Ladies and gentlemen, good afternoon. At this time, I’d like to welcome everyone to the QuickLogic Corporation’s First Quarter 2014 Earnings Results Conference Call. During the presentation all participants will be in a listen-only mode. A question-and-answer session will follow the Company’s formal remarks. (Operator Instructions) Today’s conference call is being recorded. With us today from the Company are Andy Pease, the President and Chief Executive Officer; Ralph Marimon, Chief Financial Officer; and Brian Faith, Vice President of Worldwide Sales and Marketing. At this time, I would like to turn the call over to Ralph Marimon, Chief Financial Officer. Please go ahead sir.

Thank you and good afternoon. Before we get started, let me take a moment to read our Safe Harbor statement. During this call we will make statements that are forward-looking. These forward-looking statements involve risks and uncertainties, including but not limited to stated expectations relating to revenue from our new and mature products, statements pertaining to our design activity and our ability to convert new design opportunities into production shipments, market acceptance of our customer products, our expected results and our financial expectations for revenue, gross margin, operating expenses, profitability and cash. QuickLogic’s future results could differ materially from the results described in these forward-looking statements. We refer you to the risk factors listed in our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and prior press releases for a description of these and other risk factors. QuickLogic assumes no obligation to update any such forward-looking statements. This conference call is open to all and is being webcast live. For the first quarter of 2014, total revenue was $11.2 million, which was above the high end of our guidance range. New product revenue totaled approximately $8.9 million and was above our guidance due to continued strong shipments of our ArcticLink III VX platform to Samsung. Mature product revenue in the first quarter totaled approximately $2.2 million, which was above our guidance range due to higher than expected bookings. Samsung accounted for 70% of total revenue during the first quarter, as compared to 69% of total revenue during the fourth quarter. Our non-GAAP gross profit margin for Q1 was 37% and was slightly above our guidance. The increase in gross margin is primarily due to improved manufacturing efficiency resulting from the higher revenue level. Non-GAAP operating expenses for Q1 totaled $5.4 million which was just above the mid-point of our guidance. On a non-GAAP basis, the total for other income expense and taxes was a charge of $62,000 which resulted in a non-GAAP loss of $1.4 million or $0.03 per share. We ended the quarter with approximately $37.1 million in cash. Cash declined by approximately $300,000 of cash usage from operations was offset by the exercise of employee stock option. Our Q1 GAAP net loss was $2.1 million or $0.04 per share. Our GAAP results include stock-based compensation charges of approximately $732,000. Please see today’s press release for a detailed reconciliation of our GAAP to non-GAAP results. Now I’ll turn it over to Andy who will update you on the status of our strategic effort.

To close the gap Samsung’s new GALAXY Tab 4 7.0 tablet uses a nippy display driven directly from the applications processor, a display bridge is not required. In addition to supporting two out of the three 7 inch tablet platforms Samsung is selling today our displayed bridge solutions are being used by a Tier I PC manufacturer and two tablet designs and a variety of Chinese IDX customers. While we expect display solutions to be a good market for us in 2014, we have recently received forecasts from customers that there will be a period of inventory rebalancing. A research report released last week by digiTimes stated that worldwide sell-through of tablets decreased approximately 30% sequentially, during the first quarter of 2014. Additionally, Apple reported a 27% sequential decline for iPad sell-through. When you compare this data with our 27% sequential new product revenue increase which was driven by the tablet market, the logical conclusion is our customers were too optimistic. Consequently, there will be a significant sequential decrease in our Q2 display solution revenue while customers rebalanced their inventory. Worth pointing, our total first half 2014 new product revenue is expected to be in line with the seasonal performance of the tablet sector. I am very proud to announce that we initiated production shipments for a third design with Samsung in their new GALAXY Beam 2 smartphone, which will be sold exclusively by China Mobile. That Beam 2 includes an embedded pico projector which is supported by our ArcticLink III dual display bridge device. During Q2, we expect to report production shipments for five unique handset designs using our one-time programmable instant on smart connectivity platforms. Then use of programmable logic solutions to deliver hardware differentiation in mobile devices has increased substantially during the last few years. These high…

