Sehat Sutardja – Chairman, Chief Executive Officer : Thank you, Operator. Welcome, everyone to our Q3 FY2007 conference call. Weili Dai, Chief Operating Officer, and George Hervey, Vice President of Finance and Chief Financial Officer are joining me on this call. Today, we have reported Q3 revenue increased 22% from the prior year to $520 million. Sequentially, our Q3 revenues decreased 9% from the prior quarter, which is slightly better than our revised guidance of a 10% decline that we issued on October 7th. Although, we are disappointed with our sequential decline in revenue this last quarter, we remain excited about our continued strong positioning for growth as we expand our presence into many new large volume markets. In particular, we are very excited to have now closed our purchase of Intel's application and communications business earlier this month. With this acquisition, we are pleased to have this world-class engineering team join Marvell. By combining these world-class products with our own technology, we are now strongly positioned to be a leading supplier in the cell phone market. With our broadening IP portfolio, Marvell has clearly become a very diversified and full fledged semiconductor company. With the breadth of our IP, we are now in a position to serve substantially all the large semiconductor markets. If we are not currently shipping into such a market, we are internally developing the solutions to enter them. Our ability to successfully enter such a broad number of semiconductor markets is due to the strength of our core technology, and our ability to repackage our technology and apply it to the specific end market requirement. I will elaborate more but our opportunity and our business progress, but first I will have George provide more insight into our Q3 financial results. George Hervey – Chief Financial…

Thanks, George. Last week, we announced the completion of our acquisition of the application and communication process of business from Intel. We are fortunate to have this tremendous opportunity for such a talented group of employees, proven world-class technology and strong customers joined the Marvell family. Strategic opportunities to enter such a large volume market are rare. To truly capitalize on this acquisition, and to successfully integrate this business, we have a tremendous amount of work and investment ahead of us. One of the main tasks at hand is for us to quickly port the existing as well as the new designs over to our foundry partners to help drive down product costs. For a number of different reasons, the cost structure of these products is currently too high. As we started the business, it is apparent that most of the factors that have led to this high product costs are centered around manufacturing-related issues, such as the products being built in low volume, captive manufacturing facilities, that utilize 8-inch technology. Also a variety of other manufacturing positions remain a focus on product performance, and sacrifice of cost. Now, the resulting technology and performance of the solution are the best in the market nothing else comes close. This is clearly evident by the large market share garnered by these solutions in the high end SmartPhone market. We are confident in our ability to reduce the costs as we migrate the production to our 65-nanometer geometries and implement our aggressive design rules. By leveraging our own mixed signal IP and advanced libraries along with Intel's low power circuit design techniques, which by the way the industry's lowest power design technology we will drive a considerable amount of costs out of these products, which will enable us to achieve gains consistent in…

Thanks, George. That completes our commentary. Operator, would you please poll for questions?

George, could you explain what is going on with the HCD inventory a little bit more, especially the enterprise side?

Yes. I mean, enterprise inventories are fine, we haven't given any indication that we had any issues there, and so we didn't have any in Q3. With do not expect to have any issues in enterprise in Q4. We did see some inventory issues in one of our notebook drive customers, but, we think that's primarily behind us and we are getting back into a balance of consumption versus demand with that particular customer. The majority of the issue that we faced in Q3 was really related to the desk top customers that we have. As I indicated, we now believe that problem is behind us.

Okay. So in this quarter, will you be shipping consumption?

We are indicating a modest growth in that business. So I think that would indicate that.

Great. Thank you. I would like to ask about the Intel acquisition you just closed. Particularly, when do you anticipate you will start to see some gross margin improvement, based on the manufacturing changes that you said, and you updated the dilutions for the December quarter. How about the target for when this will become accretive, if you could kind of review or update us on that?

Sure. Well, let me answer the second one first. The timetable, though, of the business becoming accretive to us is consistent with what we said, when we announced the acquisition is it should be accretive to us in Q4 of our next fiscal year. We believe that's the path that we are on. The gross margin should improve slightly every quarter with probably the most first significant improvement coming in Q2 of next year.

And so just as a clarification, you gave a $0.05 dilutive estimate for January, and then another $0.02. Is the $0.02 in addition to the $0.05?

Yes, it is.

And your next question comes from the line of Michael Masdea of Credit Suisse. Please proceed.

Yes, thank you very much. Just to follow up, Sehat, on the wireless piece, what do you think the issue was historically with their business as far as not getting as much penetration as we would like. And when is the customer relationship side like? Is that an important piece that you got with the acquisition or is that something that you have to build up?

