Rob O’Brien – Interim CFO and Corporate Controller Bruno Guilmart – President and CEO

James Schneider – Goldman Sachs Venk Nathamuni – JP Morgan Tristan Gerra – Robert Baird Bill Dezellem – Tieton Capital Management John Ahn [ph] – Morgan Stanley

Good afternoon. My name is Marcello, and I will be your conference operator today. At this time, I would like to welcome everyone to the Lattice Semiconductor Corporation third quarter 2008 conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. (Operator instructions) Thank you. Mr. Rob O’Brien, acting Chief Financial Officer, you may begin your conference. Rob O’Brien: Thank you, and good afternoon everyone. I’ve had the pleasure to meet or talk with several of you joining in on the call, but for those who haven’t met me this is Rob O’Brien. And I’ve been the Corporate Controller, since joining Lattice in May of 2004. I’ve been the acting CFO since John’s departure. Joining me today on the call is Bruno Guilmart, our President and CEO. The format will be similar to the past. I’ll begin with a Safe Harbor statement. After that I will give a financial review for the third quarter, and Bruno will provide a business review, followed by our fourth quarter outlook. We will then hold a question and answer session. So, now I will start with the Safe Harbor statement. It’s our intention this call will comply with the requirements of the SEC Regulation FD. This call includes and constitutes the company’s official guidance for the fourth quarter of fiscal 2008. If at any time after this call we communicate any material changes to this guidance, we intend to update such using public forums such as press releases or publicly announced conference call. The matters that we will discuss today other than historical information include forward-looking statements relating to our future financial performance and other performance expectations. Investors are cautioned that forward-looking statements are neither promises nor guarantees, but involve risk and uncertainties that may cause actual results to differ materially from those projected in the forward-looking statements. Some of those risks and uncertainties are detailed in our filings with the SEC, including our Form 10-K filed in March of 2008 and our quarterly reports on Form 10-Q. The company disclaims any obligation to publicly update or revise any such forward-looking statements to reflect events or circumstances that occur after this call. Our prepared remarks also will be presented within the requirements of SEC Regulation G regarding generally accepted accounting principles or GAAP. Some financial information presented by us during the call will be provided on both a GAAP and a non-GAAP basis. By disclosing certain non-GAAP information, management intends to provide investors with additional information to permit further analysis of the company’s performance for results and underlying trends. Management uses non-GAAP measures to better assess operating performance and to establish operational goals. Non-GAAP information should not be viewed by investors as a substitute for data prepared in accordance with GAAP. If we use any non-GAAP financial measure during the call, you will find the required presentation of the reconciliation to the most directly comparable GAAP financial measure in the company’s earnings press release. That concludes the Safe Harbor Statement. And now I would like to go into a financial review for the third quarter. Revenue for the third quarter was $57.6 million, that’s down slightly a 0.8% from revenue of $58.1 million in the prior quarter, and that’s down 1.2% from the $58.3 million reported in the same quarter a year ago. When you look at gross margin for the first quarter [ph], it came in at 54% which is below our guidance and under the gross margin we reported last quarter at 56%, but comparable with the 54.2% we posted in the third quarter of 2007. This sequential change in gross margin was primarily due to product mix and Bruno is going to elaborate that later in the call. A portion of this was due to the current quarter’s strong growth in new products, typically these carry an initial lower gross margin than other products that we sell. Total operating expenses, excluding intangible asset amortization and restructuring, for the third quarter came in at $32.1 million, that’s $1 million lower than the $33.1 million we posted in the second quarter. The lower quarter over quarter operating expenses were primarily the result of the 2008 restructuring plan that we announced on September 16, 2008. Quarterly R&D expense was $17.5 million, which was lower than the $17.9 million we recorded last quarter. Quarterly SG&A expense was $14.5 million, and was lower than the $15.2 million we reported in the second quarter. The company recorded a $3.9 million restructuring charge in the third quarter primarily related to the costs associated with the 2008 restructuring plan, which included a 14% headcount reduction. We expect to record approximately another $300,000 restructuring costs in Q4 at which time we think the 2008 restructuring plan will be substantially complete. Intangible asset amortization was $1.4 million last quarter. It was the same this quarter. We expect the same in the