David Pasquale – Global IR Partners Darin G. Billerbeck – President and CEO Joseph Bedewi – CFO, Corporate Vice President

Tristan Gerra – Robert W. Baird Richard Shannon – Northland Securities Sundeep Bajikar – Jefferies & Company Dunham Winoto – Avian Securities Bill Dezellem – Tieton Capital Management David Duley – Merriman Curhan Ford & Co

Good afternoon, my name is [Shannon], and I will be your conference operator today. At this time, I would like to welcome everyone to the Lattice Semiconductor Second Quarter 2011 Results 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. If you would like to ask a question during this time, simply press star then the number 1 on your telephone keypad. If you would like to withdraw your question, press the pound key. Thank you. Mr. David Pasquale, you may begin your conference.

Thank you, operator. Welcome, everyone, to Lattice Semiconductor's second quarter 2011 results conference call. Joining us today from the company are Mr. Darin G. Billerbeck, the company's President and CEO, and Mr. Joe Bedewi, Lattice's Chief Financial Officer. Both executives will be available for Q&A after the prepared comments. If you have not yet received a copy of today's results release, please email Global IR Partners using lscc@globalirpartners.com, or you can get a copy of the release off of the Investor Relations section at Lattice Semiconductor's website. Before we begin the formal remarks, I'll review the Safe Harbor Statement. It's our intention that this call will comply with the requirements of SEC Regulation FD. This call includes and constitutes the company's official guidance for the third quarter of fiscal 2011. If at any time after this call we communicate any material changes to this guidance, we intend that such updates will be done using a public forum such as a press release or publicly-announced conference call. The matters that we discuss today, other than the 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. They involve risks 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 Securities and Exchange Commission including our fiscal year 2010 Form 10-K filed on March 11 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. I would like to now turn the call over to Mr. Darin Billerbeck. Please go ahead, sir. Darin G. Billerbeck: Thank you, David; and thanks, everybody, for joining us on the call today. The second quarter was another record quarter for us, with our highest quarterly revenues in a decade. The results were in line with guidance, as we continued to execute on our business strategy and accelerate our new products to market. Based on our results and analyst market data, we continue to gain market segment shares. In terms of specific results for the second quarter, revenue of $83.9 million was up 2% from the $82.6 million in Q1 of 2011 and up 9% from the $77.1 million in Q2 of 2010. The $2 million in Japan-related safety stock pull-ons seen in Q1 was not experienced in Q2. Gross margins came in at 60.4% compared to 60% in Q1 of 2011 and 61.2% in Q2 of 2010. The revenue mix of new, mainstream and mature was 49%, 27% and 24% of revenue, respectively, in Q2. This compares to new at 44%, mainstream at 32% and mature at 24% in Q1 of 2011. New products were up 11% quarter on quarter following sequential growth of 16% in Q1. This segment again outpaced the company's overall growth. Mainstream products were down 12% quarter on quarter due to the decline in the Military segment. Mature products were consistent with the recent quarter trends. Revenue from FPGA products represented 33% of the total revenue in Q2 compared to 38% in Q1. PLD products represented 67% of the total revenue in Q2, compared to 62% in Q1. PLD product growth was broad-based, but particularly strong in MachXO, 4000ZE and Mixed Signal product families. Another revenue record was set by our Mixed Signal products which reached a high of 7% of our total revenue. Quarter on quarter, Mixed Signal grew 22%. On a geographic basis, revenue from Asia, including Japan, increased to 65% of total revenue compared to last quarter's 61%. This is primarily due to the recovery of demand in Japan. Revenue from North America decreased quarter on quarter to 13% of revenue, compared to 18% of revenue in Q1. Europe increased slightly to 22% of revenue compared to 21% of revenue in Q1. On an end-market basis, Communications increased to 47% of revenue in Q2 compared to 44% in Q1. We benefited from continued 3G demand along with some added 2G upside orders. Computing was unchanged at 13% of revenue in Q2, compared to 13% in Q1. Industrial and Other came in at 30% of revenue in Q2 compared to 31% in Q1. The slight decrease reflects the previously mentioned decline in Military revenue. Consumer dropped from 12% of revenue in Q1 to 10% in Q2. Now let me give you an update on our ongoing efforts to improve our R&D efficiencies and lower operating costs. I'm pleased to report that in Q2 we began several auctions, some of which will be completed by the end of 2011 while others will be completed by Q1 of 2012. As part of our efforts to pair U.S. and a high-value, low-cost non-U.S. site, Lattice Manila was opened in the Philippines. Lattice Manila will primarily be focused on increasing our capabilities and lowering our costs in both R&D and operations. Lattice Manila will extend our silicon development capabilities in Lattice Silicon Valley. In Q2, we agreed to acquire a team of 20 design and layout engineers who will form the nucleus of our R&D team in Manila. With a combined more than 125 years of experience within the team, we expect to quickly improve both our near-term and long-term development costs along with execution. The transaction is already closed with the team fully engaged in support our ECP4 program. Lattice Manila will also extend our Lattice headquarters planning and logistic capabilities for customer, foundry and subcontractors. Locating our planning and logistics functions in Asia, closer to our customers and subcons, will better position Lattice's supply chain responsiveness and flexibility. As part of this move to Manila, we are taking the opportunity to move the remaining [Sort/Probe] operations out of Lattice headquarters to one of our subcons in Asia. Full transition of the affected job functions will be completed by Q1 of 2012. Additionally, we've continued to make progress with our transition out of our Pennsylvania site for silicon development and software. As mentioned last quarter, we expect the majority of the transition out of the Pennsylvania site to occur in Q4 of 2011. These changes, while difficult and impactful to our organization, will enable Lattice to better execute our existing business priorities while improving our ability to execute our strategic long-range plan. We expect to incur approximately $1.1 million in restructuring-related charges in the third quarter. This is in line with prior restructuring guidance. Finally, the global franchise agreement with Avnet and Lattice is ending effective August 28, 2011. After the transition, Lattice will serve its customers with a sales network that includes a global distributor, regional distributors, manufacturing reps and our direct sales team. We do not expect a significant disruption in our ability to service customers as a result of this change. That concludes my initial comments. I will now turn the call over to Joe for additional color on the financials. Joe?

