Fei (FEIC) 8-K FEI Reports Record Bookings, Revenue and Earnings for the Fourth Quarter of 2010

Exhibit 99.1

NEWS RELEASE

For more information contact:

FEI Company

Fletcher Chamberlin

Treasurer & Communications Director

(503) 726-7710

fletcher.chamberlin@fei.com

FEI Reports Record Bookings, Revenue and Earnings for the Fourth Quarter of 2010

Bookings of $218.4 million were up 34% from Last Year’s Fourth Quarter

Revenue of $186.1 million was up 20% from Last Year’s Fourth Quarter

EPS was $0.52, More Than Three Times Last Year’s Fourth Quarter

HILLSBORO, Ore., February 3, 2011 – For the fourth quarter of 2010, FEI Company (NASDAQ: FEIC) reported the highest quarterly bookings, revenue and earnings in the company’s history, with significant year-over-year and sequential quarterly growth. Bookings, revenue and operating income also set records for the full year in 2010.

For the fourth quarter, net bookings were $218.4 million, up 15% from the third quarter of 2010 and up 34% from the fourth quarter of 2009. The backlog at the end of the quarter was $471.9 million, an all-time high. The book-to-bill ratio for the quarter was 1.17 to 1.

Revenue of $186.1 million was up 22% compared to $153.0 million in the third quarter of 2010 and up 20% from $154.4 million in the fourth quarter of 2009.

Net income was $21.3 million or $0.52 per diluted share, compared with $11.9 million or $0.30 per diluted share in the third quarter of 2010 and $6.6 million or $0.17 per diluted share in the fourth quarter of 2009.

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The gross margin in the fourth quarter was 45.0%, compared with 43.5% in the third quarter of 2010 and 38.4% in the fourth quarter of 2009. Operating income was 15.4% of sales in the quarter, compared with 11.5% in the third quarter of 2010 and 5.8% in the fourth quarter of 2009.

Gross cash, investments and restricted cash, net of debt, increased by $41.3 million in the quarter to $334.8 million at year-end.

“This quarter’s record bookings mark our fifth straight quarter of bookings growth,” said Don Kania, president and CEO of FEI, “as each of our market segments recorded sequential and year-over-year growth. Our record revenue was powered by particularly strong shipments to the Electronics market, which also contributed to the highest gross margin percentage in almost a decade. It was an excellent quarter for bookings, revenue, margins and earnings.

“Looking forward, our substantial backlog helps to provide good visibility for the first half of 2011,” Kania continued. “While margins may moderate somewhat from the fourth quarter level due to product mix, we expect continued operating improvements and a growth year for revenue and earnings.”

For the full year 2010, bookings of $751.5 million were up 25% from 2009, and revenue of $634.2 million was up 10% from 2009. Net income was $53.5 million, 136% above 2009’s net income. Diluted earnings per share were $1.34, more than double 2009’s $0.60. Net cash increased by $65.4 million during the year.

Bookings and revenue comparisons for the company’s market segments and other data are included in the supplementary information attached to this release, along with detailed statements of operations and balance sheets.

Guidance for Q1 2011

Assuming a euro exchange rate of $1.40, FEI expects revenue in the first quarter of 2011 to be in the range of $180 million to $190 million. Bookings are expected to be in the range of $175 million to $195 million. GAAP earnings per share are expected to be in the range of $0.43 to $0.49.

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Investor Conference Call — 2:00 p.m. Pacific time, Thursday, February 3, 2011

Parties interested in listening to FEI’s quarterly conference call may do so by dialing 1-800-762-8779 (U.S., toll-free) or 1-480-629-9771 (international and toll), with the conference title: FEI Fourth Quarter Earnings Call, Conference ID 4400158. A telephone replay of the call will be available at 1-800-406-7325 (U.S., toll-free) or 1-303-590-3030 (international and toll) with the passcode: 4400158#. The call can also be accessed via the web by going to FEI’s Investor Relations page atwww.fei.com, where the webcast will also be archived.

About FEI

FEI (Nasdaq: FEIC) is a leading diversified scientific instruments company. It is a premier provider of electron and ion-beam microscopes and tools for nanoscale applications globally and across many industries: industrial and academic materials research, life sciences, semiconductors, data storage, natural resources and more. With a history of over 60 years of technological innovation and leadership, FEI has set the performance standard in transmission electron microscopes (TEM), scanning electron microscopes (SEM) and DualBeams™, which combine a SEM with a focused ion beam (FIB). FEI’s imaging systems provide 3D characterization, analysis and modification/prototyping with resolutions down to the sub-Ångström (one-tenth of a nanometer) level. FEI has approximately 1,800 employees and sales and service operations in more than 50 countries around the world. More information can be found at:www.fei.com.

