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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 10-Q

(Mark One)

|/x/ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- | ---------------------------------------------------------------------------------------

For the Quarterly Period Ended June 30, 2001
or

|/ / | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|--- | ----------------------------------------------------------------------------------------

For the transition period from  to

Commission file number 0-22384

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MICRO COMPONENT TECHNOLOGY, INC.

(Exact name of registrant as specified in its charter)

Minnesota(State or other jurisdiction of
incorporation or organization)

41-0985960(IRS Employer
Identification No.)


2340 West County Road C, St. Paul, MN 55113-2528(Address of principal executive offices)

(651) 697-4000(Registrant's telephone number)

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Indicate
by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90
days Yes /x/  No / /

The
number of shares outstanding of the Registrant's Common Stock, as of August 10, 2001 was 14,057,070.

Page
1 of 18 pages

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MICRO COMPONENT TECHNOLOGY, INC.        FORM 10-Q

TABLE OF CONTENTS

|                               |                                                                                                                | 
|------------------------------ | -------------------------------------------------------------------------------------------------------------- | 
|PART I.  FINANCIAL INFORMATION |                                                                                                                | 
|                               | ITEM 1.  FINANCIAL STATEMENTS                                                                                  | 
|                               |                                                                                                                | 
|                               |                                                                                                                | 
|                               |                                                                                                                | 
|                               |                                                                                                                | 
|                               | ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
                OPERATIONS AND FINANCIAL CONDITION | 
|PART II.  OTHER INFORMATION    |                                                                                                                | 
|                               | ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURTIY HOLDERS                                                   | 
|                               | ITEM 5.  OTHER INFORMATION                                                                                     | 
|                               | ITEM 6.  REPORTS ON FORM 8-K                                                                                   | 
|                               | SIGNATURES                                                                                                     | 

2

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MICRO COMPONENT TECHNOLOGY, INC.  FORM 10-Q  PART I.  FINANCIAL INFORMATION  ITEM 1.  FINANCIAL STATEMENTS  CONSOLIDATED BALANCE SHEETS  (in thousands
except share and per share data)  (Unaudited)

|                                                 |                                                                                                     | June 30,
2001 |                            | December 31,
2000 |  
|------------------------------------------------ | --------------------------------------------------------------------------------------------------- | ------------- | -------------------------- | ----------------- | -
|Assets                                           |                                                                                                     |               |                            |                   |  
|Current assets                                   |                                                                                                     |               |                            |                   |  
|                                                 | Cash and cash equivalents                                                                           |               | $                          | 2,344             |  
|                                                 | Accounts receivable, less allowance for doubtful accounts of $200 and $200, respectively            |               |                            | 7,175             |  
|                                                 | Inventories:                                                                                        |               |                            |                   |  
|                                                 |                                                                                                     |               | Raw                        |                   |  
|                                                 |                                                                                                     |               | Work in process            |                   |  
|                                                 |                                                                                                     |               | Finished goods             |                   |  
|                                                 | Other                                                                                               |               |                            | 510               |  
|                                                 |                                                                                                     |               |                            |                   |  
|                                                 |                                                                                                     |               | Total current assets       |                   |  
|Property, plant and equipment, net               |                                                                                                     |               | 975                        |                   |  
|Goodwill and other intangible assets, net        |                                                                                                     |               | 10,172                     |                   |  
|Other assets                                     |                                                                                                     |               | 73                         |                   |  
|                                                 |                                                                                                     |               |                            |                   |  
|Total assets                                     |                                                                                                     | $             | 36,580                     |                   | $
|                                                 |                                                                                                     |               |                            |                   |  
|Liabilities and Stockholders' Equity             |                                                                                                     |               |                            |                   |  
|Current liabilities:                             |                                                                                                     |               |                            |                   |  
|                                                 | Accounts payable                                                                                    |               | $                          | 1,555             |  
|                                                 | Deferred profit                                                                                     |               |                            | 1,763             |  
|                                                 | Accrued warranty                                                                                    |               |                            | 694               |  
|                                                 | Other accrued liabilities                                                                           |               |                            | 3,567             |  
|                                                 | Current portion of accrued restructuring costs                                                      |               |                            | 730               |  
|                                                 | Current portion of long-term debt                                                                   |               |                            | 28                |  
|                                                 |                                                                                                     |               |                            |                   |  
|                                                 |                                                                                                     |               | Total current liabilities  |                   |  
|Long-term debt                                   |                                                                                                     |               | 27                         |                   |  
|Long-term portion of accrued restructuring costs |                                                                                                     |               | 611                        |                   |  
|Commitments and contingencies                    |                                                                                                     |               |                           |                   |  
|Stockholders' equity:                            |                                                                                                     |               |                            |                   |  
|                                                 | Preferred stock, $.01 par value, 1,000,000 authorized, none issued and outstanding                  |               |                            |                  |  
|                                                 | Common stock, $.01 par value, 20,000,000 authorized, 14,057,070 and 13,949,974 issued, respectively |               |                            | 141               |  
|                                                 | Additional paid-in capital                                                                          |               |                            | 88,123            |  
|                                                 | Cumulative other comprehensive loss                                                                 |               |                            | (69               | )
|                                                 | Accumulated deficit                                                                                 |               |                            | (60,590           | )
|                                                 |                                                                                                     |               |                            |                   |  
|                                                 |                                                                                                     |               | Total stockholders' equity |                   |  
|                                                 |                                                                                                     |               |                            |                   |  
|Total liabilities and stockholders' equity       |                                                                                                     | $             | 36,580                     |                   | $
|                                                 |                                                                                                     |               |                            |                   |  

