Paresh Maniar - Executive Director & IR Tunc Doluca - CEO Pirooz Parvarandeh - Group President Vijay Ullal - Group President Bruce Kiddoo - VP of Finance,

Evan Wang - Thomas Weisel Partners Craig Ellis - Citigroup John Dryden - Charter Equity Research Venkat Swami - JPMorgan John Pitzer - Credit Suisse Simona Jankowski - Goldman Sachs Jeff Rosenberg - William Blair David Wu - Global Crown Capital Gurinder Kalra - Bear Stearns Romit Shah - Lehman Brothers Uche Orji from UBS New York Sanjay Rajkumar - RBC Capital Markets Sumit Dhanda - Banc of America Ross Seymore - Deutsche Bank Nancy Friedman - Greenleaf Capital Mike McConnell - Pacific Crest Securities Steve Smigie - Raymond James

Good day and welcome to MaximIntegrated Products’ First Quarter 2008 Earnings Release Conference Call.Today's call is being recorded. At this time for opening remarks andintroductions, I will turn the call over the Mr. Paresh Maniar, ExecutiveDirector and Investor Relations for Maxim Integrated Products. Mr. Maniar, youmay begin.

Thank you, operator, and welcomeeveryone to our fiscal first quarter 2008 Earnings Call. With me on the calltoday are Chief Executive Officer, Tunc Doluca; Group President, PiroozParvarandeh; Group President Vijay Ullal; and Vice President if Finance, Bruce Kiddoo. There are some administrative items that I wouldlike to take care of before we cover our results. First, we will be makingforward-looking statements on this call, and in light of the Private SecuritiesLitigation Reform Act, I would like to remind you that statements we make aboutthe future, including our intentions or expectations or predictions of thefuture, including but not limited to possible statements regarding bookings andturns orders, revenues and earnings, inventory and spending levels,manufacturing efficiency or capacity, projected end market consumption of ourproduct, the estimated time to complete our restatement projects, and any otherfuture financial results are forward-looking statements. If we use words like anticipate,believe, project, forecast, plan, estimate, or variations of these words andsimilar expressions relating to the future, they're intended to identify forward-lookingstatements. It is important to note that the company's actual resultscould differ materially from those projected in the forward-looking statements.Additional information about risks and uncertainties associated with the Company'sbusiness are contained in the Company's SEC filings on Form 10-K for the yearended June 25, 2005.Copies can be obtained from the company or the SEC. Second, in keeping with the SEC's fair disclosure requirementswe have made time available for a question-and-answer period at the end oftoday's call. This will be your opportunity to ask questions of managementconcerning the quarterly results and expectations for the next quarter. Anoperator will provide instructions at that time. We would like to remind you that the Fiscal Q4 of 2007contains 14 weeks, whereas the first quarter of Fiscal 2008 was a 13-weekquarter. Consequently, whenever the term normalized is used during this call,the sequential information provided will be based on normalizing Q4 2007 datato 13 weeks. We are pleased by the feedbacks that indicated that theinvestment community appreciated the reduced length of our last conferencecall. We therefore request that participants again limit themselves to onequestion and one follow-up question during the Q&A session. Before I hand the call over to Pirooz, I want to remind youof the contents of our January 31, 2007, press release, which reported that due to stock optionaccounting matters, Maxim expects to re-state its financial statements. Sincethe company has not yet issued its restated financial statements, we are unableto provide detailed GAPP or non-GAAP financials for the quarter ended September 29, 2007. As a result all numberscontained in our press release and discussed on this call exclude all stockbased compensation. These numbers should be treated as estimate only and aresubject to change. Regarding the restatement project, we've made considerableprofit and the projected completion timeframe remains calendar Q1 of 2008 asstated in our 8-K filing dated September 21, 2007. No additional comments can be made regarding this issue. Iwill now pass the call over to Bruce who recently joined us as Vice Presidentof Finance. He will take over the post of CFO when our restatement is complete.

Thank you Paresh. Let me start by saying I am excited to behere today at Maxim, a premier semiconductor company with leading edge in mixedsignal products, solid revenue growth, high margins and consistently cash flow.I'll review the results of our most recently completed September quarterstarting with certain items from the income statement. Consistent with our guidance, net revenues for the firstquarter were $522.7 million, a 4% increase from the same quarter last year anda 6% increase from the normalize level of the fourth quarter of fiscal 2007.This increase was driven primarily by strength in our notebook and cell phonesegments. External distribution revenue grew modestly on a normalized 13 weekbasis, while inventory in the distribution channel decreased. Q1 gross margins excluding stock-based compensation andnon-recurring charges declined by 40 basis points, compared to Q4, consistentwith our expectations that gross margins will fluctuate within a stable range.This slight decline was primarily due to change in product mix favoring thenotebook PC segment. On an absolute basis, Q1 operating expenses excluding stockbased compensation and non recurring items increased 0.6% sequentially over Q4.While operating expenses grew slightly faster than revenue in Q1, compared toQ4, it is worth noting that several expenses such as [Maxim] expenses anddepreciation do not scale with the number of weeks in a quarter. When youcompare our Q1 '08 expenses levels with those incurred in Q3 '07, operatingexpenses increased by 8.4% while revenues increased by 9.9%. I want to emphasize that we are continuing our focus onaggressively controlling our below-the-line spending. Non recurring itemsduring Q1, included the previously announced program for expiring employeeoptions, restatement related charges and charges related to our San Jose fab impairment. Turning to the balance sheet, total cash, cash equivalentand short-term investments increased by $49.6 million during Q1, this wasdriven by strong operating cash flow, partially offset by payments of $60million for dividends and $57 million for property and equipment. Average days sales outstanding decreased from 46 days to 45days, as linearity improved compared to the prior quarter. And importantlyinventory declined during the first quarter as we continue to manage itcarefully. Finally, during Q1 CapEx totaled $68.5 million. Our forecastfor fiscal year 2008 continues to be in the range of $200 million to $250million. Regarding bookings and backlogs, during Q1, Maxim recorded netrealizable bookings of $523.2 million, up 4.3% from the 13-week normalizedlevel of $501.6 million in Q4. Our beginning current quarterbacklog of net realizable revenue for Q2 is $361.4 million, up 3.3% from thebeginning backlog for Q1. Based on the beginning backlog and orders received sofar, we expect Q2 revenues to be between $530 million and $550 million. We seestrength in our cell phone, computing peripherals and various consumerentertainment segments. We anticipate that Q2 grossmargins will be approximately in line with our Q1 gross margins subject to thenormal fluctuations. Our goal is to manage Q2 operating expenses to grow slowerthan revenue, excluding the impact of the addition of the VitesseStorage Products development team. I will now hand the call over to Tunc to provide additional comments and guidance.

