Good day, ladies and gentlemen, and welcome to the PDF Solutions, Inc. Conference Call to discuss its financial results for the third fiscal quarter ending Tuesday, September 30, 2015. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session for which instructions will be given at that time. [Operator instructions] As a reminder, this conference is being recorded. If you have not yet received a copy of the corresponding press release, it has been posted to the PDF's Web-site at www.pdf.com. Some of the statements that will be made in the course of this conference are forward-looking, including statements regarding PDF's future financial results and performance, growth rates, and demand for its solutions. PDF's actual results could differ materially. You should refer to the section entitled Risk Factors on pages 12 through 18 of PDF's Annual Report on Form 10-K for the fiscal year ending December 30, 2014 and similar disclosures in subsequent SEC filings. The forward-looking statements and risks stated in this conference call are based on information available to PDF today. PDF assumes no obligation to update them. Now, I'd like to introduce John Kibarian, PDF's President and Chief Executive Officer, and Greg Walker, PDF's Chief Financial Officer. Mr. Kibarian, please go ahead.

Thank you and welcome everyone. Today I will start our discussion with a brief summary of our third quarter results. Then I will provide some perspective on the semiconductor environment and PDF Solutions' performance towards its strategic directions. Next, turn the call over to Greg who will walk you through the financial results in detail. We'll then take your questions. In Q3, we continued the strong bookings performance for our solutions business that we have seen in the prior quarters this year. Non-GAAP solutions revenue increased 25% during the quarter. This was driven by growth in our Exensio Big Data Solution. Gainshare revenues at $6.6 million, however, declined by 27% when compared to Q2. As we have stated before, Gainshare revenues are directly related to wafer production volumes shipped by our large customers. As a result, it can be highly volatile and this year has been adversely affected by significant declines in volumes of the 28 nanometer node. While utilizations declined in some factories more than others, it was evident across the majority of our foundry customer base and seems to be consistent with the reported utilizations across this industry. While we continue to remain positive on 28-nanometer over the long-term and eventually expect volumes to recover, until our customers can increase the utilization rates for their 28 nanometer production facilities, our Gainshare results will remain volatile. Looking at other advanced nodes, our key customers made good progress on their 14 nanometer ramps and we should start to recognize 14 nanometer Gainshare in Q4. This bodes well for good 14 nanometer Gainshare in 2016. As you probably are aware, we manage our business based on a financial model that focuses on solution revenue alone for funding the lion's share of our expenses. Looking at solutions bookings and revenue both for…

Thanks John. As a reminder, in addition to using GAAP results when evaluating PDF's business, we believe it is also useful to consider our results using other non-GAAP measures. For internal purposes, the Company focuses on non-GAAP net income and EBITDAR. Non-GAAP net income excludes nonrecurring items, stock-based compensation expenses and amortization of expenses related to acquire technology and other intangible assets and their related tax effects as applicable. Additionally, the income tax provision has been adjusted in our non-GAAP net income to reflect cash tax expenses only. EBITDAR is equal to earnings before income tax adjusted to exclude nonrecurring items, depreciation, amortization and stock-based compensation. You can access the earnings press release that contains a reconciliation of EBITDAR and non-GAAP net income to GAAP results in the Investors section of our Web-site located at pdf.com. Now let's look at the financial results. Total GAAP revenues for the quarter were $23.9 million resulting in GAAP net income of $1.5 million and GAAP EPS of $0.05 per fully diluted share. Revenues on a non-GAAP basis totaled $24.4 million with non-GAAP net income of $5.8 million or $0.18 per fully diluted share. Cost of sales and operating expenses together were $21.2 million on a GAAP basis and $17.7 million on a non-GAAP basis, which represents an increase in non-GAAP spending of approximately $1 million over Q2. Moving onto revenue details, as stated above, total GAAP revenues for the quarter were $23.9 million, which were reduced by approximately $500,000 of non-GAAP deferred license and services revenues related to the Syntricity acquisition. Total non-GAAP revenue of $24.4 million for the third quarter were $1.2 million higher than in Q2. Total non-GAAP revenues were comprised of Design-to-silicon-yield solutions or solutions revenue of $17.8 million and Gainshare performance incentive or Gainshare revenues of $6.6 million. Our…

[Operator Instructions] Our first question comes from Jon Tanwanteng.

I just wanted to focus on the solutions revenue. Could you break out how much Syntricity added and if you pulled in anything from future quarters at all? The numbers are pretty strong.