See
notes to unaudited condensed consolidated financial statements

3

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MICRO COMPONENT TECHNOLOGY, INC.  CONSOLIDATED STATEMENTS OF OPERATIONS  (In thousands, except per share data)  (Unaudited)

|                                                                |                                                     | Three Months Ended |        | Six Months Ended |  
|--------------------------------------------------------------- | --------------------------------------------------- | ------------------ | ------ | ---------------- | -
|
|Net sales                                                       |                                                     | $                  | 7,404  |                  | $
|Cost of sales                                                   |                                                     |                    | 4,220  |                  |  
|                                                                |                                                     |                    |        |                  |  
|Gross profit                                                    |                                                     |                    | 3,184  |                  |  
|Operating expenses:                                             |                                                     |                    |        |                  |  
|                                                                | Selling, general and administrative                 |                    |        | 2,863            |  
|                                                                | Research and development                            |                    |        | 2,015            |  
|                                                                | Amortization of intangible assets                   |                    |        | 879              |  
|                                                                | Restructuring charge                                |                    |        |                 |  
|                                                                |                                                     |                    |        |                  |  
|Total operating expenses                                        |                                                     |                    | 5,757  |                  |  
|Loss from operations                                            |                                                     |                    | (2,573 | )                |  
|                                                                | Interest income                                     |                    |        | 41               |  
|                                                                | Interest expense                                    |                    |        | (2               | )
|                                                                | Other, net                                          |                    |        | (2               | )
|                                                                |                                                     |                    |        |                  |  
|Total interest and other                                        |                                                     |                    | 37     |                  |  
|                                                                |                                                     |                    |        |                  |  
|Loss before cumulative effect of change in accounting principle |                                                     |                    | (2,536 | )                |  
|                                                                |                                                     |                    |        |                  |  
|Cumulative effect of change in accounting principle             |                                                     |                    |       |                  |  
|                                                                |                                                     |                    |        |                  |  
|Net loss                                                        |                                                     | $                  | (2,536 | )                | $
|                                                                |                                                     |                    |        |                  |  
|Net loss per share, basic and diluted:                          |                                                     |                    |        |                  |  
|                                                                | Continuing operations                               |                    | $      | (0.18            | )
|                                                                | Cumulative effect of change in accounting principle |                    |        |                 |  
|                                                                |                                                     |                    |        |                  |  
|                                                                | Net loss                                            |                    | $      | (0.18            | )
|                                                                |                                                     |                    |        |                  |  
|Weighted average common and equivalent shares outstanding:      |                                                     |                    |        |                  |  
|                                                                | Basic and diluted                                   |                    |        | 14,018           |  
|                                                                |                                                     |                    |        |                  |  

See
notes to unaudited condensed consolidated financial statements

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MICRO COMPONENT TECHNOLOGY, INC.        CONSOLIDATED STATEMENTS OF CASH FLOWS        (In thousands)  (Unaudited)

