1113232--3/14/2006--AXCELIS_TECHNOLOGIES

related topics

{product, market, service}

{customer, product, revenue}

{operation, international, foreign}

{stock, price, operating}

{condition, economic, financial}

{operation, natural, condition}

{investment, property, distribution}

{personnel, key, retain}

{property, intellectual, protect}

{acquisition, growth, future}

{competitive, industry, competition}

If semiconductor manufacturers do not make sufficient capital expenditures, our sales and profitability will be harmed. Our financial results may fluctuate significantly. Our financial results may fall short of anticipated levels; forecasting revenues and profitability is complex and may be inaccurate. The semiconductor industry is highly cyclical and we expect that demand for our products will regularly increase and decrease, making it difficult to manage the business and potentially causing harm to our sales and profitability. Oversupply in the semiconductor industry reduces demand for capital equipment, including our products. If we fail to develop and introduce reliable new or enhanced products and services that meet the needs of semiconductor manufacturers, our results will suffer. If we fail to compete successfully in the highly competitive semiconductor equipment industry, our sales and profitability will decline. We have been dependent on sales to a limited number of large customers; the loss of any of these customers or any reduction in orders from them could materially affect our sales. Our inability to control our Japanese a joint venture may adversely affect our results. Axcelis is subject to the risks of operating internationally and we derive a substantial portion of our revenues from outside the United States, especially from Asia. We may not be able to maintain and expand our business if we are not able to hire, retain and integrate qualified personnel. Our dependence upon a limited number of suppliers for many components and sub-assemblies could result in increased costs or delays in the manufacture and sale of our products. Our international operations involve currency risk. We may be unable to obtain needed additional capital. Our stock price could be volatile and you could lose the value of your investment. Our proprietary technology may be vulnerable to efforts by competitors to challenge or design around, potentially reducing our market share. We or customers that we indemnify might face intellectual property infringement claims or patent disputes that may be costly to resolve and, if resolved against us, could be very costly to us and prevent us from making and selling our systems. If operations were disrupted at Axcelis primary manufacturing facility it would have a negative impact on our business.

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1113232--3/14/2006--AXCELIS_TECHNOLOGIES_INC