Kulicke and Soffa Industries (KLIC) 8-K Kulicke & Soffa Reports Second Fiscal Quarter Results

Exhibit 99.1

Kulicke & Soffa Reports Second Fiscal Quarter Results

A conference call to discuss these results will be held today beginning at 9:00 AM EST. Interested participants may call 877-407-8037 for the teleconference or log on tohttp://www.kns.com/investors/events for listen-only mode.

Willow Grove, PA—April 28, 2005—Kulicke & Soffa Industries, Inc. (Nasdaq: KLIC) today announced financial results for its second fiscal quarter ended March 31, 2005.

Net revenue for the second fiscal quarter ended March 31, 2005 was $124.8 million compared to $221.8 million in the comparable year-ago quarter. The net loss was $7.7 million or $0.15 per diluted share versus net income for the year-ago quarter of $29.1 million or $0.44 per diluted share.

Included in the S.G. & A. expenses for the March 2005 quarter are $2.0 million of costs associated with the severance from several separate actions and the closure of a test facility in Scotland. Also included in the March 2005 quarter is a $378 thousand reversal of gain on the sale of the Willow Grove facility, previously recorded in the first fiscal quarter and recorded as a sale of assets.

Scott Kulicke, chairman and chief executive officer, stated, “We have achieved our goal of operating our equipment and materials businesses profitably at, what we believe is, the bottom of the semiconductor cycle. We need to continue our plans to get our test business to the same level of performance.”

First Quarter Highlights

Technology & Manufacturing

• K&S introduced two new wire bonders at the SEMI trade show in China: the Maxum Ultra and Maxum Elite. These machines will replace the industry leading Maxum Plus and the Nutek when they go into production this summer.

• The K&S Quatrix, which is a next-generation test socket for a variety of semiconductor packages, has started beta testing at a customer location, with additional customers being scheduled for testing through the June quarter.

• K&S continued to ramp probe card manufacturing in China during the quarter. In the month of March, China accounted for 37% of K&S’ cantilever probe card production.

• K&S installed a saw blade manufacturing line in the China factory. Production of this product line will be transferred from Santa Clara to China, as part of ongoing cost reduction efforts.

• K&S announced the introduction of a next-generation stud bumping product, the AT Premier. Stud bumping is a form of wafer bumping for flip chip applications that uses a modified wire bonder to sequentially form and place balls on a wafer instead of using wafer fabrication techniques. The AT Premier sets a new standard for productivity of stud bumpers.

Key Product Trends

• While the industry continues in the trough of this cycle, K&S did see an increase in wire bonder demand across an increasingly broad range of customers: 29 different customers at 38 locations.

• The K&S packaging materials group produced income from operations of $5.8 million this quarter. This consistently producing group has achieved income from operations for 28 out of the last 30 quarters.

Financial Highlights

• K&S revenue rose to $124.8 million in the second fiscal quarter. The increase over the first fiscal quarter was a result of stronger equipment demand, mainly from integrated device manufacturers (IDMs).

• K&S equipment revenue for the second fiscal quarter was $39.0 million, which produced income from operations for the equipment group of $3.3 million. The closest comparable quarter in equipment revenue was the quarter ended December 31, 2002 with $44.9 million in sales and a loss from operations of $3.2 million.

Business Summary

Scott Kulicke concluded, “While we see the industry inching upward from a cyclical trough, the rate of improvement isn’t sufficient to trigger significant increases in bonder orders yet. Similarly, the ongoing industry-wide semiconductor inventory liquidation that is taking place seems to be holding down both test and materials orders. Our customers continue to tell us to expect improved business conditions later this year, but for the June quarter, we expect revenues to be in the range of flat to up 10% compared to the March quarter.”

About Kulicke & Soffa

Kulicke & Soffa (NASDAQ: KLIC) is the world’s leading supplier of semiconductor wire bonding assembly equipment. We believe K&S is the only major supplier to the semiconductor assembly industry that provides customers with semiconductor wire bonding equipment along with the complementing packaging materials and test interconnect products that actually contact the surface of the customer’s semiconductor devices. The ability to control all of these assembly related products is unique to Kulicke & Soffa, and allows us to develop system solutions to the new technology challenges inherent in assembling and packaging next-generation semiconductor devices. Test interconnect products include a variety of wafer probe cards, ATE interface assemblies, and PC boards for wafer testing, as well as test sockets for all types of packaged semiconductor devices. Kulicke & Soffa’s web site address ishttp://www.kns.com.