fourth quarter, and then we have a small tail end of about $230,000 in Q1 of 2009. You will note in our other income category of our income statement, you will see a negative $1 million and a negative $10 million for the third and second quarter respectively. During the current quarter we recorded a $1.7 million impairment charge compared to last quarter’s charge of $11.3 million. Both of these charges are primarily related to other than temporary decline in the fair value of auction rate securities. The fair value of auction rate securities at quarter end totaled $27.4 million and are recorded in long-term marketable securities on our balance sheet. I will provide a little more detail on the auction rate securities later here in the call. We recorded a tax benefit of $236,000 during the third quarter and that was primarily the result of a foreign tax refund and for the benefit related to the Housing and Economic Recovery Act signed into law just this July. The company has the benefit of significant NOLs and therefore we don’t expect to pay US Federal income taxes in the foreseeable future. The September quarter GAAP net loss was $7 million or $0.06 per share. That compares to $13.6 million loss or $0.12 per share that we posted in the second quarter. The third quarter results included charges of $8.4 million, including the previously mentioned restructuring charge as a result of 2008 restructuring plan, the impairment for other than temporary decline in fair value of investments, the amortization of intangible assets, and stock-based compensation expense. If I exclude these just mentioned charges and expenses, our non-GAAP net income was $1.4 million for the current quarter. That compares to $1.3 million posted last quarter and $1.1 million posted in the comparable quarter last year. I want to talk a little bit about our liquidity position because it remains strong and I would like summarize a couple points as it relates to Lattice. First, cash flow from operations for the three and nine months ended third quarter was $5.3 million and $24.7 million respectively. Second, at quarter end we had $68.6 million in cash and cash equivalents and short-term marketable securities. Though this is down from the $96.3 million we had at the end of last quarter, it is explained by the extinguishment of our long term debt on our balance sheet through the payment of the remaining $40 million to our convertible note-holders on July 2, 2008. Thirdly, we have the continuing benefit of our cash advance to our foundry partner, Fujitsu, and that totaled $94.4 million at the end of the third quarter. When you sum these up, that would be in the $68.6 million I mentioned in cash and cash equivalents, and the $94.4 million I just mentioned on the advances to our foundry partner. The total liquidity remained strong at $163 million at the end of the third quarter. In addition, not included in the just mentioned $163 million, we have auction rate securities, I mentioned just earlier, on our books at a fair value of $27.4 million, which represents a 30% discount to our par value. Due to the illiquid markets for these types of investments, these auction rate securities are classified long term under long-term marketable securities, which brings me to something that I think we are all keenly aware of, and that’s current global financial crisis. The crisis has created a volatile financial environment which we actively monitor. During this last quarter we responded to market events by selling $5.7 million in auction rates securities at par. We moved money market funds accounts to governmental agency investments. We reduced our commercial paper exposure and sold our remaining shares that we held in UMC. Having said that, there is some indication of cautious optimism, we are seeing a movement back into higher paying money market funds, some movement in the commercial paper markets, bond prices increasing, and the cost of credit default swaps coming down. Hopefully, this will continue and will bode well for our auction rate securities. In addition, we initiated the 2008 restructuring plan which we expect to reduce operating expenses by approximately $4.5 million when compared to a full prior quarter. Rest assured, we will continue to monitor the credit markets. We will make further adjustments to our financial strategy as the events unfold. Now I will move on the remaining balance sheet. You will note that accounts receivable at the third quarter end, September 27 was $29.9 million, that compares to $29.3 million at the end of last quarter and days outstanding was computed at 47 days. That’s more than last quarter of 46 days, but slightly better than the seasonal comparable Q3 of 2007. Inventory at the end of third quarter came in at $35.8 million. That represents a decrease of $3.3 million from the prior quarter end and represents our lowest level in nine quarters. We spent $1.4 million on capital expenditures during the third quarter and the quarterly depreciation expense was $3.5 million, up slightly from the prior quarter. And lastly deferred income was $6.7 million, down $0.8 million from the prior quarter. Now that concludes the financial review portion of the call. And I will now turn it over to Bruno for a business review.

