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)

July 30, 2008

NEWPORT CORPORATION

(Exact name of registrant as specified in its charter)

Nevada	000-01649	94-0849175
(State or other jurisdiction of	(Commission File Number)	(IRS Employer Identification No.)
incorporation)
1791 Deere Avenue, Irvine, California		92606
(Address of principal executive offices)		(Zip Code)

(949) 863-3144
(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:

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

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

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

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

TABLE OF CONTENTS

Item 2.02. Results of Operations and Financial Condition.

On July 30, 2008, Newport Corporation (the “Registrant”) announced its financial results for the second quarter ended June 28, 2008, and its outlook in the third quarter of 2008. The press release issued by the Registrant in connection with the announcement is attached to this report as Exhibit 99.1.

This information shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing by the Registrant under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as may be set forth by specific reference in such a filing.

Use of Non-GAAP Financial Measures

In the press release attached to this report as Exhibit 99.1, the Registrant has supplemented certain of its financial measures prepared in accordance with accounting principles generally accepted in the United States (GAAP) with certain non-GAAP financial measures. These non-GAAP financial measures and the reasons for their inclusion are described below. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the Registrant’s financial measures prepared in accordance with GAAP.

The Registrant has provided non-GAAP measures of net income and net income per diluted share that have been adjusted to exclude a non-cash, pre-tax charge of $7.1 million that the Registrant was required to recognize in the second quarter of 2008 to reflect a full write-off of a note receivable and other amounts relating to a business that had been classified as a discontinued operation and subsequently sold in 2005. Management considers this charge to be outside of the Registrant’s core operating results. Therefore, this charge has been excluded with the intent of providing both management and investors with a more complete understanding of the Registrant’s underlying operational results and performance trends and a more meaningful basis for comparison of such results with the Registrant’s historical and expected financial results. In addition, these adjusted non-GAAP measures are among the primary indicators that management uses as a basis for its planning and forecasting of future periods and may also be used by management for other purposes including its evaluation of performance to determine the achievement of goals under the Registrant’s incentive plans.

Item 9.01. Financial Statements and Exhibits.

     (d) Exhibits.

Exhibit No.		Description
	99.1	Press Release dated July 30, 2008 (furnished pursuant to Item 2.02 and not deemed filed).

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.

July 30, 2008	NEWPORT CORPORATION
	By:	/s/ Jeffrey B. Coyne
		Jeffrey B. Coyne
		Senior Vice President, General Counsel and Corporate Secretary

EXHIBIT INDEX

Exhibit No.		Description
	99.1	Press Release dated July 30, 2008 (furnished pursuant to Item 2.02 and not deemed filed).

EX-99.1

Exhibit 99.1

Press Release

Contact:
Charles F. Cargile, 949/863-3144
Newport Corporation, Irvine, CA
investor@newport.com
or
Dan Peoples, 858/552-8146
Makinson Cowell (US)

NEWPORT CORPORATION REPORTS
SECOND QUARTER 2008 RESULTS

Irvine, California — July 30, 2008 — Newport Corporation (NASDAQ: NEWP) today reported financial results for its second quarter ended June 28, 2008, and provided guidance regarding its outlook in the third quarter of 2008.

     Sales in the second quarter of 2008 totaled $117.7 million, an increase of 6.1% compared with the $110.9 million recorded in the second quarter of 2007. Sales in the first half of 2008 totaled $232.9 million, an increase of 6.8% compared with the $218.2 million recorded in the first half of 2007. New orders received in the second quarter of 2008 totaled $110.1 million, a decrease of approximately 1.6% compared with the $111.9 million recorded in the second quarter of 2007. New orders received in the first half of 2008 totaled $235.1 million, an increase of 5.8% compared with the $222.2 million recorded in the first half of 2007.

     Robert J. Phillippy, president and chief executive officer, commented, “Despite weak overall macroeconomic conditions, we achieved our sales objectives in the second quarter. In particular, we experienced strong year-over-year increases in shipments of products to customers for industrial manufacturing and photovoltaic applications. The strength in these areas was offset in part by lower sales to research customers and semiconductor equipment manufacturers.”

