Please standby, we are about to begin. Good day, ladies and gentlemen, thank you for standing by. Welcome to the Super Micro Computer Incorporated first quarter and full fiscal 2010 conference call. The company’s news release issued earlier today is available from its website at www.supermicro.com. In addition, during today’s call, the company will refer to a slide presentation that has been made available to participants, which can be accessed in a downloadable PDF format on its website at www.supermicro.com in the Investor Relations section under the Events and Presentations tab. During the company’s presentation, all participants will be in a listen-only mode. Afterwards, securities analysts and institutional portfolio managers will be invited to participate in a question-and-answer session, but the entire call is open to all participants on a listen-only basis. As a reminder, this call is being recorded Tuesday, October 27th, 2009. A replay of the call will be accessible until midnight, November 10 by dialing 1-888-203-1112 and entering conference ID 7248744. International callers should dial 1-719-457-0820. With us today are Charles Liang, Chairman and Chief Executive Officer; Howard Hideshima, Chief Financial Officer; and Perry Hayes, Senior Vice President, Investor Relations. And now I would like to turn the conference over to Mr. Hayes. Mr. Hayes, please go ahead sir.

Good afternoon and thank you for attending Super Micro’s conference call on financial results for the first quarter fiscal of year 2010, which ended September 30, 2009. Before we begin, I would like to advise you of upcoming investor conferences in which Super Micro will be participating. On November 4, we attend a conference in Boston, sponsored by (inaudible) where we will participate in one-on-one meetings only. On November 10, we will present at the Merriman Investor Summit in New York, which will be webcast. By now, you should have received a copy of today’s news release that was distributed at the close of regular trading and is available on the company’s website. As a reminder, during today’s call, the company will refer to a presentation that is available to participants in the Investor Relations section of the company’s website under the Events and Presentations tab. Please turn to slide two. Before we start, I remind you that our remarks include forward-looking statements. There are a number of risk factors that could cause Super Micro's future results to differ materially from our expectation. You can learn more about these risks in the press release we issued earlier this afternoon, our Form 10-K for fiscal 2009, and our other SEC filings. All of these documents are available from the Investor Relations page of Super Micro's website at www.supermicro.com. We assume no obligation to update any forward looking statements. Most of today’s presentation will refer to non-GAAP financial results and outlook. For an explanation of our non-GAAP financial measures, please refer to slide 3 of this presentation, or to our press release published earlier today. In addition, a reconciliation of GAAP to non GAAP results is contained in today's press release and in the supplemental information attached to today's presentation. And now I will turn the call over to Charles Liang, Chairman and Chief Executive Officer.

Thank you, Perry, and good afternoon everyone. Please turn to slide four. First, let me provide you with the highlights of the first quarter. We are pleased that our first quarter revenue was 148.5 million or 20.3% higher quarter over quarter, and 3.1% higher year-over-year. The result indicated that again we again outpaced the industry and that we continue to gain market share. Non-GAAP net income was 5.8 million or 54.5% higher quarter over quarter, and 30% over than last year. Super Micro's non-GAAP earnings per share was $0.15 per diluted share compared to $0.10 last quarter or $0.21 last year. Please turn to slide five. Last quarter was a strong quarter of growth for Super Micro and it was the second quarter in a row for strong growth. We believe that we have established our upward trend and we will extend this growth in the coming quarters. Super Micro is very well positioned for future growth because we have developed the strongest product line in our history. Many more customers (inaudible) Super Micro's application optimized solutions to help them realize their goals of maximizing performance per watt and per dollar. Respectively the goal we set for ourselves is to continue to outpace the industry and to take more market share. Last quarter, we saw a favorable product line contributed to our strong revenue growth. First, we clearly saw an improvement in the adoption rate of the Nehalem processor based solutions. Because we have been first to market with (inaudible) Nehalem product line in the industry, we saw a positive impact to our revenue from Nehalem by offering more selections, value and quality. We expect further gain from Nehalem based solutions for our next several quarters. Second, our 2U Twin2, the market leading architecture introduced two quarters ago continued to…