Thank you, Rob. Before I go into a more detail review of our products and markets, let me first make some comments on our progress in the last quarter. With our recent restructuring, we have taken several important steps to reach Lattice to sustainable profitability. First, as Rob mentioned, we have acted to address our cost structure and have lowered our quarterly GAAP breakeven revenue to approximately $57 million, a revenue level which we have achieved in nine of our last 12 quarters. We also believe that this restructuring has positioned us well in the face of the current volatile macroeconomic environment. Second, we recently accounted the promotion of Chris Fanning to Corporate Vice President of Low Density and Mixed Signal Solutions, and the hiring of Sean Riley to serve as our Corporate Vice President of High Density Solutions. This internal realignment of our business will allow us to better focus on identifying and pursuing programmable logic opportunities where we have sustainable and differentiated market positions. We believe that each of these accomplishments will build on our already strong liquidity position, and hasten our return to profitability. I want to reiterate that we exited the third quarter with liquidity of $163 million. We believe Lattice balance sheet is strong. Now, let me give you some color on our products and markets last quarter. Lattice's new products enjoy continuing market acceptance during the quarter and reached a tipping point where they accounted for a larger percentage of revenue than our mature products. Sales of our new products grew over 40% in the third quarter to $17.5 million, and represented 30% of total revenues. This strong growth was driven by our 90 nanometer products with their revenue doubling in the quarter. New products as a whole experienced greater than 100% growth on a year over year basis. Mainstream and mature products shrank 13% and 12% respectively this quarter. While disappointing, that movement was within historic ranges. These declines were driven by weakness in PLD products across multiple market segments. Mainstream and mature products now account for 44% and 26% of our revenue, respectively. Our differentiated non-volatile products performed well during the quarter. Our XO product line grew over 20% quarter on quarter and more than doubled year on year. (inaudible) for XO this quarter were particularly strong in the consumer set-top box and wireless communication segment. Our XP side [ph] has doubled both quarter on quarter and year on year as a result of significantly increased consumption in the consumer market. We are pleased to see not only the strong growth for our non-volatile products but also that the growth is now broadly spread across geographies and end markets. Lattice continues to enjoy a two generation technology lead with a mixed Flash and SRAM process we developed with our lead foundry partner, Fujitsu. Our SERDES equipped ECP2/M and SC families were 60% quarter on quarter and more than 200% year on year. The largest driver of our success this quarter was the Asian communication markets. Lattice has continued to build up ecosystem for the SERDES based FPGAs. Most recently, we have announced the in-stock availability for a new low cost PCI Express Development Kit for ECP2/M products. This kit was developed from the ground up to accelerate the customer’s evaluation of Lattice PCI Express technology, and to speed them in implementing their own design with Lattice’s ECP2/M. While we are talking about the ECP2/M, let me share some other reasons for our design success with that product. In developing ECP2/M, Lattice made numerous architecture decisions that reduced both deck [ph] size and power consumption. One example of this is a highly efficient, partial digital service implementation. In some customer design ECP2/M consume as low as half the power of our competition. Our innovation is enabling the customers to build more power efficient systems for FPGAs with both SERDES and low powers, customers are choosing Lattice ECP2/M. Revenue by end market for the quarter was as follows. Communications was up from 52% to 54% of total revenue, computing dropped from 14% to 11%, consumer and automotive rose 11% to 14%, and industrial and other declined from 23% to 21% of revenue. Communications picked up with gains in all geographies. We saw improvements in both our wireless and wireline businesses. Consumer grew strongly driven by our non-volatile products. Computing slowing was led by several large [ph] customers. The softness in industrial and others is spread across customers in industrial, test and measurement, and military. After you do the rounding, the revenues split by geography are essentially unchanged from last quarter. Americas was very slightly up in absolute dollar terms and was flat at 20% of total revenue. Europe was very slightly down and still at 20% of revenue. Asia’s revenue was essentially unchanged with a small downtick in Japan and small uptick in China. The downtick in Japan was broad based whereas the rise in China was driven by our communication and computing strengths there. Sales in Asia continued to deliver 60% of our total revenue. I will turn now to the fourth quarter guidance. While our starting backlog is above last quarter’s and we believe that our new product continue to gain traction, we do remain quite concerned about the overall macroeconomic environment. Taking into account all of these factors we currently estimate that revenue will be flat to down 4% sequentially in the fourth quarter. Our turns estimate for the fourth quarter is 53%, which is below the 60% turns we have experienced in the third quarter. For the rest of the P&L, we currently have following expectation for the fourth quarter of 2008. We expect gross margin as a percentage of revenue to be approximately 54% to 55%. We expect total operating expenses including amortization of intangibles to be approximately $30.5 million. Intangible asset amortization will be $1.4 million. We expect approximately $0.7 million in other income. And finally we expect the share count to be relatively flat. In closing, though the broader economy is turbulent and visibility is especially limited, we believe that our liquidity is sound and the changes we’ve put in place not only make the much needed improvements to our customer model, but also focus us on a better long term path for making progress in the market. I will now open the call for questions. Operator, please go ahead.

