Ladies and gentleman, thank you for standing. Welcome to the Qualcomm second quarter fiscal 2010 conference call. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session. (Operator Instructions) I would now like to turn the call over to Ms. Warren Kneeshaw, Vice President of Industrial Relations. Mr. Kneeshaw, please go ahead.

Thank you and good afternoon everyone. Today’s call will include prepared remarks by Dr. Paul Jacobs, Steve Mollenkopf, and Bill Keitel. In addition Steven Altman, Don Rosenberg and Derek Aberle will join the question-and-answer session. An internet presentation and audio broadcast accompany this call and you can access them by visiting www.qualcomm.com. During this conference call if we use any non-GAAP financial measures as defined by the SEC and Regulation G, you can find the required reconciliations to GAAP on our website. I’d also like to direct you to our 10-Q and earnings release which were filed and furnished respectively with the SEC today and are available on our website. We may make forward-looking statement relating to our expectations and other future events that may differ materially from Qualcomm’s actual results. Please review our SEC filings for a detailed presentation of each of our businesses and associated risks and other important factors that may cause our actual results to differ from these forward-looking statements. Now it is my pleasure to introduce Qualcomm’s Chairman and Chief Executive Officer, Dr. Paul Jacobs.

Thanks Warren and good afternoon everyone. I am very happy to be with you this quarter. I am also very pleased with our financial performance this quarter. Our revenues of $2.66 billion and pro forma earnings per share of $0.59 were very strong and exceeded the high end of our prior guidance. These results were driven by healthy 3G device shipments and greater than expected demand for our chipsets. We also returned approximately $2 billion in capital to share holders this past quarter, including $1.7 billion in share repurchases. We announced a 12% increase in the dividend, and additional Board of Directors authorization of $3 billion for share repurchases. As I indicated we had a very strong quarter. Given our knowledge of how the quarter was developing, we do not think it will appropriate until after our earnings report to implement our 10B5-1 plan that we used to execute on the new buyback authority. We anticipate getting that plan finalized in the near future, and anticipate the buybacks with commence under it as appropriate. The device market has developed much as we had expected, with a bit stronger December quarter for CDMA based devices across most regions. In fact despite a challenging economic environment in calendar year 2009, we now estimate that 3G-device shipments increased by approximately 7% for the year based on mid-point estimate. In addition in calendar year 2010, we estimated 3G device shipments will grow approximately 23% based on the mid-point of our current estimate. According to wireless intelligence, 3G subscribers have now surpassed $1 billion worldwide. The 3G option underway in India, the global 3G footprint is a step closer to completion. We announced today that we are modifying the information we provide on our licensing business, including now the addition of total subscribe unit sales…

Thank you Paul. Our QCT business continues to execute well, and I’d like to share some highlights form the second fiscal quarter of 2010. We shipped approximately 93 million chipsets, which is at the high end of our most recent guidance, and constitutes an increased of 35% over the same period last year. We saw continued strength in our 3G device shipments and believe that we gained share during this period. We have also gained new customers, particularly in the emerging markets. Over the past 18 months we have nearly doubled our already extensive customer base in China. We generated revenue of approximately $1.5 billion in the fiscal second quarter, an increase of 17% year-over-year. Our earnings before tax was $344 million, 59% higher compared to the year ago quarter. Our average revenue per MSM declined in the second quarter. This was in line with our expectation and is typical for the first calendar quarter of the year. Looking forward, we are forecasting shipments in the range of 97 million to 102 million chipsets in the third fiscal quarter, driven primarily by an increase in UMPS chipsets. Data centric chipsets and products for emerging markets are expected to become a larger percentage of our total unit volume as new customers, particularly China continue to ramp production. We expect to continue to feel downward pressure on average revenue per MSM our focus on growing 3G shipments in a competitive current environment and investing in cost competitive products with increased features in function. As a result, we expect to deliver operating profit margins consistent with the previous guidance for the fiscal year. Design traction of our highly integrated 7000 and 8000 series chipsets remains robust. As was evident at both the consumer electronic show in January and mobile world congress in February.…

