Question-and-Answer Session
Operator
(Operator instructions) Your first question comes from the line of David Hilal of FBR Capital Markets. Please proceed.
David Hilal - FBR Markets
Jeff first on the net customers’ flat sequentially, obviously two drivers there, the churn and gross customers adds, can you talk about those two pieces that make up the net number?
Jeffrey Lunsford
Yes, sure. A little more color on bookings so the, we continue to work through, we would characterize as higher-than-normal churn, smaller companies primarily. They are just having difficulty with the tough market conditions. And, we however, saw, as I mentioned, a very solid bookings quarter and in a sort of two ways to think of bookings. One is monthly minimum revenue and then our market segment has also shifted to where folks were making the annual bucket commitments. So we think about that as an annual contract value rather than a monthly contract value. And we had a nice increase in the annual contract value from quarter to quarter so we felt like from the forward looking indicator, bookings were positive but we are still working through a) raising the bar on the quality of customer, driving down BSO and b) trying to focus on the higher quality of enterprises where we can cross-sell and up-sell value-added services to expand our product portfolio.
David Hilal - FBR Markets.
So maybe talk about that Jeff as it relates to guidance so bookings sounds like were pretty decent and deferred a nice sequential move and then you will get CapEx was more than you had planned to stand which is usually the predictor of maybe what you guys are seeing in the pipeline? For your guidance it is kind of mediocre CapEx, so maybe you can reconcile that.
Jeffrey Lunsford
Well, yes so. CapEx was pretty light in the first half of the year and our build outs were somewhat lumpy. So I would not read too much into just having a large Q3. If you look at it for the first three quarters it is probably about the right pace. And as we always do with our guidance, we are going into any quarter we have about 55% of our minimum or above revenue on the contract and the other 45% to 50% is variable based on usage. So this is not sort of 90+% visibility [SAPS] business that you and I were used to David, it is a little more opaque and we are trying to provide the right level of forward guidance given what we have today.
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