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: May 25, 2006

(Date of Earliest Event Reported)

CREDENCE SYSTEMS CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

DELAWARE	000-22366	94-2878499
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1421 California Circle Milpitas, California	95035
(Address of Principal Executive Offices)	(Zip Code)

408-635-4300

(Registrant’s Telephone Number, Including Area Code)

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):

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

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

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

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

Item 2.02. Results of Operations and Financial Condition.

On May 25, 2006, Credence Systems Corporation (the “Company”) issued a press release announcing the Company’s earnings for the fiscal quarter ended April 30, 2006. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein in its entirety.

The information in this report (including Exhibit 99.1) is being furnished pursuant to Item 2.02 and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act.

Item 2.05. Costs Associates with Exit or Disposal Activities.

On May 23, 2006, the Company determined that it will shift resources away from its next generation memory development product as a result of continuing weakness in this business and the decision by one of the Company’s large customers to significantly decrease capital spending. The Company expects to take a charge of approximately $12 to $14 million associated with this action, including severance, write-off of capital assets and contract terminations and expects to complete this shift in resources away from its next generation memory development product by the end of its third fiscal quarter.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

The exhibit listed below is being furnished with this Form 8-K.

Exhibit Number	Description
99.1	Press Release dated May 25, 2006, announcing the Company’s earnings for the fiscal quarter ended April 30, 2006.

SIGNATURES

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

CREDENCE SYSTEMS CORPORATION
By:	/s/ Byron W. Milstead
	Byron W. Milstead
	Senior Vice President, General Counsel and Assistant Secretary

Date: May 25, 2006

EXHIBIT INDEX

Exhibit Number	Description
99.1	Press Release dated May 25, 2006, announcing the Company’s earnings for the fiscal quarter ended April 30, 2006.