Cognex Corporation Announces Reduction in Workforce

NATICK, Mass.--(BUSINESS WIRE)--Oct. 1, 2001--Cognex Corporation (NASDAQ: CGNX) today announced that it is eliminating approximately 85 positions at its Modular Vision Systems Division (MVSD). The positions eliminated include approximately 60 employees as well as approximately 25 contractors and open requisitions. The workforce reduction is in response to the severe downturn in the semiconductor and electronics industries and is expected to reduce expenses by approximately $6 million on an annualized basis.

Approximately 30 positions were eliminated at Cognex's Corporate Headquarters in Natick, Massachusetts, and the remaining positions were at other locations worldwide.

"This is the company's first significant reduction in force since 1985, and has been an especially difficult one for us because these are all hardworking, experienced and dedicated employees," said Dr. Robert J. Shillman, Cognex's President, Chief Executive Officer, and Chairman. "Unfortunately, the depth and duration of the high tech slowdown, coupled with a very uncertain economic outlook overall, has made it necessary to take this action. We believe that a business recovery is not likely to occur in the near future, and, in view of that, we currently need fewer people to meet our customers' needs."

Over the past nine months, Cognex has also implemented a number of other cost-containment measures to more closely align expenses to the lower level of customer demand. These measures included salary reductions, elimination of all company bonuses, mandatory shut down days, a restricted hiring plan, and a reduction in discretionary spending.

Dr. Shillman continued, "In spite of the current challenging environment, we have confidence in our business. We continue to close a record number of new customers and to see many new applications for our vision systems. The slowdown that we're experiencing is due, in great measure, to the fact that our biggest OEM customers are being severely impacted by the worldwide slowdown in capital equipment spending. We intend to continue our ongoing product development schedule to be ready for the many opportunities for machine vision when business conditions improve."

About Cognex Corporation

Cognex Corporation designs, develops, manufactures, and markets machine vision systems, or computers that can "see." Cognex is the world's leader in the machine vision industry, having shipped to date more than 150,000 machine vision systems, representing over $1 billion in cumulative revenue, since the company's founding in 1981. Cognex's Modular Vision Systems Division, headquartered in Natick, Massachusetts, specializes in machine vision systems which are used for automating the manufacture of a wide range of discrete items and for assuring their quality. Cognex's Surface Inspection Systems Division, headquartered in Alameda, California, specializes in machine vision systems which are used for inspecting the surfaces of products that are manufactured in a continuous fashion, such as metals, paper, and plastics. In addition to its corporate headquarters in Natick, Massachusetts, Cognex also has regional offices located throughout North America, Japan, Europe, and Southeast Asia. Visit Cognex on-line at http://www.cognex.com.

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Forward-Looking Statement

Certain statements made in this press release are forward-looking statements. These statements are based on the company's current expectations and estimates as to prospective events and circumstances which may or may not be in the company's control and as to which there can be no firm assurances given. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected or anticipated. The company wishes to caution readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. The company disclaims any obligation subsequently to revise forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events. Further discussions of risk factors are also available in the company's registration statements filed with the Securities and Exchange Commission.

CONTACT:
Susan Conway
Investor Relations Manager   
Cognex Corporation   
(508) 650-3000