|                                                     |                                                                             | Six Months Ended                   |                            
|---------------------------------------------------- | --------------------------------------------------------------------------- | ---------------------------------- | ---------------------------
|
|Cash flows from operating activities:                |                                                                             |                                    |                            
|                                                     | Net loss                                                                    |                                    | $                          
|                                                     | Adjustments to reconcile net loss to net cash used in operating activities: |                                    |                            
|                                                     |                                                                             | Depreciation and amortization      |                            
|                                                     |                                                                             | Changes in assets and liabilities: |                            
|                                                     |                                                                             |                                    | Accounts receivable        
|                                                     |                                                                             |                                    | Inventories                
|                                                     |                                                                             |                                    | Other current assets       
|                                                     |                                                                             |                                    | Accounts payable           
|                                                     |                                                                             |                                    | Accrued restructuring costs
|                                                     |                                                                             |                                    | Other accrued liabilities  
|                                                     |                                                                             |                                    |                            
|Net cash used in operating activities                |                                                                             |                                    | (9,739                     
|Cash flow from investing activities:                 |                                                                             |                                    |                            
|                                                     | Additions to property, plant and equipment                                  |                                    |                            
|                                                     | Payment for acquisitions, net of cash acquired                              |                                    |                            
|                                                     |                                                                             |                                    |                            
|Net cash used in investing activities                |                                                                             |                                    | (134                       
|Cash flows from financing activities:                |                                                                             |                                    |                            
|                                                     | Payments of long-term debt                                                  |                                    |                            
|                                                     | Increase in line of credit                                                  |                                    |                            
|                                                     | Proceeds from issuance of stock, net                                        |                                    |                            
|                                                     |                                                                             |                                    |                            
|Net cash provided by financing activities            |                                                                             |                                    | 170                        
|                                                     |                                                                             |                                    |                            
|Net increase (decrease) in cash and cash equivalents |                                                                             |                                    | (9,703                     
|Cash and cash equivalents at beginning of period     |                                                                             |                                    | 12,047                     
|                                                     |                                                                             |                                    |                            
|Cash and cash equivalents at end of period           |                                                                             | $                                  | 2,344                      
|                                                     |                                                                             |                                    |                            
|Supplemental disclosure:                             |                                                                             |                                    |                            
|                                                     | Noncash investing and financing activities:                                 |                                    |                            
|                                                     | Stock issued for acquisition of Aseco Corporation                           |                                    | $                          

See
notes to unaudited condensed consolidated financial statements

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MICRO COMPONENT TECHNOLOGY, INC.        FORM 10-Q        NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  (Unaudited)

1. INTERIM FINANCIAL STATEMENTS

The accompanying unaudited condensed consolidated financial statements for the six months ended June 30, 2001 have been prepared in accordance with the
instructions for SEC Form 10-Q and, accordingly, do not include all disclosures required by generally accepted accounting principles for complete financial statements. In our
opinion, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation, have been included.

Interim
unaudited financial results should be read in conjunction with the audited financial statements included in the SEC Report on Form 10-K, for the period
ended December 31, 2000.

The
results of operations for the six month period ended June 30, 2001 are not necessarily indicative of the operating results to be expected for the full year.

2. CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE

In December 1999, the Securities and Exchange Commission (SEC) staff issued Staff Accounting Bulletin No. 101 (SAB 101), Revenue Recognition in Financial
Statements, which, among other things, establishes the SEC's interpretation that if uncertainty exists about customer
acceptance of a product, revenue should not be recognized until acceptance occurs. Customer acceptance provisions may be included in a contract to enforce a customer's right to (1) test the
delivered product, (2) require the seller to perform additional services subsequent to delivery of an initial product or performance of an initial service, such as a seller is required to
install or activate delivered equipment, or (3) identify other work necessary to be done before accepting the product. The SEC presumes that such contractual customer acceptance provisions are
substantive, bargained-for terms of an arrangement. Accordingly, when such contractual customer acceptance provisions exist, the SEC generally believes that the seller should not recognize
revenue until customer acceptance occurs or the acceptance provisions lapse.

In
the fourth quarter of 2000 we changed the method of recognizing revenue to comply with SAB 101. As a result of this change, we reported a change in accounting principle in
accordance with APB Opinion No. 20 (APB 20),Accounting Changes, by a cumulative effect adjustment. Because we are a calendar year entity that
adopted SAB 101 in the fourth quarter of 2000, the cumulative effect of the change was included in the first quarter of 2000 pursuant to APB 20 which requires that the change be made as of the
beginning of the year (January 1, 2000) and that financial information for pre-change interim periods be restated by applying SAB 101 to those periods. Accordingly, the results for
the second quarter and the six months ended July 1, 2000 have been restated pursuant to the adoption of SAB 101.

