Business and Continued Growth in Pads

AURORA, Ill.–(EMWNews)–Cabot Microelectronics Corporation (Nasdaq: CCMP), the world’s

leading supplier of chemical mechanical planarization (CMP) polishing

slurries to the semiconductor industry, today reported financial results

for its third quarter of fiscal 2008, which ended June 30.

Total revenue during the third fiscal quarter was $97.0 million, which

was 9.0 percent higher than the $89.0 million reported in the same

quarter last year and represents a 2.7 percent increase compared to

$94.5 million last quarter. Year to date, total revenue increased 15.0

percent from the same period in fiscal 2007. Record revenue this quarter

was driven by solid demand for the company’s

core CMP slurry products for semiconductor applications –

tungsten, dielectrics and copper, aggregate revenue from which increased

by 9.4 percent year over year and 3.4 percent sequentially. In addition,

revenue from polishing pads grew 38.1 percent from last quarter.

Revenues from the company’s engineered surface

finishes business and slurry for data storage applications decreased

compared to both the previous quarter and the same quarter last year.

Gross profit, expressed as a percentage of revenue, was 46.8 percent

this quarter, which was down from 47.7 percent in the same quarter a

year ago and up from 44.7 percent last quarter. Compared to the year ago

quarter, gross profit percentage decreased due to higher fixed costs,

mainly associated with pad operations, lower slurry and pad

manufacturing yields, and the effect of foreign exchange rate changes,

partially offset by a higher valued product mix. Compared to the prior

quarter, gross profit percentage increased driven by a higher valued

product mix and higher pad manufacturing yields, partially offset by

lower utilization of the company’s

manufacturing capacity. Year to date, gross profit represents 46.5

percent of revenue, which is consistent with the company’s

full fiscal year guidance range of 46 to 48 percent of revenue.

Operating expenses, composed of research, development and technical,

selling and marketing, and general and administrative expenses, were

$32.5 million in the third fiscal quarter, which is consistent with

comments provided by the company during its second quarter of fiscal

2008 earnings call on April 24. Operating expenses were $4.7 million

higher than the $27.9 million reported in the same quarter a year ago,

driven primarily by increased staffing related costs and higher

professional fees, including costs to enforce the company’s

intellectual property. Operating expenses were $0.4 million higher than

the $32.2 million reported in the previous quarter, mostly due to

increased staffing related costs and travel expenses, partially offset

by lower professional fees.

Net income of $10.0 million for the quarter was essentially even with

the same quarter last year. The comparison to the prior year reflects

higher revenue this quarter and the absence of a $2.1 million pre-tax

investment write-off recorded last year, offset by increased operating

expenses this year. Net income increased 25.7 percent from $7.9 million

last quarter.

Diluted earnings per share were $0.43 this quarter, up from both the

$0.42 reported in the third quarter of fiscal 2007 and $0.34 in the

previous quarter. Year to date, earnings per share were 28.8 percent

higher than in the same period of fiscal 2007.

“We are proud of our accomplishments this

quarter, particularly the strong performance in our core CMP slurry

business and the progress made toward optimizing our polishing pad

manufacturing process,” stated William

Noglows, Chairman and CEO of Cabot Microelectronics. “We

believe that the execution of our key initiatives of Technology

Leadership, Operations Excellence and Connecting with Customers, has

allowed us to maintain our solid financial performance. Our strong year

to date growth in both revenue and earnings demonstrates our ability to

succeed across a range of economic and industry environments, and we

look forward to building on this momentum going forward.”

CONFERENCE CALL

Cabot Microelectronics Corporation’s

quarterly earnings conference call will be held today at 9:00 a.m.

Central Time. The live conference call will be available via webcast

from the company’s website, www.cabotcmp.com,

or by phone at (866) 510-0712. Callers outside the U.S. can dial (617)

597-5380. The conference code for the call is 72609315. A replay will be

available through August 21, 2008 via webcast at www.cabotcmp.com.

A transcript of the formal comments made during the conference call will

also be available in the Investor Relations section of the company’s

website.

ABOUT CABOT MICROELECTRONICS CORPORATION

Cabot Microelectronics Corporation, headquartered in Aurora, Illinois,

is the world’s leading supplier of CMP slurries used in semiconductor

and data storage manufacturing. The company’s products play a critical

role in the production of the most advanced semiconductor devices,

enabling the manufacture of smaller, faster and more complex devices by

its customers. Since becoming an independent public company in 2000, the

company has grown to approximately 800 employees on a global basis. The

company’s vision is to become the world leader in shaping, enabling and

enhancing the performance of surfaces, so the company is leveraging its

expertise in CMP slurry formulation, materials and polishing techniques

developed for the semiconductor industry and applying it to demanding

surface modification applications in other industries where shaping,

enabling and enhancing the performance of surfaces is critical to

success. For more information about Cabot Microelectronics Corporation,

visit www.cabotcmp.com or contact

Amy Ford, Director of Investor Relations at (630) 499-2600.

SAFE HARBOR STATEMENT

This news release may include statements that constitute “forward

looking statements” within the meaning of federal securities

regulations. These forward-looking statements include statements related

to: future sales and operating results; company and industry growth or

trends; growth of the markets in which the company participates;

international events; product performance; the generation, protection

and acquisition of intellectual property, and litigation related to such

intellectual property; new product introductions; development of new

products, technologies and markets; the acquisition of or investment in

other entities; uses and investment of the company’s

cash balance; and the construction of facilities by Cabot

Microelectronics Corporation. These forward-looking statements involve a

number of risks, uncertainties, and other factors, including those

described from time to time in Cabot Microelectronics’ filings with the

Securities and Exchange Commission (SEC), that could cause actual

results to differ materially from those described by these

forward-looking statements. In particular, see “Risk Factors” in the

company’s quarterly report on Form 10-Q for

the quarter ended March 31, 2008 and in the company’s

annual report on Form 10-K for the fiscal year ended September 30, 2007,

both filed with the SEC. Cabot Microelectronics assumes no obligation to

update this forward-looking information.