Ladies and gentlemen, thank you for standing by, and welcome to the Radware Third Quarter 2013 Earnings Conference Call. At this time all lines are in a listen-only mode. Later we will conduct the question-and-answer session. (Operator Instructions) And as a reminder, today’s conference call is being recorded. I’d now like to turn the conference over to Mr. Roy Zisapel. Please go ahead.

Thank you. Good morning, everyone, and welcome to Radware's third quarter 2013 earnings conference call. Joining me today is Meir Moshe, our Chief Financial Officer. Meir will start the call by reviewing the financial results. And afterwards, I’ll discuss the business highlights of the third quarter results. After my comments, we’ll open the discussion for Q&A. Meir?

Thank you, Roy, and welcome, everyone, to our third quarter conference call. First, I’d like to review the Safe Harbor language. During the course of this conference call, we may make projections or other forward-looking statements regarding future events or the future financial performance of the Company. We wish to caution you that such statements are just predictions and that actual events or results may differ materially, including, but are not limited to general business conditions and our ability to address changes in our industry, changes in demand for products, the timing and the amount of orders and other risks detailed from time to time in Radware’s filings. We refer you to the documents the company files from time to time with the Securities and Exchange Commission, specifically the Company’s last Form 20-F filed in March 2013. And now ladies and gentlemen, for the financials. Revenues for the third quarter totaled to an amount of $48 million compared to revenues of $46.8 million in the second quarter of 2013, representing 3% sequential growth and 1% increase year-over-year. The non-GAAP gross margin remained at 82%. The non-GAAP net income this quarter totaled to an amount of $7.8 million or $0.17 per diluted share compared to net income of $7.1 million or $0.15 per diluted share in the second quarter of 2013. Stock-based compensation expenses in amount of $1.3 million; amortization of intangible assets in amount of $800,000. Litigation costs and professional services associated with IT litigation in an amount of $1.8 million; tax expenses related to settlement with the tax authorities in regards to prior years in an amount of $800,000 and exchange rate expenses in an amount of $170,000 bringing the GAAP net income this quarter to $2.9 million or $0.06 per share compared to a net income of $8.2 million or $0.18 per share in the third quarter of last year. Non-GAAP operating expenses reached $32.2 million this quarter and non-GAAP operating margin increased from 14% in the first half of the year to 15% in the third quarter. The headcount for the end of this quarter was 832 employees. Cash position, including cash short-term and long-term bank deposits and marketable securities, amounted $271 million and we have no debt. Shareholders equity amounted $289 million. Guidance for the fourth quarter. We expect revenues to range between $49.5 million to $51 million; 82% gross margin; OpEx will range between $32.8 million to $33.3 million; financial income at $1.25 million; and non-GAAP EPS to range between $0.18 to $0.19. To summarize, in the third quarter of 2013 we return to growth and we continue to see strong market need of -- for our type of products. In the next quarter we believe we can increase our growth rate as well as increasing our profitability. And now, I’d like to turn the call over to Roy.

Consistent with prior quarters, the growth in North America is well balanced across enterprise customers and specifically the financial segment, online and carriers. Our focus on the datacenter markets for both application delivery and application security is paying off with these customers. Furthermore, our innovation is focused on private and public cloud, cyber security and software defined architectures where we see strong activity and interest from these type of customers who are technology savvies and early adapters. Speaking on SDN, we announced this past quarter our DefenseFlow product. DefenseFlow is an SDN application that programs SDN enabled networks to become part of the denial of service protection service itself. With DefenseFlow operators can assign a DoS protection service for virtual network segment or for a customer. This allows network-wide detection of cyber attacks with very specific diversion of suspicious traffic to scrubbing centers for mitigation. At the recent Cisco Live Events, in Orlando, we demoed a DefenseFlow product using the Cisco XNC SDN Controller and Cisco ADSL Routers to provide those protection with the native network service. We believe this SDN architecture for security has unique benefits of a legacy architectures and are happy to report that we received an initial order from an U.S. Tier 1 Carrier for this solution. We believe it is the first implementation in the industry of an SDN security application, underscoring the innovation and leadership we have in this space. Continuing with our attack mitigation solution, we continue to see a rapid increase in the number of attack incidence across the world and the sophistication of tools and methods hackers are using to undermine the availability of mission critical infrastructure. Our attack mitigation system was built with the sole purpose of protecting our customers against any type of cyber attack. Our AMS is a…

Thank you. (Operator Instructions) Our first question will come from the line of Ittai Kidron. Your line is open. Ittai Kidron - Oppenheimer & Co. Inc.: Yes, thanks. Meir, can you give us the geographical mix of the revenue and Roy can you talk about Europe specifically how is that, the turnaround over there is moving along?

