Extreme Networks, Inc. F4Q09 (QTR End 06/28/09) Earnings Call Transcript

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2009-07-31 04:44:18.0

Tags: Call Transcript, Health Care, Earnings, Stimulus Money, Vertical Industries, Benefits, Healthcare, Human Resources, Seeking Alpha, Extreme Networks

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Colby Synesael – Kaufman Brothers.

Colby Synesael – Kaufman Brothers

Just wondering what your customers are saying about the potential impact of the stimulus package as it relates to the spending patterns over the next two or three quarters, whether or not they might be delaying in front of that or when exactly they’ll be getting that funding and could be spending? Then also I was hoping you could talk a little bit about linearity of the quarter and maybe just a little bit of color on what you’re seeing already in July?

Mark A. Canepa

First of all regarding the stimulus spending, it varies greatly by market. Some markets have access to stimulus money and some markets do not. In general probably the ones that I’ve spoken to the most that have access to stimulus money tends to be in the area of healthcare so we’ve talked to a number of our healthcare customers. There are a number of things that are taking place that enables them to create proposals and these proposals can be reviewed by the various governmental bodies. So, my understanding is certainly little of this money has actually flowed but we’ll see how that takes place over time.

Also, there is some stimulus money that is available in the area of the small rural carriers. In the US we’ve had a program in place for a couple of quarters to do that. Again, they’re designing proposals and they’re submitting them for stimulus money. My understanding is relatively little of that stimulus money has flown to at least the customer we’re talking to, to date.

Colby Synesael – Kaufman Brothers

Do you think it’s fair to say that you expect that when money is released that it will impact your business in a material way? Or, is it most likely not something that you’ll see that big of an uptick from?

Mark A. Canepa

Well, we’re going to have to wait and see. Certainly, education, healthcare and US based small carriers are a big focal point of ours and those are the ones, at least in the press, have been reputed to being able to access stimulus money. We’re going to have to see whether it comes quickly enough or whether the recession sort of runs its course on its own prior to the speed at which stimulus money can be made available in fact takes place.

 

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