Question-and-Answer Session
Operator
(Operator Instructions) Our first question will come from Micheal Masdea, with Credit Suisse.
Amit Saraf - Credit Suisse
Yes. This is Amit Saraf, calling in for Michael Masdea. Could you elaborate a little more into the gross margin benefits for the quarter, specifically could you elaborate on any of these items, more non-recurring in nature and then talk about what type of cost savings or if you can quantify, we could expect for Q3?
Bertrand Cambou
Okay, I am going to -- we’ll give you more detail. But the company has, I would say a brutal focus on cost and cost per bit reductions. And then definitively in Q2 we had some benefits with that, obviously, we are kind of also affected by an ASP that is also sliding very hard. This is what you see here is just on one hand, the balance of the cost reductions per bit versus the ASPs.
And like we told you going forward, we please, anticipates to be maintaining, in fact accelerating our focus on cost to bit. But the price environment is very unclear and is really hard to see, if we are going to have a better situations in Q3 than Q2.
Now, we had like every quarter, good in bad news that kind of and I’m going to let Dario to see, he has few more a detail to give on that one.
Dario Sacomani
Yes. Thanks for trying. Just to be specific I mean a big chunk about as I quoted about 140 basis points of the improvement is based on, the efficiency on 90-nanometer production and that’s going to continue and increase as the product matures and as we begin to sell more and more 90-nanometer.
Also I mentioned we’ve got great penetration on high density MirrorBit in the embedded space and that accounted for about 100 basis points which again I anticipate to continue. I made the comment about JV1 and 2. We got overhead cost savings associated with the sale as well as gains on the sale of JV1 and 2 which I commented approximated about 210 basis points and I also made the comment, did that gain is going to be recognized over the life for the Foundry agreements. So that cost reduction continues as well as 100 basis points due to the increased final test efficiency and the 200 basis points related to variable cost savings I anticipate we go up to the neighborhood of 300 basis points in Q3. So the majority of everything that we’ve seen has been solid execution which should continue into the upcoming quarters.
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