Good afternoon. At this time, I would like to welcome everyone to the third quarter earnings release conference call. (Operator Instructions) At this time, I'd like to turn the call over to ADC's Manager of Investor Relations, Mr. John Oberle.

Good afternoon and thank you for joining us today. Bob Switz, ADC's Chairman, President and CEO, and Jim Mathews, ADC's CFO, are with me today. Before we start, I would like to remind you that today's conference call contains forward-looking statements and that future events and results could differ materially from the forward-looking statements made today. Actual results may be affected by many important factors, including risks and uncertainties identified in our earnings release and in the risk factors included in Item 1A of ADC's annual report on Form 10-K for the fiscal year ended October 31, 2008, Item 1A of ADC's quarterly report on Form 10-Q for the fiscal quarter ended January 30, 2009, and as may be updated in item 1A of ADC's subsequent on Form 10-Q or other reports filed with the SEC. This earnings release can be accessed at the Investor Relations section of ADC's Web site at www.ADC.com. ADC's comments will be on a continuing operations and GAAP basis. Bob will provide an update on ADC's business developments and highlights. Jim will cover the financial results and provide forward-looking financial guidance for our fourth quarter of fiscal 2009. I will now turn the call over to ADC's Chairman and CEO, Bob Switz.

Welcome everybody to today's call. First, I would like to share a few highlights from our third quarter and provide some further insights into the fundamental changes which ADC has made to our operations over the past year. I will also provide an update on the current market landscape and let you know where we see areas of strategic market opportunity for ADC as we come to the end of our fiscal 2009. Our full results this quarter show that we continue to make very good strategic progress, despite the challenges of the global macroeconomic climate. We believe these results show the positive impact of the actions we have taken to transform our business, strengthen our competitive position, and improve our financial performance. We are pleased that our third quarter results achieved, and in some cases exceeded, our prior guidance. For example, in the quarter we delivered sequential improvements in revenue and margins, strong positive free cash flow of over $40.0 million, and better than expected earnings. We improved our already strong balance sheet, ending the third quarter with $562.9 million in cash, cash equivalents, and available for sale securities. While sequential revenue improvement in the quarter was relatively modest, as we had expected, we delivered better than expected profitability, reflecting the success of the aggressive changes that we've made to our operations over the past year. These are not simply expense cuts or deferments. Moving forward, we expect to continue benefiting from the sustainable operational leverage we are creating through transformational restructuring initiatives. ADC remains focused on driving continuous improvement throughout the organization. We are further streamlining our operations to increase efficiency and deliver products and services more effectively to our customers worldwide. Some of our specific initiatives include improving our productivity and increasing capacity without adding incremental fixed…

First of all, I will run through our third quarter results in some detail and then I will provide guidance for our fourth fiscal quarter, which comprises only the months of August and September this year due to our pending fiscal year end change to September 30. There are some specific challenges in estimating results for this two-month period and I want to walk through these as we discuss Q4 guidance for the sub period. So starting with our third quarter financial results, sales of $283.0 million declined 25.8% year-over-year but were up 3% sequentially from the second quarter of 2009. Revenue in our global connectivity solution segment grew 3.4% sequentially, our professional services business grew 5%, and network solutions revenue was slightly lower than in the second quarter. Gross margins for the quarter were 34.8%. This compared to margins of 32.8% in the second quarter and 34.2% in last year's third quarter. The increase in margins sequentially is driven mainly by the cost actions taken since the beginning of the fiscal year. Versus the prior year, these cost actions more than offset the negative impact of lower revenues on our gross margins. Total operating costs in the quarter were $85.6 million. This includes $5.5 million of purchased intangible amortization, $5.4 million of restructuring and impairment costs, and approximately $3.2 million of one-time operating expense benefits. Therefore, on an adjusted basis, our operating expenses were approximately $77.9 million, which decreased $18.1 million from last year and were flat with the prior quarter. Selling and administrative expense was $66.9 million in the third quarter and R&D expense was $17.3 million, both flat with our last quarter. These costs were significantly lower than the third quarter of last year as the result of previously announced cost reduction actions combined with lower incentive…

(Operator Instructions) Your first question comes from Steven O'Brien - J.P. Morgan.