     Commenting on orders, Mr. Phillippy stated, “Our order level for the second quarter of 2008 was slightly below the comparable quarter of 2007 and was below our expectations, due primarily to lower orders received from customers in the life and health sciences (LHS) market. This decrease in LHS market orders was offset in part by higher orders from photovoltaic customers. Following two consecutive quarters of all-time record orders from LHS customers,

we believe that our lower orders from this market in the second quarter primarily reflect the timing of our customers’ needs. However, a few of our original equipment manufacturer (OEM) customers in this market have reported a modest slowdown in demand for their medical laser systems for cosmetic procedures. On the other hand, we continue to be pleased by the traction we are gaining in the photovoltaic market. Our new orders from photovoltaic customers in the second quarter exceeded $6.5 million, the second highest quarterly level ever recorded by Newport from this market after the all-time record level in the first quarter of this year. In the first half of 2008, we have received new orders totaling approximately $22 million from customers in the photovoltaic industry.”

     Based on generally accepted accounting principles (GAAP), Newport reported a net loss in the second quarter of 2008 of $2.8 million, or $0.08 per diluted share, compared with net income of $8.0 million, or $0.20 per diluted share, in the second quarter of 2007. Included in the net loss is a non-cash, pre-tax charge of $7.1 million to write-off a note receivable and other amounts relating to a business that had been classified as a discontinued operation and subsequently sold in 2005. The buyer of that business has failed to make certain principal, interest and rent payments due under its agreements with Newport. The company has a secured interest in the assets of the business and has begun legal proceedings to recover the amounts owed. Pursuant to GAAP, the note receivable and other amounts have been fully written off in the second quarter, and in future periods, any cash received by the company in satisfaction of these items will be recorded as other income in the company’s financial statements. Excluding this charge, the company would have reported net income of $4.0 million, or $0.11 per diluted share, in the second quarter of 2008. For the first half of 2008, Newport reported net income of $0.9 million, or $0.03 per diluted share, compared with $13.2 million, or $0.33 per diluted share, in the first half of 2007. Excluding the write-off charge, Newport’s net income for the first half of 2008 would have been $7.7 million, or $0.21 per diluted share. A table reconciling the company’s net income (loss) and net income (loss) per diluted share for the second quarter and first half of 2008 in accordance with GAAP and on a non-GAAP basis excluding the write-off is included for reference herein.

     The company’s gross profit for the second quarter of 2008 was $47.3 million, or 40.2% of net sales, compared with $49.1 million, or 44.2% of net sales, for the second quarter of 2007. The company’s gross profit for the first half of 2008 was $93.4 million, or 40.1% of net sales, compared with $95.7 million, or 43.9% of net sales, for the first half of 2007. The decrease in gross profit in both periods of 2008 was due primarily to lower gross margins in the company’s

2

Lasers Division, which incurred higher manufacturing costs and experienced greater market pricing pressure compared with the corresponding periods of 2007.

     Selling, general and administrative (SG&A) expenses for the second quarter of 2008 were $30.1 million, or 25.6% of net sales, compared with $28.8 million, or 26.0% of net sales, in the second quarter of 2007. SG&A expenses for the first half of 2008 totaled $59.9 million, or 25.7% of net sales, compared with $58.8 million, or 27.0% of net sales, in the first half of 2007.

     Research and development (R&D) expenses for the second quarter of 2008 were $12.3 million, or 10.5% of net sales, compared with $10.9 million, or 9.8% of net sales, in the second quarter of 2007. R&D expenses for the first half of 2008 totaled $23.8 million, or 10.2% of net sales, compared with $21.5 million, or 9.8% of net sales, in the corresponding period of 2007. The increase in R&D expenses in the 2008 periods was due primarily to higher expenses related to the development of products targeted at the photovoltaic industry.

     The company’s cash, cash equivalents and marketable securities at the end of the second quarter of 2008 totaled $141.1 million, an increase of $6.7 million during the quarter.

     Mr. Phillippy continued, “While our operational performance in the second quarter exceeded our expectations slightly, the low order intake levels during the quarter, the generally weak conditions in our primary end markets and the slower than anticipated rebound in our Lasers Division’s financial performance cause us to be cautious about our outlook for the third quarter and second half of 2008. We currently expect our consolidated net sales in the third quarter to be approximately 5% to 10% lower than the second quarter of 2008. We also expect this reduction in revenue to negatively impact our expected profitability in the third quarter, particularly in our Lasers Division. As a result of this weaker financial outlook, we are in the process of analyzing and quantifying actions to improve our financial performance in the second half of this year and in 2009. Once this analysis is completed, we will quantify the expected financial impact in the third and fourth quarters of this year. In addition, as we work through the legal process to recover the amounts owed relating to the discontinued operation, we anticipate recovering some, if not all, of the amounts that were written off. As these actions are finalized and the legal proceedings progress and their financial impacts are quantified, we will provide updated guidance.”