Thanks, Darin. As noted earlier, revenue for the second quarter was $83.9 million, an increase of 2% from the prior quarter and up 9% from the year-ago period. Gross margin for Q2 was 60.4% compared to 60% in the prior quarter and 61.2% in the year-ago period. Revenue and gross margin are in line with our guidance given last quarter. Total operating expenses for the second quarter came in at $37.8 million compared to $39.1 million in the first quarter. We incurred approximately $1.4 million in restructuring charges in the quarter compared to $1.8 million in Q1 of 2011. Restructuring charges will decline as we move forward and are expected to be substantially completed by the end of the year. Q2 net income was $13 million or $0.11 per diluted share as compared to $10.9 million or $0.09 per diluted share in the first quarter and compared to $16.7 million or $0.14 per diluted share in the year-ago period. Restructuring charges of $1.4 million in Q2 and $1.8 million in Q1 represent $0.01 and $0.02 per diluted share, respectively. At the current share price, we expect diluted share count to be approximately 121 million shares. The share count reflects retirement of approximately $593,000 shares valued at approximately $3.6 million purchased under our $20 million one-year share repurchase program. Cumulatively, we have purchased approximately $1.7 million shares valued at approximately $9.9 million under the program. Moving on, our balance sheet was further strengthened in the quarter. We generated an additional $16.5 million of cash from the operations, ending the quarter with a cash, cash equivalent and short-term marketable securities balance of $247.5 million, and we continue to have no debt. Accounts receivable at July 2 were $56.4 million compared to $49.9 million at the end of last quarter, and days sales outstanding were 61 days compared to 54 days last quarter and 55 days in Q2 2010. Inventory at July 2, 2011 was $35.1 million, down from $38.1 million last quarter and up from $26.8 million in the year-ago period. Months of inventory now stands at 3.2 months compared to 3.5 months at the end of Q1 2011. We spent approximately $3.2 million on capital expenditures during the second quarter, down from $4.1 million in Q1, with a quarterly depreciation and amortization expense at $4.4 million compared to $4.1 million in Q1. This concludes the financial review portion of the call, and I'll now turn things back over to Darin for the second quarter business outlook. Darin? Darin G. Billerbeck: Thanks, Joe. In summary, this was another solid quarter for us. Lattice continued to outperform the sector while taking concrete actions to ensure our future success. Our tactical focus remains on making our company more efficient and cost-effective in all aspects of developing, manufacturing and selling innovative FPGA products. We are excited about our competitive position and our long-term growth prospects. We continue to build the Lattice team into a globally-focused, cost-effective machine. Now let me turn to our second quarter expectations. We expect revenues to be flat to up 5% compared to Q1. Q2 growth margins are expected to be approximately 60% plus or minus a couple of percentage points. Total operating expenses are expected to be approximately $36.5 million, including approximately $1.1 million in restructuring charges. That concludes our prepared remarks -- prepared remarks. Operator, we'll be happy to take any questions.

