Question-and-Answer Session
Operator
(Operator Instructions). Your first question will come from Timothy Arcuri with Citigroup.
Tim Arcuri - Citigroup
Hi guys, couple of things. First of all, can you detail the timing on the breakeven plans? Where it is today, just again and kind of where... when you think you will get to the mid 60's, break even level?
Tim Carlson
So, as there we talked about in our Q3 call, we are in the low 70's, tax in Q3. We did some of the activities in Q4 which brought us down to the high 60's. However, we had the severance costs that went along with it. We believe that the actions that we've taken in the first week of February here will bring us down to that mid 60 level. However, we will not see it in Q1, as a result of some of the additional severance and cost... one time costs that will be incurred in Q1. But we should be seeing in Q2 and beyond. The only other caution that I want to make is, now that mid 60 break even level was highly depended upon product mix.
Tim Arcuri - Citigroup
Okay, I guess two more things. Can you give us some idea of what's going to happen to OpEx, you have kind of two countervailing factors, you have the cost cutting that you've undertaken, but you also have some severance cost. So can you kind of detail what to expect on OpEx moving through March and June?
Tim Carlson
So, from an OpEx standpoint if I can break it down between SG&A and R&D. As you know we did invest a significant amount of infrastructure in our High Productivity Development capabilities in the 2008 and the depreciation expense from that will roll into 2009. So we do anticipate our R&D spending growing from '08 to '09 in dollars by more than double-digit. But with that being said, we have identified and executed cost saving measures that will more than offset... more than fund that as well as reduce our operating expenses quarter-on-quarter going forward.
Tim Arcuri - Citigroup
Sorry. I am not...sure but I understand that. So you are saying that R&D will grow on an absolute dollar basis in '09 by 10 million but you think you are going to more than make it up on SG&A?
Tim Carlson
My apologies. The R&D will grow by more than the double-digits up from a percentage stand point. It'll be less than $10 million. But we do anticipate our operating expenses being below $30 million during the course of '09.
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