Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Matthew Petkun - D. A. Davidson & Co.
Matthew Petkun - D. A. Davidson & Co.
Ian or Ken, could you tell me roughly – it was a nice increase in the term business and a pretty impressive number, what is the rough duration of the term licenses signed in the quarter?
Ian R. Halifax
Yes, most term deals tend to be at a two or three years, so somewhere in the middle of the two to two-and-a-half years.
Matthew Petkun - D. A. Davidson & Co.
So far you guys have done nothing but pretty much execute according to your guidance. I think the only thing that at least we have a little bit of question with is, you know, there’s more term license revenue in the mix and as you just pointed out we’re giving away maybe a couple of years of revenue in exchange for what used to be, at least with some of these contracts, one year subscription deals. What gives you the confidence and the ability to guide roughly in line with what you’ve guided before in terms of 20% bottom line growth next year and 10% top line growth? What types of deals do you still see in the pipeline?
Ken Klein
The way we look at our business is that we’re still, you know, very much scratching the surface here. If you look at the overall penetration that we have within the electronics 300, number one. Number two, if you look at the momentum that we have in terms of design wins, which is up substantially both sequentially and year-over-year. We’re very pleased with that 300 design win number. And you know we have a lot of new products that are coming on line.
We mentioned several of those, you know, our DM product line, our MILS product line, our ability therefore to extract more incremental dollars for those new products. And targeted strategic initiatives to go after new verticals and we’re most excited of course about verticals such as the mobile and the MID marketplace. So all of these gives us tremendous confidence on a go forward basis and underpin our guidance.
Now that’s somewhat meted of course by macroeconomic factors, which we of course have taken into account the extent that we can. And again we factored that into the guidance we’ve given. And again I’d reiterate the point that Ian mentioned also that we are planning to grow EPS at twice the rate of revenue and that’s due to again keeping a very strong hand on expenses, and really leveraging our model. So that’s what gives us the confidence to go along with that guidance.
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