Good afternoon, and welcome to Diodes Incorporated first quarter 2010 financial results conference call. At this time, all participants are in a listen-only mode. (Operator instructions) As a reminder, this conference call is being recorded today, Thursday, May 6, 2010. I would now like to turn the call to Leanne Sievers of Shelton Group, the Investor Relations Agency for Diodes Incorporated. Leanne, please go ahead.

Good afternoon and welcome to Diodes first quarter 2010 earnings conference call. I am Leanne Sievers, Executive Vice President of Shelton Group, Diodes' Investor Relations firm. With us today are Diodes' President and CEO, Dr. Keh-Shew Lu; Chief Financial Officer, Rick White; Senior Vice President of Sales and Marketing, Mark King; and Vice President of Finance and Investor Relations, Carl Wertz. Before I turn the call over to Dr. Lu, I would like to remind our listeners that management's prepared remarks contain forward-looking statements, which are subject to risks and uncertainties, and management may make additional forward-looking statements in response to your questions. Therefore, the company claims the protection of the Safe Harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from those discussed today and therefore we refer you to a more detailed discussion of the risks and uncertainties in the company's filings with the Securities and Exchange Commission. In addition, any projections as to the company's future performance represent management's estimates as of today, May 6, 2010. Diodes assumes no obligation to update these projections in the future as market conditions may or may not change. Additionally, the company's press release and management statements during this conference call will include discussions of certain measures and financial information in GAAP and non-GAAP terms. Included in the company earnings release is a reconciliation of GAAP net income to non-GAAP adjusted net income, which provides additional details. Also throughout the company’s press release and management statements during this conference call, we refer to net income attributable to common shareholders as GAAP net income. For those of you unable to listen to the entire call at this time, a recording will be available via webcast for 60 days in the Investor Relations section of Diodes’ website at www.diodes.com. And now I will turn the call over to Diodes' President and CEO, Dr. Keh-Shew Lu. Dr. Lu, please go ahead.

Thank you, Leanne. Welcome, everyone, and thank you for joining us today. The first quarter reflects a number of significant accomplishments for Diodes, the first of which includes the accomplishment of record quarterly revenue and record gross profit. As many of you know, in the second half of 2009, we shifted from our focus on cash management back to our profitable growth strategy, which is evidenced in our first quarter results exceeding our prior financial peaks. And to this point in the economic recovery is a distinct accomplishment compared to many other companies in our peer group. Revenue in the first quarter increased 5% sequentially despite the first quarter typically mean a seasonally down quarter. Additionally, we are forecasting continued growth momentum in the second quarter, which will represent our fifth consecutive quarter of revenue growth and another record quarter for the company. Gross margin in the first quarter was 34.9% and is on par with our previous high achieved in the fourth quarter of 2005. The increase in gross margin was attributable to improved product mix resulting from stronger than expected growth in North America and Europe, in addition to higher our wafer fab operating at the near capacity. We rank capacity (inaudible) in our assembly testing facilities, as demand has pick up less than anticipated and has out-passed [ph] our capital expenditures. But keep in mind, our activity began increasing our capital authorization in September of 2009, ahead of most of the industry in order to ramp up early and to support our future growth. Those expenditures are just now beginning to be recorded in the first quarter. As such, we have already initiated our 2010 authorizations, and currently has the appropriate equipment committed to us, thereby preventing any potential rebates for manufacturers. This record achievements are a direct result of our consistent execution on new product initiatives and the design win traction combined with our well (inaudible) capacity expansions, which has enabled us to gain market share as well as improve our product mix and wafer fab utilization. With that, I will turn the call over to Rick to discuss our first quarter financial results and first quarter guidance in more detail.