Thank you Steve, and good afternoon everyone. I’ll begin with a few comments regarding the changes we’ve made to our metrics for QTL. In addition to estimates of ASPs and unit shipments, for CDMA based device sales reported by our licensees, we will now be providing total reported device sales, which is the sum of all subscriber licensee devices reported to us by our licensees in a given period. We’ve provided this metric in our earnings release for the four quarters of fiscal 2009, and the first two quarters of fiscal 2010. We’ve also provided a range of total reported device sales that we estimate our subscriber licensees will report to us in this third quarter of fiscal 2010, and we intend to continue to provide this quarterly guidance going forward. Utilizing our licensees reports, as well as other information, including information from licensee audits and public information, we break down total recorded device sales into our estimates of its two components. A unit shipment range, and average dollars per unit or ASP, that comprise a total reported device sales amount. Based on additional information obtained this quarter, and our ongoing analysis of CDMA device trends, as well as the assumptions we used to estimate unite shipments and ASP’s, we are adjusting some of the underlined assumptions we use to estimate licensees unit shipment and ASP. For comparative purposes, in today’s earnings release we have provided the table showing the impact of applying these adjusted estimation assumptions to the units and ASP’s on a quarterly basis, back though the beginning of fiscal 2009. As you can see, applying this analysis results in a higher ASP; a range of $2 to $8 per unit over the six quarters, based on mid points which we provided for comparative purposes. Likewise it results…

Thank you Bill. Before we go into our question-and-answer session, I would like to remind our participants that our goal in this call is to address as many questions as possible before we run out of time. I would encourage you to limit your questions to one per caller. Operator we are ready for questions.

(Operator Instructions) Brian Modoff from Deutsche Bank, please go ahead with your question.

Thanks. A question for you Steve. if you talk about the pricing environment you are seeing in terms of sequentially, how do you expect the ASP trends in our chip business to be for the year, particularly with regards to WCDMA. Then how do you see your market share evolving through the year in WCDMA? Thanks.

Brian, two parts. Obviously the first one is on pricing. In terms of the pricing that we had to extend, it’s been pretty much what we thought it was going to be the entire year. If you remember, we’ve been talking about how we thought it was a pretty challenging pricing environment. The issue that I think is another component of our ASP, if you just divide revenue by units is really mix, and I think that’s the issue that we are seeing. It’s that the percentage of our business that is low end and data centric devices, right now is still fairly high. That being said, we are very happy with the traction of 7K and 8K moving forward. We have also part your question, we feel we are building share. If you look at the quarter we just reported on, we think we built share there. We also feel moving forward that we are building share, particularly in WCDMA, and I think it’s coming from a couple of different places. Primarily as people migrate towards smartphones, we are seeing them migrate a bit towards our integrated solutions, so I think that’s probably pretty good for our business. If you look at the sequential move in the chip business, a lot of that is in WCDMA, and that’s primarily you think will pickup with share.

Okay, thank you.

Your next question is from Maynard Um from UBS. Please go ahead with your question.

Hi thanks. I’ve got a chips question. I’m just curious; you talked about market share gains, you talked about new devices like the tablet, emerging market customers starting to ramp, it sounds like we should expect to see stronger MSM unit volumes in understanding the mix. I’m just curious why we are not seeing better leverage on the volumes to the op margins. Can you just kind of walk through the impact between ASPs, gross margins and OpEx, and kind of what the different drivers are as to why we are not seeing the benefits of the margins from presumably the rise on the chips and volumes. Thanks.