At this time, ladies and gentlemen, if you would like to ask a question, please press star then the number 1 on your telephone keypad. We'll pause for just a moment to compile the Q&A roster. And your first question comes from the line of Tristan Gerra. Tristan Gerra – Robert W. Baird: Hi, good afternoon. Could you talk about FPGA trend and what was the reason for the decline sequentially in Q2? And then, what is your expectation for FPGA revenue in Q3? Darin G. Billerbeck: Yeah, hi, Tristan. Yeah, this is Darin. So, yeah, it declined due to a mixtures of things. One was consumer, right, which was down between Q2 and Q1, and the other was really our Military and Industrial segment being down. And we really expect consumer to come back to a normalized run rate. We expect Military to probably decline over time, but Industrial we expect to grow with our businesses. Tristan Gerra – Robert W. Baird: And -- Darin G. Billerbeck: Go ahead. Tristan Gerra – Robert W. Baird: Excuse me. No, that's very useful. And also, was there any difficult comparison as a result of the Japan earthquake and resulting of ordering in Q1 that also will have contributed? And if so, by how much specifically on the FPGA line? Darin G. Billerbeck: Well, Q1, yeah, Q1 we saw about $2 million of ordering which we had mentioned in the previous call, and we've got a lot more data on it now to be closer to the number that we know. And so that affected some it. And I would expect that this quarter we didn't see really any of that as we looked at the linear run rates for all of our customers, and we don't see that going forward. So I think from our perspective, the Japan prices is over. I mean there will be certain things that may be impacting some assembly, materials, but we don't see anything that's significant. Tristan Gerra – Robert W. Baird: Okay. And would you expect 90-nanometer revenues to have reached a peak, or do you expect that [inaudible] continue to grow in the second half? And also perhaps, if you could quantify the amount of revenues from 65-nanometer FPGAs in the quarter? Darin G. Billerbeck: I'm not convinced it's peaked at this point because we are seeing some upside with some of the 2G product lines, which were surprising to us, but then we're starting to learn that, from some of our customers, that the infrastructure build-out in some of the emerging countries is actually still being done in 2G. So we're not -- it's not clear to us that we've peaked yet, although we would expect the 65-nanometer price to continue to grow. Tristan Gerra – Robert W. Baird: Great. Thank you. Operator: And your next question comes from the line of Richard Shannon. Richard Shannon – Northland Securities: Hi. Darin G. Billerbeck: Hi, Richard.