On the two month quarter here and what Jim was just saying about how had you been guiding to October it would have been down, as far as normal, 6% to 7% quarter-over-quarter. If I look back, based on the 8-Ks you provided, it seems like that the first two months were typically about somewhere around 58%, 59% of the October quarter revenue. So if I took the midpoint of the new two quarter guidance, which would be about $168.0 million, and apply that 58%, I would be looking more at a revenue figure somewhere in the high $280.0 million to $290.0 million, which would actually be flat to up, quarter-over-quarter. Is there something about these two months or the past that doesn't make that math work here?

I'm probably going to leave everything I said pretty much alone because I think we may end up in a level of detail here that is not helpful. And I don't mean to not answer your question, by any means. But let me point out that we—we report on a 4-4-5 week basis, so in going back historically, we're not trying to sort out a month with a week that is split between September and October, where historically it was all in October. Secondly, if you take last year and if you do anything that involves last October, it's going to be very distortive because that was really before we started to see the very, very sharp fall-off in revenue. So I think if you try to take any of these measures and adjust them based on a specific month or a specific two-month period, even though we've put those in our 8-K, you have to take into effect both a shift from a 4-4-5 pattern to one that now splits that ninth week this year, and you also have to take into account that last October was a very, very strong month for us.

I guess looking out at the margins here, and on the guidance, if I got that right, the gross margin, or margin in general, should be more or less flat next quarter. Is high 34%, 35% in gross margin something that you expect to see going out longer term in 2010? Is there any change in sort of the pricing environment and lastly, what percentage of manufacturing is now being done in low-cost regions, and are there any other areas, or is there any room for more of that to shift to lower cost regions, and any other areas that help the gross margin.

I'm going to take some of that question and Jim's going to take some, because that was a question big enough for two. One answer is we are somewhat encouraged that we can see margins similar to this. A lot is going to depend to some degree on the competitive environment in 2010 relative to price reductions and price pressure to win new business. We think we have plans in place that handle that. The other aspect of it is, we are in continual migration to improve our manufacturing efficiencies and so not everything yet is in low-cost sites. I don’t have an exact percentage at hand as to how much is, but I would say today, excluding what we outsource in our wireless business, the bulk of our manufacturing does take place outside of the United States. And I'm going to guess at a percentage and Jim can correct me if he's got a more accurate one, but I'm going to say around 65% to 70% today is done at low-cost sites.

People, on a per-person basis, it's close to 80%, and you're correct, we had been around 55% in costs of manufacturing overseas, and it's now moving toward that 60% to 65% range.

And we made some announcements here just recently about further restructuring. Some of the references made to improvements in cost of goods sold, so some of that does involve continued movement to low-cost sites. I could envision a world where we are continuing to work on this in a fairly significant way over the next 24 months. And it doesn't necessarily end there in the sense that as we looked at the current configuration of where things get manufactured, what is taking product from high-cost to low-cost region. There's another phase of this that may take it from low-cost to lowest-cost, depending on a number of factors. So there could be products today that get produced in Mexico or the Czech Republic that ultimately get manufactured in China for global distribution, etc. So there is an evergreen aspect to this. At least over the next 24 months, in terms of manufacturing location shuffle. And then there's the other thing that I mentioned, and Jim did, too, I think, which is a lot of new methodology inside the company. You know, we have come up on lean Six Sigma pretty quickly, and we're going to see benefits currently from that and we believe over an extended period of time we're going to continue to see the benefits of that in not cost of goods sold, but also in other parts of the business as well. Jim, would you care to add more?

I think that nails it.

Your next question comes from Paul Silverstein - Credit Suisse.

On the margin issue, and I heard your response on the previous question, but Bob, last quarter you and Jim guided for flat margins, and I believe opex of $85.0 million to $86.0 million. You delivered the opex, the GAAP opex, and yet your margins came in a few hundred basis points better, so the obvious question is, is this just sandbagging when you tell us you expect flat margins again, why should a reasonable person assume that you're actually going to come in better, no different than this quarter, where you had essentially 200 basis points of upside, notwithstanding you did exactly what you had expected from an expenditure standpoint. And I understand they're two different issues, opex and gross margin, but you certainly nailed one and the other you came in very [inaudible].

