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 THESECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported):  August 2, 2018

VEECO INSTRUMENTS INC.

(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction
of incorporation) 0-16244
(Commission
File Number) 11-2989601
(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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Item 2.02  Results of Operations and Financial Condition.

On August 2, 2018, Veeco Instruments Inc. issued a press release announcing its financial results for the quarter ended June 30, 2018.  In connection with the release and the related conference call, Veeco posted a presentation relating to its second quarter 2018 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.

Item 9.01  Financial Statements and Exhibits.

(d)Exhibits.

Exhibit	Description
99.1	Press release issued by Veeco dated August 2, 2018
99.2	Veeco Q2 2018 Conference Call, August 2, 2018

The information in this report, including the exhibits, 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.

EXHIBIT INDEX

Exhibit	Description
99.1	Press release issued by Veeco dated August 2, 2018
99.2	Veeco Q2 2018 Conference Call, August 2, 2018

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.

August 2, 2018	VEECO INSTRUMENTS INC.
	By:	/s/ Gregory A. Robbins
	Name: Gregory A. Robbins
	Title: Senior Vice President and General Counsel

2

EX-99.1

EXHIBIT 99.1

VEECO REPORTS SECOND QUARTER 2018 FINANCIAL RESULTS

Second Quarter 2018 Highlights:

·Revenues of $157.8 million, compared with $112.2 million in the same period last year

·GAAP net loss of $237.6 million, or $5.02 loss per diluted share

·Non-GAAP net income of $7.2 million, or $0.15 per diluted share

·Recorded $252.3 million non-cash, intangible asset impairment charge

Plainview, N.Y., August 2, 2018 — Veeco Instruments Inc. (Nasdaq: VECO) today announced financial results for its second quarter ended June 30, 2018.  Results are reported in accordance with U.S. generally accepted accounting principles (“GAAP”) and are also reported adjusting for certain items (“Non-GAAP”). A reconciliation between GAAP and Non-GAAP operating results is provided at the end of this press release.

U.S. dollars in millions, except per share data
GAAP Results	Q2 ‘18			Q2 ‘17
Revenue	$	157.8		$	112.2
Net income (loss)	$	(237.6	)	$	(20.8	)
Diluted earnings (loss) per share	$	(5.02	)	$	(0.49	)

Non-GAAP Results	Q2 ‘18		Q2 ‘17
Net income (loss)	$	7.2	$	4.0
Operating income (loss)	$	10.8	$	6.7
Diluted earnings (loss) per share	$	0.15	$	0.09

“Veeco had solid Q2 performance with Non-GAAP gross margin, operating income, net income and EPS at the high end of our guided ranges,” commented John R. Peeler, Chairman and Chief Executive Officer.

“Based on Ultratech’s performance relative to our prior projections, we were required to record an intangible asset impairment charge of $252 million for GAAP results.  This is a non-cash charge and does not affect our liquidity, day to day operations or Non-GAAP results.

Going forward, we remain optimistic about the longer term growth prospects of the combined company as we now have a stronger presence in attractive, growing markets and the right technology to succeed.  We continue to make progress towards generating synergies through the integration of Ultratech and have initiated steps to rationalize manufacturing capacity by closing one of the Singapore manufacturing sites.  We expect to complete this initiative by the end of Q1 2019 and anticipate approximately $2 million in annualized savings,” Mr. Peeler concluded.

1

Guidance and Outlook

The following guidance is provided for Veeco’s third quarter 2018:

·Revenue is expected in the range of $130 million to $140 million

·GAAP Net Income (loss) is expected in the range of ($12) million to ($7) million

·GAAP earnings (loss) per diluted share are expected in the range of ($0.25) to ($0.15)

·Non-GAAP operating income is expected in the range of $4 million to $9 million

·Non-GAAP earnings (loss) per diluted share are expected in the range of $0.03 to $0.13

Please refer to the tables at the end of this press release for further details.