Hey, Richard. Richard Shannon – Northland Securities: Hi. I guess a couple of -- a two-part question on the guidance for the quarter. I was just curious about, in terms of the revenue guidance, if there's any material differences by end-markets leading into that flat to plus 5% guidance, any end-markets well above or below that? Darin G. Billerbeck: I don’t think we see anything that is significantly different than we saw in Q1. I think there's different places that people are talking about. I've heard different companies talk about wireless and wireline and the growth. It depends on where you're playing in those, right? So if you're playing in the wireline, there may be more of an impact than if you're playing on that last mile of wireless, if that's what you're alluding to. Richard Shannon – Northland Securities: I was curious about all end-markets, but I was going to follow up on the Communications space -- Darin G. Billerbeck: Yeah, on the Com space, we don't see, and we've talked about this in the previous earnings calls, where we may have a different dynamic going on than others because of where we play and because at this point maybe the backhaul is sufficient enough to be able to support some of the subscriber increases. And I think at this point they're just building out that [left portion]. So that's where we see our growth, is really in that last mile where others may be seeing it in the backhaul. So I think that's a difference in what some people's guidance maybe and ours. But on the Coms, we see that as consistent grower for us. Consumer we expect to grow in that market. So I think that's where we're at least today. Richard Shannon – Northland Securities: Okay, fair enough. And then on gross margins, the guidance range here is a little bit wider than usual. Is that intentional? And if so, what's driving that wider range? Darin G. Billerbeck: It is intentional, and some of it is because, remember, we're going to move a lot of our -- the cost of good sales and things over to a low-cost geography and there may be some duplication with some of those, those resources, as we transition away from having U.S.-head to having a low-cost head structure. So we're a little bit leery that we might have that, although it's a might, it's not a for-sure, because we're trying to manage our way through that. Richard Shannon – Northland Securities: Okay. Darin G. Billerbeck: But our goal, our goal is always, as you know, our goal and our model is high 50s, but we want to stay above that. Right? I mean that's where we want to stay. So it's a little bit just some of the transitions that we're making. Same thing with R&D, we're transitioning some of the R&D things. So, both of those I think we're just being a little cautious on. Richard Shannon – Northland Securities: Okay, fair enough. And then maybe a couple of questions, I'll jump on the line here. Kind of curious about the trends in the Consumer business there. I guess for me it's a little surprising to see it down a bit here in the second quarter. Kind of curious what your thoughts here. Going forward you mentioned kind of a growth market for you over time, but I guess maybe over the next six months or so, how do you see that and what will be the drivers? Darin G. Billerbeck: Yeah, Consumer is lumpy. It's lumpy at best. And so what we saw is, in some of the e-reader type devices, we saw a little bit of upside which were really nice. But then on some of the other areas, the other consumers, we saw some downsides. But that was also given that last quarter we had some real upsides there. So this thing kind of goes up and down. I think people bought for last quarter for build this quarter. Again next quarter they build for probably Christmas. So we expect it to be lumpy, and as we said, we expect the Consumer to recover next quarter. Richard Shannon – Northland Securities: Okay, fair enough. And I guess my last question, I'll jump on the line, ECP3 revenues in the quarter, you've talked about the last several quarters. Kind of curious, with FPGA revenues I think are down a little bit in the quarter, did that grow sequentially? Darin G. Billerbeck: Yes, it did. Let me pull the data on exactly how much it did, real quick. Yeah, it grew about 2% quarter on quarter, which was nice for us. And we do have some real nice design wins over time that we're expecting to grow [inaudible]. Richard Shannon – Northland Securities: Okay. Great. Fair enough. I will jump on the line. Congratulations, guys. Darin G. Billerbeck: Great. Thanks.

Thanks, Richard.

And your next question comes from the line of Sundeep Bajikar. Sundeep Bajikar – Jefferies & Company: Hi, guys. Thanks for taking my question. On the Mixed Signal business, can you give us a rough sense of the end-market mix there and sort of your expectations for how this business fares over the next year or so? Darin G. Billerbeck: Yes. So we do sell this thing in a pretty diverse marketplace. We do a lot of Consumer and we do a lot of Coms. Our primary focus at this point is really growing Coms because that's where we can service any of the different, you know, 2G, 3G, LTE, with the combination of our Power Manager, our XO and XO2 family, along with ECP3, and sometimes ECP2, right, with mixed mode devices. So we're primarily focusing Power Manager today on Coms, but it doesn’t mean that aren't aggressively pursuing Consumer. It's just it's the same customer base which affords us an easier selling path. But we do expect that to grow faster than the market, which is the same is true for all of our product lines. Sundeep Bajikar – Jefferies & Company: Thanks, that's helpful. And then just a separate question, if you could just give us sort of an update on where you are with ECP4 and then also MachXO2 and where you are in the ramp for that. Darin G. Billerbeck: Yes. So let's start with MachXO2 because that's easier, right? So, MachXO2 is in production. We're beginning to take shipments on that and lots of really good design wins for us. We feel good about that product. ECP4, I don’t want to launch the product obviously on this call, so all I can tell you is that that will be out shortly. And we expect to have some good [progresses in the floor], and that will help us with some of the other programs. Sundeep Bajikar – Jefferies & Company: Thanks so much.