Thanks, Dr. Lu. And good afternoon, everyone. As Dr. Lu mentioned, revenue for the first quarter was a record $136.8 million, an increase of 75% over the $78.1 million in the first quarter of 2009 and an increase of 5% over the $130.3 million in the fourth quarter of 2009. Gross profit for the first quarter of 2010 was a record $47.8 million, or 34.9% of revenue, compared to $14.5 million or 18.6% of revenue in the first quarter of 2009 and $41.8 million or 32.1% of revenue in the fourth quarter of 2009. The 280 basis point sequential increase in gross margin was primarily attributable to improve product mix that resulted from stronger than expected growth in North America and Europe in addition to higher wafer fab loading and performance. O-fab [ph], our wafer fab in Oldham, UK, has gone from the utilization of less than 50% to near full utilization, achieving record output in March 2010. In addition, cross-selling of Zetex products is increasing, with Zetex sales growing at all regions. During the quarter, our packaging capacity continued to be fully utilized with output from our China facilities at 5.2 billion units. Total operating expenses amounted to $28.9 million or 21.2% of revenue, down slightly from the 21.5% last quarter. Looking specifically at selling, general and administrative expenses for the first quarter, SG&A was approximately $21.4 million or15.7% of revenue compared to $20 million or 15.4% of revenue last quarter. Investment in research and development for the first quarter was $6.4 million or 4.7% of revenue, which was effectively in line on a dollar basis to the $6.8 million or 5.2% of revenue in the fourth quarter. Total other income amounted to $144,000 for the first quarter. Looking first at interest income and expense, we had approximately $1.3…

Thank you, Rick, and good afternoon. Our record first quarter revenue was a result of strong demand across all geographic regions and led by a resurgence in North America and Europe, as well as better than normal seasonality in Asia. Distributor inventory remained low and below normal distributor inventory levels. Global POS was up 17% and experienced solid growth in all regions. Both our Diodes and Zetex branded products reached record levels, as we continued to capitalize on cross-selling opportunities, resulting in increased market share at existing customers in addition to winning designs at new customers. We achieved strong momentum and design activity on our MOSFET portfolio, SPR products, and high performance bipolar transistors, as well as strong increases in analog product revenue from USB power switches and reset devices. From an end market perspective, we saw a high level of design activity and revenue increases in industrial, consumer and communication accounts. In terms of specific end market breakouts, consumer represented 32% of revenue, computing 28%, industrial 20%, communication 17%, and automotive 3%. Asia represented 73% of total revenue. Product sales increased 1.3% sequentially, led by notebooks, power supply and DC fans. Mobile phone, LCD and LED TV, as well as panels were flat for the quarter, while LNB products were down following normal seasonal patterns. Foundry wafer sales decreased 78% quarter-over-quarter due mainly to planned reductions in foundry wafer sales to support internal growing demand, while fab capacity is nearly full. Distributor POS grew 12.6% despite the impact of the Chinese New Year holiday. Distributor inventory was generally low during the period at just under two months. Design activity in Asia remained strong in the first quarter with 80 wins at 57 customers highlighted by 14 USB switches, 11 reset ICs, eight power MOSFETs, seven SPR, and five hall…

(Operator instructions) Your first question comes from the line of Tristan Gerra with Robert Baird. Please proceed. Tristan Gerra – Robert Baird: Hi, good afternoon. Could you give some specifics in terms of products helping mix in the quarter and how sustainable you believe that is?

I would say that I think it’s relatively sustainable going into the third quarter –

Second quarter.

I mean – yes, going into the second quarter, excuse me. I think basically what we’ve started to do is limit our supply of our commodity devices and just kind of move up the food chain, moving into higher ASP or higher mix unit products within the different segments that we operate. But I think it’s pretty broad-based. I did mention we had some improvements on our USB switch in some of those areas. So that’s kind of driving a better mix, and some of our new products on MOSFETs are helping improve. But I think we focused on trying to limit the growth of our commodity space and trying to position products differently. Tristan Gerra – Robert Baird: Okay. And in case maybe I missed it, what was your total sell-ins of POP sequential change for worldwide distributor in the quarter?

I think – I don’t have the – actually percentage up. Asia was flat. Both North America and Europe based on the numbers were up. But POS exceeded the growth in POP significantly in the quarter. Tristan Gerra – Robert Baird: Okay, great. And then just a last quick one, how has been demand trends in China recently including at retail?

I don’t really follow the retail, but I think the demand in China actually looks good – pretty good going into the second quarter and through the year. I think everything looks relatively strong. Tristan Gerra – Robert Baird: Great. Thank you.

And if you consider the Chinese New Year – and in 1Q, actually it’s quite strong in China internal consumption during the Chinese New Year period.

Your next question comes from the line of Joe Whitten with Longbow Research. Please proceed. Joe Whitten – Longbow Research: Hi, good afternoon. First of all, congratulations particularly on the gross margin numbers and those being kind of record highs.