Thank you,Bruce. Thank you all for joining our call and good afternoon. I will begin bydiscussing our Q1 revenues. Our revenues from our four major markets,computing, consumer, communications and industrial were rolled out. Asexpected, the computing and consumer markets have had you awaiting due toseasonality. I will next provide some color on Q1 revenue from each of thesemarkets. First, thecomputing market: As Bruce indicated, the September quarter had sharply highershipments into the notebook segment. As a result, revenues from the computingmarket increased 13% sequentially on a normalized basis. Three notablecontributors to this growth were Unique Power adaptor chip, a CCA filled driverto support back riding and notebook displays. And a high integration IC that isused to power LCD displays. Each of these devices was a recent design win thatis ramping up in production. We believe ourdesign know-how and process technology creates a significant advantage forfuture growth in notebook display, notebook battery and notebook mixed signalsockets. We observe Notebook battery and notebook mix signal socketsboard power management offers less opportunity for differentiation.Accordingly, we've been expending less of our development efforts in this areaand focus more on other opportunities in notebooks. Next, the consumer market: During Q1 shipments to theconsumer end market increased 9% on a normalized basis. We saw strength in thecell phone and consumer entertainment segment. Key contributors to the upsideand cell phone revenues were a high integration device that powers most of theCDMA phone, and IC that powers the backlight for cell display, a new USBtransceiver chip, and audio amplifiers that drive speakers and headphones andcell phones. Key upside revenue drivers in the consumer entertainment segmentwere a high-sensitive satellite radio receiver chip, a high-efficiency devicethat powers media players, and a device that powers LCD TVs. For the consumermarket, we're encouraged by the ever expanding opportunity to integratemultiple functions on single chips for mid and high end handsets. Additionally,we planned continued Maxim investment in new ICs, targeted at the consumerentertainment section. Third, the industry market: During Q1, shipments to theindustrial end market decreased a normalized 2% in addition to medical andautomatic test equipment segment. We continue to invest in products for theautomotive segment. Here, our initial offerings are now generating revenue. Acouple of notable automotive wing include a serial interface product tocommunicate with the display in high-end cars sold by a leading Germanmanufacturer and an RF receiver product, designed into various models of anAmerican auto maker. These unique, this unique receiver has two independentdata paths, and a single device simultaneously provides both remote keylessentry and tire pressure monitoring. Maxim's technology has been extremely well received byautomotive module manufacturers and the automobile companies alike. We expectsignificant revenue contribution from this segment in the coming years.Finally, communications market revenue was up 4% on a 13-week normalized basis. Next, I will turn to Q1 booking. The standout market duringthe September quarter was consumer, where orders increased by 26% sequentiallyon a normalized basis. This substantial increase was driven by high demand fromthe cell phone segment. Sequential normalized bookings in the computing andcommunications end-markets were up slightly while bookings from the industrialend-market were down. Turning to the five initiative I articulated in our Februaryconference call. We have achieved great success in four out of the five andmade further progress on the fifth. First; gross margins have stayed in astable range for several quarters now. Second, we reduced our manufacturing cycle timesignificantly, beating our original goal. We also achieved excellent on-timeproduct deliveries. Customer feedback indicates that they are very happy aboutour responsiveness and improved delivery performance. Third, our business units continue to collaborate moreclosely on joint projects. This collaboration enables us to integrate diversefunctions from our broad intellectual property portfolio and has led to keydesign wins in all segments. Fourth, we empowered our business unit executives and areholding each accountable for results. We link the compensation of ourexecutives to operating margin and operating profit growth. This raised theimportance of these metrics throughout the company. We will monitor performance of these initiatives on anongoing basis, and will continually drive for further improvements. Our fifth initiative to review and adjust our small andmedium sized customer sales strategy is making good progress. I would like toend my prepared remarks by expressing my excitement that the recent closing ofthe acquisition of the storage products line from Vitesse. We added leadingedge mixed signal high-speed technology and engineers, customer relationshipsand market positioning with this acquisition. We expect this operation tobecome profitable by our fiscal year-end and to contribute significantly to ourgrowth in the computing end-market over the next several years. Paresh.

That is the end of our prepared comments, we could nowwelcome your questions. Please limit yourself to one question with onefollow-up. Operator will you please begin polling for question.

(Operator Instructions) Our first question comes from ToreSvanberg from Thomas Weisel Partners. Evan Wang - ThomasWeisel Partners: Hi. This is Evan Wang calling in for Tore Svanberg. We haveheard that notebooks and cell phones have been strong, and I was wondering ifyou can comment a bit on whether you see indications that you are gainingshares, or if the growth in your business units there are due to the growth ofthe market?