Once again, ladies and gentlemen, in order to ask a question, please press star then the number 1 on your telephone keypad. And your next question comes from the line of Dunham Winoto. Dunham Winoto – Avian Securities: I'm calling in for Ruben. I'll start with one question first, maybe Darin or Joe can take this one. Can you give us a sense of where your churns are versus your backlog in order to make the guidance that you just provided us? Darin G. Billerbeck: Yeah, traditionally churns in the FPGA market is closer to 50%. And obviously the last couple of quarters it's been much lower than that because of some of the Japan crisis issues and other things that have happened. But I would expect over the next couple of quarters for churn to actually go back to a normal rate. Dunham Winoto – Avian Securities: Okay. And --

We're ahead of the game in Q3 though, to be -- that's what Darin said, in terms of backlog and the churns that we need to achieve the forecast. Dunham Winoto – Avian Securities: You care to share with us the number where your backlog is at right now?

No, can't do that. Dunham Winoto – Avian Securities: Can you give us a sense of what linearity was in Q2? Darin G. Billerbeck: Linearity? Dunham Winoto – Avian Securities: Yes. During the quarter. Darin G. Billerbeck: Well, I would tell you this. It hit the pattern of the last two years, right? Because we kind of plot linearity and then looked at historical linearity for each quarter, and we didn't deviate significantly from that. Dunham Winoto – Avian Securities: Okay. And you don't expect much change going forward either, I would assume, right? Darin G. Billerbeck: No, not really. Dunham Winoto – Avian Securities: Okay. Can you also talk about lead times maybe in terms of just overall product average? Darin G. Billerbeck: Yeah. We haven't changed our lead times for the last couple of quarters. I don’t know if maybe Joe wants to -- you want to jump in?

No. I mean -- I think we've been consistent on lead times and nothing has changed there. We're kind of plugging away at normal. We've got a nice backlog. We saw upside with the stuff that happened in Japan, and that backlog seemed to have held for us, so. And lead times are right in line with that. Dunham Winoto – Avian Securities: Right, right. Okay. Maybe just one last thing, FPGA versus PLD, I know that FPGA was weaker relative to PLD in second quarter. Do you expect the same trend continuing in Q3, do you expect them to reverse? Darin G. Billerbeck: Yeah, we don't expect that trend to continue. In fact, I don’t think it was a trend. I think it was just a one-time deal. Dunham Winoto – Avian Securities: It's a one-time blip? Darin G. Billerbeck: Yup. Dunham Winoto – Avian Securities: Okay. And was an end-market thing or? Darin G. Billerbeck: Well, with a couple -- yeah, with the specific couple -- customers in specific markets that just went down quarter on quarter. Dunham Winoto – Avian Securities: Okay, perfect. Thanks so much.

Your next question comes from the line of Bill Dezellem. Bill Dezellem – Tieton Capital Management: Thank you. I have a couple of questions. First of all, would you please readdress the Military market? I realize it's reasonably small, but what happened this quarter and your view going forward. And then secondarily, with the operational changes that you all have been making and the fire management team has been making, to what degree have customers been taking notice, and if they have, how have they been responding? Darin G. Billerbeck: First, on Military. So, from a Military perspective, we haven't been investing in Military for sometime but we continue to serve the market with products that are still robust, and we still get some wins on it. But we would expect that business to decline over time as it's not a focus of ours in the market segments we play in. So we anticipate the Military to drop. On the organizational changes that we talked about, again, one thing I want to make clear to everybody, is we've made no organizational changes to the customer-facing. So, our sales force is the same sales force since day one. We've made no significant organizational changes within the sales and that network. The only thing that is different is really the Avnet, right? So, Avnet, we have terminated the Avnet deal. Actually they've terminated it with us. So that makes this transition some of that. But most of our customers, they understand that there's a lot of distribution things that occur on a day-to-day basis with people rolling in and out. So, we'll manage it professionally and we'll manage it consistently to support our customers. Bill Dezellem – Tieton Capital Management: I'm sorry, maybe I should follow up that even though it may not be a customer-facing change, we're curious if some of these changes have led to aspects of either quality, delivery or some other component that customers have noticed, either favorably or unfavorably. Darin G. Billerbeck: Yeah, I think -- let's talk favorably a little bit. I'll be positive on this. The fact that we've strengthened the structure for research and development affords us to actually have higher level and more meaningful technical engagements with our top key strategic customers. And that's really been one of the biggest benefits, is now we can have quarterly review meetings with CTOs and architect and even our software systems people. So that gives us better insight into the markets that play with our key customers. So the biggest benefit I see is the engagement from a very, very technical standpoint with our customers and their technical arms. Right? On the quality and reliability side of things, again we still have a very heavy focus on our Q&A activities. We haven't made significant changes in any of our quality and reliability focus at customers. In fact, we have much of our quality and reliability systems very close to our customers, so that if there is an issue, we can engage quickly and respond very quickly. So we haven't seen anything. We don't expect anything. We haven't changed our foundry structures, we haven't changed our test architectures and things like that. We really don't see from a manufacturing perspective any issues. Bill Dezellem – Tieton Capital Management: Thanks, Darin. Darin G. Billerbeck: Okay.

