Steve Luczo – Chairman, President & CEO Dave Mosley – EVP of Sales, Marketing & Product Line Management Bob Whitmore – EVP & CTO Pat O'Malley – EVP & CFO

Kevin Hunt – Hapoalim Securities Rich Kugele – Needham & Company Ben Reitzes – Barclays Capital Mark Moskowitz – JP Morgan Stephen Fox – CLSA Jayson Noland – Robert Baird Aaron Rakers – Stifel Nicolaus

Good afternoon, ladies and gentlemen, and welcome to Seagate Technology fiscal third quarter financial results conference call. My name is Amity and I will be your coordinator for today. At this time all participants on a listen-only mode. Following the prepared remarks there will be a question and answer session. (Operator instructions) As a reminder, this conference is being recorded for replay purposes. This conference call contains forward-looking statements including, but not limited to, statements related to the Company’s future financial performance. These forward-looking statements are based on information available to Seagate as of the date of this conference call, but are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially from those anticipated by these forward-looking statements. Information concerning additional factors that could cause results to differ materially from those projected in the forward-looking statements is contained in the Company’s Annual Report on Form 10-K as filed with the US Securities and Exchange Commission on August 19, 2009 and in the Company’s Quarterly Report on Form 10-Q as filed with the US Securities and Exchange Commission on February 1, 2010. These forward-looking statements should not be relied upon as representing the Company’s views as of any subsequent date and Seagate undertakes no obligation to update forward-looking statements to reflect the events or circumstances after the date they were made. I would now like to turn the conference over to our host, Mr. Steve Luczo, CEO. Please go ahead.

Thank you, Amity. Good afternoon everyone and thank you for joining us today. On the call with me are Pat O'Malley, our Chief Financial Officer; Bob Whitmore, our Chief Technology Officer and Head of R&D and Manufacturing Operations and Dave Mosley, Head of Sales, Marketing and Product Line Management. Entering the March quarter we discussed a few underlying assumptions on which we based our financial outlook, including a muted seasonal pattern with variability around the lunar New Year, pricing trends that would reflect balance supply and demand, and the Seagate would continue to deliver time to market products. With respect to demand in the March quarter the total available market countered seasonal patterns and grew to approximately 163 million units, higher than our original expectation of 155 to 160 million units. The 163 million units were likely short of unconstrained demand. As indicated by low inventory levels, in our OEM and distribution channels. As expected, we experienced variability and demand during January and February, particularly, around lunar New Year for notebook drives. As was the case last year, demand for Seagate products increased and sustained throughout the month of March. Pricing in the March quarter was as we planned. As a result of a relatively balance supply and demand profile throughout the quarter. Additionally, channel inventory levels for Seagate products remain at around three weeks across all geographies and across all product offering. Finally, as planned, Seagate continue to shift time to market products in all markets with the broadest offering in the industry. Consistent with our expectations we delivered strong operational and financial results. Revenue in the March quarter reached $3 billion, a 42% increase year-over-year. Net income was $518 million resulting in $1 of diluted earnings per share. While the financial and operating results were strong, there were internal supply chain constraints that impacted our mix optimization early in the quarter. We generated operating cash flow of $577 million in the quarter and we repurchased approximately $250 million of our common shares. As we plan for the June quarter, we are expecting the TAM will be 155 million units to 160 million units. However, there is some growing evidence that the seasonal declines in the notebook and desktop markets historically associated with the March and June quarters are diminishing. Due to the continued growth in Asia-Pacific demand, back to school bills occurring earlier in the summer, as customers attempt to optimize their supply chains and dynamics around lunar New Year. Given the strength of the March quarter, and our current outlook for June, we are also more confident in our estimate of a calendar 2010 TAM of between 650 million units and 670 million units. As stated previously, our TAM outlook for the calendar 2010 does not include a significant commercial refresh cycle. However, we do believe there are early indications that the commercial refresh cycle has begun as evidenced by the strength in the 3.5-inch product TAM. Additionally, we believe it is increasingly likely that our broader economic recovery in the United States and Europe will occur later in the calendar year, resulting in a potential for increase in demand above our current forecast of 650 million units to 670 million units. We still believe, however, that the HDD industry is constrained to a total output of around 670 million units given capacity, yields, component supply, technology transitions and capital deployment schedule for the remainder of calendar 2010. Consistent with this outlook, we anticipate price erosion to be lower than historical patterns primarily due to tight supply for the remainder of the calendar year. Consequently, many of our OEM and distribution customers continue to emphasize supply availability as their primary concern in our discussions for the June quarter and through the remainder of calendar 2010. We remain focused on continued improvements across our global operations, delivering the best products to our customers and achieving strong financial performance to our shareholders. I will now turn the call over to Dave to discuss specific market dynamics in fiscal Q3 and going into fiscal Q4.