Thank you, Charles, and good afternoon everyone. I will focus my remarks on earnings, gross margins, operating expenses and similar items on a non-GAAP basis with reflect the adjustments to exclude stock compensation expense and a provision for litigation loss expenses. Reconciliation of GAAP to non-GAAP is included in the financial statements of the company in today's earnings release and supplemental detail in this slide presentation accompanying this conference call. Let me begin with a review of the first quarter's income statement. Please turn to slide eight. Revenue was 148.5 million, up 3.1% from the same quarter a year ago and up 20.3% sequentially. The increase in revenue from last year was fairly widespread among our customer base which we believe was primarily attributable to continuing improvement in the global economy which we have seen since March of this year. The sequential increase in revenue from last quarter was primarily due to an increased attention being put on obtaining cost-effective solutions as the economy recovers and higher purchases of new products such as our Intel and AMD-based solutions continue. Please turn start to slide nine. Turning to product mix, the proportionate revenue from server systems was 34.5% of total revenue which was a decrease from 38.7% a year ago and 36.7% last quarter. ASPs for servers was about $1400 per unit which is up from about 1300 dollars per unit last year and comparable to the $1400 per unit last quarter. The decrease in absolute dollars of server products from a year ago was primarily due to a decrease in shipments of OEM servers. The increase in absolute dollars of server product sequentially was primarily due to an increase in shipments of our series 6000 servers. We continue to maintain a diverse revenue base within [ph] of over 400 customers…

Thank you, Howard. Our first quarter results was a good beginning to start this fiscal year. We see lots of room in the market for true application optimized server solutions and we will continue to be focused and aggressive in pursuing this opportunity. We're proud of the brand that Super Micro has developed as a server technology leader with our leading architectural designs for systems and blades. And we're confident that our focus on application optimized solutions will keep us on a strong growth trend. I will now turn the call back to Perry.

Operator, at this time, we are ready for questions.

(Operator instructions) We will go first to Michael Bertz with Kennedy Capital. Michael Bertz – Kennedy Capital: Good afternoon gentlemen. Thanks for taking the question. Nice quarter. Just wanted to ask a couple of things across the balance sheet, Howard, so obviously inventories didn't increase as much as revenues, it is great, how should we think about that (inaudible) you think you can keep that as the business continues to pickup?

I think you will historically see us maintain pretty consistent days. We will have spike ups during times of product transition. But we will try to keep it in the historical limits. Michael Bertz – Kennedy Capital: Can you refresh me where that is Howard?

Sure. You will seeing our DSOs or inventory this quarter was 71 days, previous quarter was about 77 days, prior to that was about 85, about a year ago was about 74. Michael Bertz – Kennedy Capital: Okay, all right. And similarly obviously the account receivable basically in the same bucket sort of rising at the same level as inventories, about 10% quarter to quarter, it actually looks fairly linear given the revenue coming up quite so much, again same question, your ability to keep that and improve cash flow going forward?

Yes, I believe so. Again, we are seeing improved linearity in our quarters and so again the inability to maintain our DSOs over the span of 30 days. Michael Bertz – Kennedy Capital: Okay. And so any difference you'd see with the holidays for that?

Typically, if you look back seasonally, you will see that Decembers are fairly strong quarters for the company barring the economic upheaval we just went through. If you go back farther back you will see that December is usually a stronger quarter for the industry and for ourselves. Michael Bertz – Kennedy Capital: Okay and then moving on to again looking I know Charles you talked about investments in Europe, can you give us some favor on sort of what kind of investments you are making there, what kind of CapEx that might entail, how we might see that layering in over the next several quarters, not necessarily, can you tell me what you think about revenue too if you want but just in terms of what kinds of investments you are going to be making?

Okay. Indeed because (inaudible) not much investments from cash point of view or money point of view. However that will dramatically improve our time-to-market you know over a product from (inaudible) to European market and time to market will improve. Second also very important is reduce shipping charge. Before we build most of the server here, completed the server here in (inaudible) and after that we shipped to customers in Europe by air, so that could courier (inaudible) so indeed stuff next month, about next week, next week we will start (inaudible) so that will reduce our shipping costs. And with those extensions for sure, we already improved our FAE, field application help in Europe, as well as growing our sales team significantly, so we see good growth in Europe in coming quarters and years. Michael Bertz – Kennedy Capital: Okay, that's great. And then just any implications for margin impact, I mean Europe is not exactly a low cost manufacturing area pushing there [ph] to states?

Because we will save persistent shipping by air almost $80 barrels, so $80 saving by air, and for sure that includes the (inaudible) maybe slightly higher (inaudible) we can still save lots of money. Michael Bertz – Kennedy Capital: Great. And last question then, Howard, since we look forward in terms of gross margin, any thoughts about mix there and what the impact to margin that might be?