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3. EARNINGS PER SHARE

Earnings per share are computed in accordance with Statement of Financial Accounting Standards (SFAS) No. 128,Earnings per
Share. Basic earnings per share are computed using the weighted average number of common shares outstanding during each period. Diluted earnings per share include the dilutive
effect of common shares potentially issuable upon the exercise of stock options outstanding. The following table reconciles the denominators used in computing basic and diluted earnings per share:

(in
thousands)

Three Months Ended

Six Months EndedJune 30,
2001(1)

July 1,
2000(1)

June 30,
2001(1)

July 1,
2000(1)Weighted average common shares outstanding

14,018

11,067

13,985

10,486Effect of dilutive stock options and warrants







14,018

11,067

13,985

10,486


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4. REPORTING OF COMPREHENSIVE NET INCOME OR (LOSS)

In 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards (SFAS), No. 130Reporting
Comprehensive Incomewhich establishes standards for the reporting and display of comprehensive income (loss) and its components in a full set of general-purpose financial
statements. Under this standard, certain revenues, expenses, gains, and losses recognized during the period are included in comprehensive income (loss), regardless of whether they are considered to be
results of operations of the period. During the three-month periods ended June 30, 2001 and July 1, 2000 and the six month periods ended June 30, 2001 and July 1, 2000
total comprehensive loss equaled net loss as reported on the Consolidated Statements of Operations.

5. RESTRUCTURING CHARGE

On February 21, 2001, in response to the downturn in the semiconductor capital equipment industry, we announced plans to consolidate the manufacturing
and operation functions performed in our Marlborough, Massachusetts facility to our St. Paul, Minnesota facility, resulting in reductions in headcount, as well as other reduction initiatives which
would result in a restructuring charge in the first quarter of 2001. This plan was later adjusted to transfer a portion of the manufacturing functions to our Penang, Malaysia facility.

The
restructuring charge resulting from the consolidation of operations and cost reduction measures initiated in the first quarter of 2001 totaled $2.3 million. This charge
principally represents employee separation costs and costs related to idle facilities over the remaining lease term, which runs through April 2003. This restructuring affected a total of 73 employees
principally in the areas of manufacturing and administration. The restructuring

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plan is expected to be completed in 2001. The following table summarizes the charges related to this restructuring:

|(in thousands)                                                          |  |   |       |   |   |       |  
|----------------------------------------------------------------------- |  | - | ----- | - | - | ----- | -
|
|Restructuring charge incurred in the first quarter ended March 31, 2001 |  | $ | 1,011 |   | $ | 1,320 |  
|Utilization for the quarter ended March 31, 2001                        |  |   | (276  | ) |   |      |  
|Utilization for quarter ended June 30, 2001                             |  |   | (616  | ) |   | (98   | )
|                                                                        |  |   |       |   |   |       |  
|Total utilization for the six months ended June 30, 2001                |  |   | (892  | ) |   | (98   | )
|                                                                        |  |   |       |   |   |       |  
|Accrued restructuring costs at June 30, 2001                            |  | $ | 119   |   | $ | 1,222 |  
|                                                                        |  |   |       |   |   |       |  

6. ACQUISITION

On January 31, 2000, we completed the acquisition of Aseco Corporation, a Massachusetts-based manufacturer of singulated handling equipment for the
back-end of the semiconductor manufacturing process. The acquisition was structured as a stock-for-stock purchase and Aseco is now a wholly owned subsidiary of MCT.
The purchase price totaled $24.0 million, consisting of 2.6 million shares of our common stock valued at $22.5 million issued to former Aseco shareholders and $1.5 million
of acquisition-related costs.

The
acquisition was accounted for using the purchase method of accounting. The results of operations of Aseco are included in our consolidated financial statements beginning
January 31, 2000. The purchase price has been allocated based on the estimated fair values of net assets acquired at the date of acquisition. The excess of purchase price over net assets
acquired, amounting to $9.7 million, has been allocated to goodwill, and is being amortized using a straight line method over the estimated useful life of five years. Other intangible assets,
including established workforce, customer list, and core and developed technology, totaling $9.9 million, are being amortized using the straight-line method over the estimated
useful lives of two to five years. As a result of the industry downturn in the fourth quarter of 2000, we reduced the carrying values of goodwill by $2.5 million and intangible assets by
$0.9 million, due to impairment of these assets.

The
following unaudited pro forma information presents a summary of combined results of operations of MCT and Aseco as if the acquisition had occurred at the beginning of the prior
year period presented, along with certain pro forma adjustments to give effect to amortization of goodwill and other intangible assets as well as the adoption of SAB101 discussed in Note 2. The
pro forma information does not attempt to show how we would have actually

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performed on a combined basis had the companies been combined throughout this period. The following pro forma information, therefore, although helpful in illustrating the financial characteristics of
our combined company under one set of assumptions, does not attempt to predict or suggest future results.