There are a couple of different items here. Number one, we continue to invest in producing our system solutions, and as you know the investment cycle, we really invest upstream of the revenue. So we continue to invest heavily in producing system solutions, primarily in the area of mobile computing and software, so that’s existing in the business today. We are also in a little bit of a transition period where we are transitioning over to where emerging market devices or data centric devices are still a large portion of our shipments, and it hasn’t transitioned over to the point where the smartphone integrated solution chips are the large portion of the business yet. As I said before, we like the way that looks, the designing and the traction that we are seeing throughout the year is actually consistent and actually a little bit above what we had originally planned, and we are happy about that. In terms of top-line leverage, a lot of it depends on what the mix looks like, but in the quarters that were not guiding to, so in the second half of the year. Right now I’d say the biggest part of the business that is difficult to predict is really how much of that is going to move towards data or to 1X, and I think that’s the part that’s probably the hardest part to model in our business right now. Well, just supplement that a little bit, because its pretty much the same case as what we have said in the last couple of quarters, and that is that our gross margin percentage in your business, for the full year we are expecting it to be larger and the same as last year. So again, although they we are seeing a mix of product change a bit, and we are seeing a tougher competitor environment, I think we’re leveraging those R&D investments we’ve made, to be able to sell at a lower price, but still earn good gross margin percentage.

Tim Luke from Barclays Capital, please go ahead with your question.

Thanks so much. I was wondering if you could just clarify, using the old guidance associated with the handset ASPs for the quarter you just reported was 179. What was it in the quarter using the old system or maybe using maybe the new system, and in trimming the guidance for the ASPs for the year? What were some of the factors that are leading to that, and can you just clarify again, what was the catalyst for changing the system to this new system? Thanks.

Okay Tim. First for fiscal Q2, at the outset of the quarter we had estimated a midpoint of ASP of about $179, and then during the quarter we came across some information that caused us to use new assumptions in our model, okay. You think if we had had those inputs at the outset of the quarter, we would have estimated an ASP for a fiscal Q2 of about $185, and that’s about equal to the midpoint of the range we estimated as the actual. So I think the ASP forecast process for this quarter was fundamentally strong. We came across we think some material new data. As we said it was in part from licensing audits, as well as in part from some public data, and that caused us to update our estimation process, so that was the driver there. For the fiscal year, we gave you an estimate here, the midpoint was approximately $185, largely in line with what would have been, had we been estimating under these new assumptions that we are using now. In fact it was off $2, which is largely the impact of our factoring in foreign exchange, specifically the euro.

Tim Long from Bank of Montreal, please go ahead with your question.

Thank you. Just a two part here; first to clarify this change here Bill if you could. If we were unsure about units or ASPs for some of your licensee, how do we know that the royalty rate is being paid appropriately, and why is that not subject to potential change. If I could just go back at the chipset share gains. Just curious Steve if you think this is new wins, so gaining shares at specific customers, and then obviously with taking the overall industry units low, obviously your market share is higher than you expected, so should we assume that that’s mostly WCDMA because your level of visibility there I’m assuming was less, so the unit changes that we saw were more likely in WCDMA. So am I right to assume that WCDMA share is higher because of the change? Thank you.

This is Derek. Why don’t I go ahead and take the response to your first question. I think we have said in the past, we do get varying levels of information from our licensees through the reporting process in terms of unit shipment and ASP information, although we tend to have quite a bit more clarity around the total reported sales of those devices, even though it might not be broken down, but there’s much clarity in the units and the ASPs, and so we do have a high degree of competence in the reported numbers at a gross level or an aggregate level I should say. We also extensively audit our licensees to ensure that their paying royalties on the products they are selling in the way they are supposed to under the agreement. So that gives us an additional level of confidence on the numbers. With regards to share, I think it’s a combination of both factors. Number one, our existing customers are doing better in the market perhaps than they were on a sequential basis. The other aspect is we are adding new customers and they are shifting more of their volumes towards products that use our chipsets. With regards to the change in the size of the WCDMA market, I think that what that really does is just slide the market share numbers up by a certain percentage. I think my comments were really more targeted towards a sequential difference or a difference in whatever that number is. So we think quarter-to-quarter that we would increase that number; whatever that number is, whatever your size of the WCDMA market is. So both of those trends I think are positive for the business.

Ehud Gelblum from Morgan Stanley, please go ahead with your question.