I think when we announced the Syntricity acquisition and talked about it, we were saying we are expecting approximately $800,000 or so for the quarter in revenue depending on the exact date of closure because you only get a prorated portion of the quarter, and we are in that range.

Okay, and can we expect that degree of strength in solutions continue as we head into the next quarter?

What I would say is for the full year we expect the strength, quarter to quarter variances too hard to call because we don't know where percentage of completion revenue is going to end up.

Okay. And then just from a higher perspective, is the strength in solutions indicative of more Gainshare strength down the line?

Obviously that's the goal, right. So we engage in these activities to drive Gainshare and future revenues on these accounts.

Okay, great. And on the Gainshare side, 20-nanometer obviously is not doing so great. Do you have any visibility on as to when that may start to recover?

No. We went to this year expecting it to improve in the second half, and obviously with these Q3 results, it degraded from the first half to the second half which I think the industry overall starting if we do that. Obviously got through the year, I think in the summer it start becoming more evident. We don't have great visibility about when it turns up, in part because the parts that drove volumes in 2014 will not be the parts that drive designs that drive volumes in 2016. I think a lot of the mobile communication devices and computing will move on to 14-nanometer, 16-nanometer in 2016, and that will be the next wafer part to drive the volume in 28-nanometer, and that's harder to forecast when new designs hit success.

Okay, thanks. And then just on the 14-nanometer node, can you give us a little more color on the competitiveness of your customers' products in that arena? We've seen some media reports on just the way the Apple iPhone processors have been supplied and the performance differences between them. How much of what you guys do is responsible for that difference in performance or maybe what it didn't do for your customers?

So of course we got to be careful about talking about any specific customer that are under NDAs, but our vehicles do characterize parametric variability. We have seen parametric variability as you go down in nodes become a bigger and bigger and more important contributor to the overall performance and yield of the parts. We have provided as part of that a Design-for-Manufacturability solution we call Templates. I expect later on this year or early next year to be talking a little bit about the success our customers have had on parametric variability that have employed a Design-for-Manufacturability solution on these nodes and have gotten phenomenal parametric behavior. But design has a big impact on parametric yields, and I don't know the specifics of that design but modellers does typically vary when it comes to design element. With our Template solution we've seen great results but I imagine a design that uses more varying layout styles will see a lot more variability.

Okay. And then maybe just a little bit more color on the dissolved partnership and what that means to your business?

That's a great question, Jon. So earlier this past year we acquired the assets of Salland which had software products in the test area. Very good products, they had a lot of market share in the mixed-signal analog market. A lot of our existing customers for Exensio, previously our [indiscernible] customers were selling customers as well. One of the things that we saw right away with that product like many small software companies is they can't make the investment in the product that you need. So they can do something really cool in code and they need to make sure it works on all the tester platforms. Tessolve has because of its business with Qualcomm, Broadcom, most of the major fabless companies, it has tester platforms that it uses to develop software programs for those customers and we're working with Tessolve in first part to improve the software function on the existing tester platforms. And secondarily, Tessolve has 800 engineers working with all the largest test and assembly houses around Southeast Asia and that's a bigger number of employees than we have, and we're working with them as related to sales channel for the OSATs in that part of the world, part of the world that we don't typically have PDF folks today.

Have you seen any traction from that so far or is it too early to say?

We think it's a little bit too early to say on the traction. We certainly have had joint customer meetings as a result of our engagements with them and there definitely seems to be interest in our products. And in terms of the software, I think we do see big improvements and our customers have told us they see a huge change with the Salland technology as part of PDF and now Exensio-Test than it was when it was a small independent company.

Okay great. Thank you very much.

Your second question comes from Tom Diffely with Davidson.

So just getting back to the Gainshare drop-off, how much of that do you believe is just the number of units going down versus a transfer from 28-nanometer to 14-nanometer and then the lag of between when you get the royalties at 14-nanometer?

It's a great question, Tom. We know some of the end customers that drove that decline, and at least in one case they are not really up on 14-nanometer yet. So we do believe it was truly an inventory correction for probably one of the bigger customers that contributed to that volume decline. They we know have active activities on 14-nanometer and we expect them to start driving volume in 14-nanometer as we get into 2016, but I don't think they were so much of it. The other big driver on the 14-nanometer, 16-nanometer node so far has been the application processes that go in the Galaxy and iPhone launches. That shift has already happened from 28- nanometer over a year ago. So we believe this is primarily around inventory and weakness in some of the fabless customers' products in a couple of the end markets.

