Nanometrics

(NANO) - Get Report

was diving in premarket Instinet trading after the company said its fourth-quarter revenue would fall 25% sequentially.

The company's shares were down 14.9% to $21.20 in trading before the opening bell.

The company previously expected that the top line would be flat with the third quarter. Nanometrics, a maker of equipment used for producing integrated circuits, flat panel displays and magnetic heads, attributed the shortfall to continuing overcapacity in the semiconductor industry and economic deterioration in the U.S. and Japan.

"The current demand for all semiconductor equipment continues to show significant weakness, which has been reflected in all companies in our industry," Nanometrics said in a press release. "While we remain optimistic about our products and technology, our customers are still trying to sort out the overcapacity and reduced demand for semiconductors."