Hi, thank you very much guys. There are a couple of things as well. Bill, first of all the ASPs -- I’ll start with revenue for this quarter was higher than the original guidance for this quarter, and yet the four year guidance is staying the same. Can you just give a little background as to why you didn’t raise the four-year guidance. At least sort of in line with the top line beat this quarter. Then Steve, when you look at QCT margin your had guided before, actually Bill guided the QCT margin for the year, 22% to 24%, and Steve, you can Bill made a comment last quarter that margin would dip in QCT in the June quarter, and then September we would see it bounce back to levels. I think the word you used was something like levels that we are being more accustomed to seeing, implying a sort of a V in margin in the June quarter that comes back in September. I didn’t see commentary to either those effects. Are we still looking at 22% to 24% for the year, and should we still be kind of looking for a bottoming in the margin for QCT in June, and then bouncing back to more reasonable levels in September, or is that kind of changed with what you see in the dongles and data cards?

Ehud, to your first question, we carefully considered whether we should raise our revenue guidance, but if you step back we got a fairly wide range on there already, $10.4 billion to $11 billion. (2) we also said that last quarter to achieve the $11 billion level, we would need to successfully get the approximate $200 million of revenue that we think we’re owed by two licensees; one is paying and we are not recording that revenue. This quarter obviously we are three months further into the year. We still think there is an approximate $200 million of revenue upside that were owed, but given that we are three months into the year and six months left, we probably adjusted that number. So we brought that down even though what offset it was some further upside we’re seen in the rest of the loyalty business and the chip business.

Yeah, this is Steve. With regards to your second question, yes very much the same curve. I think we are not changing any of the guidance on operating margins of QCT. One thing that as bill said in his commentary, Q2 was actually quite a bit higher than we thought at the time. So I don’t think its may be as broad a bottom, as you may have looked at back in the January timeframe, just based on the results that we just reported on. I don’t think we are giving any guidance here on Q4, but as I said the units for the year look up from what we have seen in the past, but the question is really what’s the mix going to be like in the second half and we really are not at a point to talk about that.

Mike Walkley with Piper Jaffray, please go ahead with your question.

Just going back to the change in the handset, the ASPs assumption. I’m just wondering, can you help clarify maybe the units came down? What change in assumptions there are, and then more as we think about WCDMA and CDMA coming more on a global basis. Maybe our ASP is on a regional mix basis with the emerging markets; a little more than the mix in the March quarter versus the mature market to have a seasonal down tick.

Mike, on the new data that we provided based on our new estimates, the new data, going back the six quarters, the units did come down and the ASPs did come up. Again, we take that total reported subscriber royalty number that gets reported to aspire licensees, and as you know, historically we have broken that down into two components; how much is ASP and how much is units. One time the other equals that total okay. So because we got some new information that caused us to reconsider what we previously had for ASPs, the offset was in units, so ASP is a bit higher units, a bit lower, and it all has to triangulate back into that total reported number that comes from our licensees. So frankly that was some of our discussion why we thought going forward, investors might appreciate that we are dropping the ASP guidance on a one quarter forward basis, but we are going to introducing this new metric. So next caller when we report against that 24% to 26%, we’ll be pointing against an actual. Whereas if we were just giving you the ASPs and units, we’d design it here, an estimate of what our estimate had them. So we think there is a little more surety in the number, and we thought investors would like that aspect.

[Inaudible] with Oppenheimer, please go ahead with your question.

Thanks. Bill just to follow-up on that, still on an actual basis you should have very accurate report to tell you the exact amounts of units shipped every quarter. So I still don’t understand why you can’t give the point number on the historical numbers. I understand you try to reconcile to revenue number, but it feels like an artificial unit number when you already have an actual unit number for those quarters.

This is Derek, let me follow up on that again. Again, what we get with a high degree of confidence is the total reported advice sales, which is the number that we are starting to provide going forward. There is an element of estimation in our parts to try to break that down in to what piece is driven by ASP versus what piece is driven by units, because we do no get perfect information from all of our licensees. We get varying levels of detail from some of the licensees, which we then in some instances mean to cooperate through auditing in other mechanisms. So again, I think there is an element that we do need to estimate and that has been the case for quiet some time.

Can you just supplement that to say that the great majority of what we get, we know the unit and ASP estimate; it’s a smaller portion of the totality of the reports that we are estimating units and ASP’s.