Thank you. Joe Whitten – Longbow Research: That is my first question, actually wanted to hit it on the gross margin. Guidance seems to imply flat margins sequentially. I’m just trying to – kind of trying to reconcile that with Mark’s comments that maybe there is some more higher mix – more high mix products coming out. So I’m just kind of curious – are gross margins kind of topping out around these levels or can you potentially go higher in the future on either the strong seasonal periods or continued mix improvement?

Joe, you know our strategy always concentrate on the top line and bottom line. Since our strategy is profitable growth, we really concentrate more on the growth and the depth of the gross profit to the top line and increase. And therefore we really don’t intentionally just try to improve gross margin. Now, due to the – all our operation is fully loaded, including – in addition to our packaging facility is fully loaded, had been downward for a while. Now our wafer fab – both wafer fabs from Kansas City and from Zetex acquisition, they are all fully loaded, especially they continue to have wafer fab. We had a record output in March in Kansas City. We actually – at the beginning of the year, there were a lot of snowstorm and bad weather. So we are actually thinking they are going to be bad, but then they catch it up in March. And therefore, those in addition to the higher GPM region, like US grew 28% and Europe grew 18%. Those high GPM percent regions actually grow up much faster. And so it gives us a surprise on the gross margin improvement. And we believe that wafer fab and assembly [ph] will continue loaded. And we believe the product mix we have been doing should continue. That’s why we predict it would be similar. Okay? And since you asked, we’re going to continue getting higher and higher. That really is not our focus. So we take opportunity to changing the product mix when opportunities rise, but we do not want to sacrifice the growth for that. Joe Whitten – Longbow Research: Got you. And then just two quick follow-ups. I mean, you said the wafer fabs, Dr. Lu, are fully utilized – or were fully utilized. Is that for the whole quarter or just kind of recently you’re reaching those high utilization numbers? And then secondly, given your capital expenditure plans for the year, now you kind of have those positioned, how much more sales do you think the current footprint could support when you get through the current expansion plans for the year?

When I say – you remember I said much – we had a record output for the Zetex wafer fab. Therefore, if we can continue that record output, second quarter would be a little bit more than first quarter output. Okay? And Kansas City, remember I said, January, February, we had snowstorm, bad weather and (inaudible) ramp up. And then in March, we had a very good output. So if you look at all those, yes, we still have some room for that wafer fab improvement. Then – and after that, we don’t put a lot of capital in the wafer fab, because for the Kansas City one, we do use in our wafer fab to support foundry to help to deduce the cost, help loading the fab. But it's another one that is not our focus. So we would just continue to move from a foundry business to support our fab. Joe Whitten – Longbow Research: Is it possible to say what percentage of sales at each wafer fab, just approximately is being used for internal consumption versus external wafer sales?

I don't think we disclosed that number but I can tell you Zetex is 100% used power fab. Zetex fab, we don't do foundry. Joe Whitten – Longbow Research: Great. Thanks a lot and congrats again.

Thank you.

Your next question comes from the line of Harsh Kumar with Morgan Keegan. Please proceed. Harsh Kumar – Morgan Keegan: Hey guys, congratulations. Great quarter once again. Maybe a question perhaps for Dr. Lu or Mark. Can you guys tell us where you are seeing the strongest – by end market, of course, and what end market are you seeing perhaps the strongest order activity going into the June quarter and maybe talk about the linearity of orders, how they shook out in the quarter so far?

Well, if you look at the second quarter, I think it looked like most of any equipment is all very strong. We do not really see up a particularly in the flow line, an equipment and for example, LED – LCD LED TV from one of our major customers, so far they're still focused very strong. In notebook, so far this customer and our customer so far did not give us any sign of softness or anything and then you're talking about datacom. This quarter, second quarter datacom for us from what we see is quite strong, even compared with 1Q. Datacom is much stronger, like I said, above all of those and so we do not really see a much slower business. Now for Europe, I really don't know what would be happening. So whatever my comment is more in the Asia market.

