Question-and-Answer Session
Operator
(Operator Instructions) One moment please while we poll for questions. Our first question comes from the line of Mike Burton with ThinkEquity Partners. Please proceed with your question.
Michael Burton – ThinkEquity Partners
I just wanted to go through the guidance for 2008 a little more. If you could talk a little bit about what the components are regarding III-V versus display? Then maybe within the display segment are we expecting a big lift out of the military? Then, if you could follow up with that and talk a little bit about where the target model is going forward into 2008 for gross margins as these different products ramp.
Richard A. Sneider
We would expect that HBT or III-V is relatively flat. We’re expecting normal price declines of anywhere between 5 and 10% and potential increase in volumes of about the same so they’ll probably offset. So, the growth is primarily being driven by the CyberDisplay business and the bulk of that growth is being generated by the military at this point in time. That’s how we see it sorting out. I think I gave you kind of the target model to some respects other than gross margins for the year we are in the 16% range and we’re trying to get into the mid 20s in 2008. Otherwise, as I said SG&A is somewhere in the 8 to 12% range and R&D will be somewhere in the 10 to 15% range of sales.
Michael Burton – ThinkEquity Partners
Okay. Then to follow up just a little bit more there, it sounds like the majority of it being military growth, John did talk about some effect from the economy on the eyewear segment but how should we also expect the camera portion to grow? Is it going to be up or is that more flattish as well?
John C. C. Fan Ph.D.
I will make a comment that we expect the digital camera segment will actually decrease somewhat because we no longer are aiming at the fixed focus model but it’s still going to be quite healthy. The eyewear business will continue to grow because that market is that [inaudible] unknown because it depends on the economy but we expect it to grow.
Operator
Our next question comes from the line of Dan DeClue with ASB Advisors. Please proceed with your question.
Daniel DeClue – ASB Advisors
John, there was some news today about a possible joint venture in the WiMAX area reported in the Wall Street Journal, it’s not clear if it’s going to happen or not but there have been fits and starts around a roll out of a national WiMAX with some implications for all types of mobile use. Could you speak to a little bit about what impact that might have on Kopin in terms of the use of power amplifiers?
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