Stacy Rasgon from Sanford Bernstein. Please go ahead with your question.

Hi guys, thanks for taking my question. I think just quickly two parts on the device licensees, and the units again. So first of all, I know the way you recharged and everything; the ASP’s went up and the units went down. However you left your full year unit guidance pretty much unchanged at 600 to 650, and this quarter the units seem to come in very strongly at 150. Does that imply that I guess that is sort of an effective raise to your absolute unit guidance for the calendar year, if effectively the units we’ll be looking at on a go forward basis to compare them would be I guess lower than what they would have been before.

That’s correct. We are seeing a bit stronger market. It still ends up that 600 to 650 range, but as you said, given that our new information want us to believe that ASPs are a bit higher, and hence units are a bit longer. So yes, we think we are seeing more strength in Europe, both smartphones and data devices. In the Americas we are seeing CMA 2000 doing quiet well, notably on the smartphones, and then what we categorize for you as the rest of the world, it’s WCDMA. We are seeing a bit stronger traction than what we previously expected in a number on the developed markets of Japan, Korea and the U.S. for WCDMA, but your correct.

Simona Jankowski from Goldman Sachs, please go ahead with your question.

Hi thank you very much. In terms of your sequential guidance of a total reported device sales of $24 billion to $26 billion, can you just comment a bit qualitatively to see more of that sequential growth coming from a unit or a ASP prospective.

We are going to refrain from that. We are pulling back from. What we used to do is guide the units and ASPs one quarter forward. We have given you our estimate and what the total reports would be, and I think as always aware, we except a low single digit loyalty amount will earn off of that total.

Tal Liani from Bank of America, please go ahead with your question.

Hi guys. Two question; first, OpEx went up 10% sequentially it seems like in your laboratory reasons; and second QCT margin at 22%. Its inline with what you said before. Can you elaborate, so there is the outlook better or worse then what you have discussed last quarter thanks.

Tal, its Bill. In the operating expenses, the March quarter is a seasonally high quarter, and you get the restart of the employee payable taxes there. So that’s typically the December quarter that was largely paid off, and so we are not including that expense. You get that seasonal phenomena which we had expected, and as were in our estimates. The operating expenses just came in at bit higher than what we had originally expected, and that was due to our expenses around patent filings, and we are seeing a greater amount of patents that we are preparing to file and filed in this quarter. So that explains the operating expenses. In the case of QCT, we are largely in line here. There’s not a material difference on what we have seen in the last quarter. As Steve mentioned, we are working at a bit higher volume, but at the operating margin line pretty consistent with what we saw at our last call.

I might just say one thing; we do have as we saw, we revised guidance and actually got up to the high end of that. What we did see was a little bit growth in margins or growth in units; probably a little bit better on pricing and a little bit better on costs, primarily due to volume growth.

Thank you. I have got just a couple of questions for Steven. I still don’t quite understand, on the QCT margins are you saying this is the trough now or you just saying the mix is still hard to predict you don’t want to comment on margin and clarify that point. I guess even beyond just the next couple of quarters, some of your competitors are running very successfully, and are reporting quite strong financial now inferior to the M1. I guess this pricing kind of strategy that you invoked at the end of last year. Would you agree or not agree this could last for several years. We should get used to just fundamentally lower level of QCT profitability for several years. Would you see it that way or do see things differently. And a question for Bill; under your licensing dispute, are you still optimistic that you will settle in a reasonable timeline and I think you said you were hopeful by the end of this fiscal year. Does that still apply?

Here on the first part about QCT, I think a lot of people had backed into a trough type of shape for our op margins this year, and with June being the bottom, and we see it very much the same way. I am very hesitant to project or to predict what is going to happen beyond the June quarter, just because I think a lot of it depends on mix as to what we are going to see. More generally I just want to make sure just clear on a pricing environment, we then actually seen pricing throughout the yea do things that are completely consistent with what we thought they were going to do in the November time frame, again in January, and again now. So pricing really is not anything unusual for us. The issue really is the ability to predict the mix out beyond one quarter, and I think that’s probably more the reason why I don’t want to say too much about the long term profitability goals of QCT, but we definitely we see this year June being the trough.