If I can cut in, you can see that by the numbers in North America and Europe and obviously, the resurgence of the industrial and communications markets are back and so there's really been kind of an all boats rising. So the demand looks pretty strong against all segments. In Europe, in some of our direct accounts, we are seeing a little softness in automotive and the end of last quarter. Don't know how that will play out so much in the second quarter, but actually things continue to look pretty strong in all regions. You'll see our computer was down a little bit in the quarter and will remain down because that is a mix space thing. Motherboard at times drives some of our numbers and we are kind of a little bit of a de-emphasis in there because of product mix, so you’ll see some change in there. But the consumer number remained very strong. Harsh Kumar – Morgan Keegan: Okay. That's very helpful. Europe, I guess Europe is just going through some churning right now as we know today. But, guys, you hit operating margin, I think peak was about 16% on a non-GAAP basis. You are doing about 14.5. How much more of a run rate there is left? Is it fair to say you can go past the 16% peak pretty easily this time around?

Are you talking about…? Harsh Kumar – Morgan Keegan: Operating margin. Sorry.

So that's GPN less SG&A? Harsh Kumar – Morgan Keegan: Yes.

I think we will continue kind of holding our – in our SG&A spread and you know when we – when we get the more revenues. So eventually, we will get to that but – .

If you look at the model, what we've said is that it can grow at the same rate as the revenue and the SG&A will grow at about half that rate. So we would expect that the operating margins would go up somewhat over time. Not immediately.

And if you go to BTS model we actually – our BTS model is 35% GPM, 20% R&D plus SG&A in the operation of cost expense and get to 15% like an operational margin. So we are not that far away from that sale. Our operational cost now is about 21%. So slightly higher. Now, if we continue growth then that percentage goes to our model, 20%. Harsh Kumar – Morgan Keegan: Got it. Fair enough. Very helpful. And if I can ask one more. A couple of the companies are talking about supply constraints. I'm seeing – I'm asking in the products that you guys compete in, are you seeing supply constraints from your customer – from your, I apologize, your competitors and maybe you could talk about pricing?

Yeah, absolutely we are seeing constraint. There are some products that are more constrained than others. There seems to be a lot of difficulty in the MOSFET arena. I think what we're seeing, some prices increase. We are not usually the lowest guy out there. So we are raising and looking at some of our commodity prices where we've seen some people that are a little bit more dramatic with their pricings. Their pricing might have generally been a lower than ours in the first place. So there's definitely some opportunity to increase price and there's certainly opportunities to gain market share. Harsh Kumar – Morgan Keegan: Fair enough. Thanks, guys, and congratulations. I'll get back in the queue. Thank you.

Your next question comes from the line of Steven Chin with UBS. Please proceed. Steven Chin – UBS: Thank you and, also, congratulations on the record results.

Thank you, Steven Steven Chin – UBS: First question, guys, I just wanted to drill down a little bit more on performance in the North American and European markets. I guess just looking at the sales performance and also the gross margin performance, can we – is it safe to assume that some of the outperformance in the North American group was due to demand for some of your higher margin, maybe higher steep bipolars [ph] which has analog or Zetex or some of (inaudible) products or…

Yes, we generally are a very positive mix focused in North America and Europe. We saw a much better mix in these two territories. We generally let our commodities get sold in Asia. So when the boats rise and when the sales go up in North America and Europe, it should be a very positive sign for our margin mix. We keep our commodity product at a set price and we generally allow the competitors to come back up to us when the market condition gets better. So yes, our mix is much – we have a superior mix in North America and Europe. Steven Chin – UBS: Okay.

Yes, you know we put the priority to support U.S. and Europe. And that's the commodity cost constraint, the commodity product in Asia. Therefore, when this kind of shortages duration happen, it is a great opportunity for us to gain a market share in the U.S. Europe area because that is the one gives us a much better GPN percent. And constrains the commodity area, especially in Asia. So if you look at through our speech, you can see we do not really grow that much in Asia. And with that output to support U.S. and Europe such as that, it keeps us surprised on the GPN percent. Steven Chin – UBS: One more for Mark. Mark, you mentioned some additional traction by your professional [ph] package products earlier. Is that a new trend that is emerging in your business where of those multifunction package parts are now?

We are seeing a lot of interest in consolidation. You know when units get tight, people want to make it more simple too. We are seeing just more and more interest due to size constraints and complexity of boards to combine more units into one. And it just seems over the last two or three quarters, that the quantities of inquiries in the active projects continues to grow and we should see some positive results in that in the quarters to come. Steven Chin – UBS: Okay. Great. And my last question is for Rick. Rick, just given some of the fluctuations in the foreign exchange market and potential for Chinese grown revaluations, what kind of potential impact did that have on your business?