Okay. Michael, as I mentioned earlier, the biggest issues is really related to the manufacturing issues. I mentioned about the fact that some of the products are built in lower volume, manufacturing lines. The products are built in 8-inch facilities instead of the 12-inch facilities. I mentioned earlier about the cost issues. So the fact that it's also in the lower volume manufacturing lines also caused an issue with supply constraints. I mentioned also earlier that there was – historically the business has all been supply constrained. So if we look to the history of the business, there were a lot more people that wanted to use the product, but because of the supply constraint issues, they have been used for other products, including chip sales and flash. So when the business that requires the small capacity, I mean, the sales of business will obviously have to take a hit on the supply side. Now that was the past. Okay? This is improving as a lot of chipsets are moving to different paths, as well as down the road, as we move up these cell phone products, into our foundry, this issue of the capacity constraints will even more resolve, as well as not mentioning that we will build this in 12-inch fabs. So the cost structure will be significantly better than running it on this low volume captive path with a process that is actually optimized for performance, instead of optimizing for a cost. The issues is really in the past. We believe in the next one year, we will be able to resolve a lot of these issues and the beauty is the majority of the efforts, the software efforts, the platform efforts, and the many years of investments there. Each of the customers have placed into this architecture will live. But we move to our foundry solutions, our customers do not have to change anything. All they have to do is just test the new chips. And if we change the print out, at most they are changing the boards and then the software will be functioning as is. So that's even more important. This is reason why when we look to acquire this business, we look at the future. We don't look at the past. We are comfortable. I'm comfortable that that the past is the past and we can solve the future.

All that technical stuff, it makes sense. But what about the sales side. Do you feel like you have the right customer relationships, the right salespeople in place and understanding who determines the design wins. And who gets into what? Do you feel you have that piece down?

Yes. That's by default. When we talked to the customers, we are in communication with the customers actually, before closing the business. I was blown away by the acceptance of the technology of the customers. If the customer ever complained to us, it was the capacity issues. It was not a single complaint about the technologies. They all told us, clearly, the XScale technology is years ahead of the competition. If just we had a high capacity cost solution, things would be a lot different. If there are no issues with the cost issues or the capacity issue, we would not be talking about this today.

And your next question comes from the line of Chris Caso with Friedman, Billings, Ramsey. Please proceed.

All right. Thank you. George, I wonder if you could provide some update on the dilution from XScale that you see for FY2008. I think originally you were saying that it would be 5% when you originally did it. Where is that right now?

Yes, Chris, I think at this point, we are not going to talk about next fiscal year. I think in answer to it, I think it was Bill's question, we still are on a path to have the business be profitable, and therefore accretive to us by Q4 of next year. So, you know, that would imply probably for the year it will still be dilutive, but I think we'll wait until after the Q4, to get a little further clarification on that.

Okay. Well, let me try something else then. With regard to the hard disk market, could you give us, perhaps an update or shed some light on some of your plans on potentially growing share in that market? What do you think you guys can do? And where do you think you may be, in terms of engagement with some customers to gain some share in that market?

Sure. Well, again, you know, we have to be very careful, especially in these types of forums about talking about our customer, our customer relationships. I think it's clear that everyone, I think, understands what our market position is and what our objectives to try and continue. We have been very up front that we have an objective to be a supplier to all the major players in the market. We are moving very aggressively to that. I think Sehat has made those comments as well. We are looking forward to updating you folks, hopefully during the next few quarters as to the success that we will enjoy there.

Yes. In my comments earlier, I mentioned that we continue to accelerate our investment into this business, so we are putting a lot of attempts, technologies to further differentiate our productions against our competition. Our goal is basically to allow the customers that are using our technology to build products at the lowest costs, at the lowest total ownership costs. And we have been able to, over the years, over the last few years, five years, we have been able to prove that any single customer that uses our technology, actually, have better cost products, cost of ownership products, compared to the cost for competition. And what we are doing is to further implement the newer technologies and we are already doing that. We already built, for example, some of our latest solutions that we built. The 90-nanometer designs we actually built the technology about two and a half years or so ago. So we are ahead also there, and introducing new features that will allow our customers to further concentrate their manufacturing operation costs. And we have increased performance, among other things. So we are confident that with all of these efforts, we will continue to gain new design wins over the next year.

And your next question comes from the line from Seogju Lee with Goldman Sachs. Please go ahead.

