Good day ladies and gentlemen. Thank you for standing by. Welcome to the Super Micro Computer Incorporated first quarter fiscal 2011 conference call. The company’s new 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 it has made available to participants which can be accessed in a downloadable PDF format on its website at www.microsystems.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, security 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 26, 2010. A replay of the call will be accessible until midnight, November 9 by dialing 1-877-870-5176 and entering conference ID number 1980946. International callers should dial 1-858-384-5517. With us today are Charles Liang, Chairman and Chief Executive Officer, Howard Hidashima, 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 and financial results for the first quarter fiscal year 2011 which ended September 30, 2010. Before we begin, I’d like to advise you of upcoming investor conferences in which Super Micro will be participating. On November 11, we will attend the Southwest Ideas Conference in Dallas, and on November 16, we’ll attend the Merriman Investors Summit 2010 in New York, where we will present and participate in one-on-one meetings. 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 web site. 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’ll 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 expectations. You can learn more about these risks in the press release we issued earlier this afternoon, our Form 10-K for fiscal 2010, and our other SEC filings. All of those 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 outlooks. For an explanation of our non-GAAP financial measures, please refer to slide three 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. I’ll now 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 our fourth quarter. We are pleased with our first quarter revenue was $270 million or 2.7 percent higher quarter over quarter and 39.5 percent higher year over year. This result is another record high for Super Micro. Net income was $9.3 million or 2.1 percent higher quarter over quarter and 59 percent higher compared to last year. Super Micro non-GAAP earnings per share was $0.22 per diluted share compared to $0.51 last quarter or $0.15 last year. Slide five please. Now I would like to share with you some key points regarding our operating performance in the first quarter. The first quarter of fiscal year 2011 represents our sixth straight quarter of increasing revenues and our fifth straight quarter of record high revenues. We continue to grow because of our strong products that have been optimized to (inaudible) CPU and other technologies. There were launches during the last year and our products are the industry leading performance based on performance per watt and performance per dollars, performance per square foot, and the lowest total cost of ownership. The Super Micro value proposition continues to win customers. We are pleased with this quarter’s performance in spite of summer seasonality effects on the industry. We finished September with good momentum in the last weeks which indicates that we should see a seasonally strong end to the calendar year. From a geography perspective our revenue in the U.S. was consistent, but our revenue both in Europe and in Asia grew strongly during the quarter. Demand for Super Micro products continues to grow in this region, particularly in Asia where we continue to engage new customers with (inaudible) partition in data centers, power…

Thank you Charles, and good afternoon everyone. I’ll focus my remarks on earnings, gross margin, operating expenses and similar items on a non-GAAP basis, which reflects adjustments to exclude stock compensation and provisions for litigation expense. Reconciliation of GAAP to non-GAAP is included in the financial statements of the company in today’s earnings release and in the supplemental detail in the 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 $207.2 million, up 39.5 percent from the same quarter a year ago and up 2.7 percent sequentially. The increase in revenues from last year was fairly wide spread among our customer base, which we believe was primarily due to a continuing improvement in the global economy and the server refresh cycle. The sequential increase in revenue during a seasonally weak quarter for the industry was primarily due to the continued emphasis being put on obtaining effective and efficient solutions such as our 2U Twin and Twin Square servers and storage solutions as the server refresh cycle continues. Slide nine. Turning to product mix, a portion of our revenues from server systems was 35.7 percent which was an increase from 34.5 percent a year ago, and 32.2 percent last quarter. ASP’s for servers was about $1,500 per unit which is up from $1,400 per unit last year and last quarter. The increase in absolute dollars of server products from a year ago was primarily due to the increase in shipments of Twin and GPU servers. The increase in absolute dollars of server products sequentially was primarily due to the increase in shipments of Twin and Twin Squared servers and storage servers. We shipped approximately 50,000 servers and 950,000 sub-systems and accessories in the first quarter.…

Thank you Howard. We believe that the second quarter is shaping up to be a strong quarter of growth. We are well positioned with our innovative products (inaudible) to pursue this growing market community. We are also well positioned with our regional system integration operation to boost our presence in different geographies. We will stay focused on our strategy of growth balanced with investment and profitability. Operator, at this time we are ready for questions.

(Operator Instructions) And we’ll go first to Noah Huth with ThinkEquity.

Hi. Thank you for taking my question. I’m speaking on behalf of Rajesh Ghai today. My question relates to gross margin. Last quarter you had margins of about 15.5 percent and you stated in there that there was some component shortages which led to system sales coming in below your expectation and you said that had a negative effect of about 100 basis points on your gross margin. Now system sales have returned to much higher levels and we’ve only seen about a 50 basis point increase in gross margin. Is there anything else that’s been affecting that because I noticed in Q2 of 2009 with a similar product breakout, you reached 16.7 percent in gross margins.