Well, we have looked at – specifically if you look at the European currencies, they are weakening versus the dollar. And we've – we basically don't think it is going to have a lot of impact on the bottom line. We have euro-based and pound-based revenue, but we also have a euro-based and pound-based cost and so those are basically wash. Kind of the same thing in China. Steven Chin – UBS: Okay. Great. Thank you.

Your next question comes from the line of Ramesh Misra with Brigantine Advisors. Ramesh Misra – Brigantine Advisors: Hi. Good afternoon folks. First question, just a clarification, Mark. I missed end market numbers. Can I request you to repeat those please?

Let me find them. Okay, I got my papers all mixed up.

While he's looking for it, why don't you ask the second question? Ramesh Misra – Brigantine Advisors: Okay. My second question is your Shanghai facility basically running fully utilized at this point. And it still takes some time to ramp up capacity over there. Where does your Q2 revenue growth come from? Is it mix-driven or is it – is that CapEx actually beginning to have an impact already?

Well, I think if you remembered several conference calls, we have been talking about we change it from cash management strategy to profitable growth strategy, several conference calls ago. And actually, we detect this kind of shortage much earlier to about September last year. So we start to authorize the capital equipment in September last year and the equipment can start to come in 1Q and then continue since September last year. We continue to give the CapEx authorization. So actually we have the older capital equipment (inaudible) continue until August this year. So whatever we plan to grow in 2010, each quarter, we had the capital equipment ordered and committed and they give it to us per the schedule. So in the second quarter, our ARPU will be increased and that revenue will be coming – majority coming from more output, more demand. So we will be using this opportunity to gain the market share. So product mix, if it is there, we will take opportunity but the growth is going to come in from the support. Ramesh Misra – Brigantine Advisors: Okay. Got it. And then on the front end, Dr. Lu, I remembered that your Kansas City facility has more room for – physical room for expansion. What is the situation over at your Oldham fab? Is there room for expansion over there as well?

Well, in this answer from the Kansas City, even with room, the way if we need more capacity, I would just convert from 5 inch to 6 inch. Okay. I would not expand it by putting more 5 inch equipment. So anymore future expansion we just put some 6 inch equipment and convert 5 inch OREO [ph] gradually to the 6 inch. And in the Oldham fab, you remember in November 2008 when economic is bad, we shut down the 4-inch line. If you remember that's what action we took in, we took is to shut down the 4-inch line and so the space is still there. If needed we will authorize more 6 inch equipment and into that four-inch wafer, we’ll get a clean house – clean room. Ramesh Misra – Brigantine Advisors: Okay. Fair enough.

Mark has that number for you.

Ramesh, 32% consumer, 28% computing, industrial 20, communications 17 and automotive 3. Ramesh Misra – Brigantine Advisors: Got it. Okay. In regards to – sorry, just getting my train of thought realigned again. In regards to your current CapEx plan, how much – what kind of a revenue run rate would that support on an annualized basis?

We – you know. Ramesh Misra – Brigantine Advisors: I had to try.

Our biggest model is 10% to 12% and that's what we have been doing historically and our growth historically is 23% to 25% CAGR. Okay. So this year in 1Q we actually authorized 18%. And so – but again, typically, we authorize more capital at the first half than at the second half. So this year, we will expect if at the high end of that 10% to 12% – and don't forget because last year we only authorized 6%. So we might if the business continues to improve, we might authorize above 12%. Okay, if complete, company depends on the business outlook. And so far I already authorize enough capital equipment to support for second quarter growth and third quarter growth. I am still watching it. It's the fourth quarter, they are threat and I probably don't need to do anything, but if they are to continue strong then I might authorize more, but I have enough time, see. So we just take action since the last of September to predict this kind of up and fortunately we have all the equipment done up and ready to deliver to us. Ramesh Misra – Brigantine Advisors: Okay. And just a very final quick one, if I may? In terms of lead times, can you give us at least a qualitative read on where lead times are and how they've been trending?