George, just in terms of the Intel acquisition, can you update as far as the number of employees who are joining you and how we should think about the operating expenses.

Yes, as we indicated, the business had about 1400 people associated with it. Those were primarily the engineering folks. There were also enough, as we worked through the business from June to the closing in November, we worked very diligently on making sure that we took the right engineering folks. But also it became very apparent that we needed some additional support in the sales and the marketing area for this business. So that did end up increasing the costs above the original thought that we had, because of those additional functions that we're taking on. Overall, it was around 1250 people.

Okay. Great. And then in terms of the dilution, that is excluding employee stock options, just to clarify, right?

Yes, I mean, it's just a cost of Intel. Yes.

So that's non-GAAP pro forma opex.

Yes.

Now in terms of the options issue. I know you are limited in terms of what you can say but should we think about the milestones coming up going forward?

Sure. Again, we can't really say any more than we publicly said, except that we have a parallel process going on now where our special committee is still working on its review and is trying to get that completed now, as quickly as possible. And we have begun the early parts of the restatement process, such that when this whole thing is completed, we will be able to hopefully move very quickly at that point to be able to file.

Okay. Great. Good luck.

And your next question comes from the line of Louis Gerhardy with Morgan Stanley. Please proceed.

Yes, good afternoon. Just on the supply agreement with Intel, what percent of your plans for the next fiscal year would you expect to come from Intel, versus outside foundries. And then maybe Sehat, if you could comment timing, maybe the slope of the growth of XScale versus the base-band business for FY2008. Thanks.

Louis, on the first one, I think we indicated way back, even before the deal, that for the next through, calendar, 2007, we would expect 100% of the supply to come directly from Intel. We will be transitioning during 2007 with them from the buying of finished goods to a foundry-type model where we will be purchasing wafers from them and taking on the back end processing ourselves. So for primarily all of 2007 we expect the product to come from them. By the time we get to 2008, it will be a blend of their production, and product coming from our own foundry model.

And then the second one?

Can you repeat the second part, Louis?

Sure, the second part is if you compare just the slope of the growth in the next year and maybe the timing of the growth in terms of the XScale versus the base band business.

I don't have those numbers, but I can give you a general idea is that, obviously certain customers buy just the application processors and there are customers are buying the whole thing, the whole integrated application processor. The third type of customer is buying baseband, plus application processor separately on two chips, because they want even more performance, because effectively, by buying two chips, they have two XScale processors on the platform. For people would have their own baseband, those are people who are using the application processor first. Now in time, we believe as the more stable in terms of using the application processor from XScale, over time, they will be able to move on to the integrated baseband application processor. If you are looking from the customer point of views, from the market point of view, the consumers, actually, will look at the different forms really from the features of the phone, and the features of the phones are differentiated by the application processor. The reason why the majority of these high-end SmartPhone devices are using XScale today. The baseband is something that you have to have to talk to the carrier. And this happened to be some of them, maybe have software that already work with existing chips on the baseband, and then those are the ones that moved to the politic processor first. And their customers like ramping the holding in a single shot. So we will eventually, everybody will move to a single chip solution from us. Some of them are already in the process.

And your next question comes from the line of Arnab Chanda with Lehman Brothers. Please proceed.

I have two questions for either Sehat or George, or Weili. Intel business, I know we were talking about this ad infinitum, the product was really good as you said but certainly they are far behind in terms of the market share from OMAP. Is the unique professor strategy that you have, do you think that's a differentiator. And I have a follow-up about the optical storage business. Is there a market entry situation where before you get an HD Blueray, you are not going to get that launched? Or is that something that we see in the back half of calendar 2007? Thank you.

Let me take the first one. Arnab, I think it's, again, a misperception. I think Sehat pretty much went through it. This is not an issue of Intel not being successful. This is a limitation on the amount of product that was available to come into the market. They sold every chip they could make. And it's our belief that this year we will sell every chip that we're going to be able to make under this agreement. So there's no issue about the acceptance of the product by the customers. It clearly now, as Sehat has pointed out, it's a manufacturing strategy issue that we have to put into play here during 2007 to, number one, meet the very nice growth projections we already believe are there for XScale business but to really make it very much bigger in calendar 2008.

Yes.

