Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Patrick O’Leary of Piper Jaffray.
Patrick O’Leary - Piper Jaffray
I was wondering about, the revenue guidance is a little lower, I think, than we were expecting. Could you comment at all on, you mentioned the delay and profitability are accretive on the Essex, can you talk a little bit about the transponder, cost schedules, and how you guys are doing with that?
Jo Major
On the transponder world, we got a nice tunable transponder design we locked in at a Tier 1 customer this quarter. That’ll start rolling in, in March and growing from there. We have a good tunable transponder work going on in Asia, both in China and in Japan.
The comments about market uncertainty, the market does have some limited visibility right now. I’m just a little bit uncertain to see when all those slots turn on, but I think in general the design work is going pretty well. The design work is also going really well on the other piece of transmission. Of course, we sell a lot of componentry into the transmission world. And the new products are going very, very well there for like SFS tunable or next-generation tunables, but again we’re seeing a pretty restricted visibility for those products also.
Patrick O’Leary - Piper Jaffray
Okay, so it’s really just a matter of a lot of uncertainty in terms of when those are picking up?
Jo Major
Yes, it’s a general comment from our customers. We’ve been on the road a lot with our customers. We’re sitting with them all. We’re talking to them about their business needs and their technology needs.
On the technology side, we’re really starting to get a lot of slots that make sense for the company and make sense for our customers. We are very, very excited about that. And I think we have a lot of the right slots that are going to meet the means of networks in the near term.
In the short term, however, we do have the capital markets and the debt markets in a fair amount of turmoil and I think that slows down capital spending while basically the big carriers sort all those things out.
Patrick O’Leary - Piper Jaffray
With respect to your gross margin, obviously, it’s a little bit where you’ve been looking back two quarters, for next quarter, do you see that getting back towards your target at what kind of timeframe?
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