First of all, you're not complaining about better margins are you?

Certainly not.

And you've known me for a long time and you know I'm not a sandbagger. Let me do the best I can to explain the black magic there. In gross margins, there's a lot of complexity. As well as timing of events that go into the gross margin performance. So on the functional area, it's something that we have a little more control over, both in terms of predictability and execution. So it's a little more manageable. In terms of gross margins, don't forget, we had a lot of stuff going on that we started some time ago, maybe as late as last year, working through the system. And then we took initial actions over the course of this year. We, as I mentioned, have implemented a number of process changes through lean Six Sigma, to some extent, being able to precisely calculate in kind when all that is going to flow through the P&L. It's not that easy, okay? So just like we've cautioned you from time to time, when we've given you a goal of increasing margins, we've said we might not quite be there in quarter "x" because of timing and our ability to implement to implement a lot of these actions. And the same is true on the other side. And what we did see was a lot of positive benefit of the cost reduction actions flow through the P&L during the quarter. So we don't want to sandbag. We want to, as we have in the past, do the best job we can at forecasting our financials, but I do want to caution you, we have a lot of moving parts inside this company, with all of the restructuring that we've got going on, both in the functional expense area, go-to-market area, in our manufacturing and support operations. So it's very complex and we're trying to manage it as best we can, without any negative consequences. So I guess the best I can say is that in this case we saw some positive benefits in terms of our estimate relative to actual.

I just want to make sure I understand, obviously you ability and timing are two different issues, so as we look out farther beyond the quarter, and I recognize you're in an environment that really lend itself to very much visibility, even in the current quarter, but that being said, when you think about longer time period, again, should we expect further improvement with the issue just simply being a matter of timing, or is there also some ability questions still in your mind, in terms of delivering improvement?

You're going to get my answer and Jim's as well. I am optimistic that over time we have the ability to hold and improve margins. Let's just put it that way. We have enough going on, I think, that we can expect to see some of those benefits continue to accrue. The thing that we haven't taken into account, necessarily, given the dire economic times, as volume returns, we should get the benefit of volume and so that's certainly a plus to the upside on improving margins. The other variable is what's the mix going forward and what is the pricing environment. Copper, as a part of our business, will continue to go down, as a component. As you know, that's high gross margin. But I think, from my standpoint, and I want Jim to comment, and if he sees flaws or disagrees with anything I say to comment on it, but I think that we're optimistic that we can continue to make gains for some period of time.

I will add one observation. I think you noted that we kind of nailed it on opex. I think we did. I think we may have come in a little bit better than we expected to. But I would where say a lot of the gross margin improvement was that is very tough to predict is because that's generated by savings in our operations, where we have taken a lot of actions knowing exactly how those are going to flow through into the cost of goods sold is a lot tougher to predict than is opex itself. And we've got actions going on all around the world, and probably we were able to ramp some of those sooner than we thought we would be able to. We did major restructuring actions last November, again in February, all before we announced this global restructuring beginning in July and then more recently. So we've had a number of sort of waves of actions going on and trying to predict exactly how all of those will flow into cost of goods sold has been a pretty tough call.

I think I hear you say core fiber was up 11% sequentially. What was your FTTX business up?

Up 3%.

If FTTX was up 3% and the core fiber comment, was that your global core fiber business, or just the Americas core fiber business.

Just America's.

What figure is non-America's core fiber business? What did that do?

It's up 5% globally.

So core fiber was up 5% globally?

Correct.

All right, so I can back it out. I'll pass it on.

And just to put that global thing in perspective, around core fiber, as you know EMEA was a big market for us last year and generated significant growth as it did in 2007 in fiber and that's a market that hasn't bottomed out yet. So that's taken away some of the upside we've seen in the U.S.

Your next question comes from Amir Rozwadowski - Barclays Capital.

If we talked about the gross margin stability, how should we think about opex run rate levels right now? You had mentioned that there were some adjustments made to accruals this year from a compensation perspective. Would we expect those to come back or to shift in the following year?