Okay. Split between the regions, the U.S was 41% of our revenue this quarter, EMEA 24% and Asia Pacific 25%.

Regarding EMEA, we feel that the business is very stabilizing, specially I think on the booking side we’re doing way better and we do hope that we will get the business back to the level there, it was previously. So all in all, I think we’re progressing there well and next week we have our EMEA Partner Events, in Malta with very high attendance rates from the top customers and channel partners. So we’re quite optimistic on our progress in EMEA. Ittai Kidron - Oppenheimer & Co. Inc.: Okay. And can you talk about security in general how as your DDoS platform will be doing this quarter, your security solutions overall and also the contribution from Check Point and Juniper in the quarter?

Okay. So we do see a lot of activity in security, especially in the North American market. We do believe that we’re starting to see more signs of that going in to EMEA and especially in the very large enterprises online and carriers. In terms of the specific contribution from Juniper and Check Point, we’re not breaking it every quarter, but I think we gave last quarter a good indication to where the OEM business is and our expectations forward and so far it’ll be based on our expectations, there is no change there. Ittai Kidron - Oppenheimer & Co. Inc.: Very good. Good luck guys.

Thank you. Our next question will come from the line of Jess Lubert. Your line is open.

I think Asia went down year-over-year, but also very strong quarter we had in the last year in Q3. All in all, I think the business very stable. There are some countries better than others in the mix there. We do feel there is going to be an improvement in Q4, in the business. Some of the countries there -- again have a stronger Q4, like China and in some like Japan and India have strong Q1 finish. But all in all we think we are heading into a good Q4 (indiscernible).

Okay. And then Roy, I was hoping you could talk a little bit about the competitive environment, the last quarter you suggested some F5s new products has changed the pricing dynamics, particularly at the low end of the market. So I would be interested in getting an update here with respect to what you’re seeing versus F5 as well as some of the other players in the market like A10, how you’re competing against some of these lower priced solutions and how your win rates are trending here at this point in time?

I think what happened in the market is that everyone adjusted their prices to the new levels. So I believe all the -- at this point all the players are reporting a – I would say almost back to normal competitive environment, but with lower prices on the low end. From a competitive position, nothing has changed. I mean we continue to highlight the fact that we’ve the most advanced architecture for multi tenancy with some consolidation or agency here translation into marketing already we have the best in the market acceleration that I noted also in my prepared remarks coupled with the application performance monitoring. So we think we’ve a very solid offering for guaranteeing (indiscernible) submission, critical applications and allowing our customers to consolidate and virtualize the ADC datacenters. That continues to be our play. It continues to get very strong feedback from large carriers, large enterprises that really are in the high end of the market. While at the lower end, its more price sensitive environment and we compete like others in that space. So I don’t think anything has changed in the competitive positioning. I do think as we’ve discussed in the last call, that there was a reset of the price level in the low end.

And then just may be last one from me, can you give us an update on the Cisco ACE replacement opportunity, how its momentum progressing there and how are you thinking about that business going in to Q4, in 2014? Thanks.

We continue to see activities of customers replacing Cisco ACE. As a matter of fact, last quarter we had our large win, and I am saying large its in the magnitude of a $1 million in a large bank and in a top most America bank to replace, and (indiscernible). But we continue to see customers immigrating off that platform. I think it's in a steady rate. I don’t know for how long this cycle will continue, but the centers are still more -- a lot of customers are out there with [ph] aging their platforms that are starting cycles.

And Mr. Lubert does that conclude your questions?

Yes. Thank you, guys.

Thank you. Our next question will come from the line of Alex Henderson. Your line is open. Alex Henderson - Needham & Company, LLC: Hey, guys.

Hi, Alex. Alex Henderson - Needham & Company, LLC: So, can you talk a little bit about the penetration of virtualization and you defined that as your cutting edge advantage in the market place. Can you give us some sense of whether there is a change in the rate of adoption or an increase in the percentage of sales that are being driven by that as a determining characteristic; some sort of metrics along that?

So, we’re still seeing similar trends. One of the things that we do see is that 30% of the customers that are starting with two instances are actually upgrading, and over time the amount of instances they’re using. So we’re seeing growth in the consolidation ratios that our customers are doing and using the benefits of the platform. In a recent discussion with leading analyst firm in the industry, they told us that the customers that we present and the use cases that we represent are dramatically more consolidated than any other vendor in the market. So the consolidation ratios, the amount of instances that our customers are wanting is almost an order of magnitude higher than what we’re seeing in terms of realized intermediations of others. So, since then we have something real here and we’re pushing it more and more to the large areas, large cloud providers and we think that’s our entry into competitive accounts. Alex Henderson - Needham & Company, LLC: So, can you talk about what kind of mix you’re seeing in terms of applying space to VM instances versus soft only based environments and are you seeing any shift at all in the customer usage of soft only type environments either yours or the others vendors?