3

ABOUT NEWPORT CORPORATION

     Newport Corporation is a leading global supplier of advanced-technology products and systems to customers in the scientific research, microelectronics, aerospace and defense/security, life and health sciences and precision industrial manufacturing markets. Newport’s innovative solutions leverage its expertise in high-power semiconductor, solid-state and ultrafast lasers, photonics instrumentation, sub-micron positioning systems, vibration isolation, optical components and subsystems and precision automation to enhance the capabilities and productivity of its customers’ manufacturing, engineering and research applications. Newport is part of the Standard & Poor’s SmallCap 600 Index and the Russell 2000 Index.

INVESTOR CONFERENCE CALL

     Robert J. Phillippy, president and chief executive officer, and Charles F. Cargile, senior vice president, chief financial officer and treasurer, will host an investor conference call today, July 30, 2008, at 5:00 p.m. Eastern time (2:00 p.m. Pacific time) to review the company’s results for the second quarter of 2008 and its business outlook. The call will be open to all interested investors through a live audio web broadcast via the Internet at www.newport.com/investors and www.earnings.com. The call also will be available to investors and analysts by dialing (888) 684-1262 within the U.S. and Canada or (913) 312-1495 from abroad.

     The webcast will be archived on both websites and can be reached through the same links. A telephonic playback of the conference call also will be available by calling (888) 203-1112 within the U.S. and Canada or (719) 457-0820 from abroad. Playback will be available beginning at 8:00 p.m. Eastern time (5:00 p.m. Pacific time) on Wednesday, July 30, 2008, and continue through 8:00 p.m. on Wednesday, August 6, 2008. The replay confirmation code is 6469557.

4

SAFE HARBOR STATEMENT

This news release contains forward-looking statements, including without limitation statements regarding Newport’s expected sales and profitability in the third quarter of 2008 and the actions being considered to improve its financial results for the second half of 2008 and for 2009, and Newport’s anticipated recovery of amounts owed relating to the sale of its previously discontinued operation. Without limiting the generality of the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “estimate” or “continue” or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. As discussed in Newport’s Annual Report on Form 10-K for the year ended December 29, 2007, assumptions relating to the foregoing involve judgments and risks with respect to, among other things, the outcome of legal proceedings relating to the recovery of amounts due to Newport; the timing of acquisition and divestiture activities and the amounts of charges associated with those activities; the strength of business conditions in the industries Newport serves, particularly the semiconductor industry; Newport’s ability to successfully penetrate and increase sales to its targeted end markets, particularly to photovoltaic customers and the life and health sciences market; Newport’s ability to successfully integrate businesses acquired; the levels of private and governmental research funding worldwide; potential order cancellations and push-outs; potential product returns; future economic, competitive and market conditions, including those in Europe and Asia and those related to its strategic markets; whether its products will continue to achieve customer acceptance; and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of Newport. Although Newport believes that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance that the results contemplated in forward-looking statements will be realized. In light of the significant uncertainties inherent in the forward-looking information included herein, the inclusion of such information should not be regarded as a representation by Newport or any other person that Newport’s objectives or plans will be achieved. Newport undertakes no obligation to revise the forward-looking statements contained herein to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

###

5

Newport Corporation
Consolidated Statements of Operations
(Unaudited)

	Three Months Ended					Six Months Ended
	June 28,			June 30,		June 28,			June 30,
(In thousands)	2008			2007		2008			2007
Net sales	$	117,664		$	110,904	$	232,907		$	218,168
Cost of sales		70,367			61,843		139,499			122,476
Gross profit		47,297			49,061		93,408			95,692
Selling, general and administrative expenses		30,092			28,792		59,883			58,806
Research and development expense		12,341			10,874		23,785			21,477
Operating income		4,864			9,395		9,740			15,409
Write-down of note receivable and other amounts related to previously discontinued operations		(7,060	)		—		(7,060	)		—
Interest and other income (expense), net		(206	)		16		(689	)		217
Income before income taxes		(2,402	)		9,411		1,991			15,626
Income tax provision, net		390			1,448		1,058			2,412
Net income (loss)	$	(2,792	)	$	7,963	$	933		$	13,214
Net income (loss) per share:
Basic	$	(0.08	)	$	0.20	$	0.03		$	0.33
Diluted	$	(0.08	)	$	0.20	$	0.03		$	0.33
Shares used in the computation of net income (loss) per share:
Basic		36,009			38,955		36,273			39,629
Diluted		36,009			39,554		36,385			40,491
Other operating data:
New orders received during the period	$	110,076		$	111,920	$	235,051		$	222,234
Backlog at the end of period scheduled to ship within 12 months						$	122,165		$	111,913