For the second quarter of 2014, we are forecasting total revenue of approximately $6.5 million plus or minus 10%. The $6.5 million in total revenue is expected to be comprised of approximately $4.5 million of new product revenue and $2 million of mature product revenue. The decline in new product revenue reflects reduced shipments of a display solutions into the tablet segment as earlier discussed by Andy. We are forecasting a slight increase in mature product revenue due to the expected booking rates from our aerospace test and instrumentation customers. As in prior quarters, our actual results may vary significantly due to scheduled variations from our customers, which are beyond our control. Scheduled changes for existing opportunities and projected production start dates for new opportunities could push or pull shipments between Q2 and Q3 and impact our actual results significantly. On a non-GAAP basis, we expect gross margin to be approximately 40%, plus or minus 3%. Gross margin is driven primarily due to the mix of customers and product shift. We are currently forecasting non-GAAP operating expenses to be $5.5 million plus or minus $300,000. Non-GAAP R&D expenses are forecasted to be approximately $2.8 million. Our non-GAAP SG&A expenses are forecasted to be approximately $2.7 million. Our other income expense and taxes will be a charge of up to $60,000. At the midpoint of our guidance, our non-GAAP loss is expected to be approximately $0.05 per share. Our stock-based compensation expense during the second quarter was expected to be approximately $550,000. We expect to use approximately $3.5 million in cash. The forecasted cash usage is primarily due to working capital needs and capital expenditures related to new product development. Before we move to the question-and-answer section of today’s call, let me turn the call back over to Andy for his closing remarks.

Even with the new product revenue declined we are anticipating for Q2, we continue to believe we will report significant year-over-year new product revenue growth for 2014. Our smart connectivity and Sensor Hub solutions are targeting Android smartphone markets which is approximately seven times larger than Android tablet market we currently address with our displace solutions. Furthermore, the emerging variable market represents an additional high growth opportunity for our Sensor Hub and smart connectivity solutions. Looking beyond the first half of 2014, I continue to be extremely optimistic about our mid to long-term growth opportunities and the progress we are making with our new strategic platforms. These platforms enable us to deliver a highly competitive disruptive product offering in the Mobile segment, today’s largest semiconductor market. Now I would like to open up the call for questions.

(Operator Instructions) Our first question comes from Krishna Shankar of ROTH Capital. Your line is open. Krishna Shankar – ROTH Capital Partners LLC: Andrew, look at the second half of the year, you’ve said that you folks would expect significant year-over-year growth in new products 2014 versus 2013. So is that based on some of the design wins that you already has for example with the Japan, PHS customers or is that dependent on smart connectivity and sensor hubs in new Android platforms for the second half of the year.

Sure. Yes, I think the answer is why we believe that’s achievable is a two part answer. I think tactically, we are working to manage the inventory rebalancing to play solutions in the tablet sector, just a quick side comment on that. I think that that was a very surprise to all of us and it is very recent news we only found about this in mid-April. So we are still working that side of the story, strategically however, I have share of progress on our areas for growth in 2014 both in smart connectivity and sensor hub solutions. So, it’s the combination of both that give us the confidence that we will meet that goal. Krishna Shankar – ROTH Capital Partners LLC: Okay. So it would be a combination of both in new products or smart connectivity and sensor hubs, which you feel will be the biggest for new product revenue growth this year versus last year.

Right. And we’ve been saying you may recall that we’ve been saying for six months now, that these new platform based on our end system, reprogrammable logic PolarPro 3 and ArcticLink III S1 are start to generate revenue in the second half of 2014 and we continue to believe that. Krishna Shankar – ROTH Capital Partners LLC: Great. And then, for the ArcticLink S1 will it be the CSSP version which we’ll see the earlier revenue run or will it be the more customer end defined version.