And I want to add a little bit on this, Arnab. There's a thing that is unfortunate. There are people, they are trying to send the wrong message to the market to take advantage of the fact that Intel did not talk too much about this business. And the truth is, the majority of the SmartPhones are using XScale, and not OMAP. They are going to the lower end of phones, so that's what happened in the industry. And as we resolve the issues of the cost structures and the capacity constraint issues, we will go into higher volume, and mid marks as well. And in the long run, there's no reason that we won't run into the lower end segment. It's just a matter of time that we will move into the lower end segments as well.

The other question was will the optical storage penetration be limited by Blueray?

The answer to that is probably somewhere in between. The market for the DVDs will still be very, very large. Nobody is projecting any disappearance of the DVD probably until the end of this decade. So it will not happen overnight. Now, at the same time as we will be building both, not just the straight DVD only, but we are also building the blue ray and the HD DVD solution. In fact, we are internally busy working on several different versions of the chips that will integrate the blue ray and the HD DVD capabilities on top of the existing device. So the main difference between the solutions really is a couple of things at the back end, the digital back end, meaning like the ECC, the error correction, the format, the formats are slightly different, but everything else on the front end is pretty much the same. The software will be additional on top of, of course. It will be more work. But, fine, that's life. Things get more complicated, okay, so we will have to put more resources for those DVD and HD DVD solutions. So we believe that we will be successful not just in the blue ray and HD DVD solutions but in the existing market, we will get some design wins as well. Our solutions are based on events, DVD technology, so there are a lot of issues there that people are complaining about at home, but DVDs, they may not be able to read some other disk that was written in some PC. All the issues will be resolved using DSP technology. So we are confident that the superior solutions will get the design wins, especially for the higher quality better brand products. We might not be able to win the lowest, lowest end, bare bones, lowest cost products that don't care about quality. So fine. Those are the markets that we will not address. If we have to miss that opportunity, we will miss that opportunity. We will try to address to the carriers that care of their performance at first. And I think the market is big enough and we don't have to drop our shorts to get the lowest cost products. They don't care about the quality. And we are comfortable with that.

And your next question comes from the line of Jim Liang with Cowen and Company. Please proceed.

Can you talk a bit more about your strategy in terms of the integrating the acquired Intel business, specifically in terms of blending potentially two different cultures together? And also, talk about any potential area of product synergy, specifically when you talk to your SmartPhone customers, any early feedback as far as bundling the XSCale processor with your own carrier and bluetooth going forward.

Yes, I will talk about culture. So here's my view about the culture. When Weili and Pantas and I started Marvell, we realized we have to create our own culture being of course, but at the same time, when we look around the cultures, the ones that are the most successful in the history, where do you look at other companies, other big companies that are successful. So we look at the culture of Intel, the culture of HP and we adopt the culture of HP. We adopted the culture of Intel. When Intel says only the paranoid will survive, we adopted their culture. The HP way, we look up at them and we asked around, what is the HP way? We adopted the HP way. So in a sense our culture is not much different than the cultures of Intel or HP. You know, maybe as the company gets bigger some of the people and some of the groups are sort of forgetting their own culture, but, this is not an issue to me. I believe it is not an issue. After all, we come from the same background. It's a matter of sitting together and realizing, okay, we are all the same. We're not that much different. We have different businesses have different issues. We just have to resolve those issues and pick the best of the best, okay. If we have the best known design methodology or best known practices, we will share it with each other and I think we'll have better company as a result. And we are moving from that understanding. And I think a lot of people that we talk to agree with this.

Right. I think one of the positive things for the Intel folks joining us is that they are coming back into – we haven't been around as long as Intel has been around. So we are probably considered to be a little more entrepreneurial at this point, in the life of our company. So I think what we have seen so far, they welcome the ability to come in and be part of a little more younger, entrepreneurial environment. So, we're excited about that.

Yes. And as far as the XScale energy, I think today for the cellular space, before the exhibition, Marvell Wi-Fi, and XScale already on a similar platform in many customer base. As far as the overall product ecosystem, XScale is going to be the platform for all the emerging consumer platforms for other products that we develop at Marvell. There's a lot of potential.

And it's not just a chip. As you say, George, 1250 people, the majority of the people are working on the platform and the software. That's huge, huge investment there. And huge value to our customers. Our customers could buy chips from our competitors, but then most of the time they have to develop all the software from scratch. And it's not just the cost of the chip that you have to pay for. It's the additional cost of developing the software, and the additional cost of the tool, the tool chain, and the most advanced software tools, the debugging tolls. This is the most advanced tool available in the market. So the XScale comes with the piece of mind that whatever you invest today will live for the next, I don't know, ten years, five years. There's no need to change. Our customers do not have to worry that two years from now, three years from now, if they buy a microchip processor from our competitors, they have to change the software, every, every generation, after generation, they have to change the software. So, you know, historically, people have to switch. A lot of things have to change, while in XScale, the things that we have built are so far ahead of the competition, are so far ahead of the competition, and the investment, the commitment that we then put to make sure that, okay, XScale lives forever, okay, it's important for our customers.