Conference Call Information

A conference call reviewing these results has been scheduled for today, August 2, 2018, starting at 8:30am ET. To join the call, dial 1-888-394-8218 (toll free) or 1-323-794-2588 and use passcode 8196085. Participants may also access a live webcast of the call by visiting the investor relations section of Veeco’s website at ir.veeco.com. A replay of the webcast will be made available on the Veeco website beginning at 5:00pm ET this evening. We will post an accompanying slide presentation to our website prior to the beginning of the call.

New Accounting Standard

The Company adopted the new accounting standard, ASC 606, related to revenue recognition, effective January 1, 2018. The prior periods presented here have been recast to reflect the adoption of this new standard.

About Veeco

Veeco (NASDAQ: VECO) is a leading manufacturer of innovative semiconductor process equipment. Our proven MOCVD, lithography, laser annealing, ion beam and single wafer etch & clean technologies play an integral role in producing LEDs for solid-state lighting and displays, and in the fabrication of advanced semiconductor devices. With equipment designed to maximize performance, yield and cost of ownership, Veeco holds technology leadership positions in all these served markets. To learn more about Veeco’s innovative equipment and services, visit www.veeco.com.

Forward-looking Statements

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, 2017 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-

Veeco Contacts:

Investors:	Media:
Anthony Bencivenga 516-677-0200 x1308	David Pinto 408-325-6157
abencivenga@veeco.com	dpinto@veeco.com

2

Veeco Instruments Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

(unaudited)

	Three months ended June 30,						Six months ended June 30,
	2018			2017			2018			2017
Net sales	$	157,779		$	112,218		$	316,353		$	206,717
Cost of sales	102,384			76,371			204,278			136,371
Gross profit	55,395			35,847			112,075			70,346
Operating expenses, net:
Research and development	24,930			18,619			49,250			33,608
Selling, general, and administrative	24,274			22,698			50,657			41,801
Amortization of intangible assets	10,386			6,354			23,918			9,221
Restructuring	2,917			3,257			5,612			4,595
Acquisition costs	1,316			14,133			2,657			15,494
Asset impairment	252,343			675			252,343			1,138
Other, net	443			(10		)	286			(87		)
Total operating expenses, net	316,609			65,726			384,723			105,770
Operating income (loss)	(261,214		)	(29,879		)	(272,648		)	(35,424		)
Interest expense, net	(4,445		)	(4,279		)	(9,068		)	(7,621		)
Income (loss) before income taxes	(265,659		)	(34,158		)	(281,716		)	(43,045		)
Income tax expense (benefit)	(28,025		)	(13,341		)	(28,255		)	(23,868		)
Net income (loss)	$	(237,634	)	$	(20,817	)	$	(253,461	)	$	(19,177	)
Income (loss) per common share:
Basic	$	(5.02	)	$	(0.49	)	$	(5.35	)	$	(0.47	)
Diluted	$	(5.02	)	$	(0.49	)	$	(5.35	)	$	(0.47	)
Weighted average number of shares:
Basic	47,311			42,656			47,332			41,160
Diluted	47,311			42,656			47,332			41,160

3

Veeco Instruments Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

	June 30,		December 31,
	2018		2017
Assets
Current assets:
Cash and cash equivalents	$	196,429	$	279,736
Restricted cash	838		847
Short-term investments	65,023		47,780
Accounts receivable, net	133,750		98,866
Contract assets	4,931		160
Inventories	145,939		120,266
Deferred cost of sales	205		15,994
Prepaid expenses and other current assets	28,580		33,437
Total current assets	575,695		597,086
Property, plant and equipment, net	79,268		85,058
Intangible assets, net	93,582		369,843
Goodwill	307,131		307,131
Deferred income taxes	2,172		3,047
Other assets	30,261		25,310
Total assets	$	1,088,109	$	1,387,475
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	65,090	$	50,318
Accrued expenses and other current liabilities	55,274		58,068
Customer deposits and deferred revenue	73,459		112,032
Income taxes payable	1,782		3,846
Total current liabilities	195,605		224,264
Deferred income taxes	7,784		36,845
Long-term debt	281,401		275,630
Other liabilities	9,389		10,643
Total liabilities	494,179		547,382
Total stockholders’ equity	593,930		840,093
Total liabilities and stockholders’ equity	$	1,088,109	$	1,387,475