: Contrary to the last two quarters, total 3.5-inch unit shipments surpassed 2.5-inch unit shipments. OEM 3.5-inch poles were strong and the desktop channel business exhibited typical sales patterns in the March quarter. Conversely, overall, industry demand for 2.5-inch drive in January and February was impacted by notebook component and labor availability. But the situation quickly improved in March. These two dynamics allowed 3.5-inch to outpace 2.5-inch unit demand. We believe the HDD industry managed inventory appropriately from March quarter. And that Seagate specifically exited the quarter was channel inventory for desktop notebook and enterprise drives close to three weeks, which is below historical level. Looking at our market performance, Seagate shipments grew 31% from the year ago quarter to a record 50.3 million units demonstrating continued HDD demand resilience against the macro economic background. We continue to meet our customers demand for high capacity, high performance product configurations across all markets. Seagate delivered over 70% of its unit shipments to OEM customers during the quarter. Now, I will give some detail on a few key markets. Seagate shipped 5.1 million drives for mission critical server and storage applications during the quarter, representing an 11% increase quarter-over-quarter. We extended our leading share position as we believe the total available market in this space was essentially flat from the December quarter. These shipments were slightly higher than we had planned at the beginning of the quarter as our products experienced strong demand and with our flexible supply chain we were able to take advantage of competitive execution issues. We believe that the demand picture for enterprise storage systems is continuing to improve and expect to effectively meet that growing demand throughout the remainder of the calendar year. We expect the TAM for mission critical enterprise drives to be slightly down in the June quarter consistent with seasonality. And we expect our share to be more consistent with historical levels. The TAM and the desktop market for the March quarter was approximately 65.1 million units, up 4% sequentially, and up 24% year-over-year. Seagate shipped 24.6 million units in this space. For the June quarter we expect the desktop TAM to be flat sequentially. Seagate shipped 13.7 million units into the mobile compute market, an increase of 54% from the year ago quarter. The overall TAM in the mobile compute space was approximately 71 million units in the March quarter, essentially flat sequentially and up 65% year-over-year. We expect the TAM in the mobile compute space for the June quarter to be seasonal and slightly down sequentially. That said it is possible that the TAM for the June quarter for 2.5-inch mobile drives could be higher sequentially because of the supply chain optimization. In addition, depending upon the demand profile of June we may have the opportunity to build some inventory to serve customer demand in the back half of the calendar year. Finally, we believe that the retail market for both Seagate branded products and for the external Box Builders that we service saw relatively flat demand quarter-over-quarter, with high growth in Asia tampered by seasonal slowdowns in the U.S. and Europe. Now I would like to turn the call over to Bob to provide an update on our operations and product development.