(in
thousands, except per share data)

Three Months
Ended
July 1, 2000

Six Months
Ended
July 1, 2000Net revenues

$
14,413

$
22,988Net loss


(1,049
)

(5,910
)Net loss per share, basic and diluted


(0.09
)

(0.56
)


7. RECENT ACCOUNTING PRONOUNCEMENTS

In June 2001, the Financial Accounting Standards Board issued Statement on Financial Accounting Standards (SFAS) No. 141, Business Combinations, and
SFAS No. 142,Goodwill and Other Intangible Assets. SFAS
No. 141 eliminates the pooling-of-interests method of accounting for business combinations after June 30, 2001. SFAS No. 142 establishes new standards for
accounting for goodwill and intangible assets and will be adopted by the Company on January 1, 2002. Management has not completed its assessment of the impact the adoption of SFAS
No. 141 and 142 will have on the Company's financial position and results of operations.

On
January 1, 2001, we adopted SFAS No. 133,Accounting for Derivative Instruments and Hedging Activities, as amended by
SFAS No. 138,Accounting for Certain Derivative Instruments and Certain Hedging Activities. SFAS No. 133 establishes accounting and
reporting standards for derivative instruments and for hedging activities. It requires that all derivatives, including those embedded in other contracts, be recognized as either assets or liabilities
and that those financial instruments be measured at fair value. The accounting for changes in the fair value of derivatives depends on their intended use and designation. Management has reviewed the
requirements of SFAS No. 133 and has determined that we have no free-standing or embedded derivatives. All contracts that contain provisions meeting the definition of a derivative
also meet the requirements of, and have been designated as, normal purchases or sales. Our policy is to not use free-standing derivatives and to not enter into contracts with terms that
cannot be designated as normal purchases or sales.

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MICRO COMPONENT TECHNOLOGY, INC.  FORM 10-Q

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF  RESULTS OF OPERATIONS AND FINANCIAL CONDITION

The following discussion of our results of operations and financial condition should be read together with the other financial
information and condensed consolidated financial statements included in this document. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results
could differ materially from those anticipated in the forward-looking statements as a result of a variety of factors, including those discussed in "Risk Factors" and elsewhere in this
document.

Overview

We supply automation solutions for the global semiconductor test and assembly manufacturing market. Our solutions include automated test handlers, factory
automation software and our new integrated Smart Solutions product line. We believe that our products can significantly improve the productivity, yield and throughput of the back-end, or
to the post-wafer manufacturing process, including assembling, packaging, testing and singulating semiconductor devices.

The
demand for our products and services is dependent upon growth in the semiconductor industry and the increasing automation needs of semiconductor manufacturers and independent test
and assembly facilities. In the fourth quarter of 2000, the semiconductor industry went into a sharp downturn, which intensified throughout the first two quarters of 2001, resulting in a significant
adverse impact on our results for the second quarter and first six months of 2001. As a result of this downturn, we announced on February 21, 2001, plans to consolidate the manufacturing and
operation functions performed in our Marlborough, Massachusetts facility to our St. Paul, Minnesota facility, resulting in reductions in headcount, as well as other reduction initiatives which
resulted in a restructuring charge in the first quarter of 2001. This plan was later adjusted to transfer a portion of the manufacturing functions to our Penang, Malaysia facility. The resulting
restructuring charge from the consolidation of operations and cost reduction measures initiated in the first quarter of 2001 totaled $2.3 million. These charges principally represent employee
separation costs and costs related to idle facilities over the remaining lease term, which runs through April 2003. The restructuring plan is expected to be completed in 2001.

The
downturn resulted in fourth quarter 2000 charges for inventory write-downs of approximately $4.0 million and impairment of intangible assets and goodwill of approximately
$3.4 million, in addition to the first quarter 2001 restructuring charge of approximately $2.3, creating significant losses for the respective periods and decreasing our cash position. We
stated in our Form 10-K for the year ended December 31, 2000 and our Form 10-Q for the quarter ended March 31, 2001 that if the market downturn
continues to intensify or is prolonged, we may continue to incur significant cash losses and may incur additional charges for inventory write-down, asset impairment or restructuring, if
and when further actions or impairments are identified. It is our opinion that the market downturn will continue at least throughout the remainder of this year. Therefore, we will be examining the
potential for excess and obsolete inventories, impairment of intangibles and goodwill, severance costs related to workforce reductions, further consolidation of manufacturing operations and
facilities, as well as other

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strategic restructuring initiatives as a result of this downturn. The steps necessary to perform this quantification are dependent on market and product strategy and identification of the optimal
infrastructure for the company. We have begun the steps necessary to perform this analysis, which we expect to complete during the third quarter of this year. Subsequently, it is likely that, in the
absence of significant improvement in market condition, this process will result in related charges in the third quarter of 2001.