This is Derek and let me take your second question. As Bill mentioned we are about three months further long than we were obviously last time we talked about resolution of the two licensee disputes. These things can be very unpredictable in terms of timing, and so it’s really hard for us to give you a good sense of when these things will be resolved. In one arbitration we’ve got schedule in place, and I think at this point it’s probably looking like it mostly likely will not necessarily get resolved in fiscal 2011, although there is always a possibility that we could reach a negotiated resolution for that before the arbitration would run it’s course. After the second dispute we remain in discussions, and again I think it’s just difficult for us to predict when that will be resolved, but we continue to remain very confident in our position, and that this money is owed to us and it’s just really a matter of time of when we will collect it.

Arnab Chanda of Roth Capital, please go ahead with your question.

Thank you. Can you talk a little bit about your QCT business kind of qualitatively. When do you expect to see revenues from some of the non-cellular technology that you are looking at. Like thicker cells or things like Wi-Fi or other wireless technologies. And the second question is, on the QTL side. If you look at the areas that are starting to grow strongly and where the new 3G licenses are being used such as they said China and India, is there a difference in the mix relative to those markets versus in kind of more developed markets. Thank you.

On the first question about QCT and some of the non-traditional products I will call them, they probably fall in a phases, because right now we are shipping bluetooth in the tens of millions of units a year. It’s a growing business that we have lowered ASP obviously than the core MSM business, but they are progressing well. WiFi is behind. It’s being sold today as a stand-alone devise in very small quantities. It will eventually become a feature that goes into our smart phones product portfolio. And then on the femto cell side we are really in the process now of first engineering samples this year. We won’t see revenue on that for at least twelve months from now.

Tavis Mccourt from Morgan Keegan, please go ahead with your question.

We saw that the AT&T is starting to break out their non-handset devises, and I was wondering, do you get that data from your licensees? Is that something you would look to break out in your QTL business, give what I would imagine is a pretty big difference in ASP to you guys?

So far the volumes of the devices other that modem cards and dongles, which we have talked to about to some extent, have been relatively speaking, not that significant. So up to this point we have just provided an overall ASP of all devices, and we’ve tried to provide some guidance as to what is driving fluctuations in ASP in terms of growth of lower end devices like a dongle. I think we are going to continue to monitor this going forward, and at some point if it makes sense to segment those we’ll revisit it, but at this point I don’t think we have any intention to do that.

Edward Snyder from Charter Equity Research, please go ahead with your question.

Thanks. The channel on lower ASP’s, I would think a lot of that has to do with mix here. One of the things we are seeing with the OEM base is pushing a lot of 3G to what you’ve mentioned as a feature phone segment, which is obviously a low ASP product to began with. Given the relative sizes of those markets, if look at the number of edged products our there now, and I know Samsung is got aggressive plan to push low cost 3G into some of there featured phones, what kind of trade offer we are looking at in terms of volumes? It seems inevitable that your branded ASP’s on phones is going to come down, but segment size is so much larger. Have you looked at that balance and is there any color you can provide us on growth in the segment, even if you share doesn’t hold the same over the next say year or so; any the intuition there?

Ed this is Bill. I’m attempt to answer here. I would say first, we see the phone market continuing to segment broadly. Featured phones are getting pressured by smartphones, but yet it’s still a robust market, and a number of areas where OEM’s and carriers are doing extremely well with them. I think it’s still much the same for us though. We have a broad range of chipsets we sell, and some of the key to us is what’s our gross margin dollar, gross margin percentage of those products, and as we said gross margin percentage this year, we expect it to be largely inline with our gross margin percentage we had last year. So as we move done in lower end market, it takes more devices to equally the dollars you earn off the high end, but its thus far lower end to mid tier to high tier, we think its all a good business for us.