(Operator instructions) Our first question is from the line of James Schneider with Goldman Sachs. Please go ahead with your question. James Schneider – Goldman Sachs: Good afternoon and thanks for taking my question. First of all could you address your Q4 revenue outlook in terms of the relative strength or weakness of your various end markets, please?

Well, in terms of strengths and weaknesses, we are seeing – let me just address it first maybe by geographies. We are seeing continuous weakness in the American distribution channel. We are also seeing some weakness in the European distribution channel. Asia continued to be, I would say, pretty much flattish versus where it was in the third quarter. And it I think that overall, we will see a very similar mix that we’ve had in the third quarter, we would see a different mix – a very similar mix in the fourth quarter than the one we had in the third quarter. James Schneider – Goldman Sachs: But in terms of the end markets, which ones do you think would be the strongest or the weakest?

At this stage, I would say that communication continues to be relatively strong. The consumer markets will also continue to be relatively strong for us. So, we are not really seeing, I would say, specific weaknesses on a specific market segment, but as a more broad based weakness due to our weaknesses in the American and Europe distribution channels, which usually sell more of the mainstream and mature products. James Schneider – Goldman Sachs: I understand. And I think your industrial segment had one of the larger declines in Q3. Is that due to a rollout just in terms of broad based distribution or is there something specific in your mainstream and mature products where those customers were end of lifeing their products or their usage of your products.

I think that is just – again, these products tend to be the mature and mainstream products, and I think we are just generally seeing some weaknesses in these markets, okay? James Schneider – Goldman Sachs: I see. And then last one from me would be, if things worsen materially from here in terms of the revenue run rate, given the macro circumstances, do you feel there are additional leverage you can pull from an OpEx perspective to further reduce OpEx or do you think that you are pretty much running at the bare bones levels now given that the restructuring that just occurred?

I would say we do have a little bit – when we did the restructuring I think as I I’ve explained, we wanted to keep enough muscle and horse power to be able to grow the business in the coming years. But again, I think we will be generally flexible and adapt to the market environment. Right now we’ve done what we believe was necessary. And, again, we will adapt as business and macro economic conditions evolve. James Schneider – Goldman Sachs: Great. Thanks so much.

Our next question is from the line of Venk Nathamuni with JP Morgan. Please go ahead with your question. Venk Nathamuni – JP Morgan: Bruno, a question for you. You talked about relative strength in the communications end market, and I assume that a lot of that is coming from Asia, and particularly China.

That’s correct. Venk Nathamuni – JP Morgan: If that’s true, then – we’ve been hearing about some consolidation in wireless infrastructure spending in China. How concerned are you that that’s going to have an impact on your revenue stream, especially in the fourth quarter, and more importantly in ’09?

Well, as you know we don’t have much visibility already within the current quarter. So, I mean I don’t know about 2009. But I think for the time being we are well positioned with the two main players in China on both low cost SERDES and embedded Flash products. So, I think that we should continue to see a positive momentum coming out of China. Additionally, we are also starting to get some traction out of India and we are going to by the way invest a little more in India in terms of people to serve that market. So, I think for the time being I would we are still, I would say, cautiously optimistic about the demand in wireless base station, especially in China. Venk Nathamuni – JP Morgan: And – thanks. And given that yours is relatively high turns business, you have factored in potential weakness in China, communications into your fourth quarter guidance, I assume?

I am sorry. I missed that. Given the what? Venk Nathamuni – JP Morgan: Given that yours tends to be a high turns business, I assume that you have already taken into account some potential weakness in China infrastructure spending.

Yes, where [ph] the guidance, right? Venk Nathamuni – JP Morgan: Yes, with the fourth quarter guidance, yes.

Yes. Venk Nathamuni – JP Morgan: Okay, great. And then another question on your gross margins, obviously they declined substantially from last quarter, and below your guidance. Do you see any signs of increasing pricing pressure or is it just product mix or is it a combination of the two?

: Venk Nathamuni – JP Morgan: Right. So you just had a classic example of some of the newer products than you expected?