Acquisition of Aseco Corporation.On January 31, 2000, we completed the acquisition of
Aseco Corporation, a Massachusetts-based manufacturer of singulated handling equipment for the back-end of the semiconductor manufacturing process. The acquisition was structured as a
stock-for-stock purchase and Aseco is now a wholly owned subsidiary of MCT. The purchase price totaled $24.0 million, consisting of 2.6 million shares of our
common stock valued at $22.5 million issued to former Aseco shareholders and $1.5 million of acquisition-related costs.

The
acquisition was accounted for using the purchase method of accounting. The results of operations of Aseco are included in our consolidated financial statements beginning
January 31, 2000. The purchase price has been allocated based on the estimated fair values of net assets acquired at the date of acquisition. The excess of purchase price over net assets
acquired, amounting to $9.7 million, was allocated to goodwill, and is being amortized using a straight-line method over the estimated useful life of five years. Other intangible
assets, including established workforce, customer list, and core and developed technology, totaling $9.9 million, are being amortized using the straight-line method over the
estimated useful lives of two to five years. As a result of the industry downturn in the fourth quarter of 2000, we reduced the carrying values of goodwill by $2.5 million and intangible assets
by $0.9 million, due to impairment of these assets.

Results of Operations for the Three Months Ended June 30, 2001 and July 1, 2000

Net sales for the three months ended June 30, 2001, decreased $7.0 million or 48.6% to $7.4 million compared to $14.4 million for
the three months ended July 1, 2000. Product acceptance requirements related to product and customer mix resulted in a net increase to revenues over shipments in second quarter 2001, while
these same factors caused a large percentage of the revenue of second quarter 2000 shipments to be deferred into future periods. Current year product revenues, especially capacity related singulated
device handler products, were severely impacted by the downturn in the semiconductor capital equipment market. Sales of our Tapestry and Smart Solutions strip-based products increased
$1.3 million over the prior year period, while sales of singulated device handler products decreased $7.8 million. We expect net sales to continue to be adversely impacted by the market
downturn into the foreseeable future.

Gross
profit for the second quarter of 2001 decreased by $3.6 million to $3.2 million, or 43.0% of net sales, from $6.8 million, or 47.5% of net sales, for the
comparable period in the prior year. The decrease in gross margin in the current year period primarily resulted from the continued unabsorbed excess production costs associated with the industry
downturn and in particular excess production costs related to our singulated products. Gross margin contribution improved on our Tapestry and Smart solutions product as a result of their increased
sales levels over the prior year period. We expect gross margins to continue to be adversely impacted by the market downturn, partially offset by the benefits of the consolidation of manufacturing
operations

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initiated in the first quarter of 2001, which realization will not fully occur until the third quarter of 2001.

Selling,
general and administrative expense in the second quarter of 2001 was $2.9 million, or 38.7% of net sales, compared to $4.4 million, or 30.2% of net sales for
the second quarter of 2000. The decrease in expense for the current year quarter is a result of the cost reduction measures initiated in the first quarter of 2001. The increase in selling, general and
administrative expense as a percentage of net sales in the current year is primarily attributed to the decreased sales base in the current year period.

Research
and development expense for the second quarter of 2001 was $2.0 million, or 27.2% of net sales, compared to $2.2 million, or 15.6% of net sales in the second
quarter of 2000. The increase in research and development as a percentage of net sales in the current year is primarily attributed to the decreased sales base in the current year period.

Amortization
expense totaled $0.9 million, or 11.9% of net sales for the three months ended June 30, 2001, versus $1.2 million, or 8.1% of sales in the prior year
period. The absolute decrease is attributed to the reductions in carrying values of intangible assets and goodwill which were identified in the fourth quarter of 2000 due to the industry downturn.

Interest
income for the second quarter of 2001 was $41,000 compared to $23,000 in the second quarter of 2000. This increase resulted from the investment in interest-bearing cash and
cash equivalents of the net proceeds of our public offering in the third quarter of 2000. Interest expense totaled $2,000 in the current year's quarter, compared to $121,000 for the comparable period
in the prior year. The decrease in interest expense is attributed to decreased borrowings under the lines of credit during the current year quarter.

Net
loss for the quarter ended June 30, 2001 was $2.5 million or $0.18 per share, as compared to a net loss of $1.0 million, or $0.09 per share in the prior year
period.

Results of Operations for the Six Months Ended June 30, 2001 and July 1, 2000

Net sales for the six months ended June 30, 2001, decreased $5.9 million or 26.1% to $16.7 million compared to $22.6 million for
the six months ended July 1, 2000. Product acceptance requirements related to product and customer mix resulted in a net increase to revenues over shipments for the 2001 six month period while
these same factors caused a large percentage of the revenue in the six month period of 2000 from shipments to be deferred into future periods. Current year product sales, especially capacity related
singulated device handler products, continue to be severely impacted by the downturn in the semiconductor capital equipment market. Sales of our Tapestry and Smart Solutions strip-based products
increased $3.8 million over the prior year period, while sales of singulated device handler products decreased $9.1 million from the comparable prior year period. We expect net sales to
continue to be adversely impacted by the market downturn into the foreseeable future.