4

Veeco Instruments Inc. and Subsidiaries

Reconciliation of GAAP to Non-GAAP Financial Data

(in thousands, except per share amounts)

(unaudited)

				Non-GAAP Adjustments
Three months ended June 30, 2018	GAAP			Share-Based Compensation		Amortization	Other		Non-GAAP
Net sales	$	157,779							$	157,779
Gross profit	55,395			536			617		56,548
Gross margin	35.1		%						35.8		%
Research and development	24,930			(1,065	)				23,865
Selling, general, and administrative and Other, net	24,717			(2,646	)		(196	)	21,875
Net income (loss)	(237,634		)	4,904		10,386	229,533		7,189
Income (loss) per common share:
Basic	$	(5.02	)						$	0.15
Diluted	(5.02		)						0.15
Weighted average number of shares:
Basic	47,311								47,328
Diluted	47,311								47,350

Veeco Instruments Inc. and Subsidiaries

Other Non-GAAP Adjustments

(in thousands)

(unaudited)

Three months ended June 30, 2018
Asset Impairment	252,343
Restructuring	2,260
Acquisition related	1,316
Release of inventory fair value step-up associated with the Ultratech purchase accounting	520
Depreciation of PP&E fair value step-up associated with the Ultratech purchase accounting	293
Non-cash interest expense	2,912
Non-GAAP tax adjustment *	(30,111	)
Total Other	229,533

* - The ‘with or without’ method is utilized to determine the income tax effect of all Non-GAAP adjustments, as well as the exclusion of certain tax benefits attributed to the change in U.S. tax laws.

These tables include financial measures adjusted for the impact of certain items; these financial measures are therefore not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). These Non-GAAP financial measures exclude items such as: share-based compensation expense; charges relating to restructuring initiatives; non-cash asset impairments; certain other non-operating gains and losses; and acquisition-related items such as transaction costs, non-cash amortization of acquired intangible assets, incremental transaction-related compensation, and certain integration costs.

These Non-GAAP financial measures may be different from Non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. By excluding these items, Non-GAAP financial measures are intended to facilitate meaningful comparisons to historical operating results, competitors’ operating results, and estimates made by securities analysts. Management is evaluated on key performance metrics including Non-GAAP Operating Income (loss), which is used to determine management incentive compensation as well as to forecast future periods. These Non-GAAP financial measures may be useful to investors in allowing for greater transparency of supplemental information used by management in its financial and operational decision-making. In addition, similar Non-GAAP financial measures have historically been reported to investors; the inclusion of comparable numbers provides consistency in financial reporting. Investors are encouraged to review the reconciliation of the Non-GAAP financial measures used in this news release to their most directly comparable GAAP financial measures.

5

Veeco Instruments Inc. and Subsidiaries

Reconciliation of GAAP to Non-GAAP Financial Data

(in thousands, except per share amounts)

(unaudited)

				Non-GAAP Adjustments
Three months ended June 30, 2017	GAAP			Share-based Compensation		Amortization	Other		Non-GAAP
Net sales	$	112,218							$	112,218
Gross profit	35,847			500			7,495		43,842
Gross margin	31.9		%						39.1		%
Research and development	18,619			(708	)				17,911
Selling, general, and administrative and Other, net	22,688			(3,368	)		(73	)	19,247
Net income (loss)	(20,817		)	9,620		6,354	8,830		3,987
Income (loss) per common share:
Basic	$	(0.49	)						$	0.09
Diluted	(0.49		)						0.09
Weighted average number of shares:
Basic	42,656								42,884
Diluted	42,656								43,214

Veeco Instruments Inc. and Subsidiaries

Other Non-GAAP Adjustments

(in thousands)

(unaudited)

Three months ended June 30, 2017
Restructuring	2,416
Acquisition related	9,930
Release of inventory fair value step-up associated with the Ultratech purchase accounting	7,368
Depreciation of PP&E fair value step-up associated with the Ultratech purchase accounting	109
Accelerated depreciation	91
Asset impairment	675
Non-cash interest expense	2,702
Non-GAAP tax adjustment *	(14,461	)
Total Other	8,830

* - The ‘with or without’ method is utilized to determine the income tax effect of all Non-GAAP adjustments.