We don’t see a huge shift. We continue to see the vast majority of implementations using hardware based platforms. It's the base for running those virtual instances on top simply because they need hardware for acceleration of security and that is not there in a general purpose hardware running the VM. In general we do see in a public cloud environment more appetite for the completely software based virtual appliance and in private ones more desire for the hardware based consolidation. Alex Henderson - Needham & Company, LLC: And then last question for me; can you give us a breakout between enterprise and service provider on the companies revenues particularly in the ADC space?

Enterprise was 71% and carrier 29% this quarter.

And it's total, it's not only ADC, Alex. Alex Henderson - Needham & Company, LLC: Okay, great. Thanks.

Thank you. Our next question will come from the line of Joseph Wolf. Your line is open.

Thanks. I was hoping if you could give us a little bit more flavor on the guidance for the fourth quarter if you’re seeing positive trends whether it's seasonality and whether it's across some of the new products that you’ve got or in the core ADC business. And then I was hoping if you could go into a little bit more detail on the SDN, the order from the Tier 1 in the U.S. if you could describe the use case for us, if it's in the network, if it's in a specific test case or how they’re using what the opportunity for growth there is?

So, at this point we provided forecast for Q4 for sequential increase over Q3. We see there’s good momentum in the business, but we want to see that translates into the increased business that we expect. We think, we can decide whether it's conservative or not but we feel comfortable with this guidance. Regarding SDN, the use case is that they want to provide customer protection. So for key enterprise customers it want to protect these customers across multiple data centers these customers have using their network and for that they’re using SDN instead of deploying physical appliances in front of each and every customer data center that’s parts of it's service. They’re using SDN connected to our defense flow product to detect any suspicious traffic or attack traffic on these customers. And once detected our defense flow product and controls, the open flow switches to divert the suspicious traffic to centers at this point that includes our defense high end mitigations that drives this suspicious traffic and inject back the clean traffic to the carrier network, so you can think about this applications are network wide. It can be across all the network whenever the open flow switches without having security device there you can detect and attack using our defense flow SDN application and once detection is been done it moves the traffic to select points of presence where you have a lot of scrubbing and mitigation capability to clean the attack traffic. And if this service will come we’ll become the leading production service. You can expect us to grow significantly the revenues from this application as more enterprise customers will sign up for this network DDoS protection service.

So, are you selling this through the carrier as a subscription or license as they grow or is it a hardware-software sale through the carrier?

It's a hardware-software sale to the carrier. The carrier is using that to offer a managed security service to its enterprise customers.

Perfect. Thank you, Roy.

Thank you. Our next question will come from the line of Mark Sue. Your line is open. And Mark, please check your mute button. And once again Mark, your line is open. Please check your mute button.

Sorry about that gentlemen. As I look at your planning assumptions for next year, I guess what will be your key priorities gentlemen, will it be as you look through reaccelerate the top line and build on the improving execution, will it be new product development, will it be more of a marketing focus, will it be more (indiscernible) doubling down on some of the SDN projects with good carriers. Just trying to get a sense of your priorities and how we can build on the level of growth rate into next year and beyond?

Well, our number one priority will be to accelerate the growth of the business, and it's a combination of increasing the product revenue growth as well as starting to enjoy some of the services booking that is improving for us and hopefully we will start to see that impact into next year in numbers. In terms of the product line, as I’ve mentioned in my comments in previous calls we’re focused on developing and releasing new products around SDN, cloud and fiber security, that’s where our innovation is going to. That’s where we see the biggest opportunity and we’re going to see new product releases in these areas. In terms of special marketing, we are going to continue to expand the America coverage. We feel as though we’re growing nicely. We are very much under cover -- under represented into the market and we see there’s a lot of sales teams to add without any overlap to our existing inputs. And around the world we are going to selectively add resources as the business is improving. So, all in all our number one priority was to reaccelerate the revenue growth and that would be our focus across the whole company.

So, if I were to look at some of the lessons learned from your partnership impacting your partners this year and what you might do differently next year. How should we think about deeper relationships or more relationships as you expand your rest of the market, the Check Point, the IBM’s and all the other ones that you’ve worked on and how they may develop next year?

So, we think the -- we’re very optimistic as we’ve mentioned on the Check Point relationships continue to grow. And assuming we will finish this year as we believe we should, I think it's a very good starting base for next year and continue growth there as they’re becoming active, the channels are more knowledgeable and so on. We are working hard to replicate that success with other partners. We continue to believe that OEM and strategic alliances for us is a great way to market. So we continue to work on such initiatives and we’re optimistic it will help us next year for the business acceleration as well.

Okay. Thank you gentlemen. Good luck.