And the third parties and other third-party software support, that's very, very key. Yes.

And just a follow-up on that point. In terms of embedded Wi-Fi, where the Feroceon professor was a key differentiating technology in terms of getting the significant design wins do you see some synergy between XScale and Feroceon, or did you see it merging into one?

Yes, as I mentioned, we are actually moving forward. We are combining the resources of XScale and Feroceon to a look at the XScale migration. I guess maybe I need to address what the difference is between us and the competition in terms of XScale or Feroceon. The XScale team and the Feroceon teams are the only two teams today that are publicly known to be developing processors in house. That utilize the arm architecture, arm instruction sets. Okay? So we are the only two publicly known entities that have this development in house. So combining this team together we will now be the only team in the world that have publicly announced dedicated, full feature processor team in house. So this is a big deal, because by having the process architecture in house, we are able to build and incorporate new ideas, new features, new enhancements into our processor product lines, so that we can get better products, lower products, as well as we can control our destiny that we can give our customers a road map so that whatever they built, whatever they invest in software, or in platforms or in tool chains or in debugging tools, or multimedia softwares, anything they built in the past will continue to live on. The majority of the costs, if you look for the costs of building products, five to ten years from now, the majority of the costs will actually be the software costs, will be the resources, the software resources to build all the different products. It's the last thing in the world that you want to rely on products that will change every year, every two years. So we believe by bringing the team in house to develop this processor, okay, our customers will be in a better position, okay. I give long answers but it's important to say it. This is not just because we have an ego that we want to build our own processor. It's not. This is something that if you look in the history, okay, this is past anybody would wants to have a long-term product, okay, would have to invest.

Your next question comes from the line of David Wu with Global Crown Capital. Please proceed.

Yes, good afternoon. Thank you for taking my call. I just wanted a clarification. I have a real quick question. The clarifications in your comments, you said you are going to resend some of the existing designs to presumably lower cost solutions. Do the customers have to take the new designs and go test the software and also work with the operators before they can use your existing designs? The other question I have is really when I look at Marvell's entry into the business, I was wondering what your patent position is in terms of royalty negotiation between yourself and Qualcomm we have seen examples that Qualcomm is fighting in terms of patents and IP negotiations.

Okay. I will address this. The first question first. And then George will take over the patent issue. Okay. What was the question again?

About the redesign chipped and the qualifications.

I got it. I remember now. Yes, in terms of some of the redesigns, we are already working on, in progress, the goal is to have the chips to be exactly identical, not just in pinout, but not just in the software but also in the pinout. So their activities going on in devices, we are short in terms of capacity to have devices that use the same design, just forcing the libraries of even maybe doing opticals, optical advising or shrinking of the device. Now in the long run, obviously, there will be additional optimization that we will do, but those will be the second phase where we will further improve certain features or maybe add new features while at the same time, supporting the foundry. So at least for the first space, our customers will see no difference in the software. In the future, they will be deciding more features so there will be additional software if they wanted to. If they want to add or if they want to turn on the capabilities then they have to add software, obviously.

So the second part of the question, David, obviously this is not the forum to go into a detailed discussion, on, you know, patent portfolios and so forth, but I would like to point out that when we made the press release, announcing that we there completed the acquisition, we did mention in there, you know, that we got a substantial number of patents came across, included in the purchase price for this business. So I think, you know, our patent position as a company continues to be very, very strong. And I'm sure we will have a discussion with other, people in the market, and leave it at that.

Okay. George, just a clarification. The design is really to increase the capacity, not to reduce costs, correct? Because the pinout is the same.

They accomplish both. It's the opportunity for the same design to do somewhat certain percentage of optical strength because some of the technologies in the foundry, actually, they see the advanced process technologies.

Your next question comes from Allan Mishan from CIBC World Markets.

George, can you repeat the gross margin for the October quarter and then I have a question about wireless.

Sure. So basically, you want the actual numbers not guidance?

Right.