This is Tunc, I will take that question. I think it’s acombination in the cell phone market there is growth, but we are definitelygaining share in that market and also gaining that share in a profitable way. And in the notebook market, we're -- mostly the growth isbecause that market has grown significantly, and our share gains there, as Iindicated in my prepared remarks, is mostly in areas that are not in themotherboard power. So, I'd say it's a combination of both market growth andshare gains. Evan Wang - Thomas Weisel Partners: And my follow-up question is,whether you may have any anecdotal stories you can tell about how your businessunits may have collaborated to win the share gain?

Well, there is, I mean I can givea few examples. Obviously, I can't be very specific, but one example was wherewe had a joint project for some small phone tag to Mobile PCs where our groupsthat make our audio products and the groups that make our power managementproducts, have a joint development, and that was viewed very positively by thereference designed customers that we were working with. I mean that's oneexample. Vijay can you think of another one that you can...?

I think we have a couple of thosekinds of products. And I think there is similar example between our signalprocessing groups and Michael controller groups. So, we have probably 10 or 12such collaborative projects.

And definitely, one other area isin cell phones where some of these functions are being integrated together thatin our company we are developing in separate organizations but they are workingtogether to make single-chip solutions for the customer. Evan Wang - Thomas Weisel Partners: And thank you very much.

You're welcome.

Thank you. Our next comes fromCraig Ellis from Citi. Craig Ellis - Citigroup: Thanks, guys. I'll start with theclarification on the gross margin line. Bruce, could you just highlight whatthe gives and takes for in the gross margins which declined 40 basis points ina quarter, was there any inventory write-down effect there, or anything elsewas notable,

That was primarily due to mix,due to the strength in the notebook business. We did have, quarter-on-quarter,a slight improvement in our inventory write-down, but we believe that reached anormalized level at this point. So, we're primarily going to be driven by a mixand by our ongoing cost reduction activities which are very active within thecompany right now. Craig Ellis - Citigroup: Okay, that’s helpful. And then switching gears to the fiveinitiatives that you outlined in February, you highlighted the emphasis on theglobal sales plan. When should we expect to see the benefit of the changes thatyou are making there, and is there any associated operating expense increasedwith the changes that you make on global distribution?

In terms of the global distribution, our main objectivethere is to be able to capture more sockets and small and medium size customersthrough using the distribution channels SAE's and then their sales force.Therefore, that win is going to come slowly, it’s not going to immediate. So,it will be multiple quarters before we can begin to see leverage on selling ourexisting products. There was some additional hiring in the sales area anddistribution managers. But it really is not very significant in terms of whatwe need to spend below the line. Craig Ellis - Citigroup: So, is that the rest then to identify additionaldistributors for your products and leverage that more so than just hiring stafffor direct sales?

That’s correct. Craig Ellis - Citigroup: Okay. Thanks guys.

Thank you. Our next question comes from John Dryden fromCharter Equity Research. John Dryden - CharterEquity Research: Could you comment on, within notebooks, are margins higherfor the increased audio, battery and LCD power sales versus power management onthe motherboard, and where did you see the highest area of growth?

Your question was in the notebook area, how do our marginschange from those four segments that I talked about. John Dryden - CharterEquity Research.: Yes sir.

And in general I can say that they are better in some --those other segments that I talked about, clearly I really don't want toquantify that right now. And I don't think we have right now the data to showwhich segments contributed to most of that growth. But we did have a lot ofmotherboard power management wins that have been carrying over. So that's beena good growth area for us this quarter. John Dryden - CharterEquity Research.: And maybe a follow-up for Vijay, can you talk specificallyabout the strength in phones, was that primarily from increased units orincreased billing materials where you are up selling new products?

I think it's the combination. I think we did get some designwins for new products and of course we are also selling more high integrationof products. So it’s a combination for sure. It depends on the customer, at acouple of customers I think the growth has been driven by high integrationproducts. But we have some new customers that are -- who are buying our lowerintegration products. So it’s a combination. John Dryden - CharterEquity Research.: Thanks for taking my questions.

Welcome.

Thank you. Our next question comes from Chris Danely fromJPMorgan. Venkat Swami -JPMorgan: Hi good afternoon. This is [Venkat Swami] sitting in forChris. I have a couple of questions, the first one is you talked about thestrength in the computing and consumer end market segments, but looking aheadwhat segments are you particularly worried about? Do you see continuingweakness in industrial or in consumer segment?

Well going forward in the future quarters, we expect thingsto be well balanced, we really don’t have a lot of visibility beyond Q2. It'sreally difficult for me to be able to say how our mix will change or whichsegment will be weaker or stronger in [2008] and beyond. Venkat Swami -JPMorgan: Okay. That’s fair. If I could ask a follow-up, how would youcharacterize an upturn. Is it slow but steady, do you think its getting better,I know you said you couldn't look beyond Q2, but in general if you look atprior upturns how does this feel relative to the previous one?

Well, as I said it has been a steady growth for us for thelast two quarters. And if you look at our guidance for Q2 it's about, if youtook the mid point, it's about in the 3% range. So anything beyond that is verydifficult for us to say. The thing that we have noticed, that some of ourcustomers are concerned about developments, in the macro economic situation. So, we think that that might influence their stance in termsof their aggressiveness on ordering products and ordering microprocessors. So,I think that it’s best for us to be cautious right now. But as I said visibilityis pretty poor beyond Q2. Venkat Swami -JPMorgan: Okay. Fair enough, thanks. And can I ask one bookkeepingquestion?