Safe Harbor Statement

This news release contains forward-looking statements that include our guidance for the first quarter of 2011 and future periods. Such forward-looking statements may be identified by words and phrases that refer to future expectations, such as “believe”, “guidance”, “expect”, “expects”, “are expected”, “will”, “estimate”, “assuming” and other similar words and phrases. Forward-looking statements in the release specifically relate to the expected shipment of our backlog; expectations for future bookings; expectations about foreign currency rates; expected tax rates; expectations for product sales and margins, and operating improvements. Factors that could affect these forward-looking statements include, but are not limited to, the global economic environment; lower than expected customer orders and potential weakness of the Research & Industry, Electronics and Life Sciences market segments; our ability to manufacture product at expected volumes; supply chain limitations; bankruptcy or insolvency of customers or suppliers; cyclical changes in the data storage and semiconductor industries, which are the major components of Electronics market revenue; fluctuations in foreign exchange, interest and tax rates; changes in tax rate and laws, accounting rules regarding taxes or agreements with tax authorities; the ongoing determination of the effectiveness of foreign exchange hedge transactions; reduced profitability due to failure to achieve or sustain margin improvement in service or product manufacturing; the relative mix of higher-margin and lower-margin products; failure to achieve expected cost reductions and other improvements from restructuring plans; risks associated with shipping a high percentage of the company’s quarterly revenue in the last

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month of the quarter; customer requests to defer planned shipments; increased competition and new product offerings from competitors; lower average sales prices and reduced margins on some product sales due to increased competition; failure of the company’s products and technology, including new products, to find acceptance with customers; inability to deploy products as expected or delays in shipping products due to technical problems or barriers; potential shipment or supply chain disruptions due to natural disasters or terrorist attacks; changes to or potential additional restructurings and reorganizations not presently anticipated; reduced sales due to geopolitical risks; changes in trade policies and tariff regulations; changes in the regulatory environment in the nations where we do business; additional selling, general and administrative or research and development expenses; reduced governmental spending due to budget constraints; additional costs related to future merger and acquisition activity; and failure of the company to achieve anticipated benefits of acquisitions and collaborations, including failure to achieve financial goals and integrate future acquisitions successfully. Please also refer to our Form 10-K, Forms 10-Q, Forms 8-K and other filings with the U.S. Securities and Exchange Commission for additional information on these factors and other factors that could cause actual results to differ materially from the forward-looking statements. FEI assumes no duty to update forward-looking statements.

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FEI Company and Subsidiaries

Consolidated Balance Sheets

(In thousands)

(Unaudited)

	December 31, 2010		October 3, 2010		December 31, 2009
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	277,617	$	241,013	$	124,199
Short-term investments in marketable securities		44,026		38,341		212,119
Short-term restricted cash		22,114		16,177		17,141
Receivables, net		183,254		179,570		152,601
Inventories, net		155,964		159,728		138,242
Deferred tax assets		11,505		14,928		2,734
Other current assets		23,126		40,055		39,470
Total current assets		717,606		689,812		686,506
Non-current investments in marketable securities		38,662		45,102		39,662
Long-term restricted cash		41,377		41,863		35,901
Non-current inventories		47,976		43,935		44,385
Property plant and equipment, net		80,681		79,382		81,893
Goodwill		44,800		44,816		44,615
Deferred tax assets		1,072		8,392		3,369
Other assets, net		12,248		13,189		17,638
TOTAL	$	984,422	$	966,491	$	953,969
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	51,529	$	50,779	$	40,587
Accrued liabilities		51,209		42,778		36,434
Deferred revenue		81,445		76,302		65,805
Income taxes payable		3,715		5,349		1,321
Accrued restructuring, reorganization and relocation		4,884		5,583		32
Short-term line of credit		—		—		59,600
Other current liabilities		31,306		34,826		47,693
Total current liabilities		224,088		215,617		251,472
Convertible debt		89,012		89,012		100,000
Other liabilities		38,148		41,670		34,973
SHAREHOLDERS’ EQUITY:
Preferred stock - 500 shares authorized; none issued and outstanding		—		—		—
Common stock - 70,000 shares authorized; 38,280, 38,228, and 37,859 shares issued and outstanding at December 31, October 3, 2010, and December 31, 2009		509,145		508,081		485,557
Retained earnings		75,024		53,680		21,476
Accumulated other comprehensive income		49,005		58,431		60,491
Total shareholders’ equity		633,174		620,192		567,524
TOTAL	$	984,422	$	966,491	$	953,969

