Question-and-Answer Session
Operator
(Operator Instructions). Your first question comes from Mark Sue – RBC Capital Markets.
Mark Sue – RBC Capital Markets
Patrick, the improvements in bookings, was it any particular region or specific customers or was it broad based and likewise if you could comment on the big jump in deferred revenue growth?
Patrick Harshman
The bookings were quite broad based, Mark. We saw good strength domestically but also internationally. Additionally, the strength was really across the products and a different customer market segments that we saw. We saw again good strength in Cable but also good strength in satellite, direct to home, as well as IPTV.
Mark Sue – RBC Capital Markets
And maybe, Robin, if you could talk about the long term improvements in gross margins particularly with the growth in the edge segment and likewise you seems like you are not adding any headcount. Should not that mean improving operating margins in extent of the guidance that you have laid out for operating margins?
Robin Dickson
Well, let me deal with maybe the second question first, Mark. We added 21 people during the quarter and they did not all start at the beginning particularly for a number of them have started towards the end of the quarter and even few additional into October, and so the run rate for Q3 will be higher in Q4 simply because some of those people were not on board for the full quarter. That is really the principal reason to allow for some increase in operating expenses in the fourth quarter and I think, it is also important to point out, although we think we are appropriately sized for the business, nevertheless, I mean we will not cease from hiring very good qualified people for very selective roles from time to time. So I do not want to suggest we are cutting it off completely.
Mark Sue – RBC Capital Markets
I got it.
Robin Dickson
I think the first question was around longer term gross margins, I do not think our review was change there might, we expect to see more software and software based solutions permeate our product lines, whether these are pure software or very smart boxes powered by very intelligent software and firmware. And we believe that in a longer term that will continues to take our margins hopefully beyond the 50% that we have now consistently reported for the last few quarters.
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