I need to take back to the beginning of this year because what we indicated earlier this year was that we hoped to achieve, by the end of fiscal 2009, an $80.0 million run rate in adjusted opex. We have obviously bettered that. We were a little under $78.0 million this quarter. What I will tell you is that next year there are some headwinds. I mean, you've got the normal inflationary impact on salaries and certain other costs. We also, as you can imagine in a year like this, the incentive payouts are pretty modest and we would expect those to hopefully come back next year. So if you take those headwinds, you're looking at something on the order of $3.0 million to $3.5 million per quarter of headwinds. So that would obviously put us right back into sort of low-80ish range. We think with the savings that we've announced and that we're continuing to push through, we'll get those back under $80.0 million sort of mid-to-late next year in opex.

If we think about some of the additional initiatives that you had discussed, sort of fiber to the base station, some international FTP wins, how should we think about that in the context as Verizon potentially decreases its spending on its fiber plan. Do you expect them to fill that hole or where is the visibility on some of those initiatives, because they seem to be fairly material initiatives, but just trying to get a context in terms of timing and sort of visibility.

As you know, going back quite some time, when we forecasted the life cycle and the growth pattern of Verizon FTTP, we always suggested that it was our belief and hope that as Verizon started to mature, we would see the international market come on and basically provide some added lift to FTTP growth. And I think I could still say that, with one caveat. It's how granular do you want to get on when that's going to happen. Let me back up a second and say, absent the financial crisis and global recession, I think I would be telling you we would start to see that in our fiscal 2010. Since the financial crisis, global recession, we have seen a lot of the folks that were more advanced than their thinking around this, pull their horns in a bit and slowdown. And so it's not that it's not going to happen, I think it's been delayed a little bit by some because of that. In other cases there is still some wrangling over regulatory types of considerations before people decide to move forward and invest money in those assets. They want to make sure that they're their assets only. So I would say, coming off of 2009, there is the opportunity for renewed growth in FTTP, from both international and potentially stimulus spending in the U.S. The question is how fast. Do we really start to see that in a meaningful way in 2010? I would say right now I'm sure that's in the cards. I think we will see some. If it really starts to happen, I think it's going to be in the latter calendar half of 2010. I am much more confident about both the international and the stimulus coming into play in a more meaningful way in 2011. So are there some things that could pull it forward in 2010? Yes, but I think it's probably going to be mid-to-late year before we start seeing some of that. You know, we have been in trials, we've won spec position in some cases. I mean, there's real activity there, it's simply a matter of those customers finally making the commitment to spend the money, feeling comfortable both financially and from a regulatory perspective. So I think there's opportunity for growth off of 2009. Does it happen in 2010 or does it happen in 2011? That would be my assessment.

Greater than 10% customers?

We had two. Both AT&T and Verizon were in the high teens, hovering close to 20%.

Your next question comes from Simon Leopold - Morgan Keegan.

You provided a lot of good data on a pro forma basis for the historical. Don't think we have the June information. Are you going to be providing that in the 8-K?

Yes, we will.

Soon I hope?

We're going to get out by next week.

That's helpful in terms of building trending models here. One of the things that kind of jumped out at me from this quarter was the strength in the enterprise business, if I'm reading the number correctly. That looked like that had a very strong sequential move. And that would have been a factor of your business I would have thought would have been lagging in a recover. Could you talk to what's going on there?

I'll talk to it a little bit. I'm not sure that we could say this is clearly a turnaround in that business. It very well may be but through the year, even with some of our financial customers, we've seen some spending pick up, which was a little surprising to us. The international markets were very good. We've won some business outside the United States. The Australia market happened to come back during the qtr. And that was a very big market for us that went pretty dead for a period of time. That's picked back up. So we've seen some pick up in a new vertical, in the retail vertical. And again, when you think about distress, you think of the financial institutions and to some extent retail, but yet we saw some business pick up there. The higher education vertical also picked up during the quarter. So we've seen it in multiple geographies and across a variety of verticals. So I guess the question is is this sustainable? I think there is a view in our sales organization, there is a reasonable pipeline of business out there, so they're starting to see pipeline increase, and the question, again there, as it always is, does that business close. So we can't isolate it to one vertical or to one area; it was pretty broad-based.

