Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Adam Benjamin – Jefferies.
Adam Benjamin – Jefferies
Can you talk a little bit about, in prior quarters you’ve given a little bit more granularity about some other customers. This time you only talked about Cisco and Alcatel. Can you give some more color on some of the other ones?
Michael T. Tate
We are not going to specifically break down customers below 10%. But what we can highlight is, we saw a good quarter in the service provider space, so Alcatel-Lucent is clearly benefiting from that and with IPTV and as we move through the year we think it will be another good year with Alcatel as they start to deploy their next generation boxes.
Also, 10-Gigabit Ethernet, both for the knowledge-based processors and for the PHYs had a good quarter and I think you will continue to see a good port growth for 10-gigabits, especially in datacenter applications, given increased video and virtualization.
As we entered Q4, we did see a couple of pockets of weakness at cable in China, but those seem to have now stabilized in Q1. As we look into Q2, China and cable look to contribute for our growth.
Adam Benjamin – Jefferies
Ron mentioned the next generation networks, specifically in Japan and Korea coming back as early as Q2. So, historically Alaxala and Huawei have been the big providers into that. How should we be thinking about Alaxala coming back over time? It was well above the Alcatel levels at one point. How should we be thinking about that going forward?
Ron Jankov
Well going forward, Alaxala also supplies to the Korea market. They are the number one supplier there now as well, and sometimes we forget about Korea, but it’s actually a pretty big country with a big GDP, so that’s pretty exciting as well.
Regarding Alaxala’s growth, it’s not going to be a hockey stick up. They expect it to be very, very gradual and to be spread over the next four to six quarters.
Adam Benjamin – Jefferies
But by the end of that Ron, do you expect them to reach the level of where Alcatel is today?
Ron Jankov
Well, I have learned to handicap what they think they can do and in what timeframe. So I think they think they can get there but maybe give it a few more quarters.
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