That is correct. You should see again what I’ve stated. We’ve had a very significant growth in our FPGA business in the – from the third quarter over the second quarter and also we had a significant growth of our new products. Venk Nathamuni – JP Morgan: Okay, great. That’s helpful. And then an accounting question. What are your plans for CapEx spending in the fourth quarter. Do you plan to reduce it or keep it at the same level? Rob O’Brien: This is Rob. It's about the same levels. I think we are seeing about $1.5 million to $2 million, right in that range. Venk Nathamuni – JP Morgan: Okay, great.

And this is mostly related to tuning for our test – the testing of our products. Venk Nathamuni – JP Morgan: Okay, great, thanks. And then one final question from me. Can you comment on how the restructuring is going? Do you think you are half way through that process or most of the way through the process? Because I know there's some restructuring charges for the fourth quarter, but as far the implementation of the plan –

Yes. The implementation of the plan has been completed by the end of September. So, what really fall over into this quarter are just some, I would, additional charges related, some of them to leases of offices and stuff like that. So – but the plan has been completed. We’ve rolled out a new, I would say, a more realigned organization, and that’s pretty much behind us now. Venk Nathamuni – JP Morgan: Okay, great. Thanks a lot, very helpful.

Okay.

Our next question is from the line of Tristan Gerra with Robert Baird. Please go ahead with your question. Tristan Gerra – Robert Baird: Hi, good afternoon. What trend should we expect if distributors continue to reuse inventories on your mature products? Could we look into a scenario where mature product revenues decline double digits sequentially in ’09 or do you think that we should see a return to normal declines which has been around 15% per year? I'm trying to look at how this can affect your design wins and new product to hamper [ph] the next few quarters?

I would imagine that as we are getting closer to the tail end of the product maturity for the mature products that we should start to see a slowing down of the rate of decrease of our mature products on a year on year basis. Okay, there will be some up and down, quarter on quarter situations like we always have. But I think on a year on year basis, we should start to see the slow down on that rate of decline. Tristan Gerra – Robert Baird: Okay. And in the second half of last year, I think the issue with mature products was the ORCA line which was being almost phased out. Do you still have revenues from that product line? And also do you have any other product line close to being phased out at this point within your mature category?

We do not – we do still have some – I don’t have the numbers in front of me, but we do still have a little bit of business in the ORCA product line, and we are not really obsoleting any products in the foreseeable future. So, that’s the answer I can give you right now. Tristan Gerra – Robert Baird: Okay. Any update on 65-nanometer sampling in terms of timing next year?

Well, actually the sampling for our first ECP3, which is going to be a low cost SERDES [ph], it should happen in November, December time frame. So, it’s going to happen this year, okay, not next year. Tristan Gerra – Robert Baird: Great. Thank you.

(Operator instructions) Our next question is from the line of Bill Dezellem with Tieton Capital Management. Please go ahead with your question. Bill Dezellem – Tieton Capital Management: Thank you. That’s Tieton Capital Management. And a couple of questions, first of all, relative to the strength that you are seeing in China and India, do you sense that that’s from your customers having revenue strength or do you sense that’s more from your design end converting to revenue producing products.

.: Bill Dezellem – Tieton Capital Management: That’s fine. Thank you. Then relative to the mainstream product revenues, there is an oddity this quarter or at least seemed like an oddity to us where they declined almost as much as the mature product revenues declined. Would you give us some perspective why that was? And do you view that as an oddity?

Well, we looked historically, and we've had a couple of quarters where we’ve had that oddity, I would say in the last maybe 12 or so quarters. And we've see some fluctuations up and down on that. And we believe that – well, this is an oddity, okay. That’s why I am willing to comment on this at this stage. However, for this coming quarter, we do not expect really that any changes that it will be relatively flat versus the third quarter for the mainstream products. Bill Dezellem – Tieton Capital Management: And the reason is that we had the oddity in the third quarter with mainstream declining almost as much as mature, what’s your take on why that happened?

