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Plantronics F1Q08 (Qtr End 6/30/07) Earnings Call Transcript

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2007-07-24 17:46:58.0

Tags: Plantronics

Question-and-Answer Session

Operator

(Operator Instructions) Your first question is from John Bright with Avondale Partners.

John F. Bright - Avondale Partners

Good afternoon. I wanted to ask about the drivers for the demand in the enterprise channel, particularly for some of the office products. Can you give us some color on what you think is driving that demand?

Ken Kannappan

I’ll try but the truth is that fundamentally, as you know, it’s a very broad market, both geographically and in terms of type of business and it was not concentrated this quarter in terms of demand.

We did think that we are continuing to see some growth within office wireless. There may have been a little bit better demand in the contact center within some of the international markets, kind of a response to generally strong global economic environment. But it’s really hard for me to pinpoint right after a quarter any specific things because it is spread so thin and so broadly.

John F. Bright - Avondale Partners

How is the try-and-buy program progressing?

Ken Kannappan

We continue to get a positive response to try-and-buy types of opportunities. Our challenge usually is identifying enough of those opportunities effectively but a lot of the real benefit actually of course comes ex-post because we continue to see a very, very high multiplier from the identification of new people and the word of mouth that that spreads.

John F. Bright - Avondale Partners

Barbara, one question on the SG&A. The sequential step-down, I think it was about $1.4 million, can you remind me why the sequential step-down? And do you think this is a good run-rate?

Barbara V. Scherer

No, we said that we are expecting some increase in AEG in the second quarter and we also run marketing campaigns in Europe more concentrated in -- well, the December quarter and you have to start to ramp up some for that and in the September quarter, so the -- I don’t want you to annualize out this rate but it did reflect some timing shift from Q1 to Q2 to better align marketing programs with the launch of products later in the summer getting ready for fall.

John F. Bright - Avondale Partners

Okay, one last question then on mobile. On the mobile sales, what -- how much, if any -- well, can you talk about Apple’s iPhone introduction, the impact and what type of impact that had on mobile sales in the quarter?

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