Caution Concerning Forward Looking Statements

In addition to historical statements, this press release contains statements relating to future events and our future results. These statements are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, and include, but are not limited to, statements that relate to our future revenue, operating expenses, profitability, cash flows, introduction of new products, and projected continued demand for our products. While these forward-looking statements represent our judgments and future expectations concerning our business, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to: the risk of failure to successfully manage our operations; the risk that anticipated orders may not materialize or that orders received may be postponed or canceled, generally without charges; the risk that anticipated cost savings will not be achieved; the volatility in the demand for semiconductors and our products and services; the risk that we may not be able to develop and manufacture new products and product enhancements on a timely and cost effective basis; acts of terrorism and violence; overall global economic conditions; risks, such as changes in trade regulations, currency fluctuations, political instability and war, associated with a substantial foreign customer and supplier base and substantial foreign manufacturing operations; potential instability in foreign capital markets; and the factors listed or discussed in Kulicke and Soffa Industries, Inc. 2004 Annual Report on Form 10-K and our other filings with the Securities and Exchange Commission. Kulicke & Soffa Industries is under no obligation to (and expressly disclaims any obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.

Company Contact: Michael Sheaffer, 215-784-6411, 215-784-6167 fax,msheaffer@kns.com

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KULICKE & SOFFA INDUSTRIES, INC.

CONSOLIDATED STATEMENT OF OPERATIONS

(In thousands, except per share and employee data)

(Unaudited)

	Three months ended March 31,						Six months ended March 31,
	2004			2005			2004			2005
Net revenue	$	221,771		$	124,769		$	375,640		$	241,090
Cost of sales		145,237			94,324			251,744			184,267
Gross profit		76,534			30,445			123,896			56,823
Selling, general and administrative		28,651			23,745			53,367			45,818
Research and development, net		8,728			9,923			16,904			18,801
Resizing (recovery) costs		(68	)		—			(68	)		—
Asset impairment		3,293			—			3,293			—
(Gain) loss on sale of assets (1)		(794	)		378			(794	)		(1,497	)
Amortization of intangible assets		2,315			2,318			4,630			4,512
Operating expense		42,125			36,364			77,332			67,634
Income (loss) from operations		34,409			(5,919	)		46,564			(10,811	)
Interest income		302			567			506			1,016
Interest expense		(2,432	)		(1,047	)		(6,861	)		(1,893	)
Charge on early extinguishment of debt		(617	)		—			(6,769	)		—
Income (loss) from continuing operations before income tax		31,662			(6,399	)		33,440			(11,688	)
Provision for income taxes		1,410			1,274			2,760			3,176
Net income (loss) from continuing operations		30,252			(7,673	)		30,680			(14,864	)
Loss from discontinued FCT operations		(751	)		—			(432	)		—
Loss on sale of FCT Division		(380	)		—			(380	)		—
Net income (loss)	$	29,121		$	(7,673	)	$	29,868		$	(14,864	)
Net income (loss) per share from continued operations:
Basic	$	0.60		$	(0.15	)	$	0.61		$	(0.29	)
Diluted	$	0.46		$	(0.15	)	$	0.50		$	(0.29	)
Loss per share from discontinued operations:
Basic	$	(0.02	)	$	—		$	(0.02	)	$	—
Diluted	$	(0.02	)	$	—		$	(0.02	)	$	—
Net income (loss) per share:
Basic	$	0.58		$	(0.15	)	$	0.59		$	(0.29	)
Diluted	$	0.44		$	(0.15	)	$	0.48		$	(0.29	)
Weighted average shares outstanding:
Basic		50,588			51,490			50,501			51,363
Diluted		68,699			51,490			69,299			51,363
	Three months ended March 31,						Six months ended March 31,
	2004			2005			2004			2005
Additional financial data:
Depreciation and amortization	$	7,567		$	6,989		$	15,918		$	14,001
Capital expenditures	$	3,094		$	3,360		$	6,022		$	6,338
							March 31,
							2004			2005
Backlog of orders							$	112,000		$	62,000
Number of employees								3,326			3,270

Note (1) - For the three months ended March 31, 2005, $378 thousand represents the reversal of the ratable portion of the gain recognized on the sale of the Willow Grove land and building recorded during the three months ended December 31, 2004. The reversal is the result of accounting for the transaction as a direct financing arrangement in accordance with FAS 98.

KULICKE & SOFFA INDUSTRIES, INC.