These tables include financial measures adjusted for the impact of certain items; these financial measures are therefore not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). These Non-GAAP financial measures exclude items such as: share-based compensation expense; charges relating to restructuring initiatives; non-cash asset impairments; certain other non-operating gains and losses; and acquisition-related items such as transaction costs, non-cash amortization of acquired intangible assets, incremental transaction-related compensation, and certain integration costs.

These Non-GAAP financial measures may be different from Non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. By excluding these items, Non-GAAP financial measures are intended to facilitate meaningful comparisons to historical operating results, competitors’ operating results, and estimates made by securities analysts. Management is evaluated on key performance metrics including Non-GAAP Operating Income (loss), which is used to determine management incentive compensation as well as to forecast future periods. These Non-GAAP financial measures may be useful to investors in allowing for greater transparency of supplemental information used by management in its financial and operational decision-making. In addition, similar Non-GAAP financial measures have historically been reported to investors; the inclusion of comparable numbers provides consistency in financial reporting. Investors are encouraged to review the reconciliation of the Non-GAAP financial measures used in this news release to their most directly comparable GAAP financial measures.

6

Veeco Instruments Inc. and Subsidiaries

Reconciliation of GAAP Net Income (loss) to Non-GAAP Operating Income (loss)

(in thousands)

(unaudited)

	Three months ended			Three months ended
	June 30, 2018			June 30, 2017
GAAP Net income (loss)	$	(237,634	)	$	(20,817	)
Share-based compensation	4,904			9,620
Amortization	10,386			6,354
Restructuring	2,260			2,416
Acquisition related	1,316			9,930
Release of inventory fair value step-up associated with the Ultratech purchase accounting	520			7,368
Depreciation of PP&E fair value step-up associated with the Ultratech purchase accounting	293			109
Asset impairment	252,343			675
Accelerated depreciation	—			91
Interest (income) expense	4,445			4,279
Income tax expense (benefit)	(28,025		)	(13,341		)
Non-GAAP Operating Income (loss)	$	10,808		$	6,684

This table includes financial measures adjusted for the impact of certain items; these financial measures are therefore not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). These Non-GAAP financial measures exclude items such as: share-based compensation expense; charges relating to restructuring initiatives; non-cash asset impairments; certain other non-operating gains and losses; and acquisition-related items such as transaction costs, non-cash amortization of acquired intangible assets, incremental transaction-related compensation, and certain integration costs.

These Non-GAAP financial measures may be different from Non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. By excluding these items, Non-GAAP financial measures are intended to facilitate meaningful comparisons to historical operating results, competitors’ operating results, and estimates made by securities analysts. Management is evaluated on key performance metrics including Non-GAAP Operating Income (loss), which is used to determine management incentive compensation as well as to forecast future periods. These Non-GAAP financial measures may be useful to investors in allowing for greater transparency of supplemental information used by management in its financial and operational decision-making. In addition, similar Non-GAAP financial measures have historically been reported to investors; the inclusion of comparable numbers provides consistency in financial reporting. Investors are encouraged to review the reconciliation of the Non-GAAP financial measures used in this news release to their most directly comparable GAAP financial measures.