And you said it was somewhat a surprise to you, as well?

I would say a modest surprise. We started to see some—we saw the pipeline obviously, but there's a big difference between pipeline and conversion. And we have the same phenomena going on in our wireless business. We have a very robust pipeline for our in-building, but getting the conversions to orders is pretty challenging. So in this case, we saw the pipeline start to convert. We also saw some benefit from distributions doing some restocking, rebuilding, to some degree, their inventories.

Shifting gears to the gross margin question again, I think in the past you have talked about the mix shift as you tried to target some international FTTX business to grow and some of the emerging market opportunities that could be the offset to selling growth out of Verizon, that those opportunities would possibly pressure the gross margin. That these are markets where you may have some lower market share and you might have to sacrifice a little gross margin to penetrate. I think that's what you've said in the past. I'm wondering how that fits in in terms of thinking about your gross margin trends in general, are we going to work our way gradually up from this 35% or should we see that start to ebb a little bit lower with the movement into more international?

I think it's going to be a little bit of juggling and timing. It depends on when international comes on and it depends on what products serve the international market and where do those products come from. So if there's a delay, of sorts, in the APAC region, in terms of things getting started, that could actually favor us in the sense that it gives us more time to bring up a broader portfolio in our Century Man operation to serve that market, in which case our margins would be very healthy, from the get-go. And if it comes early, and we have to supply those markets with some product that currently serves the domestic market, then that could have a negative impact on margin. The goal is to have APAC serviced with product featured for that market, priced for that market, and manufactured at cost, to allow us to have respectable gross margins. So it will be one, in my opinion, of timing. I think as we look out and look at our margins, that we're taking a position that there's going to be some ability to work in those dynamics and not suddenly have a major impact on margins because of some dramatic ramp up in APAC FTTX business.

Maybe the bottom line advise you could us is, from a modeling perspective, to understand that there are puts and takes and to probably assume a relatively flattish gross margin for some period of time?

I will ask Jim to provide a range. I think that's the best way to look at this because there are swings in quarters, there's volume effects and other things, but I would ask Jim to give you his best guidance right now in terms of what he thinks a good range would be for a margin target.

I think where we've achieved this year probably has surprised even us. And so it gives me a little trepidation in saying that we want to project those forward. What I think we're seeing is a balance of really a lot of additional hard work to take out costs, but we don't at any point want to think that we're not going to see pricing pressure, that we might not see further consolidation among our customers. And that we might not, indeed, have to get more aggressive on pricing to compete and win certain business. Having said all that, we think we have got a lot of progress that we're going to continue to make on the cost side. That's going to kind of ramp in throughout 2010. So if you took margins where we are today, sustaining that I would call a good performance. Do I think there is some upside of perhaps a percent? Yes, probably so if the pricing pressures don't mount, we get the cost savings perhaps a little faster than we're expecting. But the combination of things could push us in the other direction as well. So I would probably put where we are today as sort of a midpoint with maybe a percent on either side of it as a possible range.

Your next question comes from George Notter - Jefferies & Co.

I wanted to ask about the network solutions division. That business lost a fair amount of money again this quarter. Looking at share your segment reporting. I assume that's the outdoor wireless business, specifically the start-up costs associated with the prism product. Could you give us a sense for where that product is right now, when do you expect to see traction in that and how do we get around some of these losses.

First of all, let me make sure you understand the prism product, although it is an outdoor product, is very integral to our indoor solution, so when we look at these as a product mix, certainly that one is one that while it was a little slow out of the gate, in terms of our new product introduction, we are actually quite pleased with some of the path of bookings and things like that that are developing around that. I think what you're mostly referring to is some of the other more one-off businesses that we've got in outdoor. And we are continuing to evaluate that, as we do all the time. As you well know, back in November, we discontinued a number of product lines in our outdoor business. The evaluation of product lines there is ongoing, and to the extent that we feel that the market is not going to serve us well there, it is certainly is something that we will continue to take a hard look at and potentially make decisions around going forward. I mean, these are obviously times when these markets are very depressed economically, they're very dependent on builds outside the U.S. and that has been particularly weak, and so we've been trying to be patient and give it some time here. But we will continue to study that and if we feel that tough decisions are made around those, we will do those as we always have.

