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inTEST
13^TH ANNUAL NEEDHAM GROWTH CONFERENCE


ROBERT E. MATTHIESSEN
PRESIDENT AND CEO
HUGH T. REGAN, JR.
CFO
JANUARY 13, 2011


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SAFE HARBOR STATEMENT

This presentation contains forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. These statements are based upon management's current expectations, and are subject to risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by these forward-looking statements.


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inTEST - PROFITABLE NICHE POSITION

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COMPANY HIGHLIGHTS

• History of success with blue chip customers
• Increasing diversification into non-traditional markets: Automotive, Medical, Military/ Aerospace, Industrial and Telecommunications
• Lean operating structure / cost base provides high leverage
• Defensible intellectual property base provides competitive advantage and is a barrier to entry
• Healthy balance sheet to support growth

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WHY TEST IS CRITICAL

• Defect Inspection
• Lower Manufacturing Costs; Improved Customer Yields
• Increased Customer Profit

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PATENTS SUPPORT STRONG MARGINS

• 43 active U.S. patents
• 3 new patents awarded in 2010
• 16 U.S. patents pending
• Hold corresponding foreign patents
• Underscores strength of inTEST's technology
• Competitive advantage with defensible IP base
• Provides customers extra measure of confidence

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INNOVATION - M & A & ORGANIC GROWTH

Investments in technology and successful acquisitions lead to new markets, revenue and margin expansion

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GROWTH OPPORTUNITIES

• Sigma Systems - Increased traction / market share in Asia and Europe
• Facilities relocation - Lower OpEx will save app. $0.05 EPS (annual)
• License certain Intellectual Property
• Organic growth of existing businesses
• Acquisition of additional technology / businesses
• Compatible Expertise / Mission Critical
• Increase Market Share
• Drive Margins
• Leveling of Business Curve - Mitigate Cycle Vagaries
• Accretive

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NON-SEMI: M & A, TRENDS DRIVE DIVERSIFICATION

• Acquisition of Sigma Systems further diversified Thermal Division into non-semiconductor markets
• Major non-semiconductor customers now in Automotive, Medical, Military/Aerospace, Industrial and Telecommunications
• Benefiting from manufacturers' requirements to verify operation of products at set temperatures
• Production solutions often require customization in order to maximize manufacturing efficiencies
• Electronic Sensors now proliferate many industries and applications. Their small size is suited for testing by inTEST's ThermoStreams and Thermal Platforms
• inTEST leads the domestic microwave thermal testing market, with a significant opportunity for Thermal Platforms in Asia and Europe

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inTEST SERVED MARKETS

Number 1 or 2 in Each Target Segment 15% - 50% Market Share*

• Semiconductor manufacturers - End Users
• Production Floor / Test Facilities / Laboratories
• ATE equipment suppliers - OEM
• Penetrating new markets: Automotive, Aerospace, Medical and Telecommunications

* These estimates represent management's best estimate of inTEST's market share based upon management's knowledge of the industry, given that no reliable information of market size exists.

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SEMICONDUCTOR MARKET

• 2010 - Semiconductor market rebounded from global economic downturn.
• 2010 - INTT three strong profitable quarters. Most companies saw a brief pause in December quarter to digest channel inventory levels.
• Consensus view - Overall improving economy. New applications (smart-phones, cloud computing and mobile applications) will drive higher demand levels in 2011.
• Diversification - inTEST expects to benefit from incremental demand in non-traditional semiconductor segments, including automotive and military sectors.

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inTEST MARKET SEGMENTS

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MECHANICAL PRODUCTS SEGMENT

Manipulator - 15% estimated market share*
Docking Hardware - 50% estimated market share*

* These estimates represent management's best estimate of inTEST's market share based upon management's knowledge of the industry, given that no reliable information of market size exists. 

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ELECTRICAL PRODUCTS SEGMENT

35% estimated market share*

* These estimates represent management's best estimate of inTEST's market share based upon management's knowledge of the industry, given that no reliable information of market size exists.

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THERMAL PRODUCTS SEGMENT

Semiconductor Test Market
ThermoStreams & ThermoChucks
40% estimated market share*

* These estimates represent management's best estimate of inTEST's market share based upon management's knowledge of the industry, given that no reliable information of market size exists.

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THERMAL PRODUCTS SEGMENT

Electronic Test Market - $170 million*
Chambers, Thermal Platforms, Mobile Temp
6% estimated market share*

* Estimated 2008 market based on Frost & Sullivan's Environmental Test Market Report.

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TYPICAL IC TESTING SYSTEM

Picture of: [picture omitted]

Positioner (Manipulator)
Test Head
Docking Hardware (Test Head)
Interface Board
Test Socket (Handler)
Prober Interface
Docking Hardware (Handler)
Test Site
Handler/Prober

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CUSTOMER BASE

Top 10 Customers contribute 50% of Total Sales

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END USER CUSTOMER BASE

Texas Instruments
Intersil
NXP
Sony
Analog Devices
ST
Delphi
Finisar
Intel
National Semiconductor
STATSChipPAC
IBM
Cypress
Xilinx
Freescale Semiconductor
LSI
NEC
Philips

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OEM CUSTOMER BASE

LTX Corporation
Teradyne
Verigy
Tokyo Electron
Accretech
Credence
Agilent Technologies
Cascade Microtech
COHU, Inc.

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FINANCIAL OVERVIEW

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OPERATING MODEL

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Q3 2010 RESULTS

• Net revenues of $11.3 million
• $15.3 million in 2Q10 and $6.0 million in 3Q09
• Net income of $1.7 million, or $0.17 per share
• 2Q10 net income of $3.2 million or $0.31 per share
• 3Q09 net loss of $(278,000), or $(0.03) per share
• Bookings of $9.8 million
• $12.2 million in 2Q10 and $7.9 million in 3Q09
• Cash & cash equivalents increased to $6.2 million at 9/30/10
• $3.1 million at 6/30/10
• 1^st nine months 2010: Revenue of $36.1 million and net income of $0.59 per share
• Revenue of $15.1 million and net loss of $(0.50) in 1^st nine months of 2009
• Materially higher results for 2010 1^st nine months compared with year ago period, despite recent sequential decline in bookings and revenue

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STRONG GROSS MARGIN

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FURTHER STRENGTHENED BALANCE SHEET

Expect cash and cash equivalents to further increase by approximately $3.0 million in 4Q10 before the impact of principal payments on the $1.5 million in notes payable related to the Sigma Systems acquisition in 2008.

* Notes fully retired December 1, 2010

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REVISED 4Q10 GUIDANCE (JANUARY 10, 2011)

• Net revenue now expected to be app. $10 million
• Revision from net revenue guidance in the range of $8.8 million to $9.5 million (November 3, 2010)
• Bookings now expected to be app. $11.5 million, which exceeds Q310 bookings of $9.4 million.
• Pre-tax income now expected to be in the range of $0.08 to $0.10 per diluted share
• Pre-tax income guidance is based upon current expectations and may be subject to change due to audit adjustment

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inTEST - ENTERPRISE VALUATION

As of 12/30/2010

* First Call Consensus Estimates

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POSITIONED FOR GROWTH

• Generating Profits & Cash / No Debt
• Test Solutions Driving Higher Profits
• Strong Intellectual Property Portfolio
• Thermal Technology Diversification
• Broad Customer Base
• Lean Operating Structure
• Operational Efficiencies Driving Higher Gross Margin
• Consolidation in ATE (fewer companies to invest in)