7

Veeco Instruments Inc. and Subsidiaries

Reconciliation of GAAP to Non-GAAP Financial Data

(in millions, except per share amounts)

(unaudited)

								Non-GAAP Adjustments
Guidance for the three months ending September 30, 2018	GAAP							Share-based Compensation	Amortization	Other	Non-GAAP
Net sales	$	130		-	$	140					$	130		-	$	140
Gross profit	45			-	52			1	—	1	47			-	54
Gross margin	35		%	-	37		%				36		%	-	38		%
Net income (loss)	$	(12	)	-	$	(7	)	4	4	5	$	1		-	$	6
Income (loss) per diluted common share	$	(0.25	)	-	$	(0.15	)				$	0.03		-	$	0.13
Weighted average number of shares	47				47						47				47

Veeco Instruments Inc. and Subsidiaries

Reconciliation of GAAP Net Income (loss) to Non-GAAP Operating Income (Loss)

(in millions)

(unaudited)

Guidance for the three months ending September 30, 2018
GAAP Net income (loss)	$	(12	)	-	$	(7	)
Share-based compensation	4			-	4
Amortization	4			-	4
Restructuring	1			-	1
Acquisition related	1			-	1
Accelerated depreciation	1			-	1
Interest expense, net	4			-	4
Income tax expense (benefit)	1			-	1
Non-GAAP Operating Income	$	4		-	$	9

Note:  Amounts may not calculate precisely due to rounding.

These table includes financial measures adjusted for the impact of certain items; these financial measures are therefore not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). These Non-GAAP financial measures exclude items such as: share-based compensation expense; charges relating to restructuring initiatives; non-cash asset impairments; certain other non-operating gains and losses; and acquisition-related items such as transaction costs, non-cash amortization of acquired intangible assets, incremental transaction-related compensation, and certain integration costs.

These Non-GAAP financial measures may be different from Non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. By excluding these items, Non-GAAP financial measures are intended to facilitate meaningful comparisons to historical operating results, competitors’ operating results, and estimates made by securities analysts. Management is evaluated on key performance metrics including Non-GAAP Operating Income (loss), which is used to determine management incentive compensation as well as to forecast future periods. These Non-GAAP financial measures may be useful to investors in allowing for greater transparency of supplemental information used by management in its financial and operational decision-making. In addition, similar Non-GAAP financial measures have historically been reported to investors; the inclusion of comparable numbers provides consistency in financial reporting. Investors are encouraged to review the reconciliation of the Non-GAAP financial measures used in this news release to their most directly comparable GAAP financial measures.

8

EX-99.2

Exhibit 99.2

Veeco Instruments, Inc. August 2, 2018 Q2 2018 Conference Call

Safe Harbor To the extent that this presentation 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 items include the risk factors 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, 2017 and subsequent Quarterly Reports on Form 10-Q and current reports on Form 8-K. Veeco does not undertake any obligation to update any forward-looking statements to reflect future events or circumstances after the date of such statements. Q2 2018 Conference Call © 2018 Veeco Instruments Inc. 2

CEO Introduction John Peeler

Q2 2018 Highlights All Non-GAAP P&L metrics either met or exceeded guidance Bookings declined due to LED market weakness Recorded intangible asset impairment charge of $252M Initiated cost reduction by eliminating redundant Singapore manufacturing operations Announced wins in growth markets – Photonics, Display, Advanced Packaging for Memory, Power Electronics 4 Solid P&L Performance in Q2 Q2 Results $132M Bookings $158M Revenue $11M Non-GAAP Operating Income 15¢ Non-GAAP EPS A reconciliation of GAAP to Non-GAAP financial measures can be found in the backup section of this presentation. Q2 2018 Conference Call © 2018 Veeco Instruments Inc.

CFO Financial Review Sam Maheshwari

Intangible Asset Impairment Ultratech product lines have performed below prior projections Current projections triggered an impairment of intangible assets of $252M This non-cash charge does not affect our liquidity nor our day-to-day operations Remain optimistic about the combined strength of Veeco & Ultratech and continue to execute on our growth strategies 6 Remain Optimistic about our Long-Term Growth Opportunities Q2 2018 Conference Call © 2018 Veeco Instruments Inc.