Your next question comes from Blair King - Avondale Partners.

Bob, I think you've mentioned over the past couple of quarters, or made a point to mention in your prepared remarks, activity around fiber builds to cell sites.

Yes.

And there hasn't been a lot of conversation about that, at least on this call, and I'm wondering if there's been something specific that ADC has been doing that is facilitating fiber builds to cell sites or what kind of background you might be able to give us with regard to projects going on in that space.

That's simply an area, I would argue, it creates general demand for some of our connectivity products in particular. So as more capacity gets put out in the network, and I would argue that's just going to have to happen, given the demand growth on the Internet primarily being driven by video. So if you looked at a recent forecast that was put out in a white paper by Cisco, they're projecting that in 2013, the Internet will be about four to five times larger than it is today. You've got huge growth. And the apps are growing every day for the smart phones. So the capacity, the wireless carriers can't keep up with capacity demand. So the only way that they're going to solve that problem, there are two ways, I would argue. One is to put more fiber into the network for backhaul in support of that capacity, where they can. In that case we have products that support that. Fiber panels, Ethernet panels. In a case where it's a copper plot, you might want to utilize some additional DSX-3, etc. So to some extent, in the early stages, as they ramp up just to get capacity into the network, and depending on what's in the hot, it could be either some of ADC's copper solutions or it could be some of ADC's fiber solutions. Over time, they're going to want to completely fiberize their network. So it's just one of those general trends that supports growth in certain product categories in our overall fiber business. Now the other thing to think about, a little more longer term, when you start looking at these exponential growth rates that are being forecasted for demand on the wireless networks, I think you can draw a conclusion that it really starts…

Is there anything specific going on in terms of projects now that you're engaged in there or is that just kind of a long-term trend that you see?

No we support today, we do sell connectivity products into backhaul applications.

I thought there might be some specific project you might be working on.

No, there's not one large project that we would cite. It's more general demand by people who are adding capacity to their wireless networks. The area that that may change is the one that I mentioned at the end, which is surrounding an improved architecture to support future needs of very high-capacity and high-quality service. That's a future, there's no project, but it certainly theoretically supports the architecture we've been advocating for some time.

There was some conversation earlier with regard to the pipeline fill, the level of activity, if you will, and the closure rate associated with those opportunities. I'm curious, broadly speaking, if you've seen perhaps across all product categories, any sort of increase in the closure rate relative to the amount of activity that you've had.

Well, clearly we did in the enterprise, in the structured cabling side, as I mentioned earlier. We are hoping that in this quarter we see it in our in-building. What we did see was the pipeline starting to pick up significantly as we entered this quarter. We're hoping the closure rate begins to follow that. It's too early to call right now. But that's clearly an area where we would hope to see better closing.

What about on these fiber to the x trials that are taking place. Are these trials that you've got specific milestones that need to be achieved or is it simply just a function of carriers delaying the purchasing decision?

In some cases it's postponement. It's a slowdown in moving forward, temporarily. In other cases our product is in trials. I would say there is no science to be perfected in our product. It works. There are a lot of them in the field. In many cases you're just going to have to go through a trial period with a carrier, particularly one that hasn't deployed. That's just part of the process. But in our case it's not about proving out the solution. Our products are there, they work, we're very happy to put them in trials. We have shipped trial units to certain carriers. I would say maybe, in the case of some competitors outside the United States that don't have the track record that we have, trials are more important.

Your next question comes from Christian Schwab - Craig-Hallum Capital.

Jim, just so we understand, the U.S. it appears is stabilizing but not surging, Asia Pacific strength and recovery is expanding beyond China, and Europe is yet to recover. Is that correct?

That's a pretty good summation.

And are you seeing anything on the European side that would give you any hope that that business could recover this year?