The lead times are longer now. We've kind of pushed again. If you look at the way we are trying to drive our mix, we are definitely pushing the lead times out on our commodity products. We are seeing industry lead times continue to grow. We like to, in our company, try to think lead times are a decision rather than a set term. So we are very focused on trying to accomplish what we're trying to do. So we use our capacity to meet those goals. So you'll see some standard products' lead times stretching, but I think we still have an opportunity to operate in pretty close to our normal zone. Ramesh Misra – Brigantine Advisors: Okay. Thanks, Mark. Very diplomatic answer, but I will take it. Thank you.

You know, Mark.

Your next question comes from the line of Steve Smigie with Raymond James. Steve Smigie – Raymond James: Great. Thank you. And I will add my congratulations on this and nice numbers there.

Thank you, Steve. Steve Smigie – Raymond James: Since we were on capacity, I will just throw another question in there. You guys had some issues a number of quarters ago where you didn't have enough people. It seemed like that got fixed. Do we also have a benefit in terms of possible output going forward as now we are several quarters down the road? Those guys were better or people are better trained. Will there be better efficiencies coming and therefore output potential is better just because the people are better trained at this point?

You have a good memory. That's good. Because yes. We do start the benefits for our operators that are getting more mature. Okay. You know during last year we – our output capacity was constrained by the – manpower constrained, not equipment capacity limited. And so we hired the people and it takes two to three months to be able to put them back to production line. And then you know, you take a while for them to be very productive. And fortunately, I think those kind of problems is behind us now because we continue hiring people and continue training the people, continue, put it into the production line. And fortunately is, we do increase the capital – CapEx, increase the equipment therefore we continue to need to hire more people to put in the line. Well, our people now is really the record worker in China now. Steve Smigie – Raymond James: All right. And Dr. Lu, you were one of the first to take capacity off, one of the first to add it back. So my next question is, you are increasing spending here, but it seems like lead times have gone out on the ability to get new equipment. It seems like you already got everything you need in place through Q3 in terms of what you maybe have placed in the past. So if you needed extra capacity for Q4, I mean do you have to sort of start ordering now or how is that working? Does your equipment not have lead times and the other equipment does?

Well, I just authorized another chunk of equipment, okay, out and tried to participate, maybe needed for 4Q. Now, I gamble with that because if 4Q turns out to be cyclical, if you remember our cycle typically 4Q is flat from 3Q cynically [ph]. And so if that is the case, our equipment might be just excess capacity for us for the future goal. But if, you know, fortunately, the fourth quarter start to continue to grow then we will be able to take that capability to get the market share. Therefore I am a little bit bullish so we start authorizing equipment for the fourth quarter growth. But after the third quarter, we have all the equipment committed to us. Steve Smigie – Raymond James: Right. That should be a good gamble. Like you said all you have to do is capture more market share. So my other question, well, I had two more actually. One was just on the fabs, what end markets are you primarily gaining traction in there? Was it computing and TVs or is there other stuff?

I think – you know, I mentioned to you in Asia, almost all the settlement is going up quite strong. We're gaining market share from, like I mentioned, LCD LED TV and set-top box and cell phone. Now, we do intentionally in a constraint of commodity pull out in the motherboard area. You know motherboard typically is very commodity type of product and so we constrained that area. So we might lose the market share in that area, in the U.S. and Europe since that growth is industrial and, you know, all this. So I think I won't just say some (inaudible) and equipment. We control our growth actually. Okay. In the area, we have a much better product portfolio and that's why we want to grow and we would put more capacity in that area for the commodity which we know the growth margin is not as good. And we just convert capacity to outside that area to support the other area. So you look at – for us older end equipment is running but for title alone we selected to grow one area instead of the other one. Steve Smigie – Raymond James: Okay. And the last question just if I ever thought I just – on the TVs, it got beat down pretty bad as we went into the downturn. It seemed like it came back fairly strongly and has continued to be, I think, fairly healthy over the last several quarters. Any feeling that maybe that is getting overheated? Too many TVs have been sold out there, too much penetration or is it in China, for example, such a growth market you have multiple TVs for people or you can ship into business in addition to individuals? Just any sense on the TV market actually. Because it seems like it has been going strong for some time now.