Gross
profit for the first six months of 2001 decreased by $4.4 million to $6.8 million, or 40.9% of net sales, from $11.2 million, or 49.4% of net sales, for the
comparable period in the prior year. The decrease in gross margin in the current year period primarily resulted from the

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continued unabsorbed excess production costs associated with the industry downturn and in particular excess production costs related to our singulated products. Gross margin contribution improved on
our Tapestry and Smart Solutions products as a result of their increased sales levels over the prior year
period. We expect gross margins to continue to be adversely impacted by the market downturn, partially offset by the benefits of the consolidation of manufacturing operations initiated in the first
quarter of 2001, which realization will not fully occur until the third quarter of 2001.

Selling,
general and administrative expense for the first six months of 2001 was $6.2 million, or 36.8% of net sales, compared to $7.5 million, or 33.1% of net sales for
the first six months of 2000. The increase in selling, general and administrative expense as a percentage of net sales in the current year is primarily attributed to the decreased sales base in the
current year period.

Research
and development expense for the first six months of 2001 was $4.9 million, or 29.3% of net sales, compared to $4.1 million, or 18.2% of net sales for the first
six months of 2000. The increased spending in the current year is due to the inclusion of Aseco research and development costs in the full six months of 2001 versus five months in the prior year. The
increase in research and development as a percentage of net sales in the current year is primarily attributed to the decreased sales base in the current year period.

Amortization
expense totaled $1.8 million, or 10.5% of net sales for the six months ended June 30, 2001, versus $2.0 million, or 8.7% of sales in the prior year
period. The absolute decrease is attributed the reduction in carrying values of intangible assets and goodwill which were identified in the fourth quarter of 2000 due to the industry downturn.

The
restructuring charges resulting from the consolidation of operations and cost reduction measures initiated in the first quarter of 2001 totaled $2.3 million. This charge
principally represents employee separation costs and costs related to idle facilities over the remaining lease term, which runs through April 2003. The restructuring plan is expected to be
completed in 2001.

Interest
income for the six month period was $153,000 compared to $44,000 in the first six months of 2000. This increase resulted from the investment in interest-bearing cash and cash
equivalents of the net proceeds of our public offering in the third quarter of 2000. Interest expense totaled $4,000 in the first six months, compared to $159,000 for the comparable period in the
prior year. The decrease in interest expense is attributed to decreased borrowings under the lines of credit during the current year quarter.

Net
loss for the six-month period ended June 30, 2001 was $8.2 million or $0.58 per share, as compared to a net loss of $3.8 million, or $0.36 per
share in the prior year period.

Liquidity and Capital Resources

The net loss and reductions in accounts payable and other accrued liabilites were the primary uses of cash for the six month period ended June 30, 2001.
The net loss and increases in working capital assets to support the business growth were the primary uses of cash in first six months of

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the prior year. Cash used in operations was $9.7 million for the six month period ended June 30, 2001 and $3.9 million in the comparable prior year period.

Capital
expenditures totaled $134,000 during the six months ended June 30, 2001, versus $161,000 in the comparable period of 2000. Capital purchases were for specialized
manufacturing and computer equipment in the current year period and primarily for computer equipment in the prior year period.

Cash
used in the acquisition of Aseco was $0.4 million in the six month period ended July 1, 2000.

At
June 30, 2001, we had cash and cash equivalents of $2.3 million, a current ratio of 3.1 and working capital of $17.0 million. At December 31, 2000, we
had cash and cash equivalents of $12.0 million, a current ratio of 2.5 and working capital of $22.3 million.

At
June 30, 2001 we maintained an unused $1.0 million secured line of credit with a bank. Interest on the line, at our election, is based on either the bank's prime rate
or Eurodollar rate. The amount available for borrowing is calculated as a percentage of eligible accounts receivable of Aseco, and borrowings are secured by a certificate of deposit with the bank.