Thanks, Dave. The focus in R&D and operations continues to be on executing time to market, product introductions, supplying our customers with products in a robust demand environment. Today, I will give an update on products, operations, component supply and capital investments. I will start with a brief overview of new product development. In mission critical enterprise we move forward and transitioning the 2.5-inch 10,000 RPM product line from 450 GB to 600 GB. We have completed most customer qualifications and are increasing volume production. In business critical and cloud applications we continue to increase our output for a 2.5-inch 500 GB and 3.5-inch 2 terabyte product lines. As for the desktop market, we continue to optimize an increased production of the 500 GB per disk product line as well as starting the transition to 667 GB per disk. Finally, in notebook, we continue to qualify in increased production of our 320 GB per disk and new 7 mm 250 GB product lines. Additionally, we have now shipped the industry’s first 7200 RPM product, a 375 GB per disk into our retail business and are shipping to OEMs this quarter. Overall, we continue to make good progress on new product introductions and execution and time to market deliveries for the broadest portfolio in the industry. I will now give some detail as it relates to operations, supply and capital. As mentioned earlier, we continue to run our operations in a fully utilized manner throughout the quarter. Inventory turns for the quarter were approximately 12.5, well within our target range of 11 turns to 13 turns. Raw materials and components were up over quarter due to the strategic replenishment of our component and supply lines to more normal levels and in anticipation of growth in the upcoming quarters. Similar to the previous quarter, the supply chain was generally tight for Seagate and the industry. We expect that trend to continue for this quarter and for the remainder of the calendar year. Critical components continue to be the supply of glass substrates, finished media and heads. Despite having this pressure in the supply chain we are underpinned to support the current financial outlook and well positioned to meet the increased demand through the end of the calendar year. Finally, I will make a few comments on our capital investments. Today’s robust demand environment and the broad acceptance of our products require capital investments that line our capacity to support 650 million units to 670 million units industry TAM for the calendar year 2010. This represents a year-over-year increase of 15% to 20% and is in line with third-party analyst growth estimates. As we have discussed in the past capital investments are a function of revenue growth opportunities, the need to support customer requirements, along with future technology transitions, and aerial density advancements. As such, the capital planning process is dynamic and we will continuously evaluate business requirements and raise or lower our capital investments properly. In summary, our development and operation teams remain focus on delivering time to market products, staging technologies for the future and increasing our factory output and efficiency throughout the supply chain. Now, I will turn the call over to Pat. Pat O'Malley: Thanks, Bob. You will find the Company’s press release, 8-K and additional financial information related to Seagate’s financial performance and other supplemental information in the Investor Relations section of Seagate’s Web site at seagate.com. I will start with some comments regarding the fiscal Q3 results, then touch on the balance sheet and close with our June quarter outlook. For the March quarter Seagate reported shipments of 50.3 million units and revenue of $3.05 billion, up slightly as compared to the prior quarter and up 31% and 42% from a year ago period respectively. Gross margin for the March quarter was 29.6%, roughly 40 basis points better than our midpoint guidance implied. R&D and SG&A totaled $329 million for the March quarter better than expected due to R&D spending that shifted to future quarters and discrete items benefiting SG&A. The tax provision for the March quarter was $4 million as compared to a benefit of $6 million in the prior quarter. We continue to use for planning purposes a tax rate of 3%. Note that the June quarter is our fiscal year end and any adjustments are required to our annual book tax rate will be reflected in the provision for the quarter. Moving now to the balance sheet, cash, cash equivalents, restricted cash and short-term investments totaled $2.4 billion at the end of the March quarter, up approximately $117 million as compared to the December quarter. Cash flow from operations was $577 million, capital investments were $108 million and free cash flow was $397 million. In late January, the Board approved an anti-dilution stock repurchase plan. Under this plan, the company repurchased 13.5 million common shares for approximately $250 million during the March quarter. Over the next 18 months we will continue to reshape the capital structure of the company with a primary objectives been an overall debt level of $1.5 billion to $1.75 billion and a fully diluted share count of 500 million shares or less. Now, I like to update the outlook for the June quarter. The key assumptions on which we are based our outlook are a historical pattern for unit demand which for June quarter is down 2% to 5% sequentially. Pricing trends better than historical for June quarter, reflecting a balance supply and demand environment. And our competition will likely improve the current enterprise class product offering and Seagate share in this market will trend closer to historical levels. As a result, for the June quarter the Company expects the following Industry unit TAM of 155 million to 160 million. Revenue of $2.85 billion to $3.05 billion. R&D and SG&A costs were approximately $340 million. Other income and expense of a net expense of approximately $35 million. A tax rate for planning purposes of 3%. Outstanding share count were approximately 520 million and GAAP earnings per share of $0.81 to $0.85 per share which includes approximately $0.02 in charge related to purchase intangible amortization expense. The June quarter outlook does not include the impact of any potential new, restructuring activities. Future mergers, acquisitions, financing, dispositions for other business combinations that Company may undertake, the Company’s policy is to refrain from commenting on such activities. That concludes my remarks for today. Steve?

