For more information, contact:

Richard Beck Advanced Energy Industries, Inc. 970.407.6204 dick.beck@aei.com

Cathy Kawakami Advanced Energy Industries, Inc. 970.407.6732 cathy.kawakami@aei.com

Advanced Energy Announces Further Cost Reduction Actions

Fort Collins, Colorado (May 17, 2001)—Advanced Energy (Nasdaq: AEIS) today announced it has implemented further cost reduction actions in light of the continuing economic slowdown. These actions are taken in addition to cost reductions implemented in April that included a ten percent reduction in force, a ten percent reduction in pay for senior executives and directors' fees, substantial reductions in travel, cutbacks in other discretionary spending and scheduled shutdown days throughout the remainder of 2001.

 

Today, the company further reduced its workforce by four percent of total headcount, or 59 full-time employees. This action will reduce the company's total headcount to approximately 1,326 employees worldwide. The company will also institute a wage freeze and graduated pay reductions for all domestic salaried and hourly workers effective June 1, 2001, as well as further expense and discretionary spending reductions. The company expects savings of approximately $38 million on an annualized basis as a result of all cost reduction efforts to date.

Doug Schatz, chairman and chief executive officer, said, "As we announced on May 10, 2001, the current industry and macro-economic slowdown has continued to negatively impact our business. These further cost reduction steps were painful, but necessary. These difficult decisions will enable us to more efficiently manage the company throughout this current economic slowdown." The company continues to expect a loss for the second quarter of 2001 with revenues as much as 35 percent below first quarter 2001 revenues of $74.7 million.

About Advanced Energy
Advanced Energy is a global leader in the development, marketing, and support of technology solutions that are central in the manufacture of semiconductors, data storage products, and flat panel displays. Original equipment manufacturers (OEMs) and end-users around the world depend on AE products when plasma-based technology plays a vital role in their manufacturing process. AE offers a comprehensive suite of products for vacuum process systems, including power management, temperature sensing, dynamic temperature control, gas delivery management, process monitoring and machine control tools, ion-beam sources, and plasma abatement technologies. AE technology solutions are sold and supported globally by direct offices, representatives, and distributors. Founded in 1981, AE is a publicly held company traded on Nasdaq under the symbol AEIS. AE's URL is www.advanced-energy.com.

Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements represent the companies’ reasonable judgments with respect to future events, but are subject to risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Such forward-looking statements include, but are not limited to, statements regarding the company’s ability to effectively control costs and efficiently manage the company throughout the industry slowdown. Specific cautionary statements are discussed in Advanced Energy’s SEC reports, including its Forms 10-Q and most recent annual report on Form 10-K. Advance Energy continues to be susceptible to fluctuations in quarterly and annual revenues and operating results and the volatility and cyclicality of the semiconductor and semiconductor capital equipment industries. The company assumes no obligation to update the information in this release. Free copies of this and other documents are available from the SEC at www.sec.gov or Advanced Energy at 1625 Sharp Point Drive, Fort Collins, Colorado 80525; 970-221-4670.