Thank you. Our next question comes from the line of Alex Henderson. Your line is open. Alex Henderson - Needham & Company, LLC: Yeah, just a quick follow-up; can you remind us what your Federal exposure is and give us any sense of what you saw within that vertical?

We have very little exposure to Federal. So, we are not impacted today by the environment. Alex Henderson - Needham & Company, LLC: And so, do you have any intentions of building into that space or do you plan to just leave it as it is?

We’re investing in the space and we’re looking to grow it, but it will be an upside to our current business. Alex Henderson - Needham & Company, LLC: Okay. And then on the sales side in the U.S. can you update us on where you’re in terms of hiring additional sales people in this geography. I know you had hired pretty aggressively towards the end of last year and into the first half. Can you give us an idea what your expectations are towards adding new coverage here?

We continue to do so every quarter, and it depends on our ability to find the right talent. But each and every quarter including already in this quarter we’ve added sales teams in the Americas and we will continue to do so. Alex Henderson - Needham & Company, LLC: Okay. Thanks.

Thank you. Our next question comes from the line of Rohit Chopra. Your line is open.

Thanks very much. Roy, you mentioned HP and Cisco in your press release and I just want to get a sense; are they looking for new partners just a little bit of a follow up on Mark Sue’s question. And then for Meir, I just want to get a sense on tax rate for next year. I think Check Point talked about a change in the tax rate in Israel for next year. Can you just comment on that?

So regarding partnership we think that in SDN, Cloud and cyber security as those are the most innovated spaces in the industry. There’s a lot of partnerships that can be done with larger (indiscernible) and specifically for your comments, I think in SDN all the natural [ph] contenders require applications that will run on top of their OpenFlow switches or overlay architectures, and I think we are today the only ones to provide such applications that are SDN ready and in production. So, there is a lot of options for strategic alliances and we’re pursuing them.

As for the tax, right now our tax rate is about 9%. Next year we estimate it will be in the low teens.

Low teens, okay. And then Meir, can I ask you a follow up just on the litigation, so that’s new. What is this IP litigation? Who’s this with? What's it about?

Actually we fired the (indiscernible) against two of our competitors.

Okay. Thank you.

Thank you. We’ll go to the line of Ittai Kidron. Your line is open. Ittai Kidron - Oppenheimer & Co. Inc.: Thanks. Just one last follow up, with the exception of this year where you had some challenges in Europe historically your margins now has been about plus, minus kind of couple of percent sequentially from December. Is that the same framework we need to think about as we head into the March 14 timeframe?

I think Ittai, let’s keep something for the December call when we will have better view and we’ll provide visibility. But generally speaking, Q1 is a signal weak quarter for us. I would not expect a sequential increase from Q4. But to be more specific, we will need to wait couple of months and give you more visibility then. Ittai Kidron - Oppenheimer & Co. Inc.: Okay. Good luck guys.

Thank you. (Operator Instructions) We’ll go to the line of Ryan Bergan. Your line is open.

Hey, thanks. Just got some, a thought around a $51 million quarterly revenue run rate at which point you might be able to achieve somewhere around 20% operating margin. Clearly what the midpoint of Q4 guidance the operating margin is not at that level. Are you still comfortable with that $51 million run rate as the point where you can attain 20% operating margins and if not what would you be thinking about today?

No, actually the high-end guidance $51 million is representing 17% of operating margins. Bare in mind that since we enjoy from more than 18% of gross margins so we’re very sensitive to the top line. So you can do the math by yourself, but you can understand that it's not only adding the top line, where also as Roy mentioned before hiring people et cetera. So the level of say mid 50, 55, 56, 57 it depends on different (indiscernible) it's more accurate for reaching the 20% operating margins in this stage.

I know you’re not specifically commenting on either Check Point or Juniper, but I think the Check Point relationship was it about $1 million per quarter run rate last quarter. Can you at least comment on whether or not you’re continuing to see momentum in building upon that $1 million run rate?

We don’t want to specifically know every quarter start to break it out, but as we said we feel good, it hasn’t changed for last quarter. We feel very optimistic and good about the Check Point relationship and we …

Thank you.

Thank you. We’ll go to the line of Joseph Wolf. Your line is open.

Thanks I may have missed this. I was just hoping if we can get a follow up sense, you talked about a return to growth given some initiatives at the end of last year, and this year and I am wondering if you’re still on track for a 20% growth in the core services business this year.

We think so. We are relating across to booking and but yes.

Perfect. Thank you.

(Operator Instructions) And allowing a few moments, I’m showing no other questions in queue at this time. Please continue.

Okay. I would like to thank everybody for joining us today and have a great day.

Thank you. And ladies and gentlemen that does conclude your conference call for today. Thank you for your participation and for using the teleconference service. You may now disconnect.