I think it’s broad based because of American and European distribution. In our In our mainstream products, we do have the MACH 4000, which is a very high runner. And that actually was a bit slow this – I mean in the third quarter. Bill Dezellem – Tieton Capital Management: And then the auction rate security, on that front, there had been a number of broker settlements where firms were made whole. Are sensing that with your securities that is to come, or are you really thinking that you are going to have to wait for the credit market to loosen up before those auctions will – or those securities will be able to turn the cash? Rob O’Brien: Bill, I can answer that question. I have seen various large banks come forward and offer to come in and retire auction rate securities. Unfortunately, we do not have banks that are doing that right now. What is nice for us we have a little bit of flexibility. We have not – we are not forced into decision where we have to sell right now. So, we can be a bit patient, but it's something that we are watching. These continue to be investment grade. And it’s a daily process for us right now. And I think that’s what I can say for now. Bill Dezellem – Tieton Capital Management: That is appreciated. And the next question really is just that – I'm not trying to push you one direction or another or to part an opinion. But now that you have been there a while Bruno, what is your view of share repurchases in light of what you are seeing with the auction rate securities and the share price of your liquidities putting all of those pieces together?

Right. Let me just summarize back where we are at on our cash position. So, we’ve used $40 million of cash in July to extinguish the Zero Coupon debt. We do have access a substantial liquidity, as Rob mentioned, of about a $163 million, but however, our immediate available cash is about $68 million. We will have more cash at the end of the year when a window opens in our Fujitsu wafer prepayment contract. And at that time we have an option within 90 days to call back for some of that deposit; however Fujitsu is a very important strategic partner of ours and we want to make sure that we do manage this very important relationship very carefully. As this window opens towards the end of the year we will consult with our Board on what are the options, and obviously the option will include a share buyback. But, however, given the uncertainty of the current macroeconomic environment we are going through we do believe that also having sufficient liquidity and cash is imperative, and therefore right now is the not probably the proper – given that we have only limited amount available in cash right away, it’s something it's something that is probably not wise, I would say, thing to do right now. Bill Dezellem – Tieton Capital Management: Thank you for your comments.

: Venk Nathamuni – JP Morgan: Yes. Just one clarification. In your OpEx guidance for the next quarter, you said it was $30.5 million. Is that including amortization or –? Rob O’Brien: It’s excluding. Venk Nathamuni – JP Morgan: It’s excluding amortization.

: Venk Nathamuni – JP Morgan: It’s about $1.4 million –

Yes. This is coming off in Q1 of next year. There's a small tail left in Q1. Venk Nathamuni – JP Morgan: Okay and then unless things change dramatically, you are planning to hold the OpEx pretty much flat?

That’s correct. Venk Nathamuni – JP Morgan: Okay, perfect. Thanks a lot.

(Operator instructions) We do have a question from the line of Mark Lipacis with Morgan Stanley. Please go ahead with your question. John Ahn – Morgan Stanley: Sure. Hi, this is John Ahn [ph] for Mark Lipacis. Actually I just wanted to clarify the last question from the gentlemen before that. You said your OpEx – I believe in the prepared comments you were talking about your OpEx actually including the amortization, but I think you just said that excludes it. I just want to clarify that last comment. Rob O’Brien: This is Rob. Mark the $30.5 million excludes amortization. John Ahn – Morgan Stanley: Okay. Got it. Thank you. Okay.

And maybe one more data point. For our Q4, we will have actually 14 weeks instead of 13, which is kind of unusual quarter for us. We had that oddity, I would say, every seven years. So we do have and added $1.2 million of expenses that would not be there under normalized 13 weeks quarter. John Ahn – Morgan Stanley: Okay. Great. That definitely clarifies things, thank you. The only other question I had was in regards to the gross margin. Do you guys have an ideal target gross margin model at all? Like where do you actually guys want to be?

I mean, we – yes, we do. We want to be, I would say, our goal is 55% to 56% gross margin, which is where we have been historically. John Ahn – Morgan Stanley: Okay. So, if that's the case, and I understand your gross margins were hit because of a little bit bigger mix of new products in the last quarter. And it looks like that’s going to happen in the December quarter as well. When do you expect it to start getting toward the mid to the high range – or mid to the high point of that range?

I think right now it's difficult to predict. Obviously as we ship more volumes of the new products, our cost of – overall cost will go down as we get better pricing on wafers and assembly and test. But you know right now I don’t really have the visibility on that. But hopefully this is definitely a goal for next year. John Ahn – Morgan Stanley: Okay. All right. Thank you.

And there are no further questions at this time. Gentlemen, do you have any closing remarks?

No, thank you. And again, thank you for your time and we look forward to talking to you again next quarter. Thank you, good-bye.

This does conclude today’s conference call. You may now disconnect.