Thanks, Pat. I believe we are well-positioned to meet the strong demand profile we expect for the remainder of the calendar year. I want to thank our employees for their ongoing commitment and hard work. And I would also like to thank our customers, suppliers and partners for their ongoing support and confidence in Seagate. Amity, we are ready to open up the call for questions.

(Operator instructions) Your first question comes from the line of Kevin Hunt with Hapoalim Securities. Please proceed. Kevin Hunt – Hapoalim Securities: Hi, I’ve had a couple things. I might have missed it, but did you guys say gross margin range for next quarter? Pat O'Malley: No, we didn’t say that. It would imply that we’re slightly down on our gross margin this quarter. Kevin Hunt – Hapoalim Securities: Okay. And your side of the puts and take on what would be moving down or up, what you’re expecting? Pat O'Malley: It’s just probably the mix of the enterprise as I said we’re going to historical levels in enterprise versus this prior quarter and some positive on the mix of our other product segments. Kevin Hunt – Hapoalim Securities: Okay. And then one other, Bob, you touched briefly on the branded products, but in terms of like, assuming that’s what you’re referring to is in the CE product category list in that, looks like it was very strong in a quarter. Any additional kind of color there, what might have been going on throughout that?

What are you talking about specifically? CE is different than branded. Kevin Hunt – Hapoalim Securities: Oh that’s I’m saying. I didn’t hear you saying anything about CE. So I don’t know if you’re talking?

No, we didn’t talk about specifically. I can give a little bit more color I think Kevin. The CE breaks basically into the DVR market, the gaming market; we participated in both and did quite well in both. I think we believe our DVR products were the share leader in DVR and then we started participating in some of the gaming markets as well and did over a million drive in games. Kevin Hunt – Hapoalim Securities: Okay. And that seems like kind of counter seasonal or not normal for a March quarter but that there maybe not so much in the DVR market, but on gaming at least, so is there anything different going on there in the trends in that market or?

I don’t think so. I think it’s just fairly expected. I think seasonally and some of those as we talk about a number of times some of the supply chain optimization happen, market segments to market segments also.

Its better you talk to our customers about what they’re doing, what their builds and profiles versus us having talk about it, Kevin. Kevin Hunt – Hapoalim Securities: Okay, all right, thanks a lot, guys.

There’s nothing really a seasonal about it. Kevin Hunt – Hapoalim Securities: Okay, thanks you.

Your next question comes from the line of Rich Kugele with Needham & Company. Please proceed. Rich Kugele – Needham & Company: Thank you. Good afternoon. Two questions. First, kind of a bigger picture question on the structural changes in the industry. What have you seen over the past year that really industry needs to understand when it comes to changes in seasonality or mix or production capability as opposed to maybe some of the historical rules of thumb on approaching the group whether it comes to CapEx or pricing or the channel or any help would be appreciated?

Well, I think, Rich, depending on how you define the industry, I think if you look at the supply chain and clearly, the supply chain has changed structurally and the drive industries changed structurally and our customer bases changed structurally. And if you look at who recognizes that in the industry participants I think it’s all the players, how the supply chain is allocating capital and aligning with drive companies and how our customers are aligning with us. I think all those relationships have changed pretty dramatically over the last three years to five years, I mean in general, what’s happened over the last ten years is that the drive industry was a lot more fragmented ten years ago and the customer base was lot more consolidated. And now the drive industry and the supply chain is consolidated and the customer base is actually more fragmented both with respect to of OEMs and then clearly with respect to new categories like CE being huge now and the retail business. So I think that the industry has probably responded fairly well and as you say, it’s changing the demand profile throughout the year and its one of the things that along with the growth in Asia, we’ve certainly seen more linearity within a quarter and we’re starting to see more linearity even across a calendar year although early the back half of this year seems to be certainly setting up for some fairly decent growth That could be economic as well as normal kind of September-December quarter trend. I think the investment community just depends I think the analyst community is in terms of the industry analyst I think have been probably on the subject fairly well, I mean I think John Monroe has been writing about it for well over a year now. I think the sell side analyst some get it and some preferring to PEs and earnings valuations that are historically based which maybe as an appropriate. And I think on the buy side stocks are trading at 30% to 40% below PE levels that they were off when the industry was more fragmented with fewer customers. So probably either a different analysis or a lag in terms of believing that something really has structurally changed. But I think it’s probably just more execution by the industrial help make that clear. Rich Kugele – Needham & Company: Okay, then secondly, I guess more a tactical question on what happened in the March quarter when it comes to the enterprise. What were you seeing from a competitive front and how were you able to meet the demand so quickly? Because that’s something happened towards the end of the quarter, with that product you’re staging for Q3 demand and you’re able to fulfill it or any color would be good?