Sure. Venkat Swami -JPMorgan: You may have already mentioned this, if so could you justrepeat it. What is your fiscal '08 estimate for depreciation as well as CapEx?

For CapEx for fiscal year '08 we've given guidance at about$200 million to $250 million. Venkat Swami -JPMorgan: Okay.

And I don't think we have given guidance on the depreciationin this quarter. Those are around $30 million. Venkat Swami -JPMorgan: Okay, great. Thank you very much.

Thank you. Our next questioncomes from John Pitzer from Credit Suisse. John Pitzer - Credit Suisse: Good afternoon, guys. Thanks fortaking my question. Just quickly, relatively to the revenue guidance for theDecember quarter, does that include the Vitesse acquisition? I guess, how muchshould we assume? Is $5 million the right number, and then I have a follow-up.Thanks.

It does include the Vitesseacquisition; $5 million is probably a little high. We only have two months ofshipments to benefit from this quarter. I would view this as, certainly we'renot going to give the exact number, but it’s less than 1% of total revenue. Soit's relatively immaterial. John Pitzer - Credit Suisse: And I guess the second questionis, can you just comment on just the inventory. I know you made a comment onthe prepared remarks. Was it up in the quarter, and I guess, what should weread for December, just the inventory keeps coming down, what do you think thereload happening? Is that a first-half calendar '08 have been?

Yeah and just to clarify, we saidthat our dusty revenue modestly increased in the quarter and that our revenue-- excuse me and that our inventory decreased. I think, our view from adistribution point of view is that the channel is well under control, and wedon't see dramatic uptakes or downturns at this point. We think thedistributors are being very cautious in managing their inventory levels, and sowe believe it's a more steady growth rate at this point. John Pitzer - Credit Suisse: Bruce this is a follow-up, if theeconomy starts to improve in the first half, do you think inventory levels areappropriate to an improving economy or sort of the macro economic environmentwe find ourselves in right now?

As Tunc indicated, I think, rightnow folks are being more on a cautious side and so I would say that's probablyreflective in the inventory levels as well. John Pitzer - Credit Suisse: Great. Thanks, guys.

Thank you. Our next questioncomes from Simona Jankowski, from Goldman Sachs. Simona Jankowski -Goldman Sachs: Hi, thank you. Much (inaudible), but can you comment on yourlead times and also cancellation patterns in the quarter?

Sure, I will comment on the cancellations. Cancellationswere actually down for the quarter. So, we have no real issues there. From alead time point of view, those continue to increase, excuse me, continue toimprove, consistent with the kind of pattern we've been seeing over the lastcouple of quarters.

Yes. So, one of the lead times there somewhere between 8 and9 weeks, and the lead times were given customers a pretty much matching whatthey are giving us. So, we see a pretty stable environment and then that’s whya lot of them are very satisfied with our performance. Simona Jankowski -Goldman Sachs: Sure, terrific. And just a second question, Tunc. Obviously,since last time we spoke on this kind of earnings call, you guys did get de-listed.Can you just comment on the impact, if any, does that pattern either employeemorale or any turnover or customer relationship or anything of that nature?

Okay, so let’s take that one at a time, Simona. So, in termsof customer relationships, there were a couple of customers that enquired aboutit. We informed them, we told them about our financial strength and they weresatisfied. So, I don’t regard this, that as an issue. Internally, obviously theemployees did not welcome that news. But, I think that we've been a few weeksafter that now. And I see that any affect that it had right now has reallysubsided. One thing that has happened, that was positive for the quarter wasthat, our attrition actually in Q1 dropped substantially from previousquarters. So I saw that as a good sign. Simona Jankowski -Goldman Sachs: Excellent. And just one last question. It sounded like yourOpEx came in just a little bit higher than what you guys had expected, was thatdue to the attrition rate developing or opportunistic hiring, design activityanything else you can point to?

I think a couple of quick comment. As we did say it did comein a little bit. It did grow a little faster than revenue. The issue is that inmany of our expenses really don't scale by week. And as you might recall in Q4OpEx grew significantly slower than revenue for the same reason. So the way weare looking at this is really when you compare Q3 to Q1 and that kind ofremoves this 13, 14 week issue. And so compared to Q3, Q1 revenue increased9.9%, while OpEx only increased 8.4%, more just consistent with our businessmodel. And again, as I said in my prepared remarks, just let mereemphasize again--we are absolutely focused on managing our OpEx to providethe leverage in our financial model. So overall I think we are comfortable withwhere OpEx came in this quarter and the internal processes we have to controlit. Simona Jankowski -Goldman Sachs: Okay. Thanks very much.

Thank you. Our next question comes from Jeff Rosenberg fromWilliam Blair. Jeff Rosenberg -William Blair: Good afternoon. Tunc when you were talking about the shiftin your design emphasis on the notebook side, what you think that means as youlook to your ability to grow that portion of your business in '08, are youseeing that you are like receding market share in the motherboard and as youlook out fro the design cycle and do you feel like you have enough new productsand other applications to make up for that or do you think you get more modesttype growth environment in that end market overall than you are experiencingright now?

Well I think in that particular end market we are probably-- I mean clearly, with the number of products that we are making and theinability to differentiate those products, the market share in that particularsegment we expect to go down. But I believe that there are products that wemade, investments that we put in other functions in the notebook area. They aregoing to help us balance that out somewhat. So I think that -- by the way itdoes not mean that we have completed abandoned making any product, we do seeopportunities, I just essentially wanted to say that we don't have the level ofemphasis we had maybe three or four yeas ago in that area. Jeff Rosenberg -William Blair: Okay. And on the consumer side, on the wireless side, youtalked a fair amount about products there. It seems there were more power managementoriented and other functions. In the past you've had some goals to do more inthe RF side and maybe an update there in terms of the high frequency productsand what your emphasis that is there for the handset?

