Varian Semiconductor Equipment Associates Amends Its Existing Stock Repurchase Program

Varian Semiconductor Equipment Associates, Inc. (NASDAQ: VSEA) today announced that its Board of Directors amended its existing stock repurchase program by increasing the amount of funds that may be expended in repurchasing Varian Semiconductor's common stock from $100,000,000 to $200,000,000. To date, cash expenditures for stock repurchases under the existing stock repurchase program have amounted to approximately $87,000,000. Subject to the $200,000,000 limitation, of which approximately $113,000,000 remains available for repurchases, the timing and quantity of any stock repurchases will be at the sole discretion of Varian Semiconductor.

"At current levels, we believe the company's stock is attractively valued," said Dick Aurelio, chairman of the company's board of directors. "This action reflects our ongoing commitment to improving the investment value of our stock while at the same time profitably growing our business."

The stock repurchases may be made from time to time on the open market. The timing and amount of any shares repurchased will be determined by Varian Semiconductor's management based on its evaluation of market conditions and other factors. Repurchases may also be made under a Rule 10b5-1 plan, which would permit shares to be repurchased when Varian Semiconductor might otherwise be precluded from doing so under insider trading laws. The repurchase program may be suspended or discontinued at any time. Any repurchased shares will be available for use in connection with its stock plans and for other corporate purposes.

The repurchase program will be funded using Varian Semiconductor's working capital. Varian Semiconductor had approximately 55.2 million shares of common stock outstanding as of August 1, 2006.

About Varian Semiconductor

Varian Semiconductor Equipment Associates, Inc. is the leading producer of ion implantation equipment used in the manufacture of semiconductors. The Company is headquartered in Gloucester, Massachusetts, and operates worldwide. Varian Semiconductor maintains a web site at www.vsea.com. The information contained in the Company's web site is not incorporated by reference into this release, and the web site address is included in this release as an inactive textual reference only.

Note: This release contains forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. For this purpose, the statements concerning the Company's performance, market share and technology leadership, technological capabilities and benefits are forward-looking statements and any statements using the terms "believes," "anticipates," "expects," "plans," or similar expressions are forward-looking statements. There are a number of important risks and factors that could cause actual events to differ materially from those suggested or indicated by such forward-looking statements. These include, among others, volatility in the semiconductor equipment industry; economic conditions in general and as they affect the Company's customers; significant fluctuations in the Company's quarterly operating results; the impact of rapid technological change; the Company's dependence on the development and introduction of new products; the Company's concentration on ion implantation systems and related products; concentration in the Company's customer base and lengthy sales cycles; the highly competitive market in which the Company competes; risks of international sales; foreign currency risks; and general economic conditions; and other factors identified in the Company's Annual Report on Form 10-K, and the most recent Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission. The Company cannot guarantee any future results, levels of activity, performance or achievement. The Company undertakes no obligation to update any of the forward-looking statements after the date of this press release.