Okay. And even though some of your customers have these take or pay contracts, you don't see any kind of uptick in the fourth quarter from that?

The take-or-pay we think has driven kind of a slower level of volume at at-least one of our customers and we believe that is providing some level of demand inside the factories. It's the more classic fabless customers who don't have those arrangements that buy wafers on demand where we see the weakness.

Okay. And then if you look at the, how to phrase this, the Gainshare producing foundry capacity out there for you, has that gone up this year or how is the total capacity of your Gainshare potential?

That's a great question, Tom. So I think there's a couple of things. In a lot of our foundry customers, the expansion in 14- nanometer or FinFET nodes is in new foundry capacity. So they are building entirely new show. They may do some startup of 28-nanometer in that show but it quickly shifts onto the FinFET node because the tooling set is designed to that. The IDM types or kind of the hybrid IDM foundry types, sometimes they repurpose 28-nanometer capacity into advanced nodes, and we know that at least one of the technology leaders is doing that where they are repurposing the capacity. When you repurpose the capacity, the unit volume tends to go down. In other words, the factory that could produce 50,000 wafer starts at 28-nanometer will not produce 50,000 wafer starts at 14-nanometer because the total number of processing steps goes up. So I would say for most of our customers, the newer nodes are greenfield capacity. With one particular exception, we believe that a lot of their new capacity at 14- nanometer has come at the expense of their 28-nanometer.

Okay. So if the foundries all produce at full capacity or were producing at full capacity today, would you have record royalty revenues?

Yes, if everything were for right now, we would be blowing the doors off.

Okay, we'll look forward to that next year. So, on the Syntricity acquisition, you talked about the 800,000 in the quarter. What is the kind of average quarterly run rate?

Probably a little bit higher than the 800,000, is kind of what we are taking over.

Okay. And then Greg, when you look at the OpEx structure right now post acquisition, does that feel like a structure that's going to be roughly the same going forward?

I would say certainly within 5% to 10%, up or down, on the standalone Syntricity resources. When you look at the combined companies, we will be making additional investments. Hard to say whether at that point in time are we hiring Syntricity – new Syntricity or new PDF, they are basically combined at this point in time.

Okay. And then I guess lastly, Greg, you talked about I think it was $1.6 million for some test equipment. Is that not simply part of R&D?

Depending on what stage the development on that hardware is, it can be either R&D or cost of sales. So if we have a completed design we are in production on, we're just building new equipment like a new tester that is already in the field, that would go against cost of sales.

Okay. And would you expect to have a significant ramp in tester equipment expenses for next few quarters as you kind of build up your DFI?

It will be referred to as something other than tester, but yes in the same line.

Okay. Alright, thank you.

Your third question comes from Brian Freckmann with LS Capital.

Greg, can you please repeat your commentary [indiscernible] for the fourth quarter in regards to design-to-silicon? I wasn't quite sure what you were insinuating as to the run ate from the third quarter.

So for one thing, as you know, we don't really give out quarterly guidance or expectation. So we reiterated the fact that we are expecting the full year to be strong. As far as what the next quarter will be, it's too hard to call an exact number or even within a range because there's a lot of variability driven by the percentage of completion recognition depending on how much work against our customers' timetables actually gets done. So there's quite a bit of variance there, but overall, yes, we're three quarters into the year, we know what that is and overall we feel good about the full year number, which implicitly says we feel reasonably good about the quarter. Will that be up or down from this quarter? There will be variance around that, can't say.

Any way to sort of even just give us a range of the variance in your view, like is it 10%, 20%? I mean this is certainly a benefit to the upside, a big number, and I think just trying to make sure fourth quarter is in line.

So what we've said before was we expected the year-over-year growth to be in the 5% to 10% range, closer to the high end of that range. We would certainly reiterate that guidance. So that's the way to figure out kind of bottom end of the range.

Okay, that's good. And then just sort of in looking out at the Gainshare business for sort of trying to look at calling a bottom here, which I think, John, it sounds like you're actually sort of kind of positive on this quarter versus last quarter, assuming kind of an equal number of 28-nanometer business, if we take into account 14-nanometer, is the expectation that Gainshare should be up in the fourth quarter just kind of directionally?