It's going strong and it is actually getting stronger and it's very surprised and for a lot of people too. How can they continue strong? One thing I want to point out is the China economic is quite heated up. They are able to compete – accomplish 8% GDP and now they are talking about 9% or 10% GDP for this year. So they continue very strong. Now, you are going to say, well, how people have the money to buy. Very surprised is because they were shortage in that area because the government started to do the minimum wage. It was surprised, the salary increase in the China area is getting stronger, higher and higher. People are actually getting richer and richer especially the – we call in the middle, middle laborer of the people. Our engineer and all engineer managers, they all get quite good a raise. And so and the general market is very hot so they don't have the unemployment rate like what we have in the U.S. and so people have the money to buy. They get – they spend the money. Steve Smigie – Raymond James: Great. Thanks very much.

Your next question comes from the line of Kevin Cassidy with Thomas Weisel. Kevin Cassidy – Thomas Weisel Partners: Hi, Keh. Kevin Cassidy here from Thomas Weisel. We were just wondering, you had mentioned about in your inventory that raw materials increased. Has there been a cost increases in any of your raw materials?

Well, if you see the cost like, for example, the gold wire. You know gold had been increased, but fortunately we started to take action to convert some of the gold product to the copper product. Now some raw materials increased, yes, but because of the shortage, but we kind of take action. That is why these cost increased, you know, like we know they are going to wait for shortage. We order wafer ahead of time. Now we have – we have to now pick up wafers so we can continue our growth. So to answer your question, yes, we see some building material increase, but by changing the product mix you can see we actually can improve our GPN percent. Kevin Cassidy – Thomas Weisel Partners: I see so you haven't had the issue of trying to pass along any cost increase?

Yes, clearly, we are trying to pass along some price increases on our lower value device, okay, where there's not as much room. But what we're really trying to do is sell different products where those impacts would be – almost no impact on them.

We changed the product mix. Kevin Cassidy – Thomas Weisel Partners: I see, okay.

To strengthen, our commodity product and try to focus more on the high GPM type of the product. Kevin Cassidy – Thomas Weisel Partners: Okay and do you think that because you are coming in and helping the customers out on these higher GP products that you'll be able to keep that in, I guess, if this market slows down?

I hope so. Kevin Cassidy – Thomas Weisel Partners: Yes. Great, thanks for taking my questions.

Thank you.

Your next question comes from the line of Brian Piccioni with BMO Capital Markets. Brian Piccioni – BMO Capital Markets: Yes, congratulations as well. Most of my questions as you can imagine have been asked and answered. You know, it's a minor detail to your business but many other companies that are serving the automotive space have noticed a sharp rebound and I understand that, of course, in your business it's still a very small component of revenues. Any sense what is going on there?

I think it is just customer mix on those. I think we know in our business I think there was just a couple of the key designs we had may not have been running last quarter and so far. And I think that is why we have a drop and that was specifically on our OEM side. So I don't think there's anything, any big change or says that we're missing anything. When you have got a small number, a small percentage of your sales in one area, then if one of your customers isn't clicking on one of their projects, it can change your mix. Brian Piccioni – BMO Capital Markets: Right. And you know, this might sound like a sort of a negative question but it is not intended to be. Many companies seem to be claiming growth in market share these days, and you know, you would obviously have better visibility and especially with your acquisition of Zetex and the cross-selling opportunities because it is characteristically different. What does the competitive environment look like right now for you guys?

I mean, I think there's always a competitiveness for sockets. I think right now, I think the competitive – there's really not a significant price-competitive market because people are constrained and everybody in these better times has a little bit more patience with price. But I mean, clearly, we all have the same objectives that are two and three years long. So we all have the same customers and so forth. So I think that it's a very competitive market. I think we are positioned with a lot of product and a lot of segments and a lot of good product that will offer very significant opportunities to our customer base. So I think we are positioned competitively in all of our segments.

And the evidence of that is we are now in the record revenue in 1Q. And if you look at our guidance, we are going to continue setting the new revenue record. And so if you look at our competitor, I don't think any probably – I don't see that many companies are compared to (inaudible), they have already setting a new revenue record. And so I think we feel very good and we feel very comfortable on our market position. And we believe we are well positioned ourselves for continued gaining market share. Continue setting the revenue record. Brian Piccioni – BMO Capital Markets: Okay. Great. Well, keep up the good work. Thank you.

Thank you.

And we have run out of time for questions today. I would now like to turn the call back over to Dr. Lu for any closing remarks.

Thank you for your participation today and, Operator, you may now disconnect.