Yes. The ArcticLink III S1 will probably be the catalog just cad version that has been evaluated now. Although, there are also ArcticLink III S1 opportunities in the other more customize net projects that I mention. So, it actually both. Krishna Shankar – ROTH Capital Partners LLC: Okay. When you mentioned that I guess the existing market for programmable in system connectivity something like $150 million for Android smartphones and its sounds you have one design win there already with the GALAXY Beam. Can you elaborate a little bit on that and other potential opportunities where you can capture existing sockets for smart programmable connectivity?

Yes. So, first the to be clear the Galaxy Beam 2 is that the a display product. It’s a dual port display product that simultaneously will drive the wide action as well as the display. S, what we are talking about is actually a smartphones and I try to allude to that when I was talking about the OEMs that we actually looking at a designs that were going to interceptor specific design of an existing platform at this year, which will give us a good shot add that getting on to a major platform. Krishna Shankar – ROTH Capital Partners LLC: Okay, great. Thank you. I appreciate it. Thanks, Andy.

Thank you.

Thank you. Our next question comes from Gary Mobley of Benchmark. Your line is open. Gary W. Mobley – The Benchmark Co. LLC: Hi guys, congratulations on a good March quarter results. Speaking along that line, I guess the total revenue upside relative to your guidance was $1 million and here we said today with June quarter guidance assuming some inventory correction, presumably at Samsung or perhaps your other Tier 1 tablet OEM that just started ramping. So I’m just wondering based on the information that you received in the past two weeks, what drove the revenue upside in the March quarter and what’s driving the inventory correction? Did perhaps Samsung or anybody in the supply chain misjudge how much the Samsung 7 data Lite will cannibalize existing 7.0 Tablet?

That’s a very good question, Gary, and I think to answer that, I think the growth – Q1 revenue was a fact they were introducing the Samsung Lite version to emerging markets and that we all know with the mobile devices when they’re going through a major product introduction like that they have to do a lot of inventory build to make sure that the channel is full of products so that when you and I order it you can get it in a day. So I think that that’s why there is a build up and maybe they over scope aside to that market. I really can’t say. And to tell you the truth, there’s still a lot of inquiry being done on what happened and what will we do. But as I also said, remember the overall tablet markets suffered in Q1. So it wasn’t Samsung, the Apple as well remember had a sequential decrease in iPad sell through. Gary W. Mobley – The Benchmark Co. LLC: Okay. This design win intercept for PolarPro III possibly intercepting the existing in product line mid part of the year. Could you talk about how easy it is to intercept the design or are you replacing an existing, probably logical solution in the existing product line or is this something that could be retrofitted as a additional feature to the product and could you give us a sense of the magnitude of sort of the volume for this particular skew?

Sure. I think the best person to answer that is the guy who is founding the payment every day, Brian. So I’ll let Brian take a stab at that.

Hi, Gary, this is Brian. So I think to answer to your question, to get into the mobile space with the programmable logic, obviously you first need to have a solution in the right cost, size, power and functionality and as Andy just mentioned, during the last quarter we’ve been building up this fundamental base of technology with our proven system box, the LED drive, TV remote and voiceless transmit. Those are actually allowing us to participate in this technical qualification at this OEM. So, to be clear it’s not going to be swapping out 10, 15 with another programmable logic device. It’s actually going to be a new PCB that would intercept those products that we do feel like the basic building blocks of (indiscernible). And as far as volume goes, we’re not going to comment specifically about volumes or projects, but I think Andy did qualify and say that those are big OEMs. So you can probably estimate on that.

Yes, and I think what we’re saying is you actually get first production qualified. So we have technically qualified as we talked about last year. This is a matter of getting production qualified. Once you do that then they have the confidence to put you in a major platform, which finalize the Tab 3 watch for us. It was a platform that had many different skews, so across many different operators with frankly many different APs attached to it. Gary W. Mobley – The Benchmark Co. LLC: Okay. Would you expect the PolarPro III to generate more revenue in the second half of the year versus the ArcticLink III S1?

