Question-and-Answer Session
Operator
(Operator Instructions) Your first question will come from the line of Brett Hodess with Merrill Lynch.
Brett Hodess – Merrill Lynch
Good morning and congratulations on an excellent quarter. I’ve got a couple of questions for you. First, on the advanced packaging side of the business is that primarily 300 mm at this point and given some of the gold is starting to switch over to solder can you give us a little bite information on how long this technology transition will take and how broad it will be in terms of customers that are doing it?
Art Zafiropoulo
Thanks, Brett. Actually the wafer size is dependent on the application. There is a very large U.S. company that is building a factory in the Philippines and that particular factory will deal with analog products. So that will be 8 in?200 mm. All of the microprocessor companies that we deal with around the world they run at 300 mm. So our business really is both 300 and 200 for the quarter and as we progress through this year and next year for analog you’ll continue at 200 and for most all others they will be 300.
Regarding the gold solder bump, gold utilization is still in the 60-70% range and so they are still looking at that market but as we begin to move into the gen 10 panels we believe demand will increase and so we are projecting that business will increase somewhat maybe beginning at the end of this year through the next 2-3 years after that.
So we’ve got to fill these factories with more drivers. They have done shrinks in the drivers so there is more chips per wafer and have moved to 8 inch wafers and there is one company talking about 12 inch wafers but we don’t know how real that is at this time. So there is a migration from gold to solder but the solder configuration of the machine is a little bit different than gold so they need additional hardware to do the conversion in some of the solder bump applications. So I guess that answers both of your questions as best I can remember them.
Brett Hodess – Merrill Lynch
Yes. If I can ask just one more when you are looking at the gross margin progression you gave several reasons for the improvement there Bruce. Obviously the improved cost from the LSA, overall cost cutting and mix and what not.
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