So if 28-nanometer volumes do not erode further, then with 14-nanometer orders we should see an improvement in Gainshare. That's because it's out of new capacity. Like we said, we are still – 28-nanometer is murky to us right now. We are trying to keep – we expected Q3 to be an improving 28-nanometer quarter when we got into Q1 and it turned out not to be. So with that caveat, should 28-nanometer stayed at the same level they are right now, with 14-nanometer orders we should see an improvement. If 28-nanometer erodes more, then it's going to eat into our – the gains that we are going to get off 14-nanometer.

Okay. And then did I hear this right, Greg, when you said your non-GAAP revenue was 24.4?

Correct.

Okay, it's non-GAAP revenue, okay. And then finally, is there any way to sort of think about, if we sort of bundle – I know DFI is not for a little while, but some of the sort of let's call it newer initiatives whether it's big data within the design-to-silicon business, sort of disaggregate to two sort of say core legacy PDF and design-to-silicon, sort of help us understand sort of what benefit – I mean you guys talked about these new initiatives for quite some time, I think some of us would like to begin to see sort of, hey, this revenue generated a certain percent potentially with the design-to-silicon business, we're getting rewarded for things we've been investing in for last few years, any way to sort of break that out?

It's hard to do, Brian, because if you look at for example the more than more foundry in Q3, it's an integration of CVs and the big data solution and how much of it do we attribute to each. What I think you can look at is the growth in the solutions business is greatly due to the new technologies. So if you kind of look year-over-year growth, it's mostly off the new products and new solutions that are making it some more relevant to the mature nodes, to the fabless companies, to their control, test control problems, et cetera. And you are right, there is really no revenue. All Design for Inspection right now is a drag on earnings because we're making that investment now. So it's not contributing to the top line. But the majority of the growth year-over-year is related to that, to new investments. Moreover, if you kind of look at the capital equipment industry, it was really dependent on advanced nodes. Most of the capital equipment industry this year has seen not a lot of growth in selling new equipment, and typically our business has really – the solutions part of the business has correlated with when capital goes into factories, and the Gainshare has typically moved with the application of that capacity, typically much after the capital equipment folks see their revenue from installing equipment. And what's been interesting for us this year is our business on the solutions side has been going up strongly while the capital equipment business which is really tied to the advanced nodes has not been going up as strongly, and I think that really speaks to how we're de-coupling the solutions business from the leading edge really very – some of it was about 10-nanometer this past quarter but not the lion's share of it. So I think that should give you comfort that the investments we are making are going in the right direction, but it's kind of hard to peel it out, and frankly when inside the Company, people want to, how valuable is my product versus that product. My argument to them is, what's more valuable, your heart or your lungs? I don't see anyone living without a heart and lungs. So we're not going to live as a company without a heart and a lung. So let's not talk about how much you get versus how much the other guy gets. That's my mother of an apple pie approach.

Okay. And then finally just on DFI, have you guys sort of come to a conclusion on sort of how you're going to be charging for that?

No, we are really not ready on that yet but we are getting – for the first time we're starting to get measurements and we're starting to the kind of problems that we can see for customers and they are really excited about everything. Subtle leakages that are typically very hard to see on inspection. One of our fabless customer friends says, detect the undetectable and we really are seeing things that are undetectable on inspection. So it's really quite complimentary to the inspection capacity that's out there. I think it will be very valuable for customers. But how we price for it, we still don't know yet. We want to get more data.

Okay, sounds good. And then maybe since I don't know if anyone's behind me, the $4 million in buyback on a 2015 total, given what looks like a pretty strong 2016 for 14-nanometer, I'm curious what has been the rationale for $4 million versus let's say $10 million, or sort of at the level you guys are buying, what's been the rationale to do $4 million versus a much larger amount?

This is Greg. I think two things. One is there is a limit on how much we can buy just based on probably the last 30-day average trading and so forth. So that limits us somewhat. Two is, you don't want to go in where you are moving the market, so we're careful about that. And three is, really at the Board level there is still enough discussion going around about how aggressive to be on buybacks that we are taking a relatively cautious approach to how we do that.

Okay, thanks for the color. Appreciate it.

[Operator Instructions] Your fourth question comes from Gus Richard with Northland.

Can you give me some color, what was the software revenue in the quarter?

We don't separately disclose that. So part of that is due to the fact that a lot of the deals are combined. It gets very grey as to what software versus what's IYR type work. I think John was talking about one transaction where we've got a combination of almost everything we do in the deal. So for that reason, we have not separately identified the software business, and at this point in time we don't have a plan to.