Q2 2018 Revenue by End Market and Geography 7 Diversification will be More Pronounced in Q3 and Q4 Mix by End Market Mix by Geography 16% Advanced Packaging, MEMS & RF Filters 17% Scientific & Industrial 55% LED Lighting, Display & Compound Semi $158M 18% Rest of World 45% China 16% EMEA 21% United States 12% Front-End Semi China Blue LED was 31% of Veeco revenue in Q2 Front-End Semiconductor doubled from last quarter Q2 2018 Conference Call © 2018 Veeco Instruments Inc. Amounts may not calculate precisely due to rounding United States and EMEA percentages increased and include LED, Photonics, Advanced Packaging and STT-MRAM revenue

P&L Highlights 8 Amounts may not calculate precisely due to rounding. A reconciliation of GAAP to Non-GAAP financial measures can be found in the backup section of this presentation. Gross Margin Improvement Expected in 2nd Half GAAP Non-GAAP $ millions (except per share amounts) Q1 18 Q2 18 Q1 18 Q2 18 Revenue $158.6 $157.8 $158.6 $157.8 Gross Profit 56.7 55.4 57.8 56.5 Gross Margin 35.7% 35.1% 36.5% 35.8% R&D 24.3 24.9 23.4 23.9 SG&A & Other 26.2 24.7 23.2 21.9 Operating Income/(Loss) (11.4) (261.2) 11.3 10.8 Net Income/(Loss) (15.8) (237.6) 9.2 7.2 Earnings/(Loss) Per Share ($0.34) ($5.02) $0.20 $0.15 Q2 2018 Conference Call © 2018 Veeco Instruments Inc.

Balance Sheet Highlights 9 Amounts may not calculate precisely due to rounding. A reconciliation of GAAP to Non-GAAP financial measures can be found in the backup section of this presentation. Increased Working Capital Drove Down Cash Balance $ millions Q1 18 Q2 18 Cash & Short-Term Investments 311 261 Accounts Receivable 108 134 Inventories 131 146 Accounts Payable 58 65 Long-Term Debt 278 281 Cash Flow from Operations (12) (46) DSO (days) 61 76 DOI 118 130 DPO 52 58 Q2 2018 Conference Call © 2018 Veeco Instruments Inc.

Q3 2018 Guidance 10 GAAP Non-GAAP Revenue $130M - $140M $130M - $140M Gross Margin 35% - 37% 36% - 38% Net Income (Loss) ($12M)-($7M) $1M-$6M Earnings Per Share ($0.25)-($0.15) $0.03-$0.13 Non-GAAP Operating Income $4M-$9M Q2 2018 Conference Call © 2018 Veeco Instruments Inc. . A reconciliation of GAAP to Non-GAAP financial measures can be found in the backup section of this presentation.

Business Update & Outlook

Advanced Packaging, MEMS & RF Filters 12 Advanced Packaging Will Accelerate as Moore’s Law Slows Source: Veeco estimates High-End Computing Driving Need for Advanced Packaging Artificial intelligence Big data analytics Autonomous vehicles (ADAS) Mobile processors FO-WLP Demand Forecasted to Increase Wafers incorporating FO-WLP are forecasted to grow 6X between 2018 and 2021 Applicable Technologies: MOCVD Lithography Wet Etch/Clean Laser Anneal Ion Beam MBE 3D Inspection ALD Significant Increase in Demand for FO-WLP 2018 2021 1M Wafers per Year Q2 2018 Conference Call © 2018 Veeco Instruments Inc. >6M Wafers per Year Source: TechSearch International ADAS – Automated Driver Assisted Systems FO-WLP – Fan Out Wafer Level Packaging

Driven by mega trends: 3D Sensing/VCSEL Autonomous Vehicles 5G RF & High Speed Data Displays Emerging Applications Photonics GaN RF GaN Power Electronics Micro LED Broad portfolio of MOCVD products to address market needs: K475i™ EPIK® Propel™ New Products LED Lighting, Display & Compound Semiconductor Q2 2018 Conference Call © 2018 Veeco Instruments Inc. 13 Emerging Compound Semiconductor Markets Grow at ~25% CAGR Waves of Compound Semiconductor Demand Global leader in MOCVD through waves of demand with >1,000 reactors installed at >100 customers. Mobile & TV Backlighting General Lighting Veeco MOCVD Source: Veeco estimates Applicable Technologies: MOCVD Lithography Wet Etch/Clean Laser Anneal Ion Beam MBE 3D Inspection ALD