Maybe I’ll just add one thing, this is Steven. I think there are certain places in the world where the operators really don’t from ca capacity and spectrum point of view, do now what to get much more 2G or 2.5G volumes sitting on legacy spectrum. So, I think there are reasons that trend is probably an interim trend; the question is how long? We think also that as we bring the price points done of smarphones, the penetration is going to go up. I think that trend, as I would say we are in a little bit of a transition period now. I think probably ends up being a good trend for our business.

Rod Hall from JP Morgan. Please go ahead with your question.

That’s for taking my question. I was just wondering if you guys could update us. I know that you said before you are working with Nokia on some design ends and we know that they are shipping by the end of the year, hopefully some new product on Symbian 3. Can you comment on where you stand on that and then I got a follow up to that as well.

This is Steve. One do the things that we tend now to do is talk too much about our customer’s planes, and I’m not going to do that if we can, but I would say long term there is specific planes. Long term we do think that migration of Nokia from really a more of a vertical player to a horizontal player sets us up well, particularly if you look at sort of the basket of assets that you have to have with the chip company, and the amount of scale you need to have I think to be successful long term, but with regards to the near term planes, I prefer not to talk about our customers plans.

Okay, and I guess my follow-up is a more broad question with regards to QCT margins. By my estimations it’s the first time your exiting the year with lower EPS and you’ve started since about 2003, and it seems like -- you guys can correct me if I’m wrong, I would characterize it as drive primarily by these QCT margins and when they bought them out and how they recover though the back end of the year. Do your forecasts for margins in the back end of this year, without getting specific about the numbers, include some of those major new platform design wins, or is there some up-word flex in the numbers or down flex I guess, if that would go one way or the other for you. Can you just kind of comment of that?

Hello Rod, this is Bill. I’ll offer a couple of thoughts, and may be Steve you want to supplement a bit. As Steve said, our planes that can be a little bit hard to predict the mix out two or three quarters, but for the fourth fiscal quarter we do have an improved forecast relative to the third quarter. Operating margin basis in our plan, the dream quarter is the trough. But other than that, I think it really comes down to the product mix, and as Steve said, we are seeing good traction in the 7K and 8K series. Steve you got anything to that too?

I think the biggest wiled card is mix. The hardest thing to predict in the business is mix. Both tiers; mid tier to high tier or mid tier to low tier, and also customer mix is another one that’s very difficult to predict, but we see the units there. The question is how we are going to transfer in terms of which tear is going to go into. We do think that the overall trend, what we see in terms of how the markets moving, there are number of key devices that are being launched or have been launched. It really does provide a bit of a competition across multiple players in the industry which we think is positive and what we understand is that pipeline is pretty deep right now.

Ladies and gentlemen we have reached the end of the allotted time for question-and-answers. Dr. Jacobs, do you have any final comments you’d like to make?

I wanted to say thanks again to everybody for joining us today. I’m very happy as I said with the way the quarter turned our, our ability to generate strong cash flows, return cash for our share holders, but still really invest quite strongly in our strategic initiatives, new technologies, new products, 3G and 4G. I’m also very exited about this growth in just the 3G market overall, particularly with the India 3G options just about close. I think that’s going to really give us an opportunity to break out a selling just in the low end of that maker and open up the high tier to us, which should have a very positive effect on the business. As we talked about trend towards smart phone, obviously the phones with Snapdragon they are just coming our now. There’s a lot more devices in the pipeline. We are seeing these higher end shifts continue to grow, but we expect that smartphones with Snapdragon in them gain more traction, so see a lot of opportunity of growth at the higher end of the chip business. Also I should say that’s it’s the lower end of the smartphone segment, the smartphone segment is tiering a little bit as the feature phone segment seems to be either going up the shartphone or down to the prepaid, and I think these lower end EMP BREW level platform as smartphones will be able to attract more of the high end of what once was the featured phone segment. We are looking forward to that. We are looking forward to obviously smart books and connective devices and just a continued growth of the wireless industry as it grows to cover other segments of the marker, moving to other industries. There is really a tone of opportunities out there. So thanks very much. We look forward to sharing our future planes and future results with you as we go forward. Thanks. Bye.

Ladies and gentlemen this does conclude today’s conference call. We thank you for your participations, and you may now disconnect.