Question-and-Answer Session
Operator
(Operator Instructions) Our first question will come from the line of Tavis McCourt with Morgan Keegan, please proceed.
Tavis McCourt - Morgan Keegan
First on the gross margin; I was wondering if you could enlighten us on how at this point given that the revenue level, how much of the cost of goods sold is fixed in terms of overhead and how much does that improve things as the manufacturing capacity comes back in September and beyond.
Then secondly, I was just trying to piece together that guidance and would you kind of give us a round number or how far down OpEx should trend in June versus March?
Joe Greenhalgh
Hey Tavis. I think on the fixed portion of our manufacturing facilities, we haven’t given this both between fixed and variable. I think that we’ve factored into our Q1 target, what the impact is being underutilized in the factory. Obviously that will improve over time as demand picks up, but obviously there’s also a significant component to that that is fixed and again it’s reflected in the Q1 targets.
As far as OpEx is concerned, we’re not getting a number. For Q1 I think that you can come up with your own model between the gross margin and the indicated operating loss target we’ve given you for Q1.
Tavis McCourt - Morgan Keegan
Let me ask a follow-up; then I guess the sell-through trends obviously don’t look that horrible. So I was wondering if you could talk about any linearity in the quarter on sell-through by region. Did it get better from January to March or did it depend by region or did it get worse, on a sell-through basis?
Gerry Quindlen
Yes Tavis, this is Gerry. So there is a seasonality within the quarters. We don’t see a constant pattern from month-to-month. There’s more promotions in some month than others because of holidays and natural events. What we did see that was very encouraging, particularly to the very end of Q4 was some stabilization in a number of our key markets and sell-through.
So just to be clear, still in negative territory in EMEA and the U.S., but several weeks of stability; which is a very positive sign to us. It’s not getting better, but the first key that we’ll be looking for is to see those signs of stabilization and they were in several of our key markets and in several key product categories.
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