Okay. Would it be fair to say that about I'd say 20% of the revenue from design-to-silicon solutions was software, is that a ballpark, and it's growing as a percent?

I hesitate to say whether that's ballpark or not because of the crossover between the two. Depending on what allocation methodology I use in some of these deals, I can come up with wildly different answers.

But I think, Gus, to get at the question, I think the way you might want to think about it or the way you certainly think about it, the value of the software that's being delivered in the solution is a greater and greater percentage of the total business, and that is giving us efficiencies in that we are able to deliver more value to the customer without growing the field at all like our field. The number of consultants or field folks in the organization has been around 70 folks and it continues to be at that level yet as you look at the design-to-silicon-yield solutions revenue is up substantially over where it was let's say a few quarters ago on the same field expense. And we are trying to improve that. What I really liked about the Syntricity business was they were delivering software as a service, right. So we want to find more ways to serve the customer where we drive value to the customer that doesn't involve headcount, and I think that's kind of what you're seeing in the numbers, but how to split it back out is very hard to do. The Syntricity thing, do you call that service, do you call that software. Certainly, it's software enabled service.

Okay, I get it. And then I think you announced two contracts, one for 10-nanometer design-to-silicon solutions with an Asian customer. Did you recognize revenue in the quarter from that contract or is that to come?

I think that was from a foundry customer. We didn't say who or what part of the world it was from, and that we did recognize revenue in the quarter. The other we're going to control.

Okay. And I think you had also a 28-nanometer customer, I think you said in China. [Indiscernible]

Yes, that was in China. We did recognize some revenue from that customer.

Okay, perfect. Thank you.

Your fifth question comes from Andrew Wiener with Samjo Capital.

Greg, first I just wanted to clarify something. The guidance on solutions is for half the year is 5% to 10% growth and I think you said you are very comfortable with the high end of that, and that backs out the first quarter contribution from the payment from the customer from the contract issue from last year, correct?

Correct.

Okay. Secondly, John, over the last couple of quarters, just a little bit of a follow-up to Tom's question earlier, you talked about your ability to get in with some customers in Asia, in particular China, and perhaps you can talk about how you see over the next couple of years that adding to the Gainshare potential for the Company?

Sure. Actually in our prepared remarks and to refer to the [indiscernible] because right now the business we talked about this past quarter was for a company that was headquartered in China, but we also see a lot of our Taiwanese customers making expansions into China. So broadly Greater China, we see a lot of activity. Foundry capacity is going in there, currently at the 28-nanometer node initially and we believe there is some R&D activities that we are seeing in FinFET nodes. We see that part of the market wanting to move very fast on buildout of capacity we bring up and needing to get to the worldwide competitive status quickly. In that regard I think we have a wonderful offering for them because we have a proven infrastructure on these advanced nodes from development, Design-for-Manufacturability through process control and production control. So we started out about a year ago making introductions, we did some pilots in the first part of this year. This contract we signed in Q3 is the first conversion of a pilot into a contract and we anticipate others as we go through the remainder of this year and into next year. Our activity started first with the fabless entities and we see good activity there. We believe that will be kind of the way that China moves into the leading edge nodes. We’ll start with the fabless and system companies, or have started I should say. And then it will also permeate to the foundries and we believe PDF could be a very important bridge between those fabless and system companies and the foundries themselves.

And when you look at their plan sort of in aggregate, and I realize this is not a forecast of your results per se, but if you think about wafers per month under contract or something like that from Gainshare perspective, if they were to execute against sort of their stated plan, what does that do to the overall number of potential wafers that you are entitled to –you potentially be entitled to gain share on if you wanted to [wait out] [ph] two or three years?

So of course you know the stated is about 60% of what their funds are putting – what the China government is investing is going into the front-end manufacturing and 40% goes into design, test and assembly. If you took the numbers that they are quoting and they are gargantuan numbers like in the tens of billions of dollars and put 60% of that into capacity and take all of these things that they are forecasting and to put in the volume, yes, then it would be a huge – it would dwarf the amount of capacity that we have under contract today and should we then capture that business. So I think you've got – certainly we take a healthy dose of realism, and say, okay, we have to be careful about how excited we get about this. There's certainly a potential for a lot of capacity to go in there, and if they spend the money they said they're going to spend on capacity on the front-end primarily at 28-nanometer and below, it represents a tremendous opportunity for us and a opportunity that would be as larger or much larger than the factories that we have under contract today.

