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Forward-looking statements address matters that are subject to a number of risks and uncertainties that can cause actual results to differ materially. Such risks and uncertainties include, but are not limited to those described in today's news release, and in the company's Forms 10-K, 10-Q and other filings with the SEC. The company assumes no obligation to update the information provided in this conference call.On another note, the management of Mattson Technology will be marketing with the investment community throughout the third quarter. They will be participating in the Oppenheimer Conference in Boston on August 10, and we will be marketing in New York, August 11; and the mid-Altantis, August 12. In addition, they will be participating in a Silicon Valley bus tour sponsored by Caris & Company on September 1, and the Rodman & Renshaw Conference being held in New York, September 13 through September 15. Lastly, they will be marketing in Cleveland and New York, September 22 and September 23, respectively. If you are interested in meeting with management during any of these events or cities, please contact me at 808-882-1467. And with that, I'd like to turn the call over to Andy. Andy? Andy Moring Thank you, Laura, and welcome to our second quarter 2010 conference call. After I review the financial performance and give guidance, Dave will comment on the business and then we'll open up the call for Q&A. Mattson is clearly transitioning from the technology phase of the cyclical upturn into a more capacity-driven phase of the cycle. We have seen a lighter set of customers ordering our core products for delivery in the second, third, fourth quarters, which is indicative of capacity expansion. During the second quarter, Mattson continued the trend of double-digit sequential growth in our business with a 27% increase quarter over quarter. Revenues were at the top end of our guidance and there was a broad-based buying of our core strip and RTP products from a number of customers.
Equally important, our etch business continues to grow as we shipped the remainder of our previously announced paradigmE order and announced additional orders for that product. Combined with our Alpine Etch product, we will soon have a dozen etch tools in production and several more in evaluation at multiple customers. Our positive momentum in etch is continuing and provides us an opportunity to outgrow the rest of the sector as this upturn progresses.Operationally, in addition to the growth in revenue, our loss per share was within guidance. Cash and gross margins were not within our expectations but we feel confident that we have reached the trough of our cash level and then margins will recover to acceptable levels as we achieve higher production volumes. We have also announced today that we have filed a Form S-3 shelf registration statement with the SEC for a $75 million universal shelf. As you may know, these filings are relatively common and are valid for up to three years. The purpose of the filing is to provide Mattson with increased flexibility for the strategic growth of the company. There are currently no plans to execute any financing options detailed in the filing. Here are the key points relative to our financial performance for the second quarter. 45% of our new tool revenue this quarter was for etch products. We are now recognizing revenue on all etch tools as they ship due to customer acceptance of the first tool. Margins were below our expectations this quarter due to product mix in the strip business and introduction cost for the etch products. While these factors may delay our breakeven revenue point in the short term, we feel they are temporary and should not seriously impact the long-term profitability of the company. Operating expenses increased 4% from last quarter, primarily due to engineering and new product related costs. Operating expenses will continue to be closely monitored and will be maintained at around the $19 million level. Read the rest of this transcript for free on seekingalpha.com