Newport Corporation
Reconciliation of Non-GAAP Financial Measures
(Unaudited)

	Three Months Ended					Six Months Ended
	June 28,			June 30,		June 28,		June 30,
(In thousands)	2008			2007		2008		2007
Net income (loss):
Net income (loss) — GAAP	$	(2,792	)	$	7,963	$	933	$	13,214
Write-down of note receivable and other amounts related to previously discontinued operations, net of tax impact		6,759			—		6,759		—
Non-GAAP net income	$	3,967		$	7,963	$	7,692	$	13,214
Net income (loss) per diluted share:
Net income (loss) — GAAP	$	(0.08	)	$	0.20	$	0.03	$	0.33
Write-down of note receivable and other amounts related to previously discontinued operations, net of tax impact		0.19			—		0.18		—
Non-GAAP net income per diluted share	$	0.11		$	0.20	$	0.21	$	0.33

6

Newport Corporation
Consolidated Balance Sheets
(Unaudited)

	June 28,		December 29,
(In thousands)	2008		2007
ASSETS
Current assets:
Cash and cash equivalents	$	65,142	$	88,737
Marketable securities		75,982		55,127
Accounts receivable, net		90,095		87,606
Notes receivable, net		3,923		3,821
Inventories		112,820		113,969
Deferred income taxes		6,366		6,248
Prepaid expenses and other current assets		14,227		13,603
Total current assets		368,555		369,111
Property and equipment, net		65,266		61,872
Goodwill		174,197		174,197
Deferred income taxes		16,975		16,932
Intangible assets, net		44,131		46,171
Investments and other assets		16,362		21,664
	$	685,486	$	689,947
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term obligations	$	15,192	$	12,402
Accounts payable		25,074		33,319
Accrued payroll and related expenses		22,520		23,096
Accrued expenses and other current liabilities		27,690		24,598
Total current liabilities		90,476		93,415
Long-term debt		175,000		175,000
Obligations under capital leases, less current portion		1,432		1,381
Accrued pension liabilities		11,510		10,740
Other liabilities		4,908		4,966
Stockholders’ equity		402,160		404,445
	$	685,486	$	689,947

7

Newport Corporation
Sales & Orders by End Market
(Unaudited)

	Three Months Ended				Six Months Ended
(In thousands, except percentages)	6/28/08		6/30/07		6/28/08		6/30/07
Sales by End Market
Scientific research, aerospace and defense/security	$	38,015	$	39,887	$	76,452	$	74,659
Microelectronics		36,594		32,963		72,894		64,733
Life and health sciences		20,941		20,124		41,708		40,850
Industrial manufacturing and other		22,114		17,930		41,853		37,926
Total	$	117,664	$	110,904	$	232,907	$	218,168
As a percentage of net sales:
Scientific research, aerospace and defense/security		32.3		36.0		32.8		34.2
Microelectronics		31.1		29.7		31.3		29.7
Life and health sciences		17.8		18.1		17.9		18.7
Industrial manufacturing and other		18.8		16.2		18.0		17.4
Total		100.0		100.0		100.0		100.0
Orders by End Market
Scientific research, aerospace and defense/security	$	38,383	$	40,601	$	74,065	$	76,314
Microelectronics		34,699		31,153		75,781		61,941
Life and health sciences		16,763		22,395		43,284		44,517
Industrial manufacturing and other		20,231		17,771		41,921		39,462
Total	$	110,076	$	111,920	$	235,051	$	222,234
As a percentage of total orders:
Scientific research, aerospace and defense/security		34.9		36.3		31.5		34.3
Microelectronics		31.5		27.8		32.3		27.9
Life and health sciences		15.2		20.0		18.4		20.0
Industrial manufacturing and other		18.4		15.9		17.8		17.8
Total		100.0		100.0		100.0		100.0

Note: Sales and orders from semiconductor equipment manufacturers and photovoltaic customers are included in the company’s Microelectronics end market.

8