Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Mike Crawford – B. Riley & Co.
Mike Crawford – B. Riley & Co.
Just to reconcile your guidance, you said you expect to be operating cash flow positive in the quarter. On the income statement, I think it said $2.5 million loss. I think D&A runs a little bit ahead of CapEx, so am I right in assuming you're expecting to take a couple million more out of working capital to make up the difference?
John Cobb
Yes. As we mentioned, we brought down our inventory quite significantly, but because we also paid down our accounts payable, we didn't get as much benefit in the second quarter. But we expect that to somewhat reverse in the June quarter and so working capital will definitely contribute to cash flow.
Mike Crawford – B. Riley & Co.
Switching gears regarding products, did I hear you say that you shipped 65 manometer SRAMs?
Scott Howarth
Yes, we do have some initial shipments of our 72 megabit quad and double data rate SRAM.
Mike Crawford – B. Riley & Co.
I think I saw a press release from Cypress claiming that they were the only company having that, but that's not the case?
Scott Howarth
That is not the case. We also have 65 nanometer 72 megabit SRAM.
Mike Crawford – B. Riley & Co.
Then do you still breakout SRAM gross margins separately?
Scott Howarth
We don't report it separately but typically we'll just give some general ranges for our margins.
Mike Crawford – B. Riley & Co.
So, safe to say that those could be in the 30s?
Scott Howarth
Yes, for SRAM, our margins are typically in the 30% to 35% range.
Mike Crawford – B. Riley & Co.
It also sounds like with the Enable business that you acquired, so that's running, that's almost at $10 million a year business, is that ??
Scott Howarth
Well, this quarter we reported that we're adding $1.5 million, so it's only roughly 2/3. As we look forward, we think the company within a couple of quarters should be contributing somewhere in the $3 to $5 million a quarter range for revenue.
Mike Crawford – B. Riley & Co.
With the nature of these low power products, is that something that you expect to have maybe a higher than average DRAM margin associated with?
Scott Howarth
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