On the handset side most of our products specially in the RFsegments, in that area, have not been in the signal path transceiver type ICs,most of the design wins we are getting are in functions that are additionalfunctions,. An example might be a TV tuner chip for example, which are becomingincreasingly popular in Asia. So, itsadditional products that are more feature rich and new and that are not reallythat much driven by standards, where we are getting success. I also mentioned a few other examples, like the satellitereceivers that were used and mostly goes into automobiles for example. So thereare other products, other than just power management and audio parts that wesell into consumer applications. Jeff Rosenberg - William Blair: Has that emphasis changed muchover the last couple of years or has your product roadmap with high frequencyis pretty steady?

I would say that if you look backthree or four years ago, we did have some emphasis on making transceiver chipsfor CDMA, and I don't know if you recall, but two or three years ago, that wasan issue for us in terms of bringing down our margins. So, I would say that inthe last few years we have changed our focus from really making transceiverproducts for cell phones to making the more value-added differentiable typeproducts. Jeff Rosenberg - William Blair: Okay. Thank you.

Thank you. Our next questioncomes from David Wu from Global Crown Capital. David Wu - Global Crown Capital: Yes. I have two questions. Thefirst one is on industrial market, these are fairly broad markets, and there isthe relative weakness in industrial, basically a seasonal pattern and we shouldget better as we move into the first and second calendar quarter of the year?

Well, I think in the industrial marketit's usually, those markets are bit stronger in the first half of the year, butI emphasized that word a bit because when we looked at our historical data,even though you could see a pickup in those quarters, it's very slight. So, Ithink that those markets, we expect, unless there are some macroeconomicsituation that they would get slightly better in the first half of the year. David Wu - Global Crown Capital: Okay. On the cell phone side, I got the impression in thepast, that it's primarily CDMA, the phones related. Are you tied to the KoreanHandset customers or are we looking at broader range of customers and productsthese days?

In terms of our cell phone sales whether it be audio orpower management, we do have design wins and revenue coming from multiplecustomers and multiple standards. But I would have to say that, a bulk of thatis coming from the CDMA market and most of the CDMA customers happen to be in Korea. David Wu - Global Crown Capital: Great. Okay. Fantastic, thank you.

You are welcome.

Thank you. Our next question comes from Gurinder Kalra fromBear Stearns. Gurinder Kalra - BearStearns: Thanks. First question on the OpEx side, you mentioned thatthere were some math costs which influenced OpEx, is it possible to tell us,how much was the math cost and whether that we should look at that as more of anon-recurring item?

We're not going to breakdown the actual amount of markedexpense. It did increase a little bit in the quarter, and one of the issueswith [mass] expense as you would probably expect, it’s a little bit lumpydepending on the timing. And this was quarter where the engineers were able toaccelerate some tape out, and which is obviously a good thing for us as a company.Going forward, we don’t expect it to -- we expect it to stay within a similarrange. Gurinder Kalra - BearStearns: Okay. Second question is on the handset, was thatconsiderable fraction with Chinese handset venders during the quarter alsowhich explains some of the upside.

No. I would say that the large portion of the increase inthe handset area was mostly coming from Korea. Gurinder Kalra - BearStearns: Okay. Thanks, very much.

Thank you. Our next question comes from Romit Shah fromLehman brothers. Romit Shah - LehmanBrothers: Yeah thanks for taking my question. We guys have had thepush off of the expected filing of the restatement on a couple of occasions,looking at it today are you any more confident that you will get therestatement filed by the March period?

Shah this is Bruce. Our current estimated date is stillcalendar of quarter -- first quarter and we are still confident. There is asignificant amount of effort within the company and with outside advisors tomake sure we complete this process. It’s very clear that this is the toppriority Tunc has made it very clear to all of us who are working on it. And soour efforts are to complete it within the Q1 time period. Romit Shah - LehmanBrothers: Okay. And if I could, just to clarify, Bruce are youexpecting to generate some operating leverage in fiscal '08, meaning should weexpect earnings to grow at a faster rate then sales?

Yeah, absolutely our business model is to grow OpEx at aslower rate than revenue and so you should expect to see some leverage infiscal year '08. Romit Shah - LehmanBrothers: Okay. Thank you.

Thank you. Our next question comes from Uche Orji from UBSNew York.

Thanks for taking my question. Let me just go back a bit onthe Vijay's point, I know you said the impact on revenue was not material, butif we look below the revenue line on the P&L was there any impact say onthat lines in the expenses?

Yeah when we look in….

Which, you are asking about Q1 or Q2?

I am asking about Q1?

So when we look at the test overall…

Q1 we had enclosethat.

Q1 yeah we had enclosed the deal.

It wasn’t in the numbers.

Right. And if I look at in the coming to this currentquarter what type of impact should we expect on the expenses lines. Should weexpect if any?

No. We expect it to be slightly dilutive this quarter in Q2,and expect it to be accretive for the full fiscal year, so you will see someimpact this quarter from an OpEx side.

Okay. Let me just ask another question, if I look at theguidance you are giving how much of that, how much turns business you imply inthat guidance. And if you can give me a perspective whether that's higher orlower than normal level of turns?

All right. The level of turns business is consistent withwhat we've had in prior quarters. We no longer kind of break out the exactnumber.