FEI Company and Subsidiaries

Consolidated Statements of Operations

(In thousands, except per share amounts)

(Unaudited)

	Thirteen Weeks Ended									Year Ended
	December 31, 2010			October 3, 2010			December 31, 2009			December 31, 2010			December 31, 2009
NET SALES:
Products	$	145,548		$	113,424		$	118,417		$	479,780		$	439,703
Service and components		40,522			39,581			36,032			154,442			137,641
Total net sales		186,070			153,005			154,449			634,222			577,344
COST OF SALES:
Products		75,087			60,728			69,635			262,571			252,307
Service and components		27,261			25,748			25,544			102,387			95,533
Total cost of sales		102,348			86,476			95,179			364,958			347,840
Gross profit		83,722			66,529			59,270			269,264			229,504
OPERATING EXPENSES:
Research and development		17,584			15,942			17,556			66,274			67,698
Selling, general and administrative		36,851			32,435			31,901			136,465			126,728
Restructuring, reorganization and relocation		562			536			826			11,067			3,456
Total operating expenses		54,997			48,913			50,283			213,806			197,882
OPERATING INCOME		28,725			17,616			8,987			55,458			31,622
OTHER INCOME (EXPENSE):
Interest income		468			440			581			2,632			2,880
Interest expense		(958	)		(1,025	)		(1,143	)		(4,504	)		(5,441	)
Other, net		(153	)		(472	)		(769	)		(1,364	)		(1,400	)
Total other (expense), net		(643	)		(1,057	)		(1,331	)		(3,236	)		(3,961	)
INCOME BEFORE TAXES		28,082			16,559			7,656			52,222			27,661
INCOME TAX EXPENSE (BENEFIT)		6,738			4,639			1,070			(1,326	)		5,017
NET INCOME	$	21,344		$	11,920		$	6,586		$	53,548		$	22,644
BASIC NET INCOME PER SHARE DATA	$	0.56		$	0.31		$	0.17		$	1.41		$	0.60
DILUTED NET INCOME PER SHARE DATA	$	0.52		$	0.30		$	0.17		$	1.34		$	0.60
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic		38,209			38,186			37,767			38,083			37,537
Diluted		41,676			41,536			38,194			41,737			37,905

FEI Company and Subsidiaries

Consolidated Statements of Operations

(Unaudited)

	Thirteen Weeks Ended(1)									Year Ended
	December 31, 2010			October 3, 2010			December 31, 2009			December 31, 2010			December 31, 2009
NET SALES:
Products		78.2	%		74.1	%		76.7	%		75.6	%		76.2	%
Service and components		21.8	%		25.9	%		23.3	%		24.4	%		23.8	%
Total net sales		100.0	%		100.0	%		100.0	%		100.0	%		100.0	%
COST OF SALES:
Products		40.4	%		39.7	%		45.1	%		41.4	%		43.7	%
Service and components		14.7	%		16.8	%		16.5	%		16.1	%		16.5	%
Total cost of sales		55.0	%		56.5	%		61.6	%		57.5	%		60.2	%
Gross profit		45.0	%		43.5	%		38.4	%		42.5	%		39.8	%
OPERATING EXPENSES:
Research and development		9.5	%		10.4	%		11.4	%		10.4	%		11.7	%
Selling, general and administrative		19.8	%		21.2	%		20.7	%		21.5	%		22.0	%
Restructuring, reorganization and relocation		0.3	%		0.4	%		0.5	%		1.7	%		0.6	%
Total operating expenses		29.6	%		32.0	%		32.6	%		33.7	%		34.3	%
OPERATING INCOME		15.4	%		11.5	%		5.8	%		8.7	%		5.5	%
OTHER INCOME (EXPENSE):
Interest income		0.3	%		0.3	%		0.4	%		0.4	%		0.5	%
Interest expense		-0.5	%		-0.7	%		-0.7	%		-0.7	%		-0.9	%
Other, net		-0.1	%		-0.3	%		-0.5	%		-0.2	%		-0.2	%
Total other (expense), net		-0.3	%		-0.7	%		-0.9	%		-0.5	%		-0.7	%
INCOME BEFORE TAXES		15.1	%		10.8	%		5.0	%		8.2	%		4.8	%
INCOME TAX EXPENSE (BENEFIT)		3.6	%		3.0	%		0.7	%		-0.2	%		0.9	%
NET INCOME		11.5	%		7.8	%		4.3	%		8.4	%		3.9	%

(1) Percentages may not add due to rounding.