I think as Charles alluded to, we will see some hopefully some positive impact as we expand our European logistics to better service clients and customers over there. Additionally because that again you know we're keeping a tight eye on our expenses overall to make sure that we are making the right investments for the future while still balance our expenses currently. Michael Bertz – Kennedy Capital: Okay great. Thanks guys.

Thank you.

We will take our next question from Doug Reid with Thomas Weisel Partners. Doug Reid – Thomas Weisel Partners: Thanks so much. Great quarter. Wanted to get a little closer to the gross margin trends heading into the December quarter, though. Howard, just in reviewing those factors that led to the sequential decline in gross margin, could you talk a little bit about which of those factors are likely to continue on as a headwind for gross margin going into December and then what kind of profile you might think would make sense of gross margin going into calendar 2010?

Yes, Doug, I think you know we talked about on the conference call, we had two things. We have upward push from our new product introductions, I think you'll see that as we introduced new products based on the latest technology. Apart from that, you'll see some headwinds from us as we just tried to take market share, grow our market share more aggressively going forward. And as you saw on the results of the revenue line on the top. So I think you should see us looking at the pattern going forward. Doug Reid – Thomas Weisel Partners: Okay, and could you give a little more color on where you are seeing strength around the 2U Twin2 by segment and how concentrated the business you're seeing there is?

Indeed the 2U Twin2 as you know new product to us since the last two quarters ago and product volume has continued to grow and we believed 2U Twin2 because it is much better performance per watt and performance per dollar even so demand indeed we see continuous growth. Other than that, you know, our GPU, GPU is another architecture, brand new architecture we just created about six weeks ago – indeed no more than that, abut four or five months ago, so now the (inaudible) are growing very strongly. So, all those providers pay their margins in kind of greater room to grow in volume this year. Doug Reid – Thomas Weisel Partners: Okay, great. Thank you.

(Operator instructions) We will not go next to Glenn Hanus with Needham. Glenn Hanus – Needham: Okay, good afternoon. Great revenue performance and guidance in December, maybe you could just talk a little more specifically about how much of this do you think is kind of the economy versus you know some of the new product releases and company specific things?

Basically I believe both are important. The economy overall is continuously recovering although slowly but kind of consistently. However, that area the factor that (inaudible) by our sales is the technology, so we introduced 2U Twin2 two quarters ago, GPU about five months ago, and then we will have taken TwinBlade in production very soon together with Nehalem new announced AMD six core, PCI Express II (inaudible) and that is why we believe December quarter should be a strong quarter. Glenn Hanus – Needham: How about on operating expenses, Howard, how should we think about sort of sequential growth here and operating expenses? Are you investing a little bit more on the sales side given the stronger outlook?

Yes, I think that's a fair assumption, Glenn. So you saw this past quarter we gave the sales and marketing expenses did go up sequentially, so again we are investing in our sales and marketing people as well as the overseas expansion to improve our revenue growth. Glenn Hanus – Needham: And back on the gross margins again, it sounds like when you net out the factors, you are looking for some gross margin expansion into the December quarter?

We haven't given the gross margin guidance but again like you say generally if you leverage it we are able to leverage the revenue growth that we have here, then usually you will have some leverage in the gross margin. Glenn Hanus – Needham: And the server solutions number going down, is that factor going to kind of reverse itself over the next few quarters or…

Again in always has been done in the December quarter basically we have a good feeling they come back especially the European integration facility with next week. We already have some pipeline production in the last few weeks look like average being going on smoothly, so traditionally in Europe helping us to grow. Glenn Hanus – Needham: Okay. So sounds like you will be selling more server solutions and that will help you some the internet service provider stuff that is kind of lumpy, little unpredictable, but you mentioned headwinds in order to go share so you know are you pricing a little bit more aggressively or have you seen a little bit more aggressive pricing in the marketplace and how should we think about that as a factor over the next couple of quarters?

We continue to gain more market share in high-end – higher end market, that is the kind of 2U Twin2 kind of like GPU indeed pretty much high end high value system, so we could gain more margin from those product lines. Glenn Hanus – Needham: Okay, thank you.