Okay. Let me just ask another question on the notebookmarket. Now this has been a fairly strong market. Do you have any perspectiveas to the debate going on in the industry now about double ordering within thePC segment? Do you have any perspective about that? What your sense is in thatfrom your product perspective from what you see within the channel, what's yourtake on that?

Well, I'll take that question. Well, I mean double bookingis a natural reaction from customers, when they sense that there is a supplyshortage. So, in our case we have been supporting these customers very wellwith deliveries. And our lead times for the notebook customers have remainedconstant, they have not gone up. So, all indications from customers are thatthey are not double booking on Maxim. And weather they are double booking onothers, we will not be able to tell that.

Thanks.

Thank you. Our next question comes from Mahesh Sanganeriafrom RBC Capital Markets. Sanjay Rajkumar - RBCCapital Markets: Hi, guys. This is [SanjayRajkumar] calling for Mahesh. Couple of questions. The comment, which you hadon strength in the cell phone market. My question is can you give some color onwhat do you think are the barriers of entry from the competition in terms ofboth, design of the product, as well as the manufacturing process?

So, in the cell phone market thereare several barriers for entry. In terms of our products that are singlefunction or building-block by products, those are really driven by theperformance of the part. So to win the socket you need a design team that'sknowledgeable in that particular function. And also, process technology thatgives that design team the tools to make a better product. So in that scenariowhere Maxim has invested for years, and we have leading edge process technologythat's proprietary. And we have a design team that's very experienced in thatarea. On the other hand, if you look atthe higher integration products, there, what you need is mostly the ability toput together a lot of these high-performance functions and they might be comingfrom diverse areas like you might have to put together USB transceivers withpower management, with real time clocks, with audio amplifiers, and that kindof diversity is in very few competitors of ours. So we're able to eliminate alarge portion of competitors that are trying to come in to the market just bythe fact that we can design these complex products. Sanjay Rajkumar - RBCCapital Markets: Right. If I could turn to thecomputing section, could you comment on rough terms as to how would you compareyour dollar content in notebooks, now versus, let’s say two years back?

We'd have to look at the data. Ican't really quantify it, but I do know that our numbers for those businessunits are higher than they were three years ago in terms of revenue.

And Sanjay, if I may, I would like to add a comment to thefollow-up comment. So, you would have to really compare us against other peoplein terms of the falling three things like, we have good, really good productdefinition, because of our close association with the customers. We have reallygood relationships with customers. We have unique process technologies. Our owninternal manufacturing, which gives us process and product differentiation,lower cost, and that we have a wide diversity of IP, which would entail audio,video, power management and all of these things. So, it’s really a triplethreat and you would have to, you will have a hard time finding somebody thatcould do all of those three things. As there is a very limited number of peoplewho can do all three. So, that was the differentiation for Maxim comes about inthe cell phone arena. A mix signal, anyway. Sanjay Rajkumar - RBCCapital Markets: Okay. And if I may, one last question. Can you comment onyour capacity or manufacturing capacity available? Do you have enough capacityon line at the moment to be able to taken spikes and orders from the customers?

Hi. This is Vijay. I'll comment about fab capacity, andright now, if you add all our internal fab capacity and you add in the strategicalliance with Epson, we’re running about 75% of our equipment capacity. If youlook at what our capacities with respect to what we could do, we outfitted ourinternal fab completely with equivalent. We’re running at about 46% of ourcapacity. So, we have plenty. Sanjay Rajkumar - RBCCapital Markets: Okay. Great, thank you.

Thank you. Our next question comes from Sumit Dhanda fromBanc of America. Sumit Dhanda - Banc ofAmerica: Yes hi, I had a couple of questions. Bruce just I want toask you about your operating model which seems to be a little bit of a changefrom the last call where I think Tunc suggested that operating profits shouldgrow inline with the revenues as opposed to faster. But along those lines canyou help us understand what specific action you are contemplating to allow forthe leverage to flow through the model especially given the diversification inthe business model, which I think at the outset requires higher R&D outlaysas you pursue some ASSP opportunities?

Let me take the first part and Bruce will take the second.When I was asked that question in the last conference call, I was reallyreferring to what we expected for the just upcoming quarter in terms of our --essentially what I had said was that our operating expenses have changed prettymuch with our revenue change for the quarter. But for longer term our goal isto get leverage and our goal is to grow our operating expense at a slower ratethen our revenues. Bruce do you want to add some more color?

Sure and the way we are going to achieve that a across allthree key metrics right, we are going to aggressively seek out revenue growth.We believe our strategy in our managing kind of our core business along withsort of the high consumer or high growth opportunities will allow us to growfaster than the industry. From a gross margin point of view both by managingthis mix of business and by aggressively going after cost reduction activitieswhich we are doing in fab end of line. Across the board there is a renewed emphasis and with Tuncon board to push very hard from a cost reduction point of view and then ofcourse from an OpEx point of view that's just managing your investments, but Ithink the key thing we are going to do there is in looking at the differentbusinesses that we are in, make the decisions and make the choices as to whereto invest our R&D dollars, to ensure that we are getting the best return for that. So, I think it’s going to be a very active process, acrossrevenue gross margin and operating margin. And as you have seen from the lastcouple of quarters, we've been able to deliver this nice consistent predictablerevenue growth with stable margins. And really that's the model that we aregoing to target going forward. Sumit Dhanda - Banc ofAmerica: I guess I'm not clear about couple of things, one I mean themix of the business, I am not sure how it can get richer given your strategy ofpursuing a more ASSP centric model? And then I guess second point, I am notclear on is your SG&A line is a very low percentage of revenues. So I amassuming that there is no cushion or leverage within that particular line or ifI am mistaken please help me out?