Tough to say. I think it certainly has that potential, but we’ll have to tell you in more in the next call. I think it’s too early to tell. We’ve got to get be confirmed in a platform and our style is not to talk about design wins but rather to talk about production wins once we’re shipping. So certainly by next call we’ll give you a lot more clarity on that. Gary W. Mobley – The Benchmark Co. LLC: Okay. Were there any other driven 10% customers in quarter?

No. That’s a big one. Gary W. Mobley – The Benchmark Co. LLC: Okay. Anybody close to 10%?

I don’t think. No. Not with the volume that Samsung is driving, no. Gary W. Mobley – The Benchmark Co. LLC: Okay. That’s it from me. Thanks, guys.

Okay. Thanks, Gary.

Thank you. Our next question comes from Krishna Shankar of ROTH Capital. Your line is open. Krishna Shankar – ROTH Capital Partners LLC: Andy, and Ralph, I was wondering given the potential intercept of existing design, I know that you’ve guidance only one quarter at a time, but is it possible that some of these new programs that you have designed, but just ramping up that could see potential sequential revenue growth resumed in Q3?

Krishna, no we don’t give guidance out that far. So we don’t want to mention it. Yet we have our internal plans. As Brian mentioned, we’re in the process of evaluating where we are with the display solutions right now, and it’s going to take a little while to that to resolve itself before we can give any kind of firm guidance on Q3. Krishna Shankar – ROTH Capital Partners LLC: Okay. And Andy and Brian, you mentioned three functions LED driver. I understand remote control and bar code. I guess the bar code scanning helps – it’s a block that does wide conversation of the bar code recognition to be as fast. What is the LED drive? Is that like an LED driver functionality for lighting, what does that do?

Yes, as you think about your smartphone you have a static LED. So 10 different colors if you get an email or a voicemail or the battery is low. So there’s generic ones that maybe just drive a white LED. There are phones that have color LEDs and you need a lot more sophistication and hardware to handle that off the S processors. So that’s one of the capabilities that we’ve developed and demonstrated to a few customers now. Krishna Shankar – ROTH Capital Partners LLC: Okay. And along with that Andy, looking up beyond 2014 will the uppishly for smart connectivity is bigger than the uppishly for sensor hub for the next couple of years?

Well, that’s a tough call. As you can probably tell by return of my voice I’m equally excited about both of those and actually remember that we are going to have the capability of combining the two and we are going to be able to do something that we’ve never been able to do before and that is integrate multiple chips on a single chip. Krishna Shankar – ROTH Capital Partners LLC: Okay. All right. Thank you and congratulations on the March quarter results.

Thank you.

Thank you. Our next question comes from Bob West of NI Technical Research. Your question please. Bob West – Nest Inning Technology Research: Hello Andy. Congratulations on the good first quarter.

Thank you. Bob West – Nest Inning Technology Research: Also the clarity you gave on future product development, I had a question on your (indiscernible) ESCO. If I understood correctly you indicated that it has sampled?

No, it think what I said Bob with the ArcticLink III S2 is that we have take out and we will be sampling his summer, and it will be in production in the fall towards the second half of 2014. Bob West – Nest Inning Technology Research: Okay, thank you for clarifying that. So follow-up question on that, if you have a current customer that’s going through the – an engagement process for the ArcticLink III S1. Is it possible for them to flip over and go to production with the S2? Is that a lot of added effort or how you would you characterize that?

Now this is Brian, I’ll take that question. So we’ve designed the S2 specifically to be incompatible with the S1. With that thinking in mind that a customer could go through the engagement process, work out algorithms tested in the system and actually migrate over to the S2 for production if the timeframes match up with what they need? Bob West – Nest Inning Technology Research: Right.

So to be clear, there is no PCD change required Bob West – Nest Inning Technology Research: Okay, good. That’s good news. So basically you could theoretically ship S2s later this year.

That’s the plan. Bob West – Nest Inning Technology Research: Okay. And now let’s talk that the catalog engagement the process a little bit. Could you give us anymore color or metrics on your catalogue version, but none of the engagement activity have that sort of thing.

