The company reported a $3.7 million net loss in the third quarter of 2007, or ($0.19) per share, which included $4.1 million in non-cash charges for inventory write-off and impairment charges.

Net income excluding non-cash charges, was approximately $0.5 million, or $0.02 per diluted share for the third quarter of 2007, compared with a net loss of $0.8 million, or ($0.05) per share for the third quarter of 2006, and compared with a net income of $1.1 million, or $0.05 per diluted share for the second quarter of 2007.

Cash reserves at the end of the third quarter of 2007 were $20.5 million, an increase of $0.1 million compared to the end of second quarter of 2007.

“Business conditions in third quarter were in line with our expectations and our team continued to execute to our plan, with a significant sequential increase in bookings and a strong backlog,” said Gabi Seligsohn, President and CEO. “Excluding the one-time non-cash charges, we reported our second consecutive profitable quarter and with positive cash flow.”

“The strength in bookings is related to our continued market share gains in integrated metrology and our continued penetrations into the Optical CD stand-alone segment”, continued Seligsohn. “While we continue to believe x-ray metrology has good long term prospects, the sales cycle is extremely long and we considered it prudent to appropriately reflect the current asset value of the Hypernex acquisition on our balance sheet and improve our cost structure by transferring the R&D activities to our headquarters in Israel. Meanwhile, based on the momentum in stand-alone and integrated metrology, we expect a strong finish to the year and another growth year in 2008.”

The Company will host a conference call today, November 6, 2007, at 9:00am EST. To participate please dial in the U.S: 1-888-642-5032; UK: 0-800-032-3367; or internationally: +972-3-918-0687 at least 5 minutes before the start of the call. A recording of the call will be available on Nova’s website, within 24 hours following the end of the call.

This press release provides financial measures that excludes non-cash charges for inventory write-off and impairment charges and are therefore not calculated in accordance with generally accepted accounting principals (GAAP). Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding Nova’s performance because they reflect our operational results and enhances management’s and investors’ ability to evaluate Nova’s performance before charges that will not recur in the future periods and thus are considered by management to be outside Nova’s ongoing operating results.

The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management believes that it is in the best interest of its investors to provide financial information that will facilitate comparison of both historical and future results and allows greater transparency to supplemental information used by management in its financial and operational decision making.