It's really too early to call. Normally, this time of year is very slow anyway and so it's really hard to sort out how much of that is Europe toward the tail end of its recession versus the normal summer end slowdown. So certainly we're hoping to get some better indicators here as we move into the fall. We said all year that it appeared Europe was probably six, seven, eight months behind the U.S. in terms of its economic cycle. That might suggest that it would start coming out this fall. But it's just really too early to call.

And the 200,000 cell sites, that was a U.S. number?

Yes.

And so [inaudible] suggests that you get about $3,000 to $9,000 per cell site, depending on how labor content. Is that still the appropriate number to assume for every cell site you would be involved lining up?

I think it depends on the configuration. We have heard a pretty broad range. Probably the $9,000 is on the higher end of anything I've heard. I guess in general I've heard more the in the $2,000 to $6,000 or $7,000 range. But it's again, as Bob said earlier, when do these projects actually start to take place. You then, obviously there's going to be competition out there as well, but there's no question that the big carriers have a real backhaul problem, as Bob mentioned. Just the two largest carriers in the U.S. have half or more of those cell sites so certainly we think it's a significant opportunity but it's a question of participation and timing.

If we are trying to do the math and all the help you were trying to give us, but my math comes out that you're kind of suggesting that if things follow typical seasonality, that Q1, October to December, should be $265.0 million give or take, is that accurate?

We're not ready to give guidance for that quarter yet. We will do that when we announce earnings here. I certainly want to study many of the things that we've just talked about, is Europe recovering, are some of these other project deployments taking place. I think, again, the patterns I was citing were very much to try to give people the benefit of what hindsight tells us because there is a great interest in trying to model our seasonality. But this is a tough time to call, as I mentioned earlier, when I gave that guidance. I almost had to exclude anything that related to 2009 out over 2008 just because it's such an anomaly. And so we have really got to take a hard look and see what we learn over the next few weeks and then we will give you the best guidance we can.

Your next question comes from Brian Coyne - Wedge Partners.

One more on gross margin. You offered sort of as-if guidance for the old October year end. Could you offer us sort of the as-if gross margin guidance on the same basis?

I was very careful in what I did to just do it at the revenue level. And the reason was that there were so many factor at play into gross margin. I could sit here and take last Q3 and this Q3 and tell you that just the revenue change itself should have dropped our margins by 3% to 4%. And yet we were able to actually improve margins because of all the actions that we took. And so to try to take all of those factors and translate them into a sort of a parallel seasonality, I would be just very hesitant to do that.

I don't know if you might be able to offer any additional detail on your sales channel performance. I think you talked a little bit touching on some of them, but maybe your direct sales versus the distributors in VARs. And I'm just thinking whether any of your cost rationalization efforts have impacted, or will impact, that sort of indirect sales channel as you look ahead.

Right now we're not contemplating any actions that would impact our channels. We have pretty good relationships today with our VARs and partners. We always, however, monitor them for performance so if we have non-performing partners, we certainly do something about that. As we examine our needs outside of the United States relative to cost and the economics of covering a specific territory, we conceivably could make decisions that favor using a VAR or a rep in a region as opposed to the cost of having an ADC facility and people based in that specific country, but that's on a case-by-case basis around the globe in terms the risk/reward or the cost benefit of doing business in certain geographies. In terms of performance, direct sales versus partner sales. You know, I don't think I can make a distinguishment there in terms of performance. Clearly I think the ADC sales team has performed extremely well in this environment and our partners also have tried to do their very best. And also in some cases our partners do more fulfillment than they do selling and so even though the product ends up going through channel, for distribution and credit, the sales could have been generated by an ADC direct sales person. So said differently, I don't have any heartburn today with the performance of our direct team or our partner channel.

Your final question is a follow-up from Paul Silverstein - Credit Suisse.

Jim, can you tell us the top five customers contribution in the top ten, consistent with your historical practice as well as U.S. and non-U.S.

You're talking about the percentages?

Correct.

Our top three customers were about 43% and our top five were almost half, in the very high 40%s.

And how about your top ten?

52.5%.

And your U.S., non-U.S.

I've got Americas versus non-Americas. Americas was 68% of sales, EMEA 17%, and Asia Pacific 16%.

Thank you all for participating with us in today's call.

This concludes today’s conference call.