Ladies and gentlemen, thank you for standing by for UTStarcom’s Second Quarter 2012 Earnings Conference Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. If you have any objections, you may disconnect at this time. It is now my pleasure to introduce your host, Ms. Jing Ou Yang, Investor Relations Director of UTStarcom. You may begin.

Hello everyone and welcome to UTStarcom’s second quarter 2012 earnings conference call. We distributed our earnings press release earlier today and you can find a copy on Newswire Services or on our website at www.utstar.com. In addition, we have posted a slide show presentation on our website, which you can download and use to follow along with today’s call. On today’s call, we have Mr. Jack Lu, our President and CEO; Ms. Jin Jiang, our CFO and Mr. William Wong, our COO. Before we get started, I will read the Company’s advisory on forward-looking statements. This call will include forward-looking statements relating to the Company’s operational support services business, the divestiture of its IPTV equipment business and the Company’s performance in 2012. These statements are forward-looking in nature and subject to risk and uncertainties that may cause actual results to differ materially. This include risk and uncertainties related to other things, changes in the financial condition and cash position of the Company, changes in the compensation of the management and their impact on the Company. The Company’s ability to realize anticipated result of operational improvements and the benefits of the divestiture transaction, successfully operate its Service business, execute on its business plan and manage regulatory matters, as well as risk factors identified in the company’s latest Annual Report on Form 20-F, and current reports on Form 6-K as filed with the Securities and Exchange Commission. The Company is in a period of transition and the conduct of its business is exposed to additional risks as a result. All forward-looking statements included in this release are based upon information available to the Company as of the date of this release, which may change and UTStarcom assumes no obligation to update any such forward-looking statements. I will now turn the call over…

Thank you, Jack for welcoming me on to the call today. And on behalf of the Board and the employees, I would like to thank you for your contribution to UTStarcom. You are leaving us with a Company that is much stronger than it was when you joined two and half years ago. It was under your leadership that UTStarcom turned around after six years of consecutive losses and began its transition from being purely an equipment provider and begin charting a path into operation support services. Let me say that I am thrilled to be part of UTStarcom. I look forward to working with the Board and the rest of the management team on the initiatives that we have recently announced. I firmly believe that UTStarcom has a great future and I am confident that we can work together to transform the business and generate value for our shareholders. Let’s begin with what we recently announced. Please turn to slide number 6. On July 27, 2012 the Company following the recommendations of a specialist Strategy Committee of the Board of Directors announced that it will seek to focus on and accelerate the development of the media operations support services and broadband businesses, and as a part of this strategy divest the IPTV equipment business which will become a standalone entity. It is important for our customers, employees and investors to understand the importance of these initiatives. They stem from an extensive Board review of options to accelerate revenue growth, achieve long-term sustainable profitability and increase the shareholder value. After a robust analysis in consultation with our outside advisors a decision was made to divest the IPTV business. While this business has won several new contracts recently, we estimate it will take 18 to 24 months to fully capitalize on…

Thank you, William, and hello, everyone. Please turn to slide 7, and I will discuss our second quarter 2012 financial results in more detail. As Jack mentioned at the beginning of the call, unless otherwise noticed the discussion that follows will exclude amortization of PHS deferred revenue from the Company’s second quarter 2011 results. In the second quarter 2012, we recorded $56.5 million in sales representing a 17.9% decrease year-over-year, a 21% increase sequentially. The year-over-year decrease was primarily the results of fewer next generation network service contracts in EMEA and decreased sales of PTN products in Japan partially offset by an increase in sales of RollingStream and GEPON products in China. Compared to the first quarter of 2012, the sequential increase in the second quarter was mainly driven by higher sales of PTN products in Japan. Our second quarter book-to-bill ratio was 0.62. Let me comment for a moment on our book-to-bill ratio and its significance going forward. This number will be less representative of our underlying business trends and outlook as we transition into a service business. With our services model, it does not have an associated booking number and for those sales that do have a booking number we anticipate a faster order cycle that will allow us to convert more bookings into revenue within the same quarter which will also make the book-to-bill ratio thus meaningful. On slide 8, you can see the gross profit margin was 38.5% for the second quarter 2012 compared to 38.6% for the second quarter of 2011 and 39.5% for the first quarter of 2012. As Jack mentioned, we were able to maintain growth margins at a year-ago level excluding PHS sales. We are very pleased with this performance, which was the result of our continued focus on preserving growth margins…

We will now begin the question-and-answer session. (Operator Instructions) At this time, we will pause momentarily to assemble our roster. Thank you. There are no questions at this time. I will turn the conference back to management for closing remarks.

Thank you for joining us on our second quarter 2012 earnings conference call. We look forward to updating you on our third quarter 2012 results in a few months time. Feel free to get in touch with us anytime if you have further questions, concerns or comments. Thank you everyone.

The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.