Alliance Fiber Optic Products Inc Q3 2008 Earnings Call Transcript

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2008-10-27 05:01:18.0

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Question-and-Answer Session

Operator

 

(Operator Instructions) Our first question comes from Manoj Nadkarni - ChipInvestor Group.

Manoj Nadkarni - ChipInvestor Group

Can we talk more about different markets and product segments where you are seeing strength? You already talked about connectivity products in data center and the Google project that’s going on. Can you give some more color in that regard and also maybe talk a little more on what you see with FTTX in the US and overseas.

David Hubbard

Yes sure we’ll try to do that. If it’s a specific question may I can address it in a particular market; where do you like me to start?

 

Manoj Nadkarni - Chip Investor Group

In the connectivity products, where are you seeing strength product wise and geography wise?

David Hubbard

Connectivity has been strong in data centers, as I said which is in enterprise markets predominantly and we see that remaining is strong across many products. So we have the cable assemblies like I mentioned, multi fiber products, but also connector products that serve that market place.

 

Manoj Nadkarni - Chip Investor Group

You said the Google project was complete. Is it an ongoing thing or do you anticipate more projects like these?

David Hubbard

They had large scale project which took them over several months of deployment. Our understanding is that they should have additional demands for that configuration in the future, but they don’t have a pinpoint timing line at the moment.

 

Manoj Nadkarni - Chip Investor Group

And in the FTTX space, Verizon’s files, they have introduced it in New York City and also I think on the west coast at a few locations here. What are your expectations as far as growth in the United States?

David Hubbard

Well we just asked that question directly at Verizon because they just had some conferences and everybody from Verizon perspective is saying that they are continuing their plan to roll out roughly 3 million subscribers per year to complete their -- I think their trajectory was to get to 18 million subscribers, before they started doing any ratcheting down. So that is going to carry us for at least another couple of years.

 

Manoj Nadkarni - Chip Investor Group

 

Okay, and so 3 million subscriber rate, how does that translate to growth? Is it 20%, 30% growth annually or is it more than that?

 

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