Ultratech Awarded Multi-Million-Dollar Order From A Leading Japanese Thin Film Head Manufacturer

Business Wire, March 24, 1999

SAN JOSE, Calif.--(BUSINESS WIRE)--March 24, 1999--

Model 1700MVS Systems to be Used for GMR Thin Film Head Production

Ultratech Stepper, Inc. (Nasdaq:UTEK), a leading supplier of photolithography systems used to manufacture semiconductors, micromachining devices and thin film heads (TFHs) for disk drives, today announced a multi-million-dollar order for multiple Ultratech 1700 Machine Vision Systems (MVS) from a leading Japanese thin film head manufacturer.

The customer, a prominent leader in this segment of the disk drive arena with approximately 15 percent market share, will be expanding its giant magneto resistive (GMR) production capacity with a new facility in Asia. Shipments are expected to be made during the next six months. With these installations, Ultratech will have TFH lithography tools in virtually all of this customer's worldwide fabrication facilities.

According to Ultratech's President and CEO Arthur Zafiropoulo, in addition to reinforcing Ultratech's leadership in advanced TFH lithography, this order from one of the industry's leaders signals that the disk drive business may be emerging from its prolonged cyclical downturn. Recent reports from Peripheral Research Corp. indicate that growth is expected in the disk drive industry over the next 5-10 years.

Zafiropoulo noted, "Given the variety of existing and new applications for GMR and TFH technology, we may see increasing demand for the cost-effective, high-performing advanced lithography systems so critical to success in this demanding data storage application. In fact, it is our hope that these orders may indicate the first signs of renewed vitality in this industry sector."

The Model 1700MVS is one of Ultratech's most sophisticated tools being used today in the industry for air bearing surface patterning applications. Incorporating an advanced machine vision system and customized software specifically designed for rowbar level processing, the 1700MVS recognizes and automatically aligns to preexisting features, thus eliminating the need for special targets.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Certain of the statements contained herein may be considered forward-looking statements that involve risks and uncertainties, such as the cyclicality in the thin film head and semiconductor industries, delays, deferrals and cancellation of orders by customers, pricing pressures and extended payment terms, inventory obsolescence, lengthy sales cycles for the company's systems, ability to volume-produce systems and meet customer requirements, the mix of products sold, dependence on new product introductions and commercial success of any new products, delays in collecting accounts receivables, manufacturing inefficiencies and absorption levels, economic and political conditions in Asia, risks associated with introducing new technologies, competition and changes in technologies. Such risks and uncertainties are set forth in the company's SEC reports, including the company's Quarterly Report on Form 10-Q for the period ended Sept. 30, 1998.

About Ultratech

Founded in 1979, Ultratech Stepper, Inc. designs, manufactures and markets photolithography steppers used worldwide in the fabrication of semiconductors, micromachining devices and thin film heads for disk drives. The company produces products that substantially reduce the cost of ownership for manufacturers in the electronics industry.

Ultratech's common stock is traded on the Nasdaq Stock Market under the symbol UTEK. The company's home page on the World Wide Web is located at http://ww.ultratech.com