And when I think about your business model, are you generating enough solutions or design-to-silicon revenue at this point in China where you are recouping your sort of cost of capital there or are you still in the investment mode in China?

It's a great question and one we asked ourselves earlier this week, and we haven't gotten an answer yet. We just think, okay, let's go back and look at what our investment been on the pilots so far, and now that we're starting to sign contracts how is this going to look over the next 12 quarters that [indiscernible] still on invest mode. We got to try in 2006, right. We made the decision to go to China in 2005, we got there in 2006, and we invested in engineering team there. We now have 120 folks in China, almost – I don't know what that works out to be, it used to be 33%, but slightly less than that of the Company. So we've been investing in a very long time in China. So we're not impatient. At the same time I think we're now starting to turn the corner. I don't think – we're not very many quarters away from that being a meaningful part of our business.

Also, as a follow-up, you referred to I guess a foundry that's perhaps a hybrid IDM who was transitioning 28-nanometer to 14-nanometer. From a standpoint of how we think about that as being replacement versus incremental, they have actually been running I believe at very low levels of utilization for a number of quarters now. So to the extent we start seeing 14-nanometer revenue from that customer, it's fair to say versus our current rate that it would be largely incremental?

That's correct.

Okay. Next question I had was, again you historically have said that design-to-silicon sort of pays the bills and Gainshare is where the profitability comes in. However, to the extent that software is an increasing portion of the design-to-silicon revenue and it's being sold not just to foundry customers or foundry customers for which we have integrated solutions contracting a gainshare, but I believe it's also being sold to foundries where we don't have a gainshare contract as well as it's being sold pretty broadly now to fabless, should we expect over time that the design-to-solutions actually runs profitably and is incremental to the profits of Gainshare?

You could have entered the meetings earlier this week, Andrew. Yes, it's actually something we're trying to model out. We've got two competing things there. Most of the business is ratable. So you make an investment in the field to see that business. You book a couple of million dollar contract and you see in that quarter maybe $100,000 or $200,000. So we are trying to in the field as we're doing our strategic planning, reporting on where they saw a business opportunity around the world in terms of Exensio Big Data and there was quite a number of potential business, potential clients, the customers in a variety of all of our geographies, Asia, Europe, U.S., and so we are trying to balance our investment levels to get at that business versus the profitability we drive off that business and understand a little bit about that trade-off. If you go to the steady-state, yes, our goal and the reason why we started making this investment is, we want to drive profitability of design-to-silicon solutions business irrespective of Gainshare. We want to get to a model eventually where that covers not just our expenses and our investments but also drives profitability. We are not there yet obviously and we don't know quite how long it's going to take us to get there, because as I said we are balancing investment in the channel versus immediate return and we're trying to understand that, but for sure that is the reason why we made that investment.

My last question is, if I was trying to – and then I'll pass it on to the next person – if I wanted to try to figure out the profitability of sort of classic PDF including software and sort of break out the spend on Design for Inspection which is really sort of a new opportunity and which there is no revenue attributable today, what percentage of the operating expenses would you say is attributable to the DFI initiatives?

I would certainly think it would be no more than 5% at this stage of our total spending and probably in that range. I'm sorry, that's as a percentage of revenue. As a percentage of revenue, it would be no more than 5%.

I think another way to look at it is the majority of the growth in the R&D line has been Design for Inspection. So if you compare 2014's spend level with 2015 spend level, the majority of that Design for Inspection, there was some Design for Inspection in our 2014 number and there was even some in our 2013 number, there were some very, very earlier in our 2012 number, but the majority of that growth has been Design for Inspection related activity.

Thank you.

Your last question comes from Mike Cotogno with Cardinal Capital.

Just one quick one, on the Gainshare revenue moving back a year, so my guess is that 28-nanometer was probably a nice log of the composition of the Gainshare revenue. Right now in the current quarter or the most recently reported quarter, obviously things are falling off. I mean is it safe to say that 28-nanometer is less than 50%, or can you give us kind of a rough range of where you think that's playing out right now?

Gainshare, 28-nanometer still is the majority of the Gainshare revenues, but just the total amount has fallen.

Okay, thanks.

At this time, there are no more questions.

Okay, thank you very much for attending the call today. We look forward to talking with you after the end of Q4. Have a great day.