Front-End Semiconductor 14 Front-End Semiconductor Provides Growth Opportunities Source: Adapted from New Street Research, May 2018 Extreme Ultraviolet (EUV) Lithography is an Enabler for Leading-Edge Nodes ASML is shipping/forecasting 50 EUV Lithography tools between 2018 and 2019* Veeco’s Ion Beam technology is ideally positioned for producing EUV mask blanks LSA / Melt China 28nm fabs delayed Melt tool being evaluated at 2 customers for applications at 7nm and below Applicable Technologies: MOCVD Lithography Wet Etch/Clean Laser Anneal Ion Beam MBE 3D Inspection ALD Q2 2018 Conference Call © 2018 Veeco Instruments Inc. * ASML Q2 2018 Earnings Call

Scientific & Industrial 15 Scientific & Industrial Consistently Provides Foundational Support Source: Veeco estimates Data Storage Endures through Cycles Megatrends drive increases in cloud storage Thin film magnetic head (TFMH) unit volumes are increasing to support larger hard drive storage capacities Manufacturers continue to leverage Veeco’s expertise to upgrade TFMH technology to increase areal density Continued Momentum in Optical Coatings Strong demand for Ion Beam Sputtering systems from industrial applications Edmund Optics expanded their laser optics coating capability Applicable Technologies: MOCVD Lithography Wet Etch/Clean Laser Anneal Ion Beam MBE 3D Inspection ALD Q2 2018 Conference Call © 2018 Veeco Instruments Inc. Spector® Ion Beam Sputtering System for Optical Coatings

2018 Priorities Update 16 Q2 2018 Conference Call © 2018 Veeco Instruments Inc. Ultratech Integration Proceeding according to plan with additional manufacturing cost reduction underway Continuing to Invest in Innovation Ongoing development in MOCVD, Lithography, Laser Anneal, Wet Etch Delivering Growth – Diversifying Company 2018 anticipated to grow over 2017 in each market Operating Leverage Solid Q2 Non-GAAP P&L

Q&A

Backup & Reconciliation Tables

Note on Reconciliation Tables These tables include financial measures adjusted for the impact of certain items; these financial measures are therefore not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). These Non-GAAP financial measures exclude items such as: share-based compensation expense; charges relating to restructuring initiatives; non-cash asset impairments; certain other non-operating gains and losses; and acquisition-related items such as transaction costs, non-cash amortization of acquired intangible assets, incremental transaction-related compensation, and certain integration costs. These Non-GAAP financial measures may be different from Non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. By excluding these items, Non-GAAP financial measures are intended to facilitate meaningful comparisons to historical operating results, competitors' operating results, and estimates made by securities analysts. Management is evaluated on key performance metrics including Non-GAAP Operating Income, which is used to determine management incentive compensation as well as to forecast future periods. These Non-GAAP financial measures may be useful to investors in allowing for greater transparency of supplemental information used by management in its financial and operational decision-making. In addition, similar Non-GAAP financial measures have historically been reported to investors; the inclusion of comparable numbers provides consistency in financial reporting. Investors are encouraged to review the reconciliation of the Non-GAAP financial measures used in this news release to their most directly comparable GAAP financial measures. Q2 2018 Conference Call © 2018 Veeco Instruments Inc. 19

