookings Data Storage Process Equipment $ 23,130 $ 5,410 $ 5,630 $ 9,594 EBITA ** 927 - 927 - Purchase accounting adjustment - 1,129 - 200 Restructuring expense 323 619 146 245 Equity-based compensation expense 3,040 2,341 1,587 792 Amortization expense $ 18,840 $ 1,321 $ 2,970 $ 8,357 Operating income $ 128,205 $ 107,050 $ 40,983 $ 52,966 Revenues $ 116,513 $ 264,092 $ 25,775 $ 179,229 Bookings LED & Solar Process Equipment 2008 2009 2008 2009 September 30, September 30, September 30, September 30, Nine months ended Three months ended

Reconciliation of Operating Income to Income Excluding Certain Items (in thousands, except per share data) (Unaudited) NOTE - The above reconciliation is intended to present Veeco's operating results, excluding certain items and providing income taxes at a 35% statutory rate. This reconciliation is not in accordance with, or an alternative method for, generally accepted accounting principles in the United States, and may be different from similar measures presented by other companies. Management of the Company evaluates performance of its business units based on earnings before interest, income taxes and amortization excluding certain items ("EBITA"), which is the primary indicator used to plan and forecast future periods. The presentation of this financial measure facilitates meaningful comparison with prior periods, as management of the Company believes EBITA reports baseline performance and thus provides useful information. LOW HIGH Operating income $10,900 $14,200 Adjustments: Amortization expense 1,900 1,900 Restructuring expense 300 (1) 300 (1) Equity-based compensation expense 2,900 2,900 Income before interest, income taxes and amortization excluding certain items ("EBITA") 16,000 19,300 Interest expense, net 1,800 1,800 Adjustment to add back non-cash portion of interest expense (800) (2) (800) (2) Income excluding certain items before income taxes 15,000 18,300 Income tax expense at 35% 5,250 6,405 Income excluding certain items $9,750 $11,895 Income per diluted share excluding certain items $0.29 $0.35 Diluted weighted average shares outstanding 33,500 33,500 (2) Adjustment to exclude non-cash interest expense on convertible subordinated notes. Guidance for the three months ended December 31, 2009 (1) During the fourth quarter of 2009, the Company expects to record a restructuring charge of approximately $0.3 million.