Yes. So first of all I will do them in reverse order. As faras SG&A to an extent that revenue continues grow above industry average, Iwould say there is some leverage there, we are doing significant amount of workas far as, we have publicly talked about an SAP implementation. We are lookingto drive efficiencies across the entire organization and that's happening inall of our groups. I think on the revenue side, Ithink there are two ways that we are going to kind of drive that. One is we'realong with, kind of seeking this high revenue opportunities, obviously we areworking very hard on our core business as well, and looking for new businessesto enter there and kind of defending the core to make sure that that businessstays strong and healthy. And I think the third part from a gross margin pointof view, which I mentioned before is again we are very aggressive from a costreduction point of view. Making sure we have our factories sized appropriatelyso that they are running as efficiently as possible. Sumit Dhanda - Banc of America: Okay.

And then to quantify that a bitmore, I mean if you look at our SEM, we believe it's going to grow from about$18 billion to almost $25 billion between 2007 and 2010. And a lot of thatgrowth does come from entering markets that we have not entered. So there areopportunities for us to find revenue, and we have a diverse product portfolio,but it doesn't encompass everything that's needed out there. So there areopportunities there, and then there are also opportunities, we believe, inleveraging our small and medium-sized customers with existing products. InR&D, that's already been spent to increase our revenue as well. Sumit Dhanda - Banc of America: Okay. Just as a follow-up to that20%, can you update us on what percentage of revenue at this point are comingfrom your high-volume lower-margin products? My last recollection is it wasabout 16% in fiscal '05, as you've closed fiscal '07, do you have an update forus?

I think you're referring to thebuilding block versus high integration. And that update is currently around, Ithink, it's still just below 20%. As far as the core versus high volume, wehaven't broken that percentage out. Sumit Dhanda - Banc of America: Okay. Then one final question foryou, Bruce. You -- given the sequential growth within each of the four majorsegments, any chance we could get a breakout from an exposure perspective forthose four segments?

So, currently they are relativelywell balanced. We haven't split that out specifically in the past. Sumit Dhanda - Banc of America: Okay. Alright. Thank you.

Thank you. (OperatorInstructions) Our next question comes from Ross Seymore from Deutsche Bank. Ross Seymore -Deutsche Bank: Hi, Tunc and Bruce. Can you guys talk a little bit about thelinearity of orders in the quarter, and specifically you highlighted thenotebook strength, I think a prior question asked about double ordering. Ratherthan double ordering, have you guys seen any slowdown in that as we progressthrough this quarter?

Okay. If we look at the bookings for the prior quarter, Q1quarter, I think that if we looked at that, it started up very strong and we’vegot a lot of bookings and orders, in the first part. So, I would say that itwas not completely linear throughout the quarter. And it was less towards theend, and that’s why our guidance for this quarter is 3% instead of the -- that3, but the middle range 3% instead of being a higher number. So, in terms oflooking at how Q2 started, it’s really, we really don’t want to talk aboutthose numbers because it’s too small of a sample size to be able to tellanything. So, I won’t be able to give you lot of color on, how the bookingswere going on in October.

But I think Ross, based on the bookings pattern we'reseeing, we're still obviously very comfortable with the guidance that we havegiven and that booking support that. Ross Seymore -Deutsche Bank: Great, and kind of like the prior question that was asked,even though you are not going to give the exact breakout of those segmentsbefore the computing consumer etcetera, are there any sub-segments within that,those four are bouncers, so are there any sub-segments within that, that arethe vast majority of those, anything over, say, half of those segments in andit of itself?

I think when you look at the segments, I mean, we’recurrently are tracking 19 of those segments. It’s very well diversified acrossthem. There is only three that are above 10%, and none of those three aregreater than 20%. And so basically it’s well diversified, there is obviouslythe three there are a little bit higher than the others. Ross Seymore -Deutsche Bank: Okay. Thank you.

Thank you. Our next question comes from Nancy Friedman fromGreenleaf Capital. Nancy Friedman -Greenleaf Capital: Hi thank you for taking my questions. Could you give alittle more color on the rational behind the Vitesse acquisition?

Sure this is Tunc. So essentially the particular productline market, which is the storage market, it's an area that we actually didhave a product plan to go and pursue. And especially to make one of thesesegments or one of the functions in that market is called an expander and wewere actively developing some products in that area and we found out that wewere significantly behind in this technology development internally. And we didsee a fairly large market, it is a market where the product really gets soldbecause of the very high performance of the high three or six gigabit persecond, from an interface. So we really choose the product, the analog performance ofthat high speed front end. So essentially decided that maybe the best way forus to get a jump start in the product area was to go find who the leader was inthat segment and look at acquiring them. And essentially that ended up in usacquiring that division from the Vitesse. What we also get essentially was a jump start on customerrelationships in that particular product area. There are a few OEM typecustomers and they really trusted the workforce or the design engineers and theapplications engineers and the tests. So it really gave us a jumpstart in themarket where there are not a lot of suppliers. It’s profitable because it isvery difficult to do this high speed front end circuits and we are addingessentially a group of engineers that were already experienced doing that. Sowe saw it as a good opportunity, their margins were inline with what theCompany wanted and it would provide growth for the company in general. Bruce?

So, one other thing that probably has not been or did notfactor exclusively in to this and we are kind of seeing some of the results ofit is that, these particular products are pretty core in the system. And thisallows us, we think that, based on our customer relationship that we aredeveloping in the faculties or core products and some of the other productsthat go around this core product, because we could do a better do a better jobof selling those. So, there is a leverage there that probably has not beentalked about exclusively. But we hope to see some of that.