Thank you for the question. Last quarter, September quarter we continue to have some component shortage, although the shortage overall has been improved. On memory side, memory team, (inaudible) so indeed we saw a drop in price for memory and that’s why (inaudible) have been growing last quarter, but still we grow only 50 points. But looking forward, in the coming quarters, situation should be better.

Okay. I guess what I what I’m saying is that we’ve seen a significant increase here in your system sales, but there hasn’t been that sort of corresponding increase in gross margin.

In September quarter we experienced memory team price drop and we have some inventory. That’s why we saw (inaudible).

Okay. And then also relating to system sales, how much of the demand in the September quarter, how much of that was sort of overflow from the previous quarter and how much of that was new demand.

A portion of that was some overflow from previous as Charles mentioned. We did have some component shortages. That did help a little bit, but again, as you mentioned, it has improved for us this quarter with regards to shortages, short components. So again, it wasn’t a huge dollar amount. Let’s put it that way.

And the next question comes from Alex Kurtz from Merriman Capital.

Hi this is Diane for Alex today. Just going back to the component available, do you see any changes that were noticeable on availability this quarter and also was it consistent throughout the quarter or just right at the end. Any color you can give us around that would be great.

Overall component shortage have been improving especially memory. Now a little bit of oversupply, so as you may know, main memory price dropped a lot. I’d rather say more than 20 percent in last two months. So other than (inaudible) components we still experience some shortage although that situation has been improving. And (inaudible) situation will be much better condition after December or January I believe.

And just moving on quickly to your more geographic outlook, you obviously had broad based strength in both Asia and Europe. Were there any verticals that were extremely strong or did you see any that outperformed others generally either EMIA, Asia or the U.S.?

Yes. I mean we see our 2U Twin Square especially with GPU (inaudible) have been growing very well and that’s particularly for in the (OREO and gas) and kind of some scientific calculation, some simulation and storage. Storage is another area we saw very good growth in last quarter.

All right. Thank you so much. I appreciate it.

Thank you.

And we’ll take the next question from Glenn Hanus from Needham.

Good afternoon guys. Nice report. Let’s just go back to the gross margin for a minute. So as we look sequentially here and even beyond year end and into the March quarter, could you give us a sense of just which factors kind of come into play most and if you can give us any kind of sense of how much gross margin improvement we should look for.

Our product for CPU in Europe and Asia will be continuing improving and we are growing capacity on both side, so that will continue to improve for next quarters I believe and as to the impact ...

Yes, Glenn, we had some investments in our overseas operation. If you take a look last year, probably a lot of the decrease in our gross margin comparatively speaking to last year you could point toward investments that we’re making in the BD and Asia facilities. I think you’ll see probably about a .4 to .5 percent change.

Okay. So this quarter you know, gross margins you’ll get some. Maybe you could rank the different factors that should improve your gross margins this quarter, this European and Asia factor, is that most significant and then there’s the server mix and parts issues. Can you kind of go through the factors that should improve margins this quarter and sort of maybe rank them and what’s most impactful?

I think you’ll see, as Charles mentioned some componentry shortages, the shortages with regard to componentry, things improving. That’s obviously high on the list. Utilizing our production capabilities overseas that I mentioned has two benefits for us. Not only do we get to generate revenues from the investments we’ve already made there, but also as I mentioned, our shipping expenses were fairly high this quarter due to the peak season rates. So we do see that hopefully improving for us this quarter and going beyond. I think if I was going to rank, those would be the three I would rank on the plus side.

Okay. And if there’s some offsetting factors that come into play this quarter, on the minus side.

Yes, I think if you take a look you can flip around some of the overseas expansion that we’re doing, if the revenue or capacity isn’t taken up as we expect that could be you know, potentially neutral as compared to this quarter or potentially less of a gain. Let’s put it that way.

At this moment, it’s looking quite positive for both Europe and Asia.

Okay. Thanks. I’ll stick to the one question.

We’ll take a follow up from Noah Huth.

I just had one quick follow up on clarifying a few things. You mentioned the factors affecting your margins were shipping costs and memory prices. Are these component and shipping charges not passed directly to customers as they change when they go up and down?

Yes, freight in is not – again, there are some things that we can pass on a portion of it. We found that in the September quarter there was a peak season and some additional charges seasonally was higher than normal, so we are able to pass it all 100 percent.

Okay. Thank you.

It appears at this time we have no further questions. I’d like to turn the call back over to Mr. Liang for any additional or closing comments.

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