No, I’d say, we keep healthy supply chain always on enterprise to start from pretty much the start of the quarter onwards, just strong hope for our products, both the 2.5-inch and 3.5-inches by the mission critical alliance. And we believe that was due to competitive execution issues that our share was higher than we expected going into the quarter. Rich Kugele – Needham & Company: Have those issues been resolved with this competitor?

I’m clear right now. You said competitor, Rich, I don’t know that it was a competitor, should have been more than one competitor. Rich Kugele – Needham & Company: Okay great, thank you very much. Pat O'Malley: And Rich, be clear we’re guiding that they will –

(inaudible) Pat O'Malley: Right. So, we’re making the assumption that’s going to be the case. So as they’ve said we keep a healthy supply chain there and we opportunistically and structurally support that and it came our way. Rich Kugele – Needham & Company: Okay, thank you.

Thanks.

Your next question comes from the line of Ben Reitzes of Barclays Capital. Please proceed. Ben Reitzes – Barclays Capital: Hey, thanks a lot. Could you talk a little bit about the linearity of the quarter, in particular, there were just some speculations out there about availability picking up in March. What was that true and did you see any competitive drive availability that impacted the market towards the end of the quarter or was all that speculation kind of overblown and I have just a follow-up? Thanks.

Ben, I said in my comments that I think it was a fairly seasonal or fairly typical March quarter and some of that does come especially in the channel to be higher in March than it is in January. We also saw some, I will call it some natural muting before Chinese New Year, in January in particular, because of component constraints on notebook. So I think that did drive some different linearity behaviors and what we saw for example, in the December quarter. I think we had some mix issues of our own as well that you could be interpreted various different ways in January but we made that up by March. So in aggregate I think the quarter ended up fairly predictable and fairly typical historically. As a matter of fact I think the inventory levels are probably lower than what we would generally see historically. So that’s why we said everybody behaved themselves. Ben Reitzes – Barclays Capital: And then my follow-up is with regard to the calendar second quarter, I mean, you’re guiding units down, 2% to 5% but you also said a lot of things in your comments about how it could be better than that. So I guess what are you trying to say have you seen indications from your customers that it probably is better but you just going to guide it down 2% to 5% and what exactly are you seeing that gives you the confidence that it could be a little better than that?

I will try in this way. So, this is seasonally down that much. I think most of the customers right now because of comments that we’re all hearing together are a little bit gun shy about carrying inventory at the end of this quarter and so on and so forth. But they see a big back half of the year and people are fairly consistent in that. So they will be worried about supply as well. So our guidance is that as we go up through a step function into the following quarter we’re going to watch very carefully, manage our inventory very carefully, if we see the opportunity to allay some of those fears, especially take advantage of supply chain optimization, get things on board up against back to school and so on, we will do that, we will do that with our customers as we approach June.

And I think the other kind of unknown variable is the historical patterns up until maybe last one year or two years haven’t really encompassed the level of demand that we get out of Asia Pac that we do now. And because those economies are so large and are growing so quickly that they can also tend to offset what might be “A typical seasonal decline” that was mostly a U.S. Europe phenomenon or the 20 years that we look at historically. So talking to a lot of the producers whether or not it’s OEM or ODM, they will make those decisions sometime in the May to end of June timeframe and depending on how really they make them a good it could positively impact June in a way that we haven’t seen historically. Ben Reitzes – Barclays Capital: All right, thanks and one final if can just impose is you mentioned that the industry analysts generally see demand increasing 15% to 20%, but I would think that investors are really thinking at the PC markets up around 20% this year, and you’re increasing TAM 15% to 20% I mean do you think there is a chance that disk drive capacity could hold back the growth in the PC market this year or things that type or are things that have potentially to, do you have a potential to meet demand if indeed 20%, 20% plus is, is possible in the PC market?