So initially we had on our conference call from Q2, you know, we can't get into specific numbers but we had indicated product mix was going to be a little less favorable than it historically was and therefore it was likely that our gross margin in Q3 would be down percentage-wise, would be down from where it was in Q2. Then in October, when we updated for the revenue, we indicated that, again, the product mix we would probably be a little bit more unfavorable from a gross margin standpoint and that we would have some absorption issues based on the lower volume that would cause a further pressure to the gross margins. So without getting specific number, the revised gross margin expectations were down from the original ones on a percentage basis, and then the commentary was we basically came in at that number.

Okay. And then on the Intel business, I think Sehat was saying that most of the improvements on costs will come from the manufacturing side and then I think it was you saying that most of what will be supplied in 2007 will actually be from Intel. So how do you get accretive by the end of next year if you are still making everything at Intel and most of the benefit will come from manufacturing?

Well, I think there's two things. One is there's another generation of chips that have already been designed by Intel, which come into the flow. We believe in Q2, which is consistent with when those newer versions of the chips will be actually available for sale. They currently exist and are in the qualification process right now with the customers. But they come into the sales mix which they have definitely a better gross margin profile than the current chips being shipped. That's number one. Then number two, as I indicated, we will be moving away from what we call a turnkey model of buying finish product from Intel to a foundry model, putting them into a typical foundry model where we will do wafers and that historically is also more beneficial from a cost standpoint. So those two things along with the increase of volumes, and the absorption benefits of that are what's going to drive it towards accretion in the second half of next year.

And your next question comes from the line of Adam Benjamin with Jefferies & Company. Please proceed. Q - Adam Benjamin - Jefferies & Co: Yes, thanks. Just two quick questions. First on embedded. Your commentary was that embedded would be down in Q4. I think you were referring specifically to the gaming, but can you talk about the wireless LAN as a total, including embedded and whether you expect growth sequentially in the fourth quarter and then what are the drivers there back and forth? Because you would expect given the gaming ramp in Q4, you would see some growth there. Just trying to reconcile that, thanks.

We are an integral part of the gaming platforms and that's very exciting for us. I think it's pretty publicly known that the product that will be built on those platforms this year, you know is limited. And so, you know, we have to face that as the reality that we are seeing. So we are not really anticipating, you know, in the fourth quarter as opposed to the third quarter on those platforms. And then some of the older platforms that have been in the market actually are seeing a downward revision in their production rates for this time of the year. So that, is the issue or explanation on gaming. Overall, yes, wireless LANs should do fine. Our other areas of embedded are doing quite well. So, yes, we should be quite fine overall. We wanted to point out that that is the situation because that's been such a highly monitored platform. Q - Adam Benjamin - Jefferies & Co: Right. Okay. And just a follow-up on Intel. I know this has been asked a couple of different ways. In Q4, you are looking for $90 to $100 million, the gross margin you have talked about is roughly in the 20% range and the opex is about $50 million for that business. So roughly, you are going to lose maybe $30 million in Intel in the quarter. How do you get from $30 million lost to profit by Q4 of next year. Can you break it down as to the combination of the revenue contribution or is it a reduction in opex or margin? Just quantitatively, on a percentage basis which is contributing the most there?

Yes, you know, I think we already said Adam, we are not going to touch next year at this point. We certainly, after Q4 is over, we will address, FY2008. I think, though, we have already said it previously, all of the items which you raised will be positively impacted as we go over the next year, including an increase in the revenue ramp, a decrease in the product costs and an optimization of the overall operating expense structure of now the new combined Marvell/XScale. So these are all things that we previously said that we will, and eventually already have and we will be continuing to work on going forward.

Yes. And as our customers migrating from the older products to the newer products, some of the older products which is worse on the margin side, will have a better margin on the newer products. Q - Adam Benjamin - Jefferies & Co: Yes. Right. But as you see that and plan for, that you can't give any kind of contribution level of which one is going to contribute more to get to that profitability?

We never do that anyways. We're not prepared to do that today and that is not something where we get to that level and once we are in a position to talk about our full financials, we'll give overall gross margin expectations for the company. We'll give actual operating expense trends. We're not in a position to do that right now.

Ladies and gentlemen, that's all the time we have for questions today. At this time, I will now turn the call over to Sehat Sutardja for closing remarks.

Thank you Letitia. This completes our Q3 FY2007 conference call. I would like to thank everyone for joining us and look forward to the next quarter.

Thank you.

Thank you. That will conclude today's conference. That concludes the presentation. You may all disconnect and have a good day.