FEI COMPANY

Supplemental Data Table

($ in millions, except per share amounts)

(Unaudited)

	Q4 Ended 31-Dec-2010			Q3 Ended 3-Oct-2010			Q4 Ended 31-Dec-2009			YTD Ended 31-Dec-2010			YTD Ended 31-Dec-2009
Income Statement Highlights
Consolidated sales	$	186.1		$	153.0		$	154.4		$	634.2		$	577.3
Gross margin		45.0	%		43.5	%		38.4	%		42.5	%		39.8	%
Stock compensation expense - TOTAL	$	2.5		$	2.5		$	2.6		$	10.5		$	10.6
Net income	$	21.3		$	11.9		$	6.6		$	53.5		$	22.6
Diluted net income per share	$	0.52		$	0.30		$	0.17		$	1.34		$	0.60
Interest income add back included in the calculation of diluted EPS	$	0.5		$	0.6		$	0.0		$	2.3		$	0.0
Sales Highlights
Sales by Market Segment
Electronics	$	80.7		$	44.0		$	33.0		$	222.8		$	126.4
Research & Industry	$	47.3		$	51.1		$	56.3		$	182.4		$	231.5
Life Sciences	$	17.6		$	18.3		$	29.1		$	74.6		$	81.8
Service and Components	$	40.5		$	39.6		$	36.0		$	154.4		$	137.6
Sales by Geography
USA & Canada	$	68.0		$	43.7		$	56.3		$	204.0		$	198.6
Europe	$	62.0		$	54.1		$	47.3		$	207.4		$	211.8
Asia-Pacific and Rest of World	$	56.1		$	55.2		$	50.8		$	222.8		$	166.9
Gross Margin by Market Segment
Electronics		53.7	%		50.2	%		50.8	%		50.2	%		48.8	%
Research & Industry		42.3	%		43.3	%		41.6	%		41.0	%		42.0	%
Life Sciences		40.7	%		46.2	%		29.5	%		41.0	%		34.7	%
Service and Components		32.7	%		34.9	%		29.1	%		33.7	%		30.6	%
Bookings and Backlog
Total	$	218.4		$	190.1		$	163.3		$	751.5		$	601.4
Book-to-bill ratio		1.17			1.24			1.06			1.18			1.04
Backlog - total	$	471.9		$	439.6		$	354.6		$	471.9		$	354.6
Backlog - Service and Components	$	81.3		$	80.8		$	68.0		$	81.3		$	68.0
Bookings by Market Segment
Electronics	$	76.2		$	59.6		$	49.9		$	263.8		$	140.7
Research & Industry	$	77.6		$	72.9		$	58.2		$	232.8		$	235.4
Life Sciences	$	23.5		$	18.4		$	15.5		$	87.1		$	76.7
Service and Components	$	41.1		$	39.2		$	39.7		$	167.8		$	148.6
Bookings by Geography
USA & Canada	$	80.9		$	65.8		$	45.6		$	258.6		$	203.3
Europe	$	59.5		$	63.9		$	63.0		$	220.9		$	229.7
Asia-Pacific and Rest of World	$	78.0		$	60.4		$	54.7		$	272.0		$	168.4
Balance Sheet Highlights
Cash, equivalents, investments, restricted cash	$	423.8		$	382.5		$	429.0		$	423.8		$	429.0
Operating cash generated (used)	$	52.5		($	3.5	)	$	42.7		$	75.0		$	68.1
Accounts receivable	$	183.3		$	179.6		$	152.6		$	183.3		$	152.6
Days sales outstanding (DSO)		90			107			90			90			90
Inventory turnover		2.6			2.4			2.6			2.6			2.6
Fixed asset investment	$	3.6		$	0.9		$	4.1		$	8.9		$	13.4
Depreciation expense	$	4.5		$	4.3		$	4.5		$	17.4		$	17.1
Working capital	$	493.5		$	474.2		$	435.0		$	493.5		$	435.0
Headcount (permanent and temporary)		1,813			1,810			1,781			1,813			1,781
Euro average rate		1.360			1.292			1.477			1.327			1.389
Euro ending rate		1.339			1.375			1.433			1.339			1.433