Yes, again, I think we’re mixing and matching between overall TAM versus PC and then between desktop and notebook. I think right now the industry is fairly well aligned to the growth that that’s the customers are forecasting. On the other hand if demand is stronger either because there’s a commercial refresh cycle that stronger than people are booking in or if the Europe and the U.S. pick up in ways that are currently forecasted than it could be a struggle, I mean right now though it feels everybody is kind of go and flat out and meeting the demand or maybe just shy of the constrained demand that’s there. Ben Reitzes – Barclays Capital: Thanks so much.

Your next question comes from the line of Mark Moskowitz with JP Morgan. Please proceed. Mark Moskowitz –JP Morgan: Yes, thank you, good afternoon. A couple of questions. First, I want to follow up on Dave’s comments earlier about the supply chain optimization that could potentially help Seagate build inventory in the June quarter. Just kind of curious how that could happen? Can you give us a little more on the puts and takes if the industry is so constrained how you could suddenly build inventory for the September quarter?

Why we buy and build inventory for the September quarter, that’s what I would say in with supply chain optimization. I think what we would do is we would look out into July, August timeframe and say we’re going to have to build inventory up against that at the back end of this quarter down. The question is then relative to outbound supply chain and ocean freight and things like that what do we want to do is to optimize say a six month look at this from Q4 into Q1, we would certainly take those opportunities where we could.

I think the point is that if June is stronger than what we’re thinking we’re going to be flat out, we’re not going to have the opportunity to build inventory that we could use in September or December. If June is seasonal or if it’s weaker we probably use that as an opportunity to build the inventory in September and December because the back half ramps are pretty extreme.

More clarity? Mark Moskowitz –JP Morgan: Yes, that’s helpful. I’m trying to get a sense in terms of the wiggle room so that was helpful there –?

It’s not a lot but we’ll take what we can get. Mark Moskowitz – JP Morgan: Okay. And then the other follow-up is commentary on CapEx. Should we still stick with the 700 million bogeys for the fiscal year and then how should we think about the next two quarters out there as far as making the balance 2010, I guess still be around 20% or so for CapEx growth for the calendar year?

I think that the 750 number is still about right and no change really to 2010. The number we gave you for 2010 was again against 650 to 670 TAM which is kind of we think that the industry is capped out. So doesn’t make sense to invest capital beyond that the whole supply chain can handle it. Mark Moskowitz – JP Morgan: Sure. And just lastly, Steve, clearly, price has been a big topic for lot of investors out there and it seems like you kind of some of the bare mongering out there in terms of pricing not going to be under as much pressure we see at. Any sense in terms of Seagate or other participants able to bundle with some of the key OEMs to kind of lay their concerns about constraints from a component perspective and is that kind of give you a pricing umbrella there to help out?

Not sure I understand the question. Can you –? Mark Moskowitz – JP Morgan: I’m just trying to get a sense in terms of from a pricing perspective. Just given how you and WD are a lot better position right now versus Hitachi and Fujitsu with some of their technology issues are you guys able to guarantee more volume to certain OEMs and thereby they give you better price?

Look, the pricing is highly competitive, always will be in this industry. And we understand that getting all of our technologies whether or not at the semiconductor or disk drive or PCBA or anything else is how we drive demand. So I think pricing is in balance now with the level of our technology and the capacities that we have. And for sure, we believe that our model which has two huge elements to it. One is a very broad product portfolio and two is a highly integrated supply chain work in our favor when demand and supply are tied at they are right now, when I think our customers recognize it as well. Mark Moskowitz – JP Morgan: Thank you.

Your next question comes from the line of Stephen Fox with CLSA. Please proceed. Stephen Fox – CLSA: Hi, good afternoon. I was wondering if you could take into the enterprise market a little bit. I understand what you’re talking about with competitive dynamics, but there’s been a lot of evidence that we’re more in a cycle on enterprise class type of products. If you look at your last four quarters I don’t know if that give you the numbers but they’ve been sequentially up significantly four quarters in a row. Why wouldn’t you continue to expect that in the June quarter? I know you won’t be conservative, but is there a chance that we can continue to see strength in the cycle or is there something else that you’re seeing?