Well we won’t quantify the number of engagement, but we have several people interested in the KitKat catalog part that we worked in conjunction with Central platforms, our partner and that actually was in a press release in Q1. So we have had good traction on that so far. Bob West – Nest Inning Technology Research: Great. And then the ArcticLink IV – I am sorry what is it, S3.

S3. Bob West – Nest Inning Technology Research: Okay, that has calling at the other client or suggest a new platform, would that be true?

I will let my marketing guy answer that. Okay.

Bob West – Nest Inning Technology Research: Okay. Now I have seen in writing from people who like to call in (indiscernible) Journal then I’m sorry, that you might have might have a CPU, embedded CPU and some future versions of your products. With that incurred net an ARM core process or something like that.

I think Bob there are a lot of people to speculate what their future projects have in them. And I can tell you for sure we are going to continue on a flexible fusion engine track as the embedded processing element that enables the always-on computing because that is how we get to such growth there. Beyond that we are not ready to disclose what’s going to be on our roadmap for competitive reasons. Bob West – Nest Inning Technology Research: Okay. Well, thank you for that. I think that is all the questions I’ve got for now, but thank very much and congratulations on a good first quarter.

Thank you, Bob.

Thanks Bob.

Thank you. Our next question comes from Brian Coleman of Hawk Hill Asset Management. Your line is open. Brian Coleman – Hawk Hill Asset Management: Thanks I just want to follow-up quickly on the PolarPro III design that you are thinking might intersect a product that’s already out with a major OEM. Is that essentially – would that can be your second source position in that design and that what we were talking about?

Yes, I think that Brian tried to say that the way this will work, I mean when people think about second source, they think of pin-for-pin, socket-for-socket compatibility and that's not necessarily what could be. This would be a different PCB but they would use on certain device off of a platform family. So we hesitate to not say necessarily second source, but certainly there is another person in the market that's providing mobile programmable logic for the smartphone industry. Brian Coleman – Hawk Hill Asset Management: Would a design or device that if you intersected this device and it ends up in the market would a user, somebody our customer buying a phone will there be a feature differences or would it look invisible to the end customer whether this device included the PolarPro III or the latest chip.

Brian?

From a consumer point of view, there is not going to be any appreciable difference. You would notice it. Brian Coleman – Hawk Hill Asset Management: Okay.

That occurs …

The other person is using these for TV remote control right now and as you know that’s available on a lot of high-end flagship smartphones there. Brian Coleman – Hawk Hill Asset Management:

Brian Coleman – Hawk Hill Asset Management: And that’s the A3 S2 you are referring to.

Right.

Correct. Brian Coleman – Hawk Hill Asset Management: Yes okay. And then my last question, you’ve been guiding for second half timetable for the smart connectivity and center hub is it too early, is it possible. We see this in 3Q, is it definitively 4Q. Can you just give us some idea on the qualitatively where in the second this revenue might be continued yet.

I don’t think we’re prepared to talk about that yet but we certainly are comfortable with the second half projection. Brian Coleman – Hawk Hill Asset Management: Okay, that’s great. I do actually one other question, your standalone the non-catalog sensor hub solution that requires OEMs with the proprietary algorithms to quote the codes that were written for microcontrollers into your platform. And you came out with the FFEAT and software ID whatever that is to help with that reporting of that made of code. Can you just talk about how receptors that process has been done with the OEMs, is it a difficult technical process to overcome or is it a pretty seamless effort to port the covered over into the FPGA base sensor.