And your next question comes from the line of David Duley. David Duley – Merriman Curhan Ford & Co: Yes. Just a couple of questions from me. You mentioned that your Mixed Signal products I think were about 7% of revenue. I'm assuming that’s in the new product category. What end-markets does it really fall in? Darin G. Billerbeck: For Mixed Signal? Well, a lot. So our power management is primarily in the Communications and Consumer markets. So we see a lot of that. From a Coms perspective, it's things that need power management, voltage [sequencing], things like that. So think about if people want to shut off and on and sequence things on and off, right, in the priority orders, so we see a lot of that. Very efficient in the low-power applications that we serve with our other products. David Duley – Merriman Curhan Ford & Co: Okay. And just a quick housekeeping, the mainstream products were down pretty good. Was that the bucket where the Japanese revenue came and went? Why was mainstream down as much as it was? I was a little confused about why that was. Darin G. Billerbeck: That was really the Military, so the Military -- we kind of have those bucket of Military/Industrial. So that was really the same thing that we had alluded to before. And again, that was a significant reason. David Duley – Merriman Curhan Ford & Co: Okay. And finally, you kind of alluded to I think, I just wanted to clarify that in the third quarter the sequential growth from -- in the end-markets would come in the Consumer space and the Communication space? And I guess what I heard is in the Communication space you're more tied to the wireless side and I guess there's more activity there than the landline side. Darin G. Billerbeck: Well, I think -- yeah. We play in both, so let's not forget that we do have a lot of devices that hit both wireline and wireless. So we play in a lot of those devices. But we expect that segment to grow quarter on quarter. And I mean there's nothing more than that, right? We expect that to grow. Was there a specific you were alluding to? David Duley – Merriman Curhan Ford & Co: Yeah. No, that's -- just kind of trying to clarify what you said earlier and figure out which segments are growing going forward. Darin G. Billerbeck: Yeah. And I think sometimes when we have these discussions, these people had said, "Well, the optical guys are saying it's down and the wireless guys are saying it's up and the wireline guy," so they're all kind of different pieces of the build-out to get to your cell phone, right? I kind of look at it that way. So to dive in, understanding whether Communications is growing or shrinking for different companies, you really have to decide where they play. And fortunately, we have a lot of our low-density PLDs that still play quite well, and even the backhaul, right? For some of the glue logic and some of the other things like level shifters and things like that. So we kind of play everywhere. And it's also, by the way, geography-based, right? Because some geographies are doing better than others. And so you can see some of that. So you have to look at the split of devices throughout the entire wireless build-out and then you have to look geography by geography and then actually customer by customer because some customers, even though they're located in one are very successful than others. David Duley – Merriman Curhan Ford & Co: Okay. Final thing from me is, pretty nice cash flow generation in the current quarter. I suspect that that number will look similar in the upcoming quarter, maybe get a little bump from lower receivables. Any plans? Are you going to increase the buyback? Or what will we do with the cash now that it's building nicely?

So we've actually been talking about what we're going to do with the cash for a while, and we're out exploring various options on what we could do. We're looking for something that's synergistic with our current business, something that adds value to us. We leveraged, for example, a portion of our cash when we went into Manila and we bought a capability that got us online faster. So we're looking for those kind of things to selectively utilize the cash. Our current buyback program has been approved up to $20 million, and that's where we're at today. David Duley – Merriman Curhan Ford & Co: Thanks. Darin G. Billerbeck: Okay.