Yes, and that’s the benefit, Bruce is absolutely right,thanks for making that comment. But we saw that as a benefit that we could get,but since we couldn’t quantify it, we made the decision basically on theinherent value of the products we were getting. But there is more leverage fromthat because of this relationship. Nancy Friedman -Greenleaf Capital: Thank you very much.

You're welcome.

Thank you. Our next question comes from Mike McConnell withPacific Crest Securities. Mike McConnell -Pacific Crest Securities: Thanks. Could you talk a littlebit about just general customer behavior in Q4 with respect to the OEMs, andthen maybe touch on distributors, just general behavior, build plans, are theymore conservative in the way you would normally see, etcetera?

You said Q4, but I think youmeant Q1, right? Mike McConnell - Pacific Crest Securities: Yeah, I'm sorry calendar Q4 --year fiscal.

Oh, current quarter, yeah, thiswas down quarter? Mike McConnell - Pacific Crest Securities: They -- essentially we do sendsome amount of caution in the customers, but I wouldn't say that they drasticallychange their behavior, when I'm talking about both OEMs and the distributors.But they are cautious. Mike McConnell - Pacific Crest Securities: Does it feel like though that thenormal step up though and build plans that you typically see in Q4, somewhatmuted, are in your fiscal Q2 more muted than you normally see?

It's really difficult to say. Mike McConnell - Pacific Crest Securities: What about turns? What's theconfidence on the turn side?

I think we're very confident onthe turn side, again, it's consistent with levels in prior quarters. So wedon't see any issue there. Mike McConnell - Pacific Crest Securities: And it's a fine loaded quarterthere, is that right?

Our linearity is relatively goodhere across the three months. Mike McConnell - Pacific Crest Securities: Okay. Thanks.

Thank you. Our next questioncomes from Steve Smigie from Raymond James. Steve Smigie - Raymond James: Great, Thank you. You guys havemade some investment in CapEx over the past few quarters, and I was curiousalmost have been -- and you might typically make, it seems that might appeal tosome cost risen in terms of giving them actual capacity to work with us. Haveyou seen a positive impact from that or am I thinking about that wrong?

Sorry, what was your question?

Can you repeat the question,please? Steve Smigie - Raymond James: You guys have made decentinvestment in CapEx over the past few quarters, I am just curious has therebeen any positive customer feedback from that or is that merely an operatingissue for you?

We absolutely have seen positive responses or comments fromour customers. They have seen that we are, A: We are able to deliver on ourcommitments, and also be able to meet their requirements for build. And thenalso, they feel very comfortable or confident by this fact that when there isan upside, what we put in place, we can respond fairly quickly. So, they've allcommented, they have seen that as a good thing, and they also, additionally,are very positive about the cycle time improvements we made over the last ninemonths.

I think our overall cycle times went down about five weekfrom the beginning of the year, which I think has been extremely positive forthe whole company and our customers. Steve Smigie - Raymond James: Thank you. And my other question was just on ASSP products,do you see that as more of a product, sort of products where there ispotentially pricing pressure or was it traditional standard products or more.Your perspective and really price pressure was that the one way to think aboutit?.

I would say that pricing pressure mostly comes throughvolumes. It’s not only the type of products, it’s really the volume of theproducts. So, you could have a single-function product, and if it’s being soldor bought in very high volume by a customer and you're going to have pricingpressure. So, it’s really not coming from being high integration or lowintegration, it’s mostly coming from volumes. Steve Smigie - Raymond James: Okay. Great. Thank you.

Thank you. Our next question is a follow-up from Craig Ellisfrom Citi. Craig Ellis - Citi: Tunc, can could just elaborate on what your objectives arewith regards to acquisition relative to other uses of cash. Obviously there isno buyback until the financials are restated. But should we expect the companyto be more acquisitive than in the future following up another test deal.

Craig in that area -- that is an area where we have made achange. First of all we formed a small business development group and staffedit with a couple of our best people. And our stance really is to look atopportunities essentially either coming from business units in terms of addingtechnology and Vitesse was a really good example of that and also looking forcases where we might want to add or accelerate some of our process technology,where we might want to add modules to give our engineers better tools. Somostly that groups function is to look at small additions to the company andmostly to buy us time in terms of technology development, whether it be inprocess or it be in design. Craig Ellis - Citi: Can you quantify how much that group might be charge withspending or are you thinking there is a level of spend that's a threshold forthat group on an annual basis?

Frankly we look at each case. If the group is not -- theyare not given a budget, a spending budget and we look at each one of this casesas they come and we also look at that group also will out in seek as the business unit say, it's very interestingtechnology that we need for our product roadmap to go out and look. But it'sreally not a budget based system that you might see in some of the largercompanies, that have large venture groups for example. Craig Ellis - Citi: Okay. So clearly more opportunistic. Then just Bruce foryou, on the last call there was mention made of an ARP system implementation,should we still expect that, if so when and how should we think about theexpense side of that implementation?

So, we have kicked of an SAP implementation, as you knowthose are a long process. So, that will take at least a year plus to get done.And from an expense point of view that's factored in to our business model andwill accomplish this within the business model that we have articulated. Craig Ellis - Citi: Okay. Thanks Bruce.

Thank you. Our next question is a follow-up from Uche Orjifrom UBS. Uche Orji - UBS: My question being answered, thank you very much.

Thank you. There are no further questions in the queue atthis time.

Thank you all for participating in our call. This is the endof our Q1 fiscal '08 conference call.

Thank you. Ladies and gentlemen for your participation intoday's conference. This does conclude the program, you may now disconnect.Good day.