Supplemental Information—GAAP to Non-GAAP Reconciliation Q2 2018 Conference Call © 2018 Veeco Instruments Inc. 20 Amounts may not calculate precisely due to rounding. Prior period results have been recast to reflect the retrospective adoption of ASC 606. US$ millions Q1 18 Q2 18 Net Sales $158.6 $157.8 GAAP Gross Profit 56.7 55.4 GAAP Gross Margin 35.7% 35.1% Add: Release of inventory fair value step-up for purchase accounting 0.5 0.5 Add: Share-Based Comp 0.6 0.5 Add: Accelerated Depreciation 0.1 0.1 Non-GAAP Gross Profit $57.8 $56.5 Non-GAAP Gross Margin 36.5% 35.8% US$ millions, except per share amounts Q1 18 Q2 18 GAAP Basic EPS (0.34) (5.02) GAAP Diluted EPS (0.34) (5.02) GAAP Net Income (Loss) (15.8) (237.6) Add: Share-Based Comp 4.5 4.9 Add: Amortization 13.5 10.4 Add: Restructuring 2.5 2.3 Add: Acquisition Related 1.3 1.3 Add: Release of inventory fair value step-up for purchase accounting 0.5 0.5 Add: Depreciation of PP&E fair value step-up for purchase accounting 0.3 0.3 Add: Asset Impairment - 252.3 Add: Non-Cash Interest Expense 2.9 2.9 Add: Tax Adjustment from GAAP to Non-GAAP (0.5) (30.1) Non-GAAP Net Income (Loss) 9.2 7.2 Non-GAAP Basic EPS 0.20 0.15 Non-GAAP Diluted EPS 0.20 0.15 US$ millions Q1 18 Q2 18 GAAP Net Income (Loss) $(15.8) $(237.6) Add: Share-Based Comp 4.5 4.9 Add: Amortization 13.5 10.4 Add: Restructuring 2.5 2.3 Add: Acquisition Related 1.3 1.3 Add: Release of inventory fair value step-up for purchase accounting 0.5 0.5 Add: Depreciation of PP&E fair value step-up for purchase accounting 0.3 0.3 Add: Asset Impairment - 252.3 Add: Interest Expense 4.6 4.4 Subtract: Tax benefit (0.2) (28.0) Non-GAAP Operating Income $11.3 $10.8

Q2 2018 GAAP to Non-GAAP Reconciliation 21 Q2 2018 Conference Call © 2018 Veeco Instruments Inc. Amounts may not calculate precisely due to rounding Non-GAAP Adjustments In millions, except per share amounts GAAP Share-Based Compensation Amortization Other Non-GAAP Net Sales $157.8 $157.8 Gross Profit 55.4 0.5 0.6 56.5 Gross Margin 35.1% 35.8% Research and Development 24.9 (1.1) 23.9 Selling, General, and Administrative and Other 24.7 (2.6) (0.2) 21.9 Net Income (Loss) $(237.6) 4.9 10.4 229.5 $7.2 Income (Loss) Per Common Share: Basic $(5.02) $0.15 Diluted (5.02) 0.15 Weighted Average Number of Shares: Basic 47.3 47.3 Diluted 47.3 47.4 Other Non-GAAP Adjustments Asset Impairment 252.3 Restructuring 2.3 Acquisition Related 1.3 Release of inventory fair value step-up associated with the Ultratech purchase accounting 0.5 Depreciation of PP&E fair value step-up associated with the Ultratech purchase accounting 0.3 Non-Cash Interest Expense 2.9 Non-GAAP Tax Adjustment (30.1) Total Other 229.5

Q3 2018 Guidance GAAP to Non-GAAP Reconciliation Non-GAAP Adjustments In millions, except per share amounts GAAP Share-Based Compensation Amortization Other Non-GAAP Net Sales $130–$140 $130–$140 Gross Profit 45–52 1 — 1 47–54 Gross Margin 35%–37% 36%–38% Net Income (Loss) $(12)–$(7) 4 4 5 $1–$6 Income (Loss) per Diluted Share $(0.25)–$(0.15) $0.03–$0.13 GAAP Net Income (Loss) $(12)–$(7) Share-Based Compensation 4 Amortization 4 Restructuring 1 Acquisition Related Expense 1 Accelerated depreciation 1 Interest Expense 4 Income Tax Expense (Benefit) 1 Non-GAAP Operating Income $4–$9 22 Q2 2018 Conference Call © 2018 Veeco Instruments Inc. Amounts may not calculate precisely due to rounding

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