Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Craig Ellis with Citi.
Craig Ellis - Citi
Congratulation. Keith can you just go into a little bit more detail in terms of where you think the company, is with respect to Notebook and Desktop market shares your transition over to Montevina?
Keith Jackson
So we have a very strong position, in the Desktop arena. I would say that, the dominant market share at this point. On the Notebooks as they go into the Montevina. We are expecting significant gains, we have had design wins with many of the leading Asian manufacturers there. So at this point, certainly not a majority share. Again, it is growing very rapidly in the late third quarter and fourth quarter as that starts to ramp.
Craig Ellis - Citi
Okay and then can you also just recap some of the milestones, that we should be looking at in the back half of the year, with respect to the AMI integration, and the manufacturing operations?
Keith Jackson
Okay, we will continue obviously in progress if you will in integration. We did get an early start, if you will from a savings prospective moving very quickly. The rate of change will not accelerate in the second half. Again, we are expecting to be, in that leading the year in that $50 million a year range of synergies.
The bulk of the activities, frankly from a manufacturing prospective the next crunch of all of that, again I will remind you is in fact three close downs, which will be ongoing through 2009.
Craig Ellis - Citi
Okay. Then switching over to Don. Don at the Analyst Day, you talked about a target gross margin model of around 45%. Obviously, we have got an uncertain backdrop. However, the company seems to be tracking well towards that. Can you talk about your confidence in hitting that by the end of next year?
Donald Colvin
Craig, good morning everything we said at the Analyst Day still stands remember it was 45% gross margin, something like that 22% or so operating income. What we have been very public on starting in the first quarter of this year; we were faced with some very serious economic headwinds, currency depreciations of unparallel nature, big inflation in commodity costs, like oil. All that has now been absorbed in our business model and I think we have been very local and public in saying that cost us a lot something in the 300 basis points of margin.
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