Okay I’ll take that question. So I think one thing know when we architected this power solution from the beginning we knew that the users would actually be software engineers or algorithm engineers not other guys. And as such we created as equal that you mentioned in our integrated development environment, so that they could take their algorithm that are typically expressed and in a C-like language and you compile it down to the architecture. That’s gone very well in fact. We have our ecosystem partners sensor platforms that we’ve talked about our relationship with. They use that source to port some of their algorithms into our device to create the catalog sensor hub. And I think if you ask them they would tell you it went pretty well, it’s not difficult language or a tool chain to use. So I think that met our expectations as well as some of the OEMs that have the tools as well. I wanted to say one other thing it’s not just a non-catalog guys with, they were engaged with the type tool this ecosystem partners. And then the last thing I want to say is that some of our custom CSSPs, the third category that Andy mentioned in his prepared remarks, they may not need the FFEAT tool to do the development, we may actually end up customizing some things with partners fort that customers. So not everybody has to use the FFEAT, come engage with us if its non-catalog, we still manage doing work as part of the standard CSSP engagement model.

Yes, so I want to add just one thing in terms of engagement model, so the first one you already mentioned is the catalog CSSP which is really our most scalable model where there is the minimum amount of work done on our part. Then we are a people that have their own algorithms that are using our FFEAT tool to port their algorithms to our solution. And then there are people that want to have start with our algorithms towards the center platform algorithm and then add to it or customize is still within our QuickLogic CSSP engagement model. So those are the three different types of engagement I’m trying to talk about. It’s not really all custom or catalog there’s kind of this in between hybrid or they can tweak a good starting point, what we call a non-good starting point with our CSSP engagement model. If you think about it, it really gives the customers the ultimate flexibility in getting the right solution to market quickly. Brian Coleman – Hawk Hill Asset Management: Yes, okay. And how after OEM or something is done through the process of using the FFEAT tool, how sticky does that make your sensor hub solution in future designs?

My guess is very sticky, it’s the FFEAT tool is particularly in IDE environment that is architected for the way we did our Flexible Fusion Engine, which is the way we do the compute algorithms inside our chip. Brian Coleman – Hawk Hill Asset Management: Okay, it’s great. Well it’s perfect and I’m looking forward to the second half of the year.

Yes, surely.

Thank you. We have a follow-up question from Krishna Shankar of ROTH Capital. Your question please. Krishna Shankar – ROTH Capital Partners LLC: Thank you my questions have been answered.

Okay thanks.

Thank you. Our next question comes from Rick Neaton of Rivershore Investment Research. Your line is open. Richard Neaton – Rivershore Investment Research: Thank you, hello. And I have a few – just a couple of questions. First off, since you were blinded sided with the inventory you were surprised by the inventory rebalancing just recently do you see any forecast that suggest that kind of sweep over into the third quarter?

Yes, Rick, it’s too early to tell, like I said this is very fresh information, and we have now received any updated forecast as of yet, so we don’t know yet. Richard Neaton – Rivershore Investment Research: Okay so, you are not prepared to say it’s a one quarter event only, but you don’t see anything, saying third quarter yet either?

I can’t even comment on that because our customer is still working, they said be patient with us, we’re working through the details so we are complaint. Richard Neaton – Rivershore Investment Research: Okay, for purposes of comparables, can you refresh my memory as to what the new product revenue was in 2013 that’s the comparable for the significant growth in 2014? Now what would you – total new product revenue for full year 2013?

$18.1 million I believe it was.

At $18 million?

North of $18 million. Richard Neaton – Rivershore Investment Research: Okay, and one last kind of detailed question, couple of years ago in 2012 when you did a placement you also issued some warrants that I think cover about 2.3 million shares. Are they still all out there or are all of them have some of them been used and are they still set to expire in 2017?

Some of the 2012 financing are all still out there, none have been exercised. Richard Neaton – Rivershore Investment Research: Okay, thanks guys, thanks for your information. Bye, bye.

Thank you, at this time I’d like to turn the call over to President and CEO, Andrew Pease, for any closing remarks or comments, sir.

Yes, thank you for your support. Our Q2 2014 earnings call is scheduled for Wednesday, July 30th 2014. And I look forward to talking to you then.

Thank you Mr. Pease, and thank you ladies and gentlemen for your participation. This does concludes your program. You may now disconnect your lines at this time. Have a great day.