MINNEAPOLIS -- CyberOptics Corp. today reported September quarter net income of $626,000 on revenues of $10.3 million. Both figures represented a sharp drop from Q3 2004, when the maker of sensors and inspection gear reported earnings of $3.6 million on revenues of $19.4 million.
Sales and earnings were at the top end of previously company guidance.

The company showed signs of rebounding from a difficult first half. Sequentially, sales rose 23% and net income was up 210%. Sales of electronics assembly sensors were up 28% and inspection systems were up 26%. Sales of semiconductor products were virtually unchanged from the prior quarter.

In a statement, president and chief executive Kathleen P. Iverson, said, "Orders for both existing and new products have increased following the close of the third quarter. Coupled with our improved third quarter results, this heightened order activity makes us believe that our markets are starting to strengthen. Although a full recovery of our capital equipment markets typically lags that of the semiconductor sector, we are encouraged about CyberOptics' near-term prospects."

During the quarter, CyberOptics shipped its first fiducial/inspection sensors for DEK's solder paste screen printers, and called sales of its SE 300 Ultra solder paste inspection system "robust," particularly to Asian ODMs. It also sold its first EPV 5 sensors for pick-and-place equipment. A program for integrating the technology into a new robotic placement platform of Universal Instruments was placed on hold and will be reviewed in six to 12 months.

For the December quarter the company forecast earnings of $0.08 to $0.12 per diluted share on revenues of $11 million to $12 million.

At quarter's end CyberOptics had a cash balance of $39.5 million, down from $42.4 million sequentially, due to an increase in accounts receivable.