Our
anticipated capital needs for the next twelve months are expected to be less than $1.0 million and concentrated in development of additional products and upgrading our
management information systems. As previously discussed, the market we service is experiencing a significant, protracted downturn, which has caused us to incur significant losses and has reduced our
cash and working capital position. We have and will continue to implement cost reduction measures and restructure our operations in response to this downturn to minimize the impact to our working
capital positions. We believe that cash and cash equivalents on hand at June 30, 2001, funds available through our existing bank line and establishing additional lines of credit, if necessary,
are sufficient to finance our continuing operations at the significantly reduced levels, for the foreseeable future, but that a prolonged or intensified market downturn, one or more additional
business acquisitions or unforeseen changes in market conditions could cause us to seek additional financing sooner. We may acquire other companies, product lines or technologies that are
complementary to our business and our working capital needs may change as a result of such acquisitions.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The vast majority of our transactions are denominated in U.S. dollars; as such, fluctuations in foreign currency exchange rates have historically had little
impact on us. Inflation has not been a significant factor in our operations in any of the periods presented, and it is not expected to affect operations in the future. Our bank line of credit carries
a variable interest rate. At June 30, 2001, we had no borrowings on our credit line; however, the need to borrow in the future could expose us to interest rate risk. At June 30, 2001,
all of our outstanding long-term debt carries interest at a fixed rate. There is no material market risk relating to our bank lines or long-term debt.

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IMPACT OF ACCOUNTING STANDARDS

In June 2001, the Financial Accounting Standards Board issued Statement on Financial Accounting Standards (SFAS) No. 141, Business Combinations, and
SFAS No. 142,Goodwill and Other Intangible Assets. SFAS
No. 141 eliminates the pooling-of-interests method of accounting for business combinations after June 30, 2001. SFAS No. 142 establishes new standards for
accounting for goodwill and intangible assets and will be adopted by the Company on January 1, 2002. Management has not completed its assessment of the impact the adoption of SFAS
No. 141 and 142 will have on the Company's financial position and results of operations.

On
January 1, 2001, we adopted SFAS No. 133,Accounting for Derivative Instruments and Hedging Activities, as amended by
SFAS No. 138,Accounting for Certain Derivative Instruments and Certain Hedging Activities. SFAS No. 133 establishes accounting and
reporting standards for derivative instruments and for hedging activities. It requires that all derivatives, including those embedded in other contracts, be recognized as either assets or liabilities
and that those financial instruments be measured at fair value. The accounting for changes in the fair value of derivatives depends on their intended use and designation. Management has reviewed the
requirements of SFAS No. 133 and has determined that we have no free-standing or embedded derivatives. All contracts that contain provisions meeting the definition of a derivative
also meet the requirements of, and have been designated as, normal purchases or sales. Our policy is to not use free-standing derivatives and to not enter into contracts with terms that
cannot be designated as normal purchases or sales.

RISK FACTORS

Except for the historical information contained herein, certain of the matters discussed in this report are "forward-looking statements" as defined in the
Private Securities Litigation Reform Act of 1995. These "forward-looking statements" involve certain risks and uncertainties, including, but not limited to, the following: (1) the prolonged or
intensified downturn in the semiconductor market which often has had a disproportionately negative impact on manufacturers of semiconductor capital equipment, and which could cause us to continue to
incur significant cash losses decreasing our cash and expose us to potential further charges for restructuring, excess and obsolete inventory and/or impairment of assets; (2) rapid changes in
technology and in tester and handler products, which we must respond to successfully in order for our products to avoid becoming noncompetitive or obsolete; (3) customer acceptance of our new
products, including the strip-based Tapestry handling systems and Smart Solutions products, and MCT 5117 and S900 singulated device handler products in which we have invested significant amounts of
inventory; (4) possible loss of any of our key customers, who account for a substantial percentage of our business; (5) the possible adverse impact of competition in markets which are
highly competitive; (6) the possible adverse impact of economic or political changes in markets we serve; and (7) other factors detailed from time to time in our SEC reports, including
but not limited to the discussion in the Management's Discussion & Analysis included in Form 10-K for the year ended December 31, 2000. All forecasts and projections
in this report are "forward-looking statements," and are based on our current expectations of our near-term results, based on current information available pertaining to us, including risk
factors discussed above. Actual results could differ materially.

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MICRO COMPONENT TECHNOLOGY, INC.

FORM 10-Q    PART II. OTHER INFORMATION

Item 4. Submission Of Matters To A Vote Of Security Holders



Roger Gower
David M. Sugishita
Dr. Sheldon Buckler

D. James Guzy
Donald R VanLuvanee

Donald Kramer
Patrick Verderico




Item 5. Other Information



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Item 6. Exhibits and Reports on Form 8-K



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MICRO COMPONENT TECHNOLOGY, INC.    FORM 10-Q

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.

|                       |  | MICRO COMPONENT TECHNOLOGY, INC.Registrant
|---------------------- |  | ------------------------------------------
|Dated: August 14, 2001 |  | By:                                       
|                       |  | And                                       
|Dated: August 14, 2001 |  | By:                                       

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