CONSOLIDATED BALANCE SHEET

(In thousands)

				(Unaudited)
	September 30, 2004			March 31, 2005
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	60,333		$	67,000
Restricted cash		3,257			3,497
Short-term investments		32,176			35,805
Accounts and notes receivable (less allowance for doubtful accounts: 9/30/04 - $3,646; 3/31/05 - $3,258)		110,718			97,277
Inventories, net		58,017			52,614
Assets held for sale		6,072			—
Prepaid expenses and other current assets		10,310			11,493
Deferred income taxes		12,417			11,655
TOTAL CURRENT ASSETS		293,300			279,341
Property, plant and equipment, net (1)		51,434			50,302
Intangible assets, (net of accumulated amortization: 9/30/04 - $35,209; 3/31/05 - $39,722)		54,045			50,532
Goodwill		81,440			81,440
Other assets		7,463			6,888
TOTAL ASSETS	$	487,682		$	468,503
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Current portion of long term debt (1)	$	202		$	631
Accounts payable		50,002			42,197
Accrued expenses (1)		37,660			31,880
Income taxes payable		11,986			11,911
TOTAL CURRENT LIABILITIES		99,850			86,619
Long term debt (1)		275,725			280,395
Other liabilities (1)		8,112			6,996
Deferred taxes		36,975			36,516
TOTAL LIABILITIES		420,662			410,526
Commitments and contingencies		—			—
SHAREHOLDERS’ EQUITY
Common stock, without par value		213,847			217,346
Retained deficit		(139,912	)		(154,776	)
Accumulated other comprehensive loss		(6,915	)		(4,593	)
TOTAL SHAREHOLDERS’ EQUITY		67,020			57,977
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	487,682		$	468,503

Note (1) – During the three months ended March 31, 2005, the Company applied FAS 98 Accounting For Leases, to the Willow Grove land and building transaction recorded as a sale-leaseback during the three months ended December 31, 2004. Such application required the Company to account for this transaction as a direct financing arrangement. Accordingly, the balance sheet line items referenced above were adjusted as follows: Property, plant and equipment, net increased by $6.1 million, the cash received as part of this transaction of $10.6 million was recorded as debt (current and long-term), and Accrued expenses and Other liabilities were reduced by $4.5 million.

KULICKE & SOFFA INDUSTRIES, INC.

OPERATING RESULTS BY BUSINESS SEGMENT

(In thousands)

(Unaudited)

Fiscal 2005:

	Equipment Segment		Packaging Materials Segment		Test Segment			Corporate and Other			Consolidated
Quarter ended March 31, 2005:
Net revenue	$	38,985	$	63,616	$	22,168		$	—		$	124,769
Cost of sales		22,655		52,085		19,584			—			94,324
Gross profit		16,330		11,531		2,584			—			30,445
Operating costs		13,031		5,770		13,402			3,783			35,986
(Gain) loss on sale of assets (1)		—		—		—			378			378
Income (loss) from operations	$	3,299	$	5,761	$	(10,818	)	$	(4,161	)	$	(5,919	)
Six months ended March 31, 2005:
Net revenue	$	68,334	$	127,634	$	45,122		$	—		$	241,090
Cost of sales		39,981		103,337		40,949			—			184,267
Gross profit		28,353		24,297		4,173			—			56,823
Operating costs		25,108		12,063		24,348			7,612			69,131
(Gain) loss on sale of assets		—		—		(1,497	)		—			(1,497	)
Income (loss) from operations	$	3,245	$	12,234	$	(18,678	)	$	(7,612	)	$	(10,811	)
Fiscal 2004:
	Equipment Segment		Packaging Materials Segment		Test Segment			Corporate and Other			Consolidated
Quarter ended March 31, 2004:
Net revenue	$	135,360	$	56,170	$	30,241		$	—		$	221,771
Cost of sales		76,458		44,082		24,697			—			145,237
Gross profit		58,902		12,088		5,544			—			76,534
Operating costs		15,861		5,209		13,339			5,285			39,694
Resizing (recovery) costs		—		—		—			(68	)		(68	)
Asset impairment		—		—		3,293			—			3,293
(Gain) loss on sale of assets		—		—		(85	)		(709	)		(794	)
Income (loss) from operations	$	43,041	$	6,879	$	(11,003	)	$	(4,508	)	$	34,409
Six months ended March 31, 2004:
Net revenue	$	216,440	$	105,678	$	53,522		$	—		$	375,640
Cost of sales		125,582		82,172		43,990			—			251,744
Gross profit		90,858		23,506		9,532			—			123,896
Operating costs		30,529		10,433		24,122			9,817			74,901
Resizing (recovery) costs		—		—		—			(68	)		(68	)
Asset impairment		—		—		3,293			—			3,293
(Gain) loss on sale of assets		—		—		(85	)		(709	)		(794	)
Income (loss) from operations	$	60,329	$	13,073	$	(17,798	)	$	(9,040	)	$	46,564

Note (1) - For the three months ended March 31, 2005, $378 thousand represents the reversal of the ratable portion of the gain recognized on the sale of the Willow Grove land and building recorded during the three months ended December 31, 2004. The reversal is the result of accounting for the transaction as a direct financing arrangement in accordance with FAS 98.