We will go next to Nihal Satchi [ph] with Technology Insights Research. Nihal Satchi – Technology Insights Research: Hi guys, nice quarter. Just wanted to follow-up on some of Glenn's questioning here, with systems coming up on a QoverQ basis more than components I believe that you guys are indicating, correct?

Yes. Nihal Satchi – Technology Insights Research: Okay. So but the guidance in place at the EBIT margins are going to stay more or less consistent, and so are you guys going to be reinvesting in your OpEx at a faster rate than you expect your sales growth?

I think – Nihal, this is Howard. Like I said, yes, you do see that but again I think we will temper our investments with what opportunities are out there and on the top line we will take a look at our revenue and make strategic decisions there also. But back to your question on op expenses, we will watch that and we will temper it according to the opportunities that exist. Nihal Satchi – Technology Insights Research: Okay. So it sounds like there's a lot of moving parts in order to optimize basically possibility in the near-term and long-term basically as you look at market share opportunities as well as investing in sales?

That is correct. Nihal Satchi – Technology Insights Research: Okay, thank you.

We will go next to Alex Kurtz with Merriman Curhan Ford. Alex Kurtz – Merriman Curhan Ford: Yes, thanks guys. And thanks for taking the question and great quarter. So Howard just a follow up on that question, I mean if you look at September of your last fiscal year, you did $144 million in revenue and you did about 9% operating margin and here we are talking about the December quarter, the midpoint of about say $160 million in revenue and you guidance sort of implying maybe flat operating margin, so I guess if – what – where is the discrepancy again in that because if we – you obviously hit much higher operating margin targets about four, five quarters ago, it's just been OpEx creep over the last year that leads us to a point where you can't do 8% or 9% this quarter?

I think Alex certainly like you said it is a combination as Nihal indicated, there is combination of factors that are happening. You know one the OpEx is somewhat higher than it was last year. Sequentially we have kept it fairly consistent and we plan to keep an eye on it and keep it fairly consistent, make the right investments, I guess that's the way to put it while still at the same time allowing us to grow our top line and our opportunities. Alex Kurtz – Merriman Curhan Ford: Okay, all right. And then Howard on the unit count, can you just give us the unit by server, by servers and components? Do you have that?

Let me get back to that one, Alex. Just a second. Alex Kurtz – Merriman Curhan Ford: Okay. Then Charles, I just have a quick question for you. As we head into calendar 2010, how would you sort of see demand from a server refresh perspective based on Istanbul and Nehalem versus a bounce back in spending, which of those two items do you see sort of leading the way for you guys?

Indeed we feel basically very positive real, the economy looks like continue, will continue recover slowly, but although slowly, very consistently, but mostly important because our kind of outstanding architecture right, I mentioned a couple of times 2U Twin2 has been a very popular architecture people like to have and GPU again the quantity ramping up very strongly. So with Nehalem and with (inaudible) also coming very soon. AMD's Istanbul, PCI Express Gen II just a bit above a quarter ago and quantities still in quickly ramping up. Plus however 40 giga Infiniband we just make our 40 G DDR Infiniband switch available about a one month ago all those factors will grow our business though. Alex Kurtz – Merriman Curhan Ford: Okay. And Howard just I don't know if you have those unit numbers yet, but just as a last question here, you want to take a stab at what revenue levels you have to get back to then to hit that the low end of your long-term operating model?

I think we are still at as I indicated before there are long term operating models are probably one to three years out, so if you extend our growth on there, I think during the past five years prior to the economic upheaval, we were growing at about 34%, 32% cliff on a CAGR basis, and so again as we extend out one to three years, get out of this economic recession that we have been in, and as Charles mentioned, get back on more the trajectory were on previously. Alex Kurtz – Merriman Curhan Ford: Okay, thank you guys.

Alex, just as a follow-up, 37,000 server units. Alex Kurtz – Merriman Curhan Ford: Okay. And the server components?

Sub systems and accessories are sitting at about 655,000. Alex Kurtz – Merriman Curhan Ford: Okay, thank you very much.

(Operator instructions) And it appears, at this time, we have no further questions. I would like to turn the call back over to Mr. Liang for any additional or closing comments.

Thank you for joining us today and we are looking forward to talking to you again at the end of this quarter. Thank you everyone. Have a great day.

Thank you, ladies and gentlemen. This does conclude the Super Micro first quarter fiscal year 2010 conference call. We do appreciate your participation. You may disconnect at this time.