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Mike El-Hillow
Advanced Energy Industries, Inc.
Dori Jones

Advanced Energy Reports First Quarter 2004 Results
FORT COLLINS, Colo., April 15, 2004—Advanced Energy Industries, Inc. (Nasdaq: AEIS) today reported financial results for the first quarter ended March 31, 2004. Advanced Energy offers a comprehensive suite of process-centered solutions critical to the production of semiconductors, flat panel displays, data storage products, architectural glass and other advanced product applications.

For the 2004 first quarter, revenues were $104.5 million, up 86 percent from $56.2 million for the first quarter of 2003, and up 40 percent compared to revenues of $74.7 million for the fourth quarter of 2003.

Net income for the first quarter of 2004 was $6.9 million or $0.21 per diluted share, compared to a net loss of $8.6 million in the first quarter of 2003, or $0.27 per share. This compares to the fourth quarter 2003 net loss of $2.4 million, or $0.08 per share. Net income for the first quarter of 2004 includes approximately $1.0 million in pretax gains resulting from the sale of certain marketable securities and the sale of the Company's thermal control business.

Doug Schatz, chairman and chief executive officer, said, "We experienced strong demand in all product groups, driven by continued momentum in the semiconductor capital equipment market and the market leading positions we have secured in high-growth semiconductor processing applications. This sales growth, coupled with the progress we've made to streamline our operating infrastructure, enabled us to achieve significant profitability in the first quarter. Our commitment to continued product innovation drives our ability to capture new opportunities and expand our market reach over a wide range of plasma-based processing applications.

"Our decision to move out of the thermal control business is part of our continued focus on core competencies. The wafer chiller line is based on highly differentiated technology, and we are not willing to devote the resources required to meaningfully promote and support these products given our target long-term operating model for sustainable profitability throughout industry cycles.

"Towards the end of the first quarter, we were seeing indications that order patterns are leveling out as the market absorbs the recent surge in capital equipment purchases. We anticipate second quarter revenue in the $107 million to $115 million range and an earnings per share range of $0.20 to $0.25. We continue to make progress in our transition to a more variable operating model, targeting sustainable, ongoing improvements to our incremental operating margin," said Mr. Schatz.

First Quarter Conference Call

Management will host a conference call today, Thursday, April 15, 2004 at 5:00 pm Eastern time to discuss Advanced Energy's financial results. You may access this conference call by dialing 888-713-4717. International callers may access the call by dialing 706-679-7720. For a replay of this teleconference, please call 706-645-9291, and enter the pass code 6231765. The replay will be available through Thursday, April 22, 2004. There will also be a webcast available at .

About Advanced Energy

Advanced Energy is a global leader in the development and support of technologies critical to high-technology manufacturing processes used in the production of semiconductors, flat panel displays, data storage products, compact discs, digital video discs, architectural glass, and other advanced product applications.

Leveraging a diverse product portfolio and technology leadership, Advanced Energy creates solutions that maximize process impact, improve productivity and lower the cost of ownership for its customers. This portfolio includes a comprehensive line of technology solutions in power, flow, thermal management, and plasma and ion beam sources for original equipment manufacturers (OEMs) and end-users around the world.
     (in thousands except per share data)

                                                     Quarter Ended March 31,
                                                     2004               2003

     Sales                                         $104,487           $56,158
     Cost of sales                                   66,073            38,208
     Gross profit                                    38,414            17,950

    Operating expenses:
         Research and development                    13,410            13,367
         Sales and marketing                          8,037             8,330
         General and administrative                   5,767             4,529
         Amortization of intangible
          assets                                      1,170             1,100
         Restructuring charges                          220             1,509
              Total operating expenses               28,604            28,835

    Income (loss) from operations                     9,810           (10,885)

     Other (expense) income, net                     (1,155)           (2,750)
     Income (loss) before income taxes                8,655           (13,635)
     (Provision) Benefit for income taxes            (1,731)            5,045
     Net Income (loss)                               $6,924           $(8,590)

    Basic net income (loss) per share:                $0.21            $(0.27)

    Diluted net income (loss) per share:              $0.21            $(0.27)

    Basic weighted-average common shares
     outstanding                                     32,581            32,159
    Diluted weighted-average common
     shares outstanding                              33,593            32,159

     (in thousands)

                                                 March 31,        December 31,
                                                   2004              2003


    Current Assets:
         Cash and cash equivalents                $43,996           $41,522
         Marketable securities                     84,045            93,691
         Accounts receivable                       79,013            61,927
         Income tax receivable                        465               151
         Inventories                               72,148            65,703
         Other current assets                       3,827             5,486
    Total current assets                          283,494           268,480

    Property and equipment, net                    45,273            44,725

     Deposits and other                             6,306             5,630
     Goodwill and intangibles, net                 86,529            88,943
     Demonstration and customer service
     equipment, net                                 4,266             3,934
     Deferred debt issuance costs, net              2,765             3,019
     Total assets                                $428,633          $414,731


    Current Liabilities:
         Trade accounts payable                   $33,072           $23,066
         Other current liabilities                 26,046            28,216
         Current portion of capital
          leases and senior borrowings              8,239             8,582
         Accrued interest payable on
          convertible subordinated notes            1,810             2,460
    Total current liabilities                      69,167            62,324

    Long-term Liabilities:
        Capital leases and senior
         borrowings                                 4,935             6,168
        Deferred income tax liability,
         net                                        4,787             4,672
        Convertible subordinated notes
         payable                                  187,718           187,718
        Other long-term liabilities                 2,095             2,015
    Total long-term liabilities                   199,535           200,573

    Total liabilities                             268,702           262,897

    Stockholders' equity                          159,931           151,834
    Total liabilities and stockholders'
     equity                                      $428,633          $414,731

    (in thousands)

                                                  Three Months Ended March 31,
                                                     2004              2003

    NET CASH USED IN OPERATING ACTIVITIES          $(4,344)          $(4,579)

     INVESTING ACTIVITIES                            8,003            (5,460)

    NET CASH USED IN FINANCING ACTIVITIES           (1,588)           (1,981)

     CASH                                              403               134
     EQUIVALENTS                                     2,474           (11,886)
    CASH AND EQUIVALENTS, beginning of
     period                                         41,522            70,188
    CASH AND EQUIVALENTS, end of period            $43,996           $58,302


Advanced Energy operates in regional centers in North America, Asia and Europe and offers global sales and support through direct offices, representatives and distributors. Founded in 1981, Advanced Energy is a publicly held company traded on the Nasdaq National Market under the symbol AEIS. For more information, please visit our corporate website:

Safe Harbor Statement

This press release contains certain forward-looking statements, including the company's expectations with respect to Advanced Energy's financial results for the second quarter of 2004. Forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to: the volatility and cyclicality of the semiconductor and semiconductor capital equipment industries, Advanced Energy's ongoing ability to develop new products in a highly competitive industry characterized by increasingly rapid technological changes, Advanced Energy's ability to successfully integrate acquired companies' operations, and other risks described in Advanced Energy's Form 10-K, Forms 10-Q and other reports and statements, as filed with the Securities and Exchange Commission. These reports and statements are available on the SEC's website at . Copies may also be obtained from Advanced Energy's website at or contacting Advanced Energy's investor relations at 970-221-4670. The company assumes no obligation to update the information in this press release.