Once again, ladies and gentlemen, in order to ask a question, please press star then the number 1 on your telephone keypad. Your next -- you have a follow-up question from Richard Shannon. Darin G. Billerbeck: Back again, huh, Richard? Richard Shannon – Northland Securities: I'm back, yeah. Just a couple more. One of your most recent responses, Darin, let's delve into that a little bit more, in the Communication space. Kind of curious, not only just for the third quarter but maybe looking out a couple, two, three, four quarters or whatever timeframe you'd like to talk about. I'm kind of curious where you're seeing the drivers in the Communication space both wireline and wireless and even within wireless 2G versus 3G, you made some comments about 2G specifically in the second quarter. And then -- and also kind of split it up by geographies, and I don’t know if you have a visibility into where the equipment is being deployed or at least I guess by OEM there, where are you seeing the relative strengths and weaknesses? Darin G. Billerbeck: Yes. So let's talk about 2G first. I think we were a little surprised this quarter that 2G came up to where it did, but then we talked to our customers, they alluded to the fact that there are still a lot of low-cost build-outs where people just want a phone. And I would -- since we don't know the end-market at this point, I would probably jump at this thing that it's probably India or one of the emerging markets that they're doing that build-out. And then when you look at geography versus geography, it still seems like Asia has a lot more focus on the comps than other areas. I'm not too sure as far as the speed which LTE is rolling out. I think there's going to be challenges in different geographies based on the affordability and the ARPU for each of the service providers, so where spend a boatload on spectrums, and you and I talked about that a couple of times. But I think Asia seems to be going harder at building that infrastructure out than any other area. And so we've actually seemed to be doing okay in Asia from our product rollout, which is really primarily the 2G and 3G. But let's not forget, we have products that fit even within LTE. Because a lot of people say, "Oh, you don't have the highest-performance [for this] device. That doesn’t preclude you from still playing in that. So we're working pretty heavily on all that stuff. But it seems like Asia, stronger a little bit right now than maybe Europe and North America, at least from what we can see and the visibility we have in those markets. Richard Shannon – Northland Securities: Okay, fair enough. And then my second question, Darin, just from kind of a high-level perspective, as we've watched over the last quarter, I think the thinking about the overall worldwide economy is probably not as strong as we were thinking maybe a quarter ago. I'm kind of curious, your thoughts on that topic as you look at your more economically-sensitive parts of your business, not where you've got specific builds going on. But what's your viewpoint on how things have changed over the last quarter and how that may impact you going forward for the next couple of quarters or so? Darin G. Billerbeck: Yeah, I mean I think the things that are hovering over, you're aware, just like the U.S. debt crisis, bailing out Greece, and all these other things that seem to put dampers on people's investments. I don’t really see -- I don’t think that we have any visibility on Q4, nor do we give guidance on Q4, but originally, I think a lot of people thought that things would go spinning ahead in the first half and maybe not be as strong. The indications we have for the guidance we've put out of flat to 5%, we still think there's pretty strong evidence at least in the markets we play that we're doing okay. I think the biggest thing that -- the advantage maybe we have that other companies don't have, or maybe they're focusing on too, is we're really trying to strive for the lowest possible cost products within the markets we serve, and it seems at this point that the value proposition is really driving down different things into a more cost-sensitive approach for build-out. It seems to be working. Now we have a long way to go because we're trying to move from our existing technologies to the most advanced technologies and get our products out as fast as we can. So we still have a lot of work to do. But the products that we have serving the markets that we do I think are very successful because we're focused on that portion of the market. So, not everything is going to be the highest end, nor do we play in everything. But I think where we targeted seems to be doing okay. I'm more concerned about all these debt crises and bailouts that stop investment and then the macro drops versus the places we play. But I think everybody is afraid of that, including you guys, right? Richard Shannon – Northland Securities: Yes. That's certainly true. Thanks, Darin. Thanks for the thoughts there. Darin G. Billerbeck: All right.

Once again, ladies and gentlemen, in order to ask a question, please press star then the number 1 on your telephone keypad. And there are no further questions. Mr. Pasquale, do you have any closing remarks? Darin G. Billerbeck: Okay. This is Darin. Just in closing, I want to thank everybody for the support. Again, another solid quarter for us, and we're expecting next quarter hopefully to be another solid quarter as we move forward. Again we're doing everything we can to lower our cost and try to get our margin model as high as humanly possible. But again, thanks. And thanks for joining our call today.

This concludes today's conference call. You may now disconnect.