Question-and-Answer Session
Operator
(Operator instructions) Your first question comes from the line of Tom Curlin with RBC.
Tom Curlin – RBC Capital Markets
Hi. Good afternoon. Can you hear me?
Michael Picariello
Yes, Tom.
Tom Curlin – RBC Capital Markets
Congratulations. Good quarter. Good guide. I think philosophically, though, what I’d like to understand is the approach or principles you’re going to follow in terms of OpEx in the event the revenue does not go up as you might expect just given downside scenarios in this kind of environment. You mentioned, if you will, not focusing on margin expansion, but you’re guiding to say 16 or so for the year; is that a hard number? Is that a hard line? If macro gets worse and it looks like the revenue’s just not there, what level of commitment do you have to that sort of 16% level?
Bob Hammer
I understand, Tom. Number one, in spite of this current economic environment, we’re seeing quite a bit of expansion opportunity that we hadn’t anticipated on the upside and I think I spelled it out.
One, this next release is turning out to be, as we get through the betas, we’re always very enthusiastic about it, but we’re even more enthusiastic about that now. Besides, in addition to the distribution opportunities we’ve talked about, we see some other opportunities opening up that could drive revenue. In addition to that, beyond the next release, we’ve got the release after that pretty well sculpted out and we’ve got a long-term strategic direction. That will not only continue to enhance our value proposition versus competition, but will continue to open up some major new markets for us.
So, the Company continues to see lots and lots of opportunity to expand the business and we think for long-term shareholder value, it really would be a shame to not to invest realizing those opportunities and I can tell you, I’ve been doing this for a long time, and I know we’re in extraordinary times here, but every company I’ve managed through these recessions, we’ve come out much stronger in 100% of the cases. So, unless there’s something very catastrophic out there, we will continue to prudently invest for long-term value and there is, at the moment, there’s more potential for upside than downside, but if we see some downside occurring, we will take appropriate action, but we are not committing that we’re going to take a hard line on that 16.5% operating margin, but we will do the right thing for shareholders over the long-term.
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