Well, I would say if I go back four quarters we were really hitting at the time what we talked about with the bare refresh rate. I mean there was really not that growth. So how much replenishment went on over the last couple of quarters is one way to look at it. We’re still not theoretically back to where we’re before, the macroeconomic front sharpened. I do think that there are possibilities people are talking about certain refresh, there are possibilities in storage for more growth. I mean we’re not really baking that in and we don’t think it would happen in the June seasonal quarter anyway but we’ll react to it if it starts. Stephen Fox – CLSA: And definitely where you wouldn’t be constrained if you saw upside to your expectations right now?

No. Stephen Fox – CLSA: And then last question can you just talk a little bit more I think you mentioned that external demand it was especially strong in Asia. I mean is there something in particular that’s driving that now as opposed to what you’ve been seeing in North America or is just that similar dynamics that have moved further East?

I think some of the models are developing quite well in Asia and even if you just look at PC demand it was hardly down quarter-over-quarter. So it’s really back to Steve’s comments around the lunar New Year. Some of those behaviors we’re seeing are driving our calendar Q1 to be fairly strong actually and I think the retail markets are taking advantage of that as well. Stephen Fox – CLSA: Great, thank you very much.

Hey, Amity, we’re going to take two more questions.

Your next question comes from the line of Jayson Noland with Robert Baird. Please proceed. Jayson Noland – Robert Baird: Yes, thank you. A follow-up question on inventory build expectations for the June quarter I guess against the guidance are you expecting it channel inventories to come up a bit off of a three-weeks or just more color there would be helpful?

I would say we model in, Noland, we will have to see how it runs at against the end of the quarter so we’re not expecting to do it. I wouldn’t look at it as channel inventories as much as I would look at a CE held inventory against the build. So what we hold in West maybe around finished goods. If we’re really going into a calendar Q3 this is as big as what we forecast. Jayson Noland – Robert Baird: Steve, anything else you could add around some of the early trends you are seeing on the commercial side? You said 3.5-inch pull through is pretty good.

I think there’s obviously been an enough tech companies reporting this week whether or not it was Intel last week and Apple today and it certainly seems like that there is evidence out there is a commercial refresh starting to occur I think people have been fairly consistent, for the last quarter or two that to say that this on the server side they’ve seen that happening, now the question is how does that flow through to commercial notebook and desktop. Starting if you look it’s certainly CIOs are getting more confidence in deploying new technology given frankly, how well be installed basis. Jayson Noland – Robert Baird: Last question from me, Pat, should we expect ASPs to be down a dollar to end of the June quarter? Pat O'Malley: I think probably somewhat less than that, but it’s a mix but I would just say within that range are better. Jayson Noland – Robert Baird: Thanks, gentlemen, congrats on a quarter.

Thanks very much. Last question.

Your final question comes from the line of Aaron Rakers with Stifel Nicolaus. Please proceed. Aaron Rakers – Stifel Nicolaus: Thanks, guys and congratulations as well. Two questions from me. Number one, I know it looks like according to my estimates the CapEx came in a little bit shy what I was previously estimating. Did you guys give an updated CapEx assumption for the full year, any thoughts as you look in the fiscal 2011? And then I do have a follow-up.

No change to what we’ve been saying for 2010. It’s too early to talk about 2011. We’ll see where we’re at in terms of later this summer in terms of what the September and December quarter feels like and then if you’re looking at a normal growth off of 2010 of call it 10% to 12%, then we will deploy capital as appropriate. Aaron Rakers – Stifel Nicolaus: And then the follow-up would be it looks like your notebook business down 7% or so in shipments versus the industry of flat sequentially. Maybe you guys were more heavily impacted by some of the component shortages. Maybe you can help us understand that a little bit relative to again the flat industry count?

No, let’s be clear, so the component shortages weren’t inside of our supply chain. They were under notebook supply chain on the outbound. They happened early in the quarter. We impacted somewhat slightly but I wouldn’t say that we were very far off of our plans going into the quarter. Aaron Rakers – Stifel Nicolaus: And then I will sneak one last one in here. Any update on SSD strategy?

No change. We think it’s going to be an important business for us and we’re hard at look at it and we feel good about our product road map. Aaron Rakers – Stifel Nicolaus: Okay, thanks, guys.

Thank you. All right, thanks, everyone. And we look forward to talking to you in the next quarter.

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