Question-and-Answer Session
Operator
(Operator Instructions) Your first question is from Chang Qiu, Forun Technology Research.
Chang Qiu, Forun Technology Research
Good morning, Steve and Ying. Congratulations on very good results.
Steve Zhang
Thank you.
Ying Han
Thank you, Chang.
Chang Qiu, Forun Technology Research
Steve, one question for you first. With four of the major operators in China announced an increased spending budget for 2006, I would like to see your view on the telecom software business. Previously you were growing 10-11% year-over-year. What is your new projection?
Steve Zhang
You are saying that telecom operators have increased their investment budget for this year?
Chang Qiu, Forun Technology Research
Right.
Steve Zhang
We see that for China Mobile. That has been increased by about 11%. So China Unicom, because China Unicom was going through some senior management changes, I think it has an impact for our China Unicom business, in the second half of this year. We expect to see more than 10% organic growth in the full year 2006 for our telecom business.
Chang Qiu, Forun Technology Research
Ying, for your guidance, or maybe even for your Q1 results, do you have any stock-based compensation expense?
Ying Han
For Q1, I don't think we have. Let me check, good question. We have, as we announced previously, we have all the stock options vested in 2005. So we do have the amortization for newly issued restricted stock, but the amount is not very material.
Chang Qiu, Forun Technology Research
This was incorporated in your Q2 guidance?
Ying Han
Yes, you are right. Q1 we have about $136,000.
Chang Qiu, Forun Technology Research
$136,000. And how much is in Q2?
Ying Han
It is roughly the same, because all of our stock options were vested already in the year of 2005.
Chang Qiu, Forun Technology Research
Okay. Back to your guidance, it looks like you have a vast improvement in the securities business, but on the [OFM], how you are guiding the total revenue between $18 million and $20 million, which means are you seeing the telecom software business down due to sequential reasons? Or due to just because you tried to be conservative?
Ying Han
I think the telecom business sequentially will be flat in Q2 because we had obviously a little bit lower performance in Q1 because of the holidays. But we do expect these to continue to grow sequentially.
Chang Qiu, Forun Technology Research
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