Milpitas, California. October 30, 2007.

Nanometrics Reports Financial Results for the Third Quarter of 2007

Third Consecutive Quarter of Revenue Growth and Gross Margin Improvement
GAAP EPS $0.11 per Share

Nanometrics Incorporated (Nasdaq: NANO), a leading supplier of advanced metrology equipment to the semiconductor industry, today announced its financial results for the third quarter ended September 29, 2007.

Revenues for the third quarter were a record $38.6 million, an increase of 3.5% compared to second quarter 2007 revenues of $37.3 million and an increase of 33% over revenues of $29.1 million for the third quarter of 2006. Net income for the third quarter of 2007 was $2.0 million, or $0.11 per diluted share. This compares to a net loss of $130,000, or $0.01 per share, for the second quarter of 2007 and a net loss of $6.6 million, or $0.40 per share, for the third quarter of 2006.

Third quarter 2007 operating income of $1.7 million includes non-cash charges of $1.3 million for amortization of acquired intangible assets and $0.9 million for stock-based compensation expenses. The results for the third quarter also include a $2.1 million restructuring charge related to the closing of the company’s Milpitas machine shop and plating facility, and a $2.1 million gain on asset sales resulting from the sale of real estate holdings in Japan and Milpitas as well as the sale of other non-strategic assets.

“I am pleased to be announcing Nanometrics’ first profitable quarter in more than two years,” commented Tim Stultz, president and chief executive officer of Nanometrics. “The team has done a remarkable job in turning around our performance, evidenced by our third straight quarter of revenue growth, improved gross margins and reduced operating expenses. After just two months at the helm, I am happy to be reporting that the turnaround is behind us and the Accent merger integration is essentially complete. Going forward, we will continue to focus on profitability, cash flow and predictability, with the added objectives of improving competitiveness and customer satisfaction.”

Conference Call Details
A conference call to discuss the third quarter 2007 results will be held later today at 5:00 p.m. Eastern Daylight Time (2:00 p.m. PDT). To participate in the conference call, the dial-in numbers are 866-510-0705 for domestic callers and 617-597-5363 for international callers. The passcode is 70668631. A live and recorded webcast will be made available on the investor page of the Nanometrics website at www.nanometrics.com.

View Q3 2007 consolidated balance sheets and statement of operations [pdf]

About Nanometrics
Nanometrics is a leader in the design, manufacture and marketing of high-performance process control metrology systems used in semiconductor manufacturing. Nanometrics standalone and integrated metrology systems measure various thin film properties, critical dimensions, overlay control and optical, electrical and material properties, including the structural composition of silicon and compound semiconductor devices, during various steps of the manufacturing process. These systems enable semiconductor manufacturers to improve yields, increase productivity and lower their manufacturing costs. The company maintains its headquarters in Milpitas, California, with sales and service offices worldwide. Nanometrics is traded on NASDAQ Global Market under the symbol NANO. Nanometrics’ website is http://www.nanometrics.com.

Forward Looking Statements
This press release contains forward-looking statements including, but not limited to, statements regarding Nanometrics’ expected results for its most recently completed fiscal quarter, which remain subject to adjustment in connection with the preparation of Nanometrics’ audited financial statements.

Contact:
Investor Relations:
Claire McAdams
Headgate Partners LLC
530-265-9899 tel; 530-265-9699 fax
claire@headgatepartners.com

Company Contact:
Dan Choy
408-